Senators Push HUD on CARES Act Allocation Delays

Legislation | June 10, 2020 | by Linda Couch

Secretary Carson testified before the Senate Banking, Housing, and Urban Affairs Committee on June 9.

Secretary Carson testified before the Senate Banking, Housing, and Urban Affairs Committee on June 9.

Secretary Carson was asked a wide range of questions, including several on HUD delays in allocating funds provided by the March 27 CARES Act and how HUD is preparing for an expected “evictions cliff” this summer.

In questions initially about how HUD has yet to allocate Community Development Block Grant funds from the CARES Act and then generally about the rest of the CARES Act’s unallocated funds at HUD, which includes the $50 million for the Section 202 program, including up to $10 million for Service Coordinators, and the remaining $200 million in Section 8 Project-Based Rental Assistance, Secretary Carson said the funds would be allocated by October 1.

“That is way too late,” Senator Robert Menendez (D-NJ), said, “That is not what Congress intended. There’s no way we should be waiting until October for that to happen.” When pressed further by senators, Secretary Carson said HUD would get funds out as quickly as possible.

In a June 4 letter to Secretary Carson, LeadingAge urged HUD to release COVID-19 relief funds as quickly as possible. “The CARES Act became Public Law 116-136 on March 27, 2020,” LeadingAge President and CEO Katie Smith Sloan wrote, “The time is long overdue for HUD-assisted senior housing providers to receive the funding they need to pay for cleaning, disinfecting, personal protective equipment, services, security, and other COVID-19-related costs.”

Secretary Carson was also asked repeatedly about HUD’s predictions and readiness to address an “evictions cliff” that many see coming this summer as the national moratorium on evictions for nonpayment of rent in federally-backed housing and the Unemployment Insurance program’s pandemic add-on of $600 a week are both set to expire on July 24 without Congressional action.

Secretary Carson, asked what HUD’s plan are to keep renters in their homes and help property owners who may not have gotten rent in recent months, replied that, if people can’t get a job  they can have their income readjusted so their rent is adjusted downward. To be clear, only residents of HUD and Rural Housing Service programs can adjust their rents by recertifying their incomes. Market rate tenants to not have this ability, even though Secretary Carson appeared to be talking about all renters, not just HUD- and RHS-assisted renters. 

Asked what property owners should do to account for missed rent payments, Secretary Carson replied that these owners are businesses and they qualify for the Small Business Administration’s Paycheck Protection Program and that is how housing owners can receive help. LeadingAge is frustrated by SBA’s lack of clarity on who is eligible for the PPP program; while some nonprofit housing organizations have received PPP loans, others have been told that nonprofit housing organization are not eligible. Seeking clarity, LeadingAge sent this letter to the SBA on May 1. Without clarify from the SBA, HUD is not moving forward with further guidance on how to PPP and HUD subsidies can and cannot intermingle.

Senator Kyrsten Sinema (D-AZ) expressed concern for the rising number of seniors experiencing homelessness in Arizona. Senator Sinema acknowledged HUD is seeking a small increase in new Section 202 funding for fiscal year 2021, and said more is needed. Secretary Carson responded, saying HUD needs to concentrate on the type of housing for seniors that is most appropriate, and then gave an example of shared living space with private bathrooms and bedrooms so seniors can intermingle. In an awkward exchange, Secretary Carson he wasn’t sure if Senator Sinema knew anything about mental health, but intermingling with others is essential. Senator Sinema responded that she is a licensed clinical social worker and she knows a lot about mental health, and that her concern is that the nation is not doing enough for seniors, many of whom are facing homelessness.

Secretary Carson’s prepared oral statement or his written testimony for the hearing did not describe the reasons for the allocation delays, COVID-19’s disproportionate impact on older adults or racial and ethnic minorities. While his prepared oral statement and his written testimony mentions his role on the White House’s Opportunity and Revitalization Council and its role to ensure that minority and underserved communities are kept safe, there were no specifics on HUD’s actions.