Memo to the Designated Housing Secretary: Coronavirus Emergency Rental Assistance for Puerto Rico
Published on January 14, 2021
To: William Rodríguez, Designated Housing Secretary
From: CNE Research and Policy Teams
Re: Coronavirus Emergency Rental Assistance for Puerto Rico
The Consolidated Appropriations Act of 2021 included $25 billion in emergency rental assistance for FY 2021, with a $400 million carve-out for Puerto Rico, U.S. Virgin Islands, Guam, American Samoa, and the Commonwealth of Northern Mariana Islands. The Secretary of the Treasury will make allocations based on population size and eligibility. Estimates from the National Low-Income Housing Coalition (NLIHC) place the amount available for Puerto Rico at $325 million.
90 percent of funds must be used to provide eligible households assistance with rent, rental arrears, utilities, and utility arrears. No more than 10 percent can be used for administrative costs including data collection and reporting requirements related to such funds. Funds are limited to one year of assistance (until December 31, 2021), with an available extension of up to three months, subject to the availability of funds and approval by the Secretary.
The law requires grantees to prioritize consideration of households that meet the following criteria:
- The income of the household does not exceed 50 percent of the area median income for the household.
- One or more individuals within the household are unemployed as of the date of the application for assistance and have not been employed for the 90- day period preceding such date.
Grantees cannot provide assistance for prospective rent payments for more than three months, unless there is a subsequent application that demonstrates financial assistance is necessary to ensure housing stability and there are remaining funds available to do so. Further, if applicants have rental arrears, grantees may not provide prospective rent payments unless they have also provided assistance to reduce an eligible household’s rental arrears.
Further, if by the end of the federal fiscal year (Sept. 30, 2021), if a grantee does not use all allocated funds, the Secretary can recapture these funds and reallocate them to other eligible grantees who at the time have obligated at least 65 percent of the original allocation, based on needs and approval by the Secretary.
Following a conservative estimate, we believe that the amount allocated to Puerto Rico for rental assistance can cover 8 months of rent and utility expenses for some 52,191 households. Below are some figures and estimates that may prove useful for program design purposes. Unless otherwise indicated, the primary sources are the US Census Bureau’s 2019 Puerto Rico Community Survey and HUD’s Program Parameters and Research Division.
Puerto Rico Households with cash rent in 2019
Households with cash rent whose incomes are at or below $14,400 (50% of San Juan-Guaynabo, PR HUD Metro FMR Area Median Income)
Households with cash rent whose incomes are at or below $15,450 (50% AMI of San Juan-Guaynabo, PR HUD Metro FMR Area for a family of 4)
Average monthly contract rent for households whose incomes are at or below $15,450
Average annual electricity cost for households whose incomes are at or below $15,450
$1,980.32 ($165.02 per month)
Average annual water cost for households whose incomes are at or below $15,450
$2,720.19 (226.68 per month)
Total average rent and utility costs per month for households whose incomes are at or below $15,450
Percent of households with cash rent whose incomes are at or below $15,450, with an unemployed person in 2019
Percent of households with cash rent whose incomes are at or below $15,450, with a person outside the labor force in 2019
Percent of households with cash rent whose incomes are at or below $15,450, with an unemployed or a person outside the labor force in 2019
Percent of households who are at risk of eviction*
*Source: The COVID-19 Eviction Crisis: an Estimated 30-40 Million People in America Are at Risk – The Aspen Institute
The following is a rough calculation, based on some of the figures provided above, that arrives at some conservative estimates of the Emergency Rental Assistance Program’s potential reach and impact in Puerto Rico.
We would be happy to discuss these facts and figures in greater detail and facilitate an information exchange with other research and advocacy groups who are currently addressing program design issues.