U.S. Treasury Tag Archives

Dr. Yellen Confirmed as Treasury Secretary

The Senate confirmed Dr. Janet Yellen as Treasury Secretary in an 84-15 vote, she is the first woman to ever hold the position. Secretary Yellen was the third cabinet official to be confirmed by the Senate, indicating President Joe Biden’s focus on the economy. Dr. Yellen previously served as chair of the Federal Reserve from 2014 to 2018 and was a member from 2010 to 2018 and 1994 to 1997.

Treasury Releases Emergency Rental Assistance FAQ

The Department of the Treasury released FAQs for the new $25 billion emergency rental assistance (ERA), which:

  • requires applicants for assistance to provide third-party source documentation evidencing income and their experience of unemployment or financial hardship due directly or indirectly to COVID-19;
  • clarifies that applicants who occupy a federally-subsidized or mixed-use property, including LIHTC properties, may receive ERA assistance. However, if a household receives a monthly federal rental assistance subsidy — such as a voucher, public housing, or project-based rental assistance — and the tenant rent is adjusted to account for changes in income, the renter household may not receive ERA assistance. If the household receives rental assistance, ERA may be used to cover the tenant-paid portion of rent and utility costs not paid by the other rental assistance (NCSHA is requesting further clarification on this point);
  • defines which utilities are covered under the program, including electricity, gas, water and sewer, trash removal and energy costs, such as fuel oil; but not costs for telephone, cable, or internet;
  • clarifies the ERA program can cover rental payments beginning after March 13, 2020, the date of the national emergency declaration; and
  • provides a 21-calendar day period or three for landlords to respond to requests from grantees to provide direct payments. After no response following the 21-day period or three attempts, the grantee may provide the payments directly to the tenants.

Notably, Treasury has not yet made a determination on “other expenses” as related to housing incurred due, directly or indirectly, to COVID-19.

Treasury Releases ERA Guidance

The Department of the Treasury released guidance on its new $25 billion Emergency Rental Assistance (ERA) program. Eligible grantees (states and local governments with populations of more than 200,000) will have until January 12 to provide payment information and sign the acceptance of award terms in order to receive the money by January 26. Eligible households must meet at least one of the following criteria:

  • Qualifies for unemployment or has experienced a reduction in household income, incurred significant costs or experienced a financial hardship due to COVID-19;
  • Demonstrates a risk of experiencing homelessness or housing instability; and
  • Has a household income at or below 80 percent of the area median.

Eligible households that include an individual who has been unemployed for the 90 days prior to application for assistance and households with income at or below 50 percent of the area median income are to be prioritized for assistance.

Household income is determined as either the household’s total income for calendar year 2020 or the household’s monthly income at the time of application. For household incomes determined using the latter method, income eligibility must be redetermined every three months.

Eligible households may receive up to 12 months of assistance, plus an additional three months if the grantee determines the extra months are needed to ensure housing stability and grantee funds are available. The payment of existing housing-related arrears that could result in eviction of an eligible household is prioritized. Assistance must be provided to reduce an eligible household’s rental arrears before the household may receive assistance for future rent payments. Once a household’s rental arrears are reduced, grantees may only commit to providing future assistance for up to three months at a time. Households may reapply for additional assistance at the end of the three-month period if needed and the overall time limit for assistance is not exceeded.

An application for rental assistance may be submitted by either an eligible household or by a landlord on behalf of that eligible household. Households and landlords must apply through programs established by grantees. In general, funds will be paid directly to landlords and utility service providers. If a landlord does not wish to participate, funds may be paid directly to the eligible household. Households and landlords should not submit applications for assistance to Treasury.

Jennifer Schwartz with the National Council of State Housing Agencies will describe the model guidance they are developing for their members, as well as how the states are planning to roll out the funding during our January 21 webinar on “Unpacking the Affordable Housing Provisions in the Year-End Bill.” Register here.

Economic and Fixed Income Insights, May 19, 2020

Yesterday, Federal Reserve Chairman Jerome Powell testified alongside Treasury Secretary Steven Mnuchin as to the effects so far of the CARES Act to the Senate Banking Committee. Mirroring his previous comments, he reiterated a likely long and difficult road for the U.S. economy, prompting the need for additional stimulus from both the Federal Reserve and federal government.

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