MN House passes bill to phase out Gov. Walz's eviction moratorium

·4 min read

Jun. 25—A bipartisan bill that would phase out Gov. Tim Walz's moratorium on evicting renters from their homes during the coronavirus pandemic cleared its first hurdle Thursday when the House passed it on a 72-59 vote.

The measure was negotiated by the House Democratic-Farmer-Labor majority and Republicans who control the Senate. That chamber is expected to pass it as part of a two-year, $52 billion budget package.

Lawmakers meeting in special session must adopt a new budget by July 1 to prevent a state government shutdown.

The bill provides an "off ramp" that gradually lifts the moratorium so that renters and the state's courts aren't hit by an avalanche of evictions when the pandemic and Walz's emergency powers to fight it end.

HOUSING FUNDING

Ending the eviction moratorium was one piece of a larger housing finance bill that allocates $136 million to the Minnesota Housing Finance Agency for the next two years — a $10 million increase over its current budget — for several existing programs, plus $100 million in housing infrastructure bonds to finance more affordable housing.

Walz ordered the eviction ban after the pandemic hit in March 2020 to enable renters to "stay home and stay safe," Rep. Michael Howard, DFL-Richfield, said during the House debate. "It has saved lives."

The off ramp creates special rules that expire 105 days after the bill becomes law.

During that time, landlords would have give tenants 15 days' notice before evicting them for lease violations not related to overdue rent.

Renters who are late on rent and make too much money to qualify for the state's emergency rental assistance could be evicted after 75 days.

Renters who have applied for but haven't yet received government assistance would be protected from eviction until June 1, 2022.

Howard called the bill a "win-win for renters and landlords."

REQUESTS FOR ASSISTANCE

As of June 17, the housing agency had received 26,292 applications requesting a total of $136.5 million in rental assistance. So far, the agency has made more than 1,500 payments to landlords totaling $8.3 million, or 6 percent of the amount requested. The state and its largest cities and counties are receiving a combined total of $672 million federal emergency rental assistance.

During the floor debate, Republicans criticized the agency for failing to send out payments faster, creating financial problems for landlords who pay mortgages, maintenance and repair expenses and other costs. State Housing Finance Commissioner Jennifer Ho previously said she'd like to get money out the door faster, but the federal government demands detailed information from landlords and tenants to ensure the assistance goes to those who need it most.

Rep. Peggy Scott, R-Andover, also faulted the bill for failing to make housing more affordable. "It does nothing to lower the cost of home ownership," she said.

To qualify for the rental assistance program, a household's income must be below 80 percent of the area median income (AMI) — in the East Metro, that's $55,950 for a single person, $63,950 for a couple and $79,900 for a family of four. The housing agency reported that nearly half of its applicants earned less than 30 percent of the AMI and only 11 percent of those seeking aid earned more than half of the AMI.

Nearly seven in 10 applicants are Black, Indigenous or people of color. More than half of those applying have minor children, and 41 percent have experienced recent unemployment.

The federal government requires that state and local agencies prioritize funding to households with incomes below 50 percent of the AMI, are out of work or have been unemployed for 90 days and are at risk of experiencing homelessness or housing instability.

In May, PolicyLink, a California-based research organization, estimated 69,000 Minnesota households owe nearly $215 million in back rent with an average debt of $3,100.

The housing agency still is accepting applications for assistance on its website, RentHelpMN.org, or by calling the United Way's 2-1-1 resource helpline.

Eligible tenants can get help to pay rent going back to March 13, 2020. They also can apply for up to three months of upcoming rent.

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