Item 17 - Emergency Rental Assistance Program Spending Plan and Appropriation Adjustment

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Emergency Rental Assistance Program Spending Plan & Appropriation Adjustment February 16, 2021 Page 5 4 1 9 to deploy $2.6 billion in Federal Emergency Rental Assistance Program (ERAP) resources to assist struggling tenants and landlords impacted by the economic damage of COVID-19. Staff is attaching information from the Business, Consumer Services, and Housing Agency that explains these state funds further (Exhibit 7). The State received a direct allocation of ERAP funds from the Department of Treasury for the City of Santa Ana similar to the City. The City received a direct allocation of $9,880,391.30 and the State received an allocation of $10,633,695.01 that must be designated for the City of Santa Ana. This is a total of $20,514,086.31. Regarding the State’s allocation for our City, the following are the three options for cities and counties with over 200,000 in population: 1. State Program: Participate in a central state program where both federal allocation and state allocation are managed on behalf of the City or County by a Community Development Financial Institution partnered with the State; or 2. Self-Administer: Receive a state block grant allocation and self-administer the City’s share of rental funds in a manner consistent with state and federal program requirements; or 3. Self-Administer and State Administer: If a City or County chooses to self- administer its federal allocation but chooses to not conform their local program to the state requirements, it is not eligible for a block grant. Landlords and tenants located in their jurisdiction may still apply to the State Program (administered by a CDFI) for a proportionate share of the state funds, but the responsibility to manage duplication of benefits will rest with the City or County. To summarize, the State is offering the City three general options: 1) give our $9.8 million back to the State to administer a State Rental Assistance Program; 2) enter into a contract with the State for a block grant of the $10,633,695.01, but with the caveat that we must administer the funds in conformance with the State’s Rental Assistance Program; or 3) self-administer our own allocation of $9.8 million and the State will administer their $10.6 million for the City of Santa Ana. The State’s Emergency Rental Assistance Program will be administered statewide by the Local Initiatives Support Corporation (LISC) and includes the following key parameters per SB 91: The State’s rental assistance program will provide eligible landlords with immediate relief through the payment of 80% of their tenants’ rental arrears accumulated between April 1, 2020 and March 31, 2021. Landlords, in turn, agree to accept this payment as payment in full of any unpaid rent for that period. (This is nearly identical to our CARES for Landlords Program that we administered from August 17, 2020 to December 15, 2020.) In cases where a landlord chooses not to participate, an eligible tenant may apply to the program for 25% of their rental arrears, which will be paid to the landlord.