Axne Calls Out Treasury Department Delay Which Has Forced Closure of Polk County Rental Aid Program

Statement

Today, Rep. Cindy Axne (IA-03) is calling out the U.S. Department of the Treasury for a delay in approving a reallocation of $35 million in rental assistance funds from the State of Iowa to Polk County that was requested earlier this year.

The Treasury Department's failure to approve this reallocation has forced Polk County to stop accepting new applications for the Emergency Rental Assistance Program (ERAP), despite the facts that both Polk County and the State of Iowa support the move and that Treasury previously approved a similar transfer earlier this year.

"For more than a week now, residents of Polk County have been unable to apply for rental assistance funds, leaving my constituents in need and waiting on Treasury to approve a transfer that both parties want to make," Rep. Axne wrote in a letter to Treasury Secretary Janet Yellen today. "I am hopeful you can swiftly approve this application so that my constituents in Polk County can begin applying for rental assistance again."

After the Treasury Department issued new rules in October that allowed for and prioritized local transfers of rental funds -- a change Rep. Axne had advocated for -- Polk County requested a $30 million transfer from the Iowa Finance Authority (IFA) to allow them to continue providing rental assistance in the county. That transfer was approved by Treasury on January 7, 2022.

Despite the recent approval of that transfer, a subsequent request for a $35 million transfer from IFA to Polk County made on January 25 has not been approved, and no update on the transfer's status has been provided by the Treasury Department.

Because Polk County believes that current applications will exhaust the remainder of their current funds, it has halted new applications to the ERAP program, which is being managed through Impact Community Action Partnership (Impact CAP).

The Emergency Rental Assistance Program (ERAP) was created by Rep. Axne and Congress in December 2020. Additional funds and flexibility were provided by the American Rescue Plan.

The full text of the letter sent today can be found here and below:

Dear Secretary Yellen:

I write to urge you to quickly approve a voluntary reallocation of Emergency Rental Assistance (ERA) funds from the State of Iowa to Polk County. For more than a week now, residents of Polk County have been unable to apply for rental assistance funds, leaving my constituents in need and waiting on Treasury to approve a transfer that both parties want to make.

As you know, Congress created the Emergency Rental Assistance Program, first in December 2020 and then provided an additional $21 billion under more flexible rules in the American Rescue Plan. Iowa received funding at the state level, as well as for Polk County and the City of Des Moines. The rental assistance program for Polk County and Des Moines residents, which is administered by Impact Community Action Partnership (Impact CAP), has been an essential lifeline to help more than 7,500 households who were at risk of eviction or homelessness. Their team quickly began getting funding out last Spring, and last summer Treasury cited them as a High-Performing grantee. Due to both the strong need for rental assistance and the excellent work of those administering the program, all direct funds under both rounds of ERA were exhausted this past fall.

I appreciate that your Department in October released guidance outlining the process for reallocation between grantees of ERA funds, including allowing for voluntary reallocation between grantees in the same State. A voluntary transfer of $30 million between Iowa and Polk County was requested this fall, and approved January 7, 2022 as part of more than $1 billion of reallocations. The Polk County program had already obligated a significant amount of those funds, which they were able to do because they'd received assurances they'd be funded by the State if there were issues with the reallocation process.

On January 25, 2022, Polk County submitted an updated application for a second reallocation of $35 million, which was needed after more than three months of applications based on the first reallocation. Last week, Impact CAP estimated that they had enough applications in process to fully expend the first $30 million reallocation, and stopped taking applications on Tuesday, February 8th. Without certainty on getting further funds, the Polk County program can't approve additional applications, as that would risk approving applications they'd be unable to pay in the future.

I am grateful for the work you've done thus far to ensure Iowans and Americans can get help with rental assistance during these difficult times, but I remain concerned that my constituents in Polk County have now gone more than a week without being able to apply for rental assistance. This delay is especially concerning for a transfer where both the State and County are in agreement.

I am hopeful you can swiftly approve this application so that my constituents in Polk County can begin applying for rental assistance again, but if there are any issues that need to be worked out or questions to be answered, I stand ready to help, and get my constituents the help they need as quickly as possible.

Source