Minnesotans anxiously await rent help as a fraction of federal aid has gone out

It's been a stressful week and a half since Nicole LaFavor-Bostwick applied for state help covering $5,000 in rent and utilities payments she owes on her Hastings home.

Every day matters to LaFavor-Bostwick, who fears her landlord will kick her out in early June if she doesn't get the money — despite a state ban on such evictions.

"I haven't heard anything back yet," said LaFavor-Bostwick, who has repeatedly checked the state website for updates only to find her application is still under review. "It's kind of nerve-racking, because I have to be out in two weeks or less."

Renters, landlords and property managers across Minnesota have been anxiously awaiting aid from the RentHelpMN program. More than 20,000 people have submitted applications and the state has sent money to help 200 households, Minnesota Housing Commissioner Jennifer Ho said Wednesday.

Minnesota has given out only about $1 million of the $672 million it received from the federal government to help people who are struggling with housing costs due to the COVID-19 pandemic.

The slow rollout has prompted frustration among those waiting on critical dollars that the U.S. Treasury allocated to the state early this year.

"Each application is unique, each situation is unique," Ho said, and four out of five require additional work with the renter or owner.

"It's an online application, but it's not an automated payment because these are big dollar amounts and there's a lot that needs to be reported back to the Treasury. So yes, it's taking some time."

Minnesota's start date for getting checks out the door — May 13 — appears to be slightly behind the national average.

About 30 states were making payments by the end of April, said Stockton Williams, executive director of the National Council of State Housing Agencies.

However, Williams said the state's program has been cited as a national model by low-income renter advocates.

Housing officials here did a lot of work trying to ensure the system was accessible, and spent more time than almost any other state coordinating with local and tribal governments, he said.

The extra couple of weeks the state took to set up its program will make delivery of the dollars more effective, Williams said.

But some property managers and landlords said they have run into a number of technical glitches with the system to submit applications, and are worried about delays.

One tenant who owed $3,000 applied for rent help but then abandoned the apartment, leaving the landlord in the lurch and no longer able to get money from the state program, said Lisa Dack with property management company H. & Val J. Rothschild Inc.

"The delay is causing mental hardship on the residents, more financial hardship for the landlords," she said.

She fears others will get scared when they don't hear back quickly about the money. "I think this one skip is just the start," Dack said.

Jennifer Spadine with Guardian Property Management said tenants at their properties owe $69,000.

So far, 14 of their renters have submitted applications for rent help, and she said Guardian has had some difficulty seeing all of those applications.

They have also struggled to make corrections if something is entered wrong and said a "spinning circle" popped up after tenants submitted information, causing confusion about their application's status.

The company the state contracted with for the software, Allita 360, has drawn criticism elsewhere.

Rhode Island ended its contract with the company, saying the state experienced "significant and continuous obstacles with the technology platform." Allita 360 did not respond to a request for comment.

"We had some glitches in the software that we have fixed. It was inevitable, because we were trading speed with perfection," Ho said.

But Sheila Melton with Heartland Realty Investors cited ongoing concerns to lawmakers during a public hearing Wednesday.

She said she is in charge of working with rental assistance programs across eight states.

"I have been on all the various state rental assistance software or portals to apply as a landlord and to also help our residents apply," Melton said, and called Minnesota's system, "the most frustrating software I have ever seen."

She suggested changing the process so that landlords would submit information first, rather than tenants.

The Minnesota Multi Housing Association has been pushing for that method and association President Cecil Smith said the state's approach was "well-intentioned to be tenant-focused, but perhaps not entirely thought through."

Melton was one of many people to testify at a hearing where lawmakers reviewed the rent-help program and continued their debate over how to end Minnesota's eviction moratorium, which has been in place since the start of the pandemic.

State leaders continue to disagree over the timeline for phasing in evictions as well as how far in advance landlords must notify a tenant before evicting and whether certain evictions should be expunged from someone's record.

Some people wonder why the state even needs an off-ramp for the halt on evictions given that businesses are reopening, there are more job opportunities and vaccinations are increasing, Senate Housing Committee Chairman Rich Draheim, R-Madison Lake, said earlier this week.

"We're running out of excuses to keep this going on. So we need to do something. If we're going to do it, let's do it. We've got a month until the feds drop theirs off," he said.

While the federal eviction moratorium ends June 30, the state's moratorium could continue if legislators don't strike a deal. Gov. Tim Walz issued the eviction halt using his emergency powers, which GOP lawmakers want to end.

Ho urged lawmakers to ensure the state has enough time to use the extraordinary amount of federal relief money it received before evictions start, and several tenant advocates echoed that request during Wednesday's hearing.

Ho said she's not sure how long it will take to get all the money out, but plans to add an online dashboard in the next few weeks so people can monitor Minnesota's use of the dollars.

LaFavor-Bostwick, the Hastings resident who fears eviction, hopes she and others can be protected by the moratorium for a while as they try to catch up on rent.

She lost her job at a restaurant early in the pandemic and just got a receptionist job at a car dealership after working sporadically over the past year.

"Being forced to stay home, and locked down at home from our jobs due to all of this, how can they really expect people to get up and get back into regular life when it hasn't been that way?" she said. "It just doesn't make sense."

Jessie Van Berkel • 651-925-5044