The City of Philadelphia took the right action today in announcing that it would use federal funds to increase aid to renters and landlords, helping to keep renters in their homes during the ongoing COVID-19 pandemic.
Last month, I raised concerns with the Kenney Administration that Phase 2 of Philadelphia’s rental assistance program was not progressing at a pace that would allow Philadelphia to fully draw down $28 million in PACARES funds the State legislature had provided for rental assistance through PHFA, which could hinder the City’s goal of maximizing recovery efforts. The deadline for submitting applications to PHFA for this assistance is September 30th.
The issue is that the $750 cap on the State’s program was not enough to induce more landlords to enroll in the program. The program requires landlords to not evict tenants for the six months the $750 monthly payment is made, or for two more months after the payments end. City Council housing specialists identified that Allegheny County was finding a way around this problem by allocating $14 million in local CARES funds to match the State’s $750 per month.
Philadelphia has received approximately 10,500 applications from tenants and approximately 4,100 applications from landlords. The landlord participation rate in this program is 40% — revealing the $750 per month is not sufficient to induce landlord participation. The average rent of tenants who participated in Phase 1 of the program was over $1,100 per month, far above the $750 stipend being provided by the State.
Philadelphia cannot afford to leave any of this $28 million on the table. We cannot wait and hope that the legislative cap of $750 per month will be changed by the General Assembly in Harrisburg, nor can we rely on the federal government to pass more relief any time soon.
My office urged the administration to allocate a portion of Philadelphia’s local CARES funds to match the PACARES funds – to better enable Philadelphia to draw down on the $28 million.
This assistance has several social, health and economic benefits for tenants, landlords and our City – including reducing evictions and stabilizing landlords, many of which are small businesses. Moreover, evictions often lead to homelessness. Keeping families housed is not only the moral thing to do, it also makes sense from a fiscal standpoint, as the cost of providing services will far exceed any allocation of CARES funds we put into this program.
This was the right decision and action by the City, and I commend it.
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