The agreement requires the California Department of Housing & Community Development to give pending and denied applicants a fair chance to receive Covid-19 rental assistance
June 5, 2023 – A landmark settlement has been reached in a case brought by tenants’ rights advocates alleging that the California Department of Housing & Community Development (HCD) unconstitutionally operated the state’s Covid-19 Emergency Rental Assistance Program (ERAP or Housing is Key), which has led to qualified applicants missing out on the assistance they were promised after the pandemic destroyed many Californians’ livelihoods. More than 100,000 households are still waiting for a decision on their applications—and many of them are being served with eviction notices and being harassed by their landlords for rent they still owe. The settlement agreement will offer a renewed chance for applicants who remain in limbo to receive Covid-19 rental assistance, which remains essential to supporting and stabilizing families as the housing and homelessness crisis worsens in California.
California’s Covid-19 Emergency Rental Assistance Program was created to provide direct assistance to low-income families struggling to pay rent during the pandemic. The Alliance of Californians for Community Empowerment (ACCE Action), Strategic Actions for a Just Economy (SAJE), and PolicyLink—represented by Western Center on Law & Poverty, Public Counsel, the Legal Aid Foundation of Los Angeles, and Covington & Burling LLP—sued HCD in June 2022 for several systemic failures in the program, including a confusing application process that led eligible tenants to be wrongfully denied assistance.
As part of the settlement, HCD has agreed to take several steps to improve its process for the remaining ERAP applications, including:
- Providing tenants who are going to be denied all or part of the assistance they requested with a detailed explanation of the reason for denial, so they can address issues with the application and have a fair opportunity to appeal;
- Ensuring that tenants subject to “recapture” of rental assistance funds have a fair opportunity to challenge the state’s decision;
- Providing better access to the appeal process;
- Expanding funding to the Local Partner Network, which will assist tenants with navigating their pending applications and appeals;
- Conducting an audit of prior denials to correct wrongful denials of assistance; and
- Providing greater transparency about who is receiving rental assistance and who is not, with data about the race, ethnicity, and zip code of people denied assistance.
Tenants who have been waiting for a decision on their applications will receive an update in the coming months and should regularly check their email, application portal, and postal mail for notifications. Tenants who have been evicted or moved since they applied for rental assistance should contact the Housing is Key program to update their contact information and ensure they receive any important notices. Those who receive a denial will have 30 days to file an appeal.
California identified more than $6 billion in rental assistance from the state and federal government for the Housing is Key program, which came at a critical time and should have made a profound difference for the hundreds of thousands of families impacted by the economic fallout of the pandemic. More than half a million households applied to the program. Thus far, HCD has denied nearly 30 percent of applicants, according to an analysis of program data conducted by the National Equity Atlas (a research partnership between PolicyLink and the USC Dornsife Equity Research Institute). The vast majority of those denied (93 percent) have incomes below 80 percent of the area median income—the income threshold to be eligible for the program. Tenants did not receive any meaningful explanation of why they were being denied the help they needed to avoid eviction, and many had difficulty accessing the appeal process.