Housing rights advocates say innocent applicants will be unfairly impugned
As thousands of Massachusetts residents face eviction, the administration of Gov. Charlie Baker is cutting back aid payments designed to keep people in their homes, saying the state is running low on federal funds.
At the same time, Mass is looking to spend $800,000 of that aid on corporate law firms to look for fraud in applications. It’s a move that housing rights advocates say not only takes money away from people in desperate need of aid, but could result in the rejection of legitimate applications.
“It’s disappointing to see the state prioritize and invest hundreds of thousands of dollars investigating fraud rather than hiring and training more case workers … and distribute money faster to families,” said Gabriela Cartagena, an organizer at City Life Vida Urbana.
“The timing of this is questionable and frankly distressing, coming on the heels of the state’s recent decision to end federal rental assistance programs in the coming months,” Andrea Park of the Mass Law Reform Institute said.
Cutting back payments
Since the start of the pandemic, the state Department of Housing and Community Development has received nearly $850 million in federal Emergency Rental Assistance (ERA) aid to help people make housing payments. They spent about 56% of that by the end of 2021, according to a Department of Housing & Community Development (DHCD) newsletter, but weren’t given a reallocation at the end of the year.
The state estimates it will stop accepting new applications for ERA and other housing payment aid by April 15, according to the newsletter. And the agency made several changes as of Jan. 1 to “preserve our existing resources as long as possible” that are hurting people who are expecting aid, housing advocates said.
The changes include requiring applicants to be at least one month in arrears before getting aid. Also, once they have exhausted aid from the ERA program, they can’t get help from Residential Assistance for Families in Transition (RAFT), another large state aid program, until July. And while previously-approved households could go through a short “recertification” to apply for additional aid, they now have to file another application and start from the beginning.
That loss of recertification is a huge blow to tenants who were expecting—or have already benefited from—an easier process to get aid, said Kelly Turley, the associate director of the Massachusetts Coalition for the Homeless. Having to go through the application process again could lead to evictions of tenants who thought they were in the clear.
“The point of emergency programs is to move nimbly and get aid to people in a timely way. If there are further delays in payments, landlords don’t want to wait,” Turley said. “Getting funds out in a timely way is important so there aren’t evictions under the radar.”
In a letter sent to Gov. Baker and state leaders earlier this month, the Massachusetts Coalition for the Homeless, the Massachusetts Law Reform Institute, and Homes for All Massachusetts called for the state to walk back the changes to ERA allocation, with hundreds of local advocacy groups signing on.
“At a time when application numbers are increasing, these changes will place additional burdens on families and individuals already in crisis due to the pandemic,” the letter states. “With so much money available for emergency relief, moving forward with these changes would be a disgraceful and unnecessary outcome.”
Spending on consultants, not tenants
And at the same time the state is cutting back on assistance, close to $1 million has been earmarked for investigating applicants, not giving them aid. Two weeks after making those changes to “preserve our existing resources as long as possible,” DHCD put out a bid for a consultant to “detect, manage, and provide mitigation recommendations” regarding potentially fraudulent ERA applications.
In the bid, DHCD says it has received between 3,000 and 3,500 ERA and RAFT applications a week for the past 10 weeks, but does not say how many have been fraudulent or suspected of fraud. The consultant will not only track reports of potential fraud, but also “use proactive and reactive data analysis to identify trends in potentially fraudulent applications,” according to the bid, and then use its work to make policy and process recommendations to DHCD.
High-profile firms that have done business with the state before, like RSM US, Ernst & Young, and KPMG have signaled interest in the bid, according to the state’s procurement website. The agency wants work to begin by Feb. 7, if not sooner, and is earmarking up to $800,000 for the job, according to public documents.
DHCD did not respond to questions about how much fraud they have seen in applications, whether consultants would focus on tenants or landlords, and whether the money spent on consultants would be outweighed by the fruits of finding fraudulent activity. Nor did they respond to questions about how mitigation measures using trends identified by the consultant could mistakenly deny legitimate applications.
The bid says the consultant’s findings should be “robust regarding false positive/false negative,” but Turley said that kind of analysis could harm communities that have already been affected by the eviction crisis. Advocates pointed to issues like the lack of official paychecks for renters whose work pays them in cash, saying that could be a red flag preventing tenants from getting aid, and said the application process is already difficult and rejects legitimate applicants.“We are concerned about the policy and process recommendations that may come from this fraud investigation, as we know that many people have had difficulty, and some have ultimately failed, to access the rental assistance system due to language, technological, and other barriers,” Park said.
“Whatever the intentions are, in application the result could be to disproportionately impact lowest-income households and communities of color, given the way things like this have played out in the past,” Turley said.