The oodles of money thrown by the federal government over the past year and a half at virtually every enterprise and adult in this country has avoided an economic meltdown, although what all this borrowing means for the future is still to be determined.
Most of the pain that COVID-19 inflicted when it first reached this country was remarkable both for its severity and its short duration.
A lot of the debate now is not about avoiding an economic collapse. Rather, it’s whether there has been too much of a good thing, with generous government assistance depressing the labor participation rate and creating a bottleneck in which supply cannot keep up with demand.
There is in Mississippi, however, at least one area where too little money has been disbursed — rental assistance. It’s frustrating to both renters and their landlords on how slow the state has been to get this aid into needy hands.
According to reporting this week by the Clarion Ledger, as of July 13, the state had distributed just $4 million, or only a little more than 2%, of the $180 million in federal aid allocated to Mississippi to help low- and moderate-income residents pay their rent and utilities.
Time is running out to do something about it.
A federal moratorium on evictions, in place for nearly a year, is set to expire at the end of this month. Thousands in Mississippi could be kicked out of where they live, even though the money is there to keep that from happening. It also could create a serious dilemma for landlords. Do they let their past-due tenants ride a little longer, in hopes that they will get most of their back-due rent? Or do they write off their losses and try to find new tenants with the ability to pay?
Even where landlords are patient or charitable, they still have bills to pay. There’s no moratorium on property insurance or property taxes.
So what’s the holdup?
Scott Spivey, the executive director of the state agency in charge of getting the money disbursed, says it’s a combination of factors.
The agency didn’t have the computer infrastructure or the manpower to process applications for the assistance, causing it to outsource much of the work to a law firm with offices in Jackson. Most of the applications coming in are not being completely filled out, which is slowing up the applications’ approval. And a lot of eligible tenants are not applying for the assistance, probably because they are not aware it exists or how to go about applying for it.
It sounds like someone is not doing a very good job of marketing.
Whatever the cause, the clock is ticking. Not only is the eviction moratorium only about a week from ending, Mississippi is on a deadline to get the money out. If at least 65% of the $180 million it has been allocated is not spent by the end of September, the federal government could start taking the funds back and giving them to states that are doing a better job of shepherding tenants through the process.
That would not just be painful for Mississippi renters. It would be hard on the entire rental industry, producing a ripple effect of blight, bankruptcies and depressed local government coffers. Owners might abandon properties rather than pay the taxes on them.
It’s a bad situation all the way around.
- The Greenwood Commonwealth