In an effort to help those most in need during the raging pandemic, officials across the nation mishandled payments for vulnerable renters, resulting in thousands of overpayments just weeks before the crisis hit. Now officials who oversee the programs are scrambling to reclaim the money they so generously dispensed to tenants, often without asking for anything in return.
The 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act included $25 billion in emergency rental assistance to renters who faced eviction due to the pandemic. The funds went to states, cities, and tribal organizations that then administered programs to distribute the money to residents.
Unfortunately, this aid money wasn’t always efficiently managed. In Maryland, for example, officials overpaid 9,600 people a total of $17 million. One county said it gave out $40,000 to one woman, even though she was not eligible for the program.
The problem has been similar in other states. In California, 2,300 renters got too much money, totaling nearly $14 million. Another 200 people who already had sufficient funds were still given thousands of dollars more.
The officials who run these programs are now in the difficult position of having to ask for the overpaid funds back. At the same time, the people who received the overpayments are often the most vulnerable in society and may not have the means to pay the money back.
In some cases, local governments are sending out letters to remind renters of their obligations, along with details of how to pay back the funds. However, they are also relying on the goodwill of residents to voluntarily pay back the money.
In Maryland, officials hope to resolve the overpayments issue by the end of the year. Beyond Maryland, justice department officials have said that the laws concerning disbursement of funds are quite broad and that it is possible some of the overpayments could be forgiven.
The situation highlights the lack of coordination and preparation in the nation as the pandemic took hold. Despite the urgent need for the funds by so many, it appears that not enough time and effort went into ensuring that vulnerable populations were getting the exact amount of aid they required without being overpaid.
Officials are taking action to minimize the problem, though, with many budgeting for overpayments and making changes to properly monitor the dispersal of funds. The hope is that the money will be paid back to those who require it the most and that by the end of the pandemic we can learn from our mistakes.
