In a huge win for Alabama’s tenants and housing providers, the Alabama Legislature passed in February house bill (HB) 231 appropriating more than $263 million in rental assistance funds.
The federal Emergency Rental Assistance Program became law in late 2020, with a set aside of $25 billion for tenants and housing providers. Alabama REALTORS® and local REALTOR® associations worked with the Governor’s Office and eligible local governments respectively to encourage participation in the program. These efforts resulted in Alabama receiving over $326 million to cover rent and utilities for those Alabamians affected by COVID-19.
Administering Agency
The Alabama Housing Finance Authority (AHFA) will administer the state’s emergency rental assistance program. Although applications are not yet available, AHFA has preliminary information on its webpage here. Total amounts provided to our area are:
$6,007,644.10 to the City of Huntsville
$5,223,224.50 to Madison County
Guidelines
The U.S. Department of Treasury issued broad guidelines for the funds detailed below:
Eligible Recipients: Eligible renter households are those in which at least one individual:
Is obligated to pay rent on a residential dwelling;
Qualifies for unemployment or has experienced household income reduction, incurred significant costs or experienced a financial hardship due to COVID-19;
Demonstrates a risk of experiencing homelessness or housing instability; or,
The household income is at or below 80 percent of the area median income.
Eligible Costs for Renters: Rent, rental arrears, utility and home energy costs and/or arrears, and other housing costs.
Priority Applicants: When reviewing/approving applicants, the state has discretion but must prioritize:
Households with an individual who has been unemployed for 90 days before applying; and,
Households below 50 percent area median income.
Applications: Renter can apply; or the housing provider can also apply for rental assistance on behalf of the resident but must inform the renter and secure renter’s consent.
Payments:
How Made: Payments are sent directly to the housing provider. Residents may receive payment directly from the administrative agency and pay their provider if that provider does not want to participate in the program.
Payment Limit: Rental assistance payments are limited to 12 months, with the possibility of an additional 3 months if necessary and funding available.
Arrears First: Rental arrears must be paid first before prospective rent payments are made.
Not Federally Taxable: Payments are not included in the renter’s income.