Colorado’s free rent program has paid out 15.2% of its available federal funds

A program offering up to 15 months of free rent has paid out 15.2% of available funds in its first six months. Payments are speeding up with one-third of the funds distributed in August after the state housing agency made changes to address payment delays.

The Emergency Rental Assistance Program, overseen by the Colorado Department of Local Affairs, is now paying out $6 million a week — instead of per month. It’s paid $104.9 million, as of Aug. 31, and has helped about 18,000 eligible Coloradans, according to data from the U.S. Treasury. 

But there are still thousands of applicants waiting to get approved — and paid — as well as more than 13,600 who have been denied, though most of the denials were due to duplicate applications. State officials said they continue to work on the process.

“Our mission to keep Coloradans safely and stably housed through the pandemic is an enormous undertaking, and we strive to become more efficient in our processes every single day,” housing director Alison George said in a statement this week. “There are still plenty of people in need and there are resources that can help.”

The agency also saw a 25% increase in ERAP applications in September after the national eviction moratorium abruptly ended on Aug. 26. 

The ERAP money came from two federal relief packages that split Colorado’s share between the state and 11 high population cities and counties. The first round, dubbed ERA1, allocated $385.1 million to Colorado, with one-third designated for 11 local jurisdictions. ERA2, the second round, provided $304.7 million and has not yet been touched in Colorado.

DOLA, which launched the program in March, itself had paid out $50.1 million as of Aug. 31. It also handled the approval and distribution for the cities of Aurora and Colorado Springs. DOLA officials said they have distributed 100% of Aurora’s $11.4 million, and two-thirds of Colorado Springs $14.4 million. Residents of both cities will have the opportunity to apply for more rent as part of ERA2 funding. 

As of Aug. 31, there was still more than $580 million in allocated rent assistance available.

The federal rent assistance, meant to help struggling Americans stay housed and landlords get paid during COVID, faced delays all year as enormous demand caused a months-long backlog in getting applicants approved and then for some, another months-long delay to get paid. 

But Colorado wasn’t alone. Many states faced challenges setting up the program. By the end of July, only 11% of the $46.5 billion had been distributed, The New York Times reported. At the time, Colorado had paid out just 7.4% of its $690 million share.

In August, Colorado switched payment vendors to Bill.com, while the U.S. Treasury eased some requirements, including by allowing applicants to certify their own incomes instead of having to provide documentation that could be very hard to track down if a former employer had closed down.

“While many jurisdictions have more work to do to meet the urgent demand for this relief in their communities, grantees saw significant growth in August — particularly among state and local agencies that adopted the Treasury’s recommended best practices,” the Treasury said in a written statement.

Some states, like New Jersey, doubled the rate of payments last month and distributed 78% of its first round of funding, or ERA1, by Aug. 31, compared to 37% at the end of July.

Colorado, meanwhile, paid out 27.2% of the first round of funding by the end of August, compared to 17.8% by the end of July.

Colorado’s payments are now to $6 million a week, according to DOLA. The agency, which oversaw $50 million in payments by the end of August, doubled the amount in September and “recently just crossed over $100 million paid out,” agency spokesman Brett McPherson said in an email.

Some local programs were faster at getting money to the renters who needed it, like Maiker Housing Partners, a nonprofit housing authority in Adams County. By early September, it had distributed 50% of its $9 million at a rate of $300,000 a week.

“(We’re) definitely seeing faster payments – we did about $706,000 to 72 families last week alone,” said Peter Lifari, Maiker’s executive director. “Based on our current pace we’re thinking we’ll tap into ERA2 before the end of October here in Adams County.”

While the process has sped up, there are still thousands of ERAP applicants waiting or wondering what happened. According to DOLA data, there are about 3,700 applications submitted and waiting to be processed. Another 5,200 are missing information, while 13,600 have been denied. 

About 80% of the time, the rejections were due to duplicate applications, McPherson explained.

“About 5% are denied because the client was served by another program,” he said. “About 15% are denied for reasons such as the applicant is over-income, the applicant does not attest to a COVID-related reason for the request, or otherwise does not meet the program guidelines.”

Denied applicants are allowed to appeal.