By Vanessa Raymond-Garcia, Policy Analyst
It was clear before the COVID-19 Pandemic (“Pandemic”) many people cannot afford an unexpected expense. In a series of reports from the Federal Reserve Bank, we know that 4 in 10 adults would have difficulty covering a $400 expense. This was true prior to the Pandemic and is true now. However, some aspects of the Pandemic response have shown us that there is another way.
In the Federal Reserve Bank’s Report on the Economic Well-Being of U.S. Households in 2018 – May 2019, 4 in 10 adults would have difficulty covering a $400 expense. Looking at the same question, the Report on the Economic Well-Being of U.S. Households in 2020 – May 2021 after the pandemic started found similar overall results but noted two significant changes. First, the number of people who could have handled that level of unexpected expense was temporarily higher earlier in the pandemic when people were receiving support from “pandemic-related relief policies.” Second, the report noted that for those who had experienced unemployment within the last 12 months, the percent of those able to manage a $400 expense was significantly lower.
Of course, due to structural racism, the results vary significantly based on race.
With the eviction moratorium lifted, COVID unemployment benefits stopped, and the child tax credit ended, individuals and families across the state and country deserve aid and policies that will help them thrive, not just struggle to survive. There are opportunities to do just that – if leaders and policymakers are willing to address the issues with the same urgency that they would if they or someone they loved were experiencing it.
Underutilizing Existing Resources
The Federal Reserve Report shows that the support people were getting over the summer is dwindling or gone. But for many people that should not be the case. Especially in the housing area, there are millions of dollars still unspent from multiple Congressional bills passed in 2020 and 2021 – from the Consolidated Appropriations Act and American Rescue Plan Act. For example:
- HUD received $9 billion to combat COVID-19 impacts through two housing programs and have only spent approximately $2 billion.
- Pennsylvania has, as of February 8, 2022, only spent 43% of the funding allocated to the emergency rental assistance program.
- The Commonwealth was allocated $7 billion under the American Rescue Plan and brought in more than $2.5 billion extra in sales tax revenue in 2021. The General Assembly decided to keep $5 billion of those dollars in reserves for another day – meaning, they can be spent for anything in any area at any time.
While speed is important, it is also important to target communities that have historically been left behind. Counties across the Commonwealth should be thinking about ways to improve their process with the goal of equity in mind.
The challenges in housing are both individual and systemic. The programs described above have been more individual support-focused. There is also a potential opportunity to invest in systemic challenges.
Addressing Systemic Housing Problems
“The market” does not naturally provide housing that is affordable and of good quality to all people. Our national housing policy has evolved to focus on the development of new affordable, subsidized housing. Even with that focus for decades, we are far short of the number of units we need to address the problem.
Any injection of funding to preserve current affordable housing and develop new affordable housing would be very welcomed and is desperately needed. For Pennsylvania, as one of the top 5 states with the oldest housing stock in the country, this would mean tenants throughout the state would benefit from repairs to their rental units, have a larger supply of affordable housing, and benefit from the investments in other policy areas – in other words, other aspects of their lives. Rents over the last year across the country and in metro areas specifically have skyrocketed. Emergency rental assistance is not getting to those who need it most fast enough. People are on the line to lose their homes to foreclosure if homeowner assistance funds do not get disbursed. Inflation is the highest it has been in over a decade and wages are stagnant. Investing in affordable housing is one of the best ways to mitigate harm against people across the nation, especially for vulnerable communities.
Formal and informal leaders at every level must prioritize working individuals and families by supporting further COVID-19 relief, childcare and caregiving, climate change efforts, affordable health care, education, affordable housing, immigration reform, and additional social safety net programs and vital infrastructure. Each of these housing-adjacent issues could easily create a sizeable, unexpected expense that could set off a cascade of events that results in housing loss or instability. Moreover, we know that housing has a direct impact on health. Our failure to act with the level of urgency needed to meaningfully address the needs of those who have been put in the worst positions during the Pandemic means that we are not only accepting housing instability and homelessness but that we are also failing to act in a way that would prevent more health-related harms. Without a home, there is no health and there is no justice.