The Impact of Federal Assistance: How CARES Act Dollars Helped Keep Vermonters Housed
Vermont has long been in the midst of an affordable housing crisis, and the COVID-19 pandemic threatened low-income Vermonters’ already precarious ability to access safe, affordable housing. As sectors of the economy shut down across the country, millions of Americans lost jobs and income; in Vermont, over 136,000 lost work. Nationally, nearly 1 in 5 renters is behind on rent, and experts warn of an impending eviction crisis once moratoriums expire. As officials urged Vermonters to stay home to keep safe and stop the spread of the pandemic, it became clear that those without secure housing to stay in were among the highest risk for both the economic and health impacts of COVID-19. The pandemic has made VAHC’s mission clearer and more urgent: housing is a basic human right, the foundation of health care, safety, and economic stability.
We’re thankful that Vermont lawmakers recognized housing as a critical need in this time and, when Vermont received $1.25 billion through the CARES Act passed in late March, directed a considerable portion of that funding to keeping Vermonters safely housed. In July of 2020, the Vermont legislature allocated $34.25 million from the Coronavirus Relief Fund to the Vermont Housing and Conservation Board (VHCB), which funds affordable housing; $16 million to the Department of Children and Families to fund programs to support those experiencing homelessness; and another $36.45 million to the Department of Housing and Community Development, which in turn distributed some of these dollars to other state and local agencies——including the Vermont State Housing Authority, Vermont Housing Finance Agency, Vermont Legal Aid, and Vermont Landlords Association—to administer housing assistance programs targeting specific needs.
In addition, lawmakers passed an eviction moratorium to prevent further homelessness, and the Public Utilities Commission enacted a utility shut-off moratorium that complemented an $8 million CARES Act allocation for utility arrearage assistance.
The wave of federal funding helped the state stand up several keystone programs to keep Vermonters housed and help them find and afford more stable, safe housing. Some of these innovative programs creatively tackled problems and gaps in the housing world that the state government hasn’t typically addressed at such a scale, such as helping landlords restore properties that were blighted or otherwise not up to code. Other programs expanded existing models, such as making rental and mortgage assistance available to a much wider range of Vermonters. The relative flexibility of the funding allowed Vermont to try new things and learn more about how these programs can best be supported.
This was not, of course, without its challenges, specifically a tight timeline. It takes a lot of logistical coordination to support programs like this, and they had to start operating in record time. Plus, until late December, Vermont agencies were operating on the assumption that the deadline to expend the funds was December 30. Thankfully, the second relief package passed in December extended this deadline, and more help is on the way. Vermont agencies will now have to figure out how to distribute $200 million in rental and utility assistance from a second federal relief package with much more strict parameters.
Overall, the federal aid from the CARES Act helped thousands of Vermonters stay housed and therefore stay healthy and safe. With most of the allocated money having been spent, here’s an overview of the impact made in Vermont through several keystone programs:
Rental Housing Stabilization Program (RHSP)
Debra Davis and her granddaughter live in a Champlain Housing Trust apartment in Burlington. Due to the pandemic, Debra was let go from her job and had difficulties paying rent with her unemployment check. She learned about the Rental Housing Stabilization Program and after being accepted into the program, was back in good financial standing.
Administered by the Vermont State Housing Authority with support from DHCD
Total amount: $25 million*
Funds expended: $22.88 million*
9,319 households and 21,231 individual tenants served (as of January 7)
Average payment per household: $2,050
RHSP provided rental assistance to tenants impacted by the economic hardships of Covid-19 by paying landlords on behalf of tenants for past-due rent. While Vermont tenants have been protected from eviction for nonpayment of rent throughout the pandemic thanks to a statewide eviction moratorium, housing advocates have long worried that people who are financially struggling will accumulate rent in arrears, leading to a mass wave of evictions once the moratorium is lifted (it ends 30 days after Governor Scott lifts the current public health emergency). Uniquely, Vermont framed RHSP as an eviction prevention and public health program, making it clear that whether tenants lost income due to Covid-related unemployment, illness, or another issue, their priority was keeping people safely housed during the pandemic, alleviating the possibility of future eviction, and ensuring families didn’t have to choose between paying rent and putting food on the table.
Rental assistance programs weren’t unique to Vermont during the pandemic—the National Low Income Housing Coalition identified at least 438 state and local programs distributing rental assistance in response to COVID. RHSP stood out, however, in getting the money out the door to people who needed it. “It took only 10 days from the signing of legislation to accepting applications, which is completely unheard of,” DHCD’s Shaun Gilpin said. RHSP required both the landlord and tenant to attest that some amount of rent had not been paid, and families received up to the VHSA monthly payment standard, which generally aligns with Fair Market Rents for their area as defined by HUD. This setup helped prevent fraudulent claims while still meeting needs and avoiding cumbersome income verification requirements that take up staff time and discourage some in need from applying.
VSHA also launched a sub-program, Money to Move, which funded moving expenses, including first months’ rent and security deposit, for households who were previously homeless or unstably housed. That program served 260 households, with an average grant of $2,353.
Most rentals in Vermont are not owned by large professional landlords, but rather “mom-and-pop” owners who may depend on rental income to stay afloat themselves—according to a survey VSHA conducted, 50 percent of landlords who utilized the program owned fewer than four units. The program was also of enormous benefit to the Coalition’s nonprofit member owners, helping them close operating cost shortfalls due to lost rent.
By recognizing that both landlords and tenants needed this assistance, RHSP was able to foster unprecedented collaboration between the Vermont Landlord Association and tenant advocacy organizations, particularly Vermont Legal Aid. With the CRF funds they were subgranted through DHCD, the two “VLAs” even launched a free mediation program to help resolve landlord/tenant disputes that went beyond nonpayment of rent. “It was a great cooperative partnership with groups that have been seen as adversarial but have come together,” Gilpin said.
*RHSP was originally allocated $25 million. $3 million was reallocated to the Everyone Eats program in late 2020; however, the House FY 21 Budget Adjustment Bill allocated $2.8 million back to the program to account for the unexpectedly large number of applications (1,500) received in November and December that could not be funded. VSHA has requested $2.8 million back out of the $3 million reallocated to assist 1,500 applications that came in during the final weeks of the program, but that could not be assisted due to lack of funds
Mortgage Assistance Program
Administered by the Vermont Housing Finance Agency with support from DHCD
Total amount allocated: $4.7 million (original amount was $5 million, minus $300,000 reallocated)
Total amount paid out: $4,200,442
645 households served
Median monthly mortgage payment: $1,183
Median payment per household: $6,051
While homeownership is often left out of the conversation of housing justice, low-and-moderate-income homeowners certainly weren’t left out of the economic effects of the pandemic. VHFA’s Mortgage Assistance Program was open to households facing economic hardship brought on by COVID-19 who fell behind on their mortgage payments, with the ultimate goal of preventing foreclosures and helping people pay the bills.
VHFA’s final data shows that the program was truly effective at preventing foreclosures. The majority of households who applied were over six months behind on their mortgage payments. Program recipients had a moderate median household income of $3,067 per month. The program was also able to serve Vermonters who were younger, more racially diverse, with larger household sizes, lower incomes, and more likely to have a disability than the general population. “For years, we’ve been talking about the need for affordable homeownership,” VHFA Executive Director Maura Collins said. “As rents continue to rise year after year it becomes harder and harder for folks to save up for a downpayment that they may need to buy their home, and this is especially true for people of color.”
VHFA’s report noted that the program was less in-demand than it otherwise would have been thanks to large lenders offering mortgage forbearances nationwide—but future assistance will be needed as the prolonged economic crisis caused by COVID-19 continues to stress household budgets. “This is why we are here. This is why Vermont has a Housing Finance Agency to step in during times like this when you need an equitable statewide program to be run and to ensure that it’s going to reach the demographics that I know the legislative intent aimed to hit,” Collins said.
Rehousing Recovery Program
Administered by regional Homeownership Centers with support from DHCD
Total amount allocated: originally $6.2 million, boosted to $7.6million
218 rentals brought online or up to code
141 rentals before December 20, 2020
75 additional rentals by April 2021, most of which will be complete in or before February 2021
Additional rentals being identified
Vermont’s affordable housing crisis is exacerbated by its aging housing stock, with thousands of potential (and currently occupied) rental properties in disrepair and in need of serious repairs in order to truly be habitable. At the same time, homeless assistance programs often struggle to find suitable housing for their clients—even when they have rental assistance vouchers that would help them afford a place to live. There simply aren’t enough rentals available that meet the vouchers’ standards.
This unique program aimed to tackle both issues at once, bringing vacant, blighted, and code non-compliant apartments back online with grants to property owners who agreed to rent the rehabilitated rentals to formerly homeless and low-income Vermonters. Landlords who benefitted from the program had to sign a 5-year affordability covenant stating the rent could not exceed HUD Fair Market Rent or a housing voucher payment standard, and agree to review at least three referrals from their local Continua of Care homeless assistance organizations.
While the program faced difficulties due to the extremely tight original December 20 deadline for expending all grant money to make repairs on the properties (in addition to a statewide labor and material shortage), it elicited strong interest and considerable support.
According to Gilpin, DHCD is waiting on final information on how many rentals leased up with referrals from local CoCs. That information will help assess how effective the program was at housing formerly homeless Vermonters.
VHCB Shelter and Housing for those experiencing homelessness
$34.25 million allocated to the Vermont Housing and Conservation Board to create permanent housing and safe shelter for people experiencing homelessness related to the COVID-19 emergency
247 new or rehabilitated units of affordable housing
Health and safety improvements to 12 shelters to ensure compliance with CDC guidelines
A VHCB grant allowed Champlain Housing Trust to purchase the Ho Hum motel in South Burlington as an isolation and quarantine site for unhoused people experiencing COVID-19 symptoms or exposure.
The Vermont Housing and Conservation Board (VHCB) is the state’s pre-eminent agency for funding the physical “bricks and mortar” leg of the housing stool. In allocating CRF dollars to VHCB, Vermont lawmakers recognized that rental assistance, supportive services, and dedicated collaboration can only do so much if there is no affordable housing for people experiencing homelessness to transition into. VHCB was able to help fund unique housing developments across the state, adding as many apartments in 6 months as normally are added in 2-3 years. All new units were leased up to people experiencing homelessness related to the pandemic, who were referred through the motel system or other agencies. The program was a testament to the benefits of flexibility in spending federal dollars. Among the projects VHCB funded included the conversion of a former John Deere dealership by the Rutland Housing Authority into apartments, the construction of tiny homes in Barre with the help of a Norwich University community program through a partnership between Downstreet Housing and Community Development and Washington County Mental Health, and former motels converted to apartments in Brattleboro and Burlington, all for people sheltering or transitioning out of homelessness.
“This was an incredible effort. Usually, housing projects are in progress for several years, and so to have to try to pull this together over a 6-7 month period took remarkable cooperation and coordination,” VHCB Executive Director Gus Seelig said. Among the successful developments VHCB funded were several purchases of former motels and other buildings that are no longer being used as intended and converting them into permanent housing, temporary shelter, or quarantine and isolation facilities. Through this model, developers can add new affordable housing faster for those who need it most.
Agency of Human Services Assistance
Expanded General Assistance (GA) Emergency Housing voucher program
The GA Motel Voucher program has historically served a few hundred households at a time, but due to the pandemic, the Department for Children and Families temporarily waived restrictions on the program to assist directly with housing Vermonters who are homeless. By the the first week in January 2021, 2512 people without stable housing were living in motels paid for by the state. Motel utilization through the GA Emergency Housing program dropped slightly through the summer, but has increased steadily through the fall. Despite the rental assistance noted above, many Vermonters are finding themselves with no other safe place to stay.
The program expansion was partially funded by CRF dollars, but is mainly funded from the Federal Emergency Management Agency (FEMA).
Rapid Resolution Housing Initiative
This initiative has served 250 households with flexible funds (for debt relief, transportation, move-in costs, security deposit, etc.) to help them quickly transition from hotels into permanent housing.
Rental assistance: 12-18 months of support for formerly homeless households
Vermont Rental Subsidy
52 families with vouchers; 40 have leased apartments.
CARES Act Housing Project Vouchers
275 families with vouchers; 91 have leased apartments.
Overall, this great work has helped thousands of Vermonters stay safe, sheltered, and find or keep affordable housing, but the crisis is far from over. Check out VAHC’s legislative priorities for an idea of what else needs to be done to ensure affordable housing for all Vermonters.