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Root Cause Research Center's Comments on Louisville Metro's Use of COVID Relief Funds

On May 1, 2020, Louisville Metro Government released their Proposed Amendment to the 2019 Annual Action Plan for HUD Entitlement Funds to Incorporate the Coronavirus Aid, Relief and Economic Security Act (CARES Act) funding for COVID-19 Relief Programming. This amendment proposed new projects to be undertaken during Program Year 2019 (July 1, 2019 – June 30, 2020) with federal entitlement funds received through the CARES Act. This proposed amendment is available electronically here.

With only a 5-day public comment period, Louisville Metro hosted a public meeting on May 4, 2020 that can be viewed here.

The Root Cause Research Center submitted the following comments to Develop Louisville regarding the use of CARES Act funding.

Develop Louisville ATTN: Michelle Rodgers 444 South 5th Street, Fifth Floor Louisville, KY 40202 

Re: Root Cause Research Center comments on Proposed COVID-19 Response Programs 

General Comments

We recommend that these funds be allocated exclusively for crisis relief to coronavirus-related housing and homelessness needs that provide direct service to those most impacted by the pandemic. We do not believe that these funds should be used for economic development programs or for those making over $40,000/year while the most vulnerable in our community suffer from the systemic patterns rooted in predatory extraction and oppression. 

Our demands in the public comment process related to COVID emergency relief funding: 

  • Emergency rental assistance for all tenants with no requirements or restrictions

  • Ensure moratoria on evictions do not lead to mass evictions after the emergency period has passed

  • Extend funding for hotel/motel space until after the emergency passes

  • Facilitate transfer of unused/vacant housing to families who are unhoused

Eviction Prevention Program Comments: 

“Each participant would be required to work with a caseworker and attend a budgeting class or meet with a financial coach…”

Requiring residents who receive eviction assistance to participate in budgeting classes is a racist and classist policy. There is no empirical evidence indicating that low income people lack the necessary knowledge, skill or responsibility to manage budgets, particularly as it relates to emergency funding for COVID relief efforts. This funding is designed for relief for those experiencing income loss due to COVID. Forcing those impacted to submit a budget is shaming and oppressive. This requirement should be removed and should be offered only as an option. 

“The program will help renters/households at less than 80% of area median income (AMI) who are facing eviction.”

The eviction prevention program should be used exclusively for households at less than 30% area median income. These funds are allocated for emergency relief from the COVID crisis and the households most at risk of being unhoused should be prioritized. The 2019 Louisville Metro Housing Needs Assessment found that our greatest housing needs are for those making 30% area median income or less, with very little housing need at the 80% area median income level. Allowing these funds to be used for higher incomes will limit the availability for those most at risk, particularly since this funding amount will only serve 1,500 households. Between 3/2/2020 and 3/26/2020, there were over 780 forcible detainer (eviction) cases filed in Jefferson County. These cases will be heard as soon as the eviction moratorium is lifted. We suggest that these funds be used for households who are covered under the CARES Act, to prioritize the most vulnerable populations.

“Landlords would have to agree to the structure for a tenant/participant to be able to participate, and all parties would be required to sign a tri-party agreement.” 

In this program, landlords are being subsidized and should not have authority over the tenant’s payment structure or agreement. 

This program should include an external evaluation at the end of the 10-week period and another evaluation 6 months later.

Housing Stabilization Programs Comments:

Instead of rental assistance, we recommend that this funding be used for rapid rehousing programs and converting hotel/motel space for providing shelter for unhoused persons during the emergency.

Community Land Trusts Comments:

Community Land Trusts (CLTs) do not address the needs of emergency housing during the COVID crisis. As Louisville Metro noted in the public meeting on Monday 5/4/2020, this program is designed to be an “economic development” project for 2 nonprofit housing developers. This program will only construct 50 housing units with income requirements set at 80% area median income. In the time it takes to construct 50 new homes, this funding could be used to provide shelter for thousands of families who are housing insecure. Additionally, having income requirements at 80% area median income negates the affordability benefits associated with CLTs, since prices at 80% area median income are comparable with those of market rate housing. This program essentially diverts emergency relief funds away from those most in need of housing assistance, to subsidize nonprofit housing developers in building market rate housing disguised as a CLT, with very little of the benefits that traditional CLTs offer, such as community control of land and perpetual affordability requirements for those with incomes below 30% area median income. There was no public participation process for this CLT program, which is an absolutely essential component of CLTs. We recommend that the funds for this program be put into the Eviction Prevention Program.

If Metro continues with this CLT program, we recommend that it includes:

  1.  A yearlong public engagement process that includes community organizing with the goal of establishing grassroots resident organizations

  2. Allowing resident-led organizations to apply and compete for funding in launching a CLT

  3. Income requirements for those making less than 30% area median income.

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