Tenant Groups Reach Settlement With State Of California Over Applicants Stuck In Rent Relief Limbo

Los Angeles tenant groups announced Monday they have settled their lawsuit against the state of California over how housing department officials handled the state’s rent relief program.

About the deal

The deal gives tenants another chance to have their rent relief application reviewed or to appeal a denial. An estimated 331,000 L.A. area households remain behind on rent, and many of them are now facing possible eviction.

“Hopefully, people who were quickly denied in the past will actually be approved when the state is forced to look a little bit closer,” said Legal Aid Foundation of L.A. attorney Jonathan Jager. He worked on the legal team that brought the lawsuit forward on behalf of L.A.-based tenant group Strategic Actions for a Just Economy, statewide advocacy organization Alliance of Californians for Community Empowerment and national research institute PolicyLink.

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During the pandemic, California’s Housing Is Key program came under fire for being difficult to access, or even understand, especially for low-income tenants who didn’t own computers or speak English. The lawsuit sought to address those disparities, and get eligible tenants connected to the relief they were promised.

Billions in rent relief

Despite those problems, California’s rent relief program wasn’t without success. The Housing and Community Development Department delivered $4.6 billion in federal COVID-19 relief money, primarily to landlords, in order to forgive rent debts accrued by tenants who lost income due the COVID-19 pandemic.

As a result, hundreds of thousands of Californians who might otherwise have been evicted remained housed. Housing experts credit this and other pandemic relief measures with slowing the rise of L.A. homelessness in recent years.

“Providing relief to California renters and landlords affected by the COVID-19 pandemic has always been our priority,” state housing department officials said in a written statement about the settlement. “We are committed to working with our partners to bring resolution and support to those remaining in the application pipeline.”

Why many applicants were stuck in limbo

More than half of the state’s total funding went to hard-hit L.A. County. But many applicants in the L.A. area and across the state have been stuck in limbo since the rent relief program shut down in April 2022. Tenant advocates say the state denied about 30% of applicants, and 100,000 California households are still waiting for a decision about whether they’ll receive funding. Advocates said Monday’s settlement will give those applicants another chance to secure help.

“Some of them have, unfortunately, been evicted while waiting on this assistance that could have stopped their eviction,” Jager said. Others, he said, remain housed but are being harassed by landlords who often blame tenants when the state fails to deliver rent relief.

L.A. County ended its eviction protections for tenants who can’t pay rent due to the pandemic at the end of March. Some renters are now being taken to eviction court, where most struggle to obtain legal representation against landlords who almost always have a lawyer. If their back rent is not covered by the state’s rent relief program, their wages can be garnished.

Where things stand

It remains unclear if the state has enough leftover federal COVID-19 relief funds to cover all the pending applicants who may be eligible under the settlement. If California runs out of federal money, legislators may have to find alternative funding sources in order to pay all the households promised relief.

In a statement on the settlement, Western Center on Law and Poverty attorney Madeline Howard said the program’s “delays and dysfunction left far too many eligible families facing eviction because they could not access this critical assistance. We are hopeful that this settlement will create an opportunity for these tenants to finally receive the help they need.”

Under the terms of the settlement, California’s housing department will send new denial letters to households specifying exactly why their application was rejected. Tenant advocates say the state’s previous denial letters were vague, and didn’t provide renters with a clear path for appealing the decision or submitting further documentation proving their eligibility.

The state also agreed to conduct an audit of the problems associated with previous rent relief application denials. It will also provide $8 million in new funding to local organizations helping renters through the application and appeals process. That funding will be targeted toward Southern California groups, given the high number of pending applications in the L.A. area.