Many Affordable Housing Recipients Missed Payments in 2020

People who manage to get an affordable housing unit often have to deal with a long list of stipulations. They can't have any arrests, can't be charged with any drug violations, must allow inspectors to come in and ensure the unit is clean and can't miss any payments, not even by one day. In a report released on March 18, the city of Winston-Salem, NC, stated that it had received more than $12.6 million in federal assistance for affordable housing, but it was withholding the funds to anybody who missed a payment since March 2020.

Funds Received by Winston-Salem

Winston-Salem received $8.1 million in rent assistance and another $4.5 million in rent and utility assistance for low-income residents from the December 2020 stimulus package. At the city council meeting in February, Mayor Allen Joines stated that evictions should not be a problem until September, even though the city officials had delayed the release of the finding. Some residents had already missed payments, and they need the assistance to catch up on what they owe for rent. The person responsible for releasing the funds is Marla Newman, who is the Community Development Director.

Evictions in Winston-Salem

Evictions have been ongoing since the Centers for Disease Control and Prevention (CDC) lifted its moratorium on December 31. On February 15, the day of the mayor's announcement, there were 176 eviction hearings at the Forsyth County Courthouse. The city of Winston-Salem has been the plaintiff in evictions throughout 2021.

Community Group Works to Get Funds Released

A local housing community action group has been petitioning the city to release the funds. When the city finally revealed details about how the funds would be distributed, the group found a lot of flaws. The plans did not prevent landlords who got the money from evicting the residents, even once the rent was paid in full. The state of North Carolina has a law on the books stating that once a landlord has a court judgment against a tenant for lack of payment, they can proceed with the eviction process, even if the tenant cures the debt in full. Landlords often raise the rent and look for tenants while the case goes through the local court system. The housing advocacy group wants the city of Winston-Salem and the state of North Carolina to prohibit landlords from evicting tenants once the back rent is fully paid.

Other Demands of the Community Housing Advocacy Group

The housing advocacy group found another flaw in Winston-Salem's plan. According to the group, if a landlord refuses to participate in the program, the city has no mechanism for giving the funds directly to the tenants. Landlords often refuse to rent to tenants who are part of federal or state subsidy programs. Thanks to the group's efforts, the city of Winston-Salem has agreed to distribute the funds directly to the tenants if the landlord doesn't fill out their part of the application within 14 calendar days.

Additional Concerns of the Housing Advocacy Group

The United States Department of the Treasury added stipulations to the stimulus package. One of those stipulations was a requirement that local governments can only use up to 10% of the funds for administrative expenses. However, an email from March 4 from the Community Development Director said that a full 10% would go toward the administrative costs. That's nearly $1 million federal dollars that won't go to the people who need the help. The turnaround time for disbursement of the funds is also too long for tenants who are facing conviction. The group argued that it should not take the city two weeks to distribute the funds. North Carolina requires seven days between eviction filings and hearings. The group requested that funds be distributed to tenants within seven days so that they can pay their balances before a court can hear the case. The group discovered that the city has been holding onto federal funds it received in September for low-income residents in need of housing assistance.

Absentee Landlords Shouldn't Benefit

The housing advocacy group explained that funds shouldn't go to landlords who aren't caring for the properties. Tenants have documented problems, including broken heating units, windows and appliances. They've also shown holes in floors, walls and ceilings. Leaks, vermin infestations and molds are common in the low-income housing units. The group wants the city to hold absentee landlords liable for being in violation of minimum standards in the affordable housing units.

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