The pressure to get 100s of millions of dollars out to landlords across Minnesota was already intense for the state Housing Finance Agency and its commissioner, Jennifer Ho. It just got more so.
State and local governments have received $670 million from two federal pandemic relief acts to cover back rent for thousands of residents, back rent that has left landlords at risk of not being able to pay their own mortgages, their own bills, their own employees.
But a slow rollout of the program, operating under the joint website renthelpmn.org, has piled criticism on the agency and Ho, who is the public face of the previously little noticed agency.
This week, the pressure intensified as Ho was one of a handful of appointees of Gov. Tim Walz whose job was put at risk by state Senate’s majority Republicans. When the Senate adjourned Wednesday, Ho remained on the job — unlike Laura Bishop, who resigned as commissioner of the Pollution Control Agency Tuesday after learning she would likely be rejected by the Senate.
But unlike others left unconfirmed at adjournment, including state Department of Natural Resources Commissioner Sarah Strommen, Ho alone was not given any assurance that what several DFL senators referred to as a Sword of Damocles wasn’t still dangling overhead.
Lawmakers will likely return into special session in September to approve a plan to distribute $250 million in federal funds as bonuses to workers who remained on the job during the pandemic — so-called Heroes Checks. That date gave meaning to the way Senate Housing Committee Chair Rich Draheim ended Ho’s confirmation hearing Tuesday afternoon: “Let’s enjoy the rest of the summer. I think we’ll be back in September.”
After a lengthy Wednesday debate about the process that Senate Republicans have used to bring up some of Walz’s more controversial appointees, Senate Majority Leader Paul Gazelka agreed to adjourn the session without voting on others. Had they done so, the East Gull Lake Republican said, they would have confirmed Strommen and Compart. Even with a formal vote, he said, they should be assured that they are not at risk of being removed from office.
“We didn’t want them sitting out there for another six months,” he said afterward. “We wanted to say we’re good with them, they’re doing their job as they’re supposed to.”
What about Ho, Gazelka was asked.
“We were not moving forward or against Jennifer Ho. We decided that that could wait,” he said.
Ho was selected by Walz in December, 2018 and began at the housing agency the following month. She has worked on housing and homelessness issues for two decades, first as executive director of Hearth Connection and later as deputy director at the U.S. Interagency Council on Homelessness. She was the senior adviser for housing and services at the U.S. Department of Housing and Urban Development in the Obama administration and worked with Michelle Obama’s Mayors Challenge to End Veteran Homelessness.
Ho faced a series of questions during a nearly two-hour informational hearing Tuesday — informational because the House Committee was not one empowered to take formal action during the special session. GOP senators focused heavily on the slow rollout of the federally funded rental assistance program, the selection of a software vendor who has been criticized in other states for failures to create the programs needed and the long delays between making application and the movement of money to landlords.
Estimates of the scope of the back-rent program vary. But a dashboard crafted from U.S. Census Pulse survey data and a pandemic coping survey done by the University of Southern California estimates that 69,000 Minnesota households are behind on rent. The PolicyLink dashboard estimates the total rent owed at $230 million and the average debt as $3,300.
According to Housing Finance’s own dashboard that attempts to show the progress of the state and local programs, 28,545 requests for rent help have been made with requests totaling $151 million. The program can pay back rent from the start of the pandemic in March of 2020 and also pay future rent for income eligible applicants for a total of 18 months of payments.
But so far, only 2,800 checks have been sent out, totalling about $14 million, less than 10 percent of the current applicants.
Ho told the Housing Committee members that her agency distributes about $30 million in federal funds in normal years and will be spending more than $500 million in rental assistance this year and next. That number is on top of the $85 million in assistance that was distributed last year with money from the state’s share of the CARES Act.
“I know for people who are waiting it is causing stress and anxiety,” she said. “Just know that help is on the way if you submitted and qualify for the program.” There is more than enough federal money to cover all eligible back rent, she said. Ho acknowledged glitches in the rollout.
“It wasn’t perfect on Day 1. If I had waited for a perfect system on Day 1 I don’t think we would be up and running and we’d be having a different conversation,” she said. “I think getting it up and running and making improvements as we go was the right way to go.”
Sen. Zach Duckworth, R-Lakeville, said that at the current pace it will take more than a year to complete the current applications. And more applications are expected as word gets spread about the existence of the program and that the eviction ban is ending soon.
Ho said she expects the pace of payments to increase. The pressure to make that happen increases each month as the phase-out of the eviction ban begins. Starting July 14, landlords can begin actions against tenants who violated non-economic aspects of their leases. Evictions against tenants who have not paid rent and are not eligible for rental assistance can begin in mid-September.
Only those who are income eligible and who have started applications are protected from evictions through June 1, 2022.
There were no strong indictments of Ho from GOP members during the hearing, though impatience with the pace of checks to landlords was evident. No Republicans appeared to be practicing their floor speeches to urge votes against Ho’s confirmation. The hearing did include defenses of the agency and Ho from DFL members. It was pointed out that Minnesota is not alone in the slowness in standing up the rental assistance program. The Wall Street Journal reported Saturday that just $1.5 billion of the $47 billion set aside in the American Rescue Plan had been distributed nationally as of May 31.
There is bipartisan agreement that a lot of problems can be solved in the rental housing market by getting money to landlords. That has tempered criticism of the agency and is making promoting the program a higher priority. To that end Draheim appeared with Ho, Duckworth, Lt. Gov. Peggy Flanagan and DFL lawmakers two weeks ago to highlight the upcoming eviction calendar under a bipartisan law passed last month.
“We’re all dealing with the hand we were dealt,” Draheim, a Republican from Madison Lake, said. Federal rules prevent landlords from initiating applications even though he said it would speed up the flow of money. But getting people to apply at renthelpmn.org has been the unifying tenet of GOP-DFL negotiations on the issue.
“We can pick it apart. We can complain about this or that. But the goal is to get people to renthelpmn.org or call 211,” he said. “It is time to move on.”
During the hearing, Ho spoke about the politics of the confirmation fight without directly mentioning the confirmation fight. After complimenting Republican and DFL members for reaching a compromise on the off-ramp, she said: “Housing is a bipartisan issue, or a non-partisan issue. We need more housing, we all need homes regardless of ideology, regardless of where we live in the state and we need to work together on this. I’m not in it for the politics.”
Gazelka left some solace for Ho and other commissioners who remain unconfirmed and therefore vulnerable, at least that their tenure might last into the fall and winter. When asked if he might take up the issue of confirming Walz appointments when the Legislature reconvenes in September, he said it wasn’t his plan.
“What will September look like for a special session? Our intent would be that we just do the front-line workers. We don’t have an agenda beyond that.”