MaineHousing stops rental assistance program

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MaineHousing is halting new applications for its emergency rental assistance program while awaiting hearing from the federal government on whether to approve a request for $55 million in additional funding for the program.

The program, which began in March 2021, was expected to last until at least December 2022, but an “unexpected surge in demand” for support means it will have to be suspended, MaineHousing said in a statement.

Since its inception, the program has helped 33,719 households with rent payments and spent approximately $275 million in federal COVID-19 relief funds.

The goal of the $45 billion federal program, available in all 50 states, is to help qualifying renters temporarily pay their rent. But demand for the program has exceeded the funds currently available.

There are approximately 11,000 outstanding applications that MaineHousing is processing that the agency can approve with existing funding. Based on past experience, about 7,000 would be eligible for the program. But expanding the program beyond that will require additional federal funding.

“This application pause is a fiscally responsible and sensible step we take to ensure that everyone who has previously applied to this program has a fair chance to receive help,” said Scott Thistle, a spokesman for MaineHousing. “This temporary program, funded with one-time funds from Congress, was intended as an emergency measure to help contain the economic backlash caused by the COVID-19 pandemic in Maine. It was not intended as a long-term association, a permanent rental subsidy, or a solution to the state’s ongoing shortage of affordable housing. Simple math tells us that this program cannot run indefinitely without replenishment.”

Thistle said demand for the program has increased this year, a combination of rising rents, housing shortages and the financial impact of the ongoing pandemic. MaineHousing tried to reduce demand by tightening the eligibility limit of households earning up to 80 percent of median income to 50 percent of median income and capping the amount paid to hotels. For those eligible, the program pays rent directly to landlords for three months, with extensions of up to one year possible.

But the demand was still increasing.

“We slammed on the brakes to try and slow the car, but when we slammed on the brakes it didn’t slow the car,” said Thistle.

He said if the request is successful, MaineHousing will be able to extend the program through at least much of the winter.

Dozens of states have paused or ended similar programs, including New York, California, Florida, New Jersey, Connecticut and Rhode Island, MaineHousing said.

Thistle said the additional demand for the program highlights the cost of living challenges Maine is going through, with a housing shortage driving up costs for homeowners and renters everywhere.

A new Maine law passed this year and taking effect in July 2023 will require local governments to allow duplex construction in all areas where single-family homes are permitted, regardless of zoning. It’s part of a larger effort to deal with the housing crisis, though proponents say much needs to be done as Maine becomes an increasingly expensive place to live.

“The housing crisis is seriously affecting Maine families,” House Speaker Ryan Fecteau said in a statement Friday. “Supply is insufficient to meet demand, and as a result, costs for renters and homebuyers are rising.

“I’ve worked with hundreds of city planners, community leaders and citizens on this bill to make duplexes and secondary housing units legal in Maine so more homes can be built in each city to meet demand.”


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