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Virginia’s lauded rent relief program a ‘band-aid’ on affordable housing shortage

Multifamily apartment structure
With Virginia's pandemic-era rent-relief program set to run out of funding, lawmakers are looking forward for ways to increase the availability of affordable housing. (Photo: Crixell Matthews/VPM News)

Virginia’s pandemic rent relief program could run out as early as July 2022 after spending nearly $1 billion, a state official told lawmakers on Wednesday.

The program has helped over 71,000 households and won national praise by tenant advocates for working to quickly distribute federal funds that other states have left unspent. While other nearby localities in Maryland and Washington, D.C. are winding down their programs, Erik Johnston, director of the Virginia Department of Housing, said the commonwealth is increasing outreach to tenants with the help of nonprofits. He said the commonwealth has asked the U.S. Treasury Department to access an additional $294 million in leftover federal funds.

Still, Johnston told members of the Virginia Housing Commission the Rent Relief Program was a “band-aid” and that its success highlighted the urgent need for more affordable housing.

“There are way too many households that don't have access to affordable housing in the commonwealth and some of the long-term solution is actually the production of more homeownership and multifamily units,” Johnston said.

Person speaks at lectern
Erik Johnston, director of the Virginia Department of Housing updates members of the Virginia Housing Commission on Wednesday. (Photo: Ben Paviour/VPM News)

Several components of Virginia’s program are unique and have helped the commonwealth distribute its share of federal rent relief faster than any other state as of September. In November 2020, Gov. Ralph Northam signed a budget requiring landlords to seek relief through the program before attempting to evict a tenant. The same budget set aside state money to fund the program after a first round of federal funds expired, sustaining the program until a fresh round of federal funding came through. And Johnston told the commission Virginia had an uncommon level of cooperation between landlord and tenant advocates, who’ve fought legal battles in other states.

Johnston provided some data on who had been helped by the program: 58% of recipients are Black, 21% white and 9% Hispanic. Over three-quarters of the recipients made 30% or less than the area median income. Almost half — 45% of households who received funds — reported having children under the age of 8. The average rent relief payment to landlords totalled roughly $5,400, which tenants are not required to repay.

The program is still accepting applications and launched a new portal on Dec. 1 to replace two separate application processes for tenants and landlords that some applicants found unwieldy. The new system, Gov2Go, syncs up with other state agencies so that an applicant won’t need to re-upload income documentation twice. Either tenants or landlords can apply.

The question looming over the Housing Commission is what to do to help avoid an eviction crisis once the money disappears. The legislature’s research arm, the Joint Legislative Audit & Review Commission is set to release a report on affordable housing on Monday.

Any new state policies or funding would have to pass in the upcoming 2022 legislative session to reach tenants when the money runs out, which Johnston said he expects to happen sometime in the second half of 2022. Chesterfield County, which runs its own program, is projected to run out of funds by the end of this month and has asked the U.S. Treasury Department for more money, according to Johnston.

State Sen. Ghazala Hashmi (D-Chesterfield), who sits on the commission, said she planned to do more research on policy solutions that would help boost homeownership.

“There is greater financial stability for families, there's opportunity for generational wealth growth and those are opportunities that have been lacking for so many communities here in Virginia,” she said.

Gov.-elect Glenn Youngkin spoke about the need for more affordable housing on the campaign trail. He proposed requiring a vote before localities increase property taxes, a measure that could cut down on homeowners’ bills but also curtail local government funding for roads and schools.

Speaking to reporters at an October tour of an affordable housing project in Manchester, Youngkin was vague about his plans on the topic but maintained that funding was available.

“One of the challenges that we've got is it's all disparate. And it's spread around the different pockets,” Youngkin said. “One of the things I look at is how do we make sure the resources get to their end objective so that they can benefit people.”