Thursday, April 18, 2024

Treasury Department Makes Big Blunder on COVID-19 Emergency Rental Assistance

The U.S. Treasury Department has spent $46 billion on an Emergency Rental Assistance (ERA) program to help people who can’t pay rent due to COVID-19, but a new report warns the program has a serious flaw.

The U.S. Government Accountability Office (GAO) revealed its finding in a report published Tuesday.

“Treasury doesn’t have complete data on payments or recipients,” according to the GAO report.  

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“For example, Treasury is missing data on 26 percent of payments made to households in 2021. In addition, the agency hasn’t fully assessed the risks of potential misuse of funds—like paying ineligible recipients.”

By June 2021—five months into the program—about one-quarter of grantees had not made any payments.

“Multiple factors contributed to payment delays, based on GAO’s interviews with grantees and review of their documentation,” the GAO report went on to say.

“These factors included limited grantee staff and technology resources, gathering information for tenant eligibility determinations, and unclear program guidance.”

The GAO, citing third-party studies and eviction data, said the program has helped limit evictions. According to limited Treasury data, 85 percent of households served by the first ERA appropriation had incomes below 50 percent of the area median, consistent with a legal requirement to prioritize such renters. Households received larger average payments in urban areas ($7,200) than in rural areas ($5,200) and in counties with higher rents and more rent-burdened households.

The GAO recommended that the Treasury Department’s Chief of the Office of Recovery Programs do the following:

• Expediently collect complete and accurate data, including quarterly payment data and performance measures required by the Consolidated Appropriations Act, 2021.

• Expediently publish complete ERA program data, including all required disaggregated performance measures required by the Consolidated Appropriations Act, 2021, for all applicable quarters from program inception through the end of the award performance period. Such reporting should include information necessary for determining data quality, such as the rate of missing or erroneous data for key data elements.

•  Complete a detailed assessment of the ERA program’s susceptibility to improper payments, such as a quantitative analysis that incorporates grantee payment data and other relevant data sources.

The Consolidated Appropriations Act of 2021, according to the U.S. Treasury’s website, continued many of the programs established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020.

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“Without better data collection and reporting, Congress and Treasury will lack information on the program’s outcomes,” the GAO report said.

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