Montana to pause rental assistance program, citing backlog and diminished funding

A key COVID-era relief program to assist renters may be approaching its expiration date in Montana.

The state’s Department of Commerce announced last week that it is set to pause emergency rental assistance applications in the next couple of days because of a backlog in applications and diminished funding.

The pause comes as the department assesses whether the amount of remaining funding will be sufficient to keep up with the number of eligible applicants, so it is unclear if the application window is closed for good.

The Montana Emergency Rental Assistance Program (MERA), which started as part of the December 2020 COVID relief package, allocates federal dollars to Montanans whose income levels qualify them for rental and utility payment assistance. The program was not set to expire until September 2025.

Since the advent of the program, more than 12,000 Montana households have been provided with more than $109 million in rent and utility assistance, according to the Department of Commerce. The pause will apply only to new applicants; everyone who has been previously approved will still be eligible to apply for continuing assistance, according to the commerce department.

As it stands, the department is roughly three months behind in application reviews, according to department officials and landlords. In other words, people who applied in October are just now having their applications looked at. Rent payments following approvals have also been delayed.

Those delays are starting to push landlords and tenants into a bind.

Landlord Karen Burkett, whose property management company runs multiple rental units throughout Montana, said that the delays have gotten worse over the last couple of months and that MERA payments have not always been as delayed as they are now.

Burkett said “several” people at the Department of Commerce told her the lengthening waits are due to new staffing issues, but Melissa Higgins, a housing program executive with the state, said there have been employee vacancies throughout the program’s duration, not just in recent months.

On average, the state receives roughly 1,100 applications per month, and a full staff of 22 full- time workers would be able to review about 800 per month, according to Higgins. The department currently has the equivalent of 20 full-time employees, Higgins said.

Regardless, Burkett’s business is feeling the delays and is requiring tenants to pay rent with or without MERA assistance and threatening eviction if they’re not able to make the payment.

“In reality you still have bills to pay as an owner — a mortgage, payroll, utilities, upkeep,” Burkett told Montana Free Press. “I feel bad for the residents, but you know, my job is to collect the rent and get the bills paid.”

Montana Landlords Association President John Sinrud agreed, calling the 90-day delay “insane.”

At two of Burkett’s Bozeman apartment buildings, tenants were notified by a letter dated Jan. 12 and left at their doors that they would be responsible for their rent — including for this month — and that the agency will not defer rent collection due to delayed MERA funds.

“If you are a resident who is waiting on Montana Emergency Rental Assistance payments to come through for January 2023 and beyond, you are responsible to pay for the rent for these months, at least until the funds begin to come through for your household,” the letter said.

Multiple residents said the letter came as a surprise because payments have been delayed in recent months and they haven’t been required to make up the difference.

“It caught me off guard because I hadn’t planned for it,” said Clark Davis, an 81-year-old Bozeman resident and retired rancher. “It will really hurt.”

Right now, it does not appear that there will be a replacement program once the coffer dries up. Instead, Montanans receiving MERA assistance will have to fall back on other programs.

Bozeman resident Coleen Hicks said that MERA rent money makes it easier for her to pay for other necessary expenses.

“I’m going to have to go fly a sign to go pay my utilities, to pay for my hygiene, to pay my electric,” she said. “I’m 68 years old.”

The letter also reminded tenants that “if rent is not paid after receiving the 3-Day Notice, your file will be sent to our attorney to begin an eviction.” Burkett told MTFP that is not an empty threat.

“This building is all elderly and elderly disabled people. How are we supposed to pack up and move in three days?” Hicks asked. “It’s not humanly possible. And then where do we go?”

Being notified in mid-January that residents are required to make their MERA payments “puts everybody in a bind and now everybody’s scared they’re going to get kicked out,” Davis said.

Even as Montana has doled out MERA dollars to thousands of households, new applications are still consistently rolling in.

“Given that we assisted 600 households last year in applying for this funding and we’re still fielding 10-15 inquiries per day this year, we are concerned about the impact this will have on our clients who may not be eligible for other HUD funding, don’t reside in units that can pass inspection requirements, or are in alternate housing options like hotels and motels,” said Penny Johnson, the communications manager for Southwest Montana’s HRDC.

It’s not just Montana who is experiencing diminishing funds. More than half of the country’s emergency rental programs are on hold, and nearly one-quarter of them are already depleted, according to the Montana Department of Commerce.

No new applications from tenants who have not already been approved will be accepted after 11:59 p.m. on Jan. 20, 2023, and any applications received after Jan. 13, 2023, will be processed subject to available funds.

Bozeman-based reporter Victoria Eavis can be reached at veaivs@gmail.com. The Montana Free Press is a Helena-based nonprofit newsroom.