HEROES Act would give a lot of support to low-income renters - Affordable Housing Online

HEROES Act would give a lot of support to low-income renters

By on May 15th, 2020

Tagged As: Affordable Housing News, Editorials

United States Capitol. Photo by pixabay.com

Speaker of the House Nancy Pelosi (D-CA) unveiled the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act this week. This is the House’s latest aid package to help people and businesses hurt by the coronavirus pandemic. At $3 trillion, it would surpass the recent CARES Act as the largest aid package in U.S. history. If passed, the legislation will address many challenges facing low-income renters as the pandemic drags on.

Editor’s Note: If you or your family have been impacted by the coronavirus outbreak, it’s important to contact your local representatives to inform them of the importance of passing this bill. You can use the short form here to send a message directly to your representatives.

Emergency Rental Assistance and More Affordable Housing Funds

Millions of low-income renters have struggled to pay rent during the pandemic. Many have chosen to skip the rent in April and May so that they have enough money for food and medicine. This also hurts landlords, who cannot pay their mortgages, insurance, or taxes without rental income. 

The HEROES Act would provide $100 billion for emergency rental assistance. Originally introduced by Congressman Denny Heck (D-WA), it would provide a lifeline for millions of low-income renters who have lost wages and work because of the pandemic.

The emergency rental assistance will be targeted to those most in need. It says that 40% of funds must serve people who have extremely low incomes, meaning they earn less than 30% of the Area Median Income (AMI). At least 70% of the funds must serve very low-income renters who earn below 50% of AMI. The remainder of the funds can serve low-income households with incomes up to 80% of AMI. The bill also increases the eligible rent level to 120% of the area Fair Market Rent (FMR). This will help low-income renters living in high cost areas.

The legislation also targets assistance to help people experiencing homelessness, the population most vulnerable to the spread of the coronavirus. It provides $11.5 billion for Emergency Solutions Grants (ESG). ESG supports homeless shelters and services, and this funding will help providers address challenges arising from the pandemic.

Federal rental assistance programs would also get a boost. As renter incomes plummet during the pandemic, those receiving federal assistance can recertify their income and pay less each month. But this means that the federal subsidy has to be increased to cover the rest of the unit rent.

The HEROES Act would provide $3 billion in additional funds for the Section 8 Housing Choice Voucher (HCV) program, and $1 billion in voucher funding for emergency assistance to victims of domestic violence. Section 8 Project-Based Rental Assistance (PBRA) would receive $750 million. Public Housing also receives more support, with $2 billion for the Public Housing Operating Fund.

After receiving no additional funding from the CARES Act, USDA rural rental programs would get $309 million more funding by the HEROES Act. Image by nrcs.usda.gov

Although HUD programs also received additional funding in the CARES Act, USDA rural rental programs had not received any earlier support. The HEROES Act addresses that oversight by providing $309 million for rural rental assistance. Twenty-five million dollars of this funding would go to rural vouchers. The funds can also be used to provide rental assistance to tenants in USDA properties that do not currently receive aid.

Affordable housing for populations with special needs also gets more funding in this bill. Section 202 Supportive Housing for the Elderly would receive $500 million. The Section 811 Housing for Persons with Disabilities program would get $200 million, and the Housing Opportunities for Persons with AIDS (HOPWA) program would get $15 million.

The HEROES Act also proposes $5 billion for Community Development Block Grants (CDBG). CDBG helps state and local governments pay for public infrastructure, affordable housing, economic development, and critical community programs. It not only pays for water and sewer systems, it also provides funding to many Meals on Wheels programs that serve seniors. CDBG funds can also be used to provide short-term emergency rental assistance for up to three months, and many cities have looked to this source as the housing crisis grows during the pandemic.

Low-income homeowners would also benefit from this legislation. It proposes $75 billion for a Homeowner Assistance Fund. This would help low-income homeowners with incomes below 80% of AMI. It can cover mortgage payments, utilities, insurance and other related expenses.

The bill would provide Community Development Financial Institutions (CDFIs) with $2 billion. CDFIs are community lenders, and often provide funding for affordable housing developments.

Protections for Low-Income Renters

The HEROES Act provides substantial funding to help low-income renters pay the rent. It also provides important protections so that people do not lose their homes. It would impose a moratorium on all evictions, adopting legislation originally sponsored by Congressman Jesus Garcia (D-IL). Also, it would suspend foreclosures on all 1-4 unit properties. The ban on evictions would be in place for a year after the law is enacted.

Housing counseling services would receive $100 million. These services would target renters and homeowners who are at risk of homelessness due to the pandemic.

In addition, $14 million go to HUD’s Office of Fair Housing to address housing discrimination related to COVID-19. There are concerns that landlords may discriminate against certain applicants or tenants because they fear these people are at high risk for the disease. This kind of discrimination violates the Fair Housing Act, and these funds would allow HUD to pursue these cases.

Other Major Items that Benefit Low-Income Renters

The HEROES Act would provide a second round of Economic Impact Payments. Like the stimulus checks sent out under the CARES Act, every adult would receive a $1,200 payment from the government. But the benefits for children are increased from $500 to $1,200 per child, up to a maximum of $6,000. Dependents up to age 24 would be eligible. This means that families can get stimulus funds for college-age children living at home.

The bill also extends the enhanced unemployment payments authorized under the CARES Act. Those on unemployment have been collecting $600 extra each week. This funding was supposed to end July 31, but the HEROES Act extends the enhanced payments through January of next year.

The legislation would also create a $200 billion “Heroes Fund” that would provide hazard pay to essential workers. This includes first responders, healthcare workers, sanitation workers, grocery store workers, and others deemed “essential” by their governors. Many low-income renters work in these jobs, and the hazard pay would be a big help in meeting expenses.

State and local governments would also get $1 billion under the bill. These funds help states, counties and cities with unexpected costs they have faced responding to the pandemic. It would help state and local governments continue providing many services that help low-income renters.

Other Items of Interest to Low-Income Renters

The HEROES Act would place a moratorium on consumer debt collection for the duration of the pandemic emergency, plus 120 days. In addition, it does the same for small business and nonprofit organization debt. 

The legislation addresses the problem of large payments being owed at the end of the debt suspension. It requires that credit providers give favorable repayment options at the end of the emergency period, such as adding the missed months onto the end of the loan term. This would protect low-income consumers who have collections pending avoid a large financial hit as the pandemic winds down.

Work participation requirements for people receiving assistance through Temporary Assistance for Needy Families (TANF) would also be suspended during the pandemic. It also “stops the clock” on time charged to the lifetime limit on TANF benefits during the period of the pandemic emergency.

And low-income renters would have their access to the ballot box improved by the HEROES Act. It would require states to provide at least 15 days of early voting before all federal elections, starting this November and going forward. It would also require all states to provide no-excuse absentee vote-by-mail as an option for all federal elections, starting this November. All states would have to allow voters to submit absentee ballot requests online.

Where Things Stand
Senate Majority Leader Mitch McConnell (R-KY). Photo by seanmaloney.house.gov

House Democrats are planning to pass the measure on Friday. Senate Republicans, led by Majority Leader Mitch McConnell (R-KY), have said the Senate will not consider another stimulus package until after Memorial Day. Republicans argue they want to see the impact of earlier rounds of assistance before committing more money to pandemic relief. Republicans also oppose many provisions in the HEROES Act, so it is not certain that it will pass the Senate without changes.

It is likely that this is the last major pandemic relief package that Congress will consider before the November elections. If you have been impacted by the coronavirus outbreak, it is very important that you contact your Senators and Representative. They need to know how critical it is to pass this bill. No one should lose their home because of this pandemic.

Contact Congress

It is important for anyone who has been negatively affected by the COVID-19 pandemic to reach out to their local representatives in support of this bill. If you do not know how to reach your members of Congress, the National Low-Income Housing Coalition (NLIHC) has a coronavirus response page. The form will locate your representative and senators. It will provide their office phone numbers, and allow you to send an email to their offices if you like.

Here’s a breakdown of the notable affordable housing funding the HEROES Act would include:

  • National moratorium on evictions and foreclosures.
  • $100 billion for emergency rental assistance.
  • $11.5 billion for Emergency Solutions Grants (ESG) for homeless providers dealing with COVID-related issues.
  • $75 billion for a Homeowner Assistance Fund.
  • $309 million for USDA rural rental assistance, which includes $25 million for rural vouchers.
  • $2 billion for the Public Housing Operating Fund.
  • $3 billion for Section 8 Housing Choice Vouchers.
  • $1 billion for Section 8 HCV emergency rental assistance for domestic violence.
  • $750 million for Section 8 Project-Based Rental Assistance.
  • $500 million for Section 202 Supportive Housing for the Elderly.
  • $200 million for Section 811 Supportive Housing for Persons with Disabilities.
  • $15 million for Housing Opportunities for Persons with AIDS.
  • $100 million for housing counseling services, targeting renters and homeowners at risk of homelessness due to the pandemic.
  • $14 million for Fair Housing, targeted to addressing COVID-19 motivated discrimination.
  • $5 billion for Community Development Block Grants.
  • $2 billion for Community Development Financial Institutions.

Published by

Chris Holden

Chris Holden, Affordable Housing Online's Senior Housing Analyst, has been in the affordable housing field for 25 years. Originally from Keene, New Hampshire, he has worked as a researcher, policy analyst, lender, trainer and real estate developer. He also taught political science at Keene State College. He is focused on making housing policies more accessible for low-income renters.