D.C. City Council Emergency Legislation Addresses Rental Assistance Program Financial Crisis

Amid growing concerns about escalating unpaid rents and the impact on affordable housing in the District of Columbia (D.C.), the D.C. Council adopted, on an emergency basis, the Emergency Rental Assistance Reform Emergency Amendment Act of 2024. The new law amends the requirements relating to the Emergency Rental Assistance Program (ERAP) and will go into effect once approved by Mayor Muriel Bowser.

According to memoranda issued by Council Chair Phil Mendelson and Mayor Bowser, the longstanding procedures under ERAP created a financial crisis for affordable housing developers. According to reports, affordable housing providers throughout the city accrue a total of $15 million per year in unpaid rent, and as a result, lenders are discouraged from financing affordable housing developments in the District. City leaders are also concerned that should these developments go into foreclosure, the associated affordable housing covenants would be automatically extinguished, thus resulting in a net loss of dedicated affordable units.

Prior to the recent legislative amendments, the court was required to stay proceedings in eviction cases when tenants filed an application for ERAP funds, even if the tenants were ineligible for the funds or would not receive enough ERAP funds to cover the full amount of unpaid rent and the housing provider opts not to pursue a payment plan to cover the remaining arrearages. Additionally, because of the quarterly application process, tenants were able to secure multiple stays in an eviction case. Thus, ERAP processes and procedures have resulted in lengthy eviction proceedings, contributing to a significant backlog in the Landlord Tenant Branch of Superior Court.

There are four significant changes under the Emergency Rental Assistance Reform Emergency Amendment Act of 2024 that would help to address this lengthy process:

• a tenant must now describe the nature of their emergency situation in their ERAP application
• the definition of "emergency situation" was refined to characterize emergency situations as those resulting from an unforeseen or unusual event, such as job loss or high medical costs, that impacts an applicant's ability to pay rent and cannot be resolved without financial assistance
• the court may stay an eviction proceeding only once during the pendency of an ERAP application
• a tenant is required to provide evidence that the ERAP application could result in sufficient rental assistance to pay the full amount of rent owed or, if not, consent to enter into a payment plan agreement with the housing provider to cover the remaining unpaid rent.

Laws adopted on an emergency basis take effect immediately following approval by the mayor and remain in effect no longer than 90 days. The Council may adopt legislation that keeps the amendments in place on a permanent basis.