On October 26, 2022, at the request of Commissioner Fernandez, the City Commission referred an item to the Finance and Economic Resiliency Committee (FERC) to explore an ordinance that would establish a universal rental fee application program.

On February 17, 2023 the FERC discussed the potential for a rental fee application program and directed the Administration to develop and provide details on a potential pilot grant program that would reimburse households for 80% of the cost of their rental application fees not to exceed $500 per year. The FERC also directed the Administration to explore possible grants and other funding sources and opportunities to help families above 80% and up to 120% AMI.

The proposed pilot grant program would provide financial assistance to low-income households to alleviate the financial burden associated with rental application fees. The pilot program would be based on a reimbursement structure and eligible households would include those at or below 80% Area Median Income (AMI).

The Administration has identified $50,000 in HOME Investment Partnership Program American Rescue Plan (HOME-ARP) funds for households at or below 80% AMI. At least one hundred (100) households may be able to receive a reimbursement of 80% of the cost of their rental application fees, up to $500 per year, until funding is exhausted. The Office of Housing and Community Services would be responsible for administering the program, including the income certification of income-eligible households, ensuring compliance with the HOME-ARP program guidelines including income limits.

HOME-ARP income limits are calculated using the same methodology the U.S. Department of Housing and Urban Development (HUD) uses for determining the income limits for the Section 8 housing program. These income limits are updated annually by HUD.

HOME-ARP income limits for 2022 are:

 All households applying for funds through the pilot program will be required to provide documentation demonstrating the amount expended for application fees. While multiple rental applications may be accepted, the reimbursement amount would not exceed $500 per year.

The application for the pilot program will be made available online and advertised via the Marketing and Communications Department. Applications will be evaluated on a first-come, first-qualified, first-served basis.

Fiscal Impact: The pilot grant program would be supported by $50,000 in HOME-ARP funds for households earning up to 80% AMI. The Administration has not yet identified additional funding opportunities for households earning over 80% AMI.

The Administration supports the creation of a pilot grant program that would reimburse tenants for a portion of rental application fees utilizing $50,000 in HOME-ARP funding. The Administration will continue to explore other funding opportunities to assist those households that earning between 80% to 120% AMI.

If the pilot program is to extend beyond the identified funding available through HOME-ARP or to households above 80% AMI, I recommend that this be evaluated as part of the FY 2024 budget development process.