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Partial federal shutdown puts payments to landlords for low-income tenants at risk

The sign outside Highland Apartments on Becker Avenue Southeast in Willmar is pictured. Monthly payments to area landlords that subsidize low-income tenants could be put at risk if the partial government shutdown continues for a significant period of time. More than 40 families in Willmar receive subsidies from their landlords through the HRA. Tribune photo by Ron Adams

WILLMAR — Monthly payments to area landlords that subsidize low-income tenants could be put at risk if the partial federal government shutdown continues into November and beyond, a local housing official says.

“If the shutdown continues we won’t be able to forward any more payments to them,’’ says Jill Bengtson, executive director of the Willmar, Kandiyohi County and McLeod County Housing and Redevelopment Authority.

The joint housing authority cannot forward payments to private landlords who participate in the Section 8 Rental Assistance Program, which assists low-income households with their rental costs, unless the agency receives its monthly funding from the U.S. Department of Housing and Urban Development.

“Those (landlords) that have called were told they will get their payments for October,’’ says Bengtson. “But going forward there won’t be if the shutdown lasts: no payment in November if the shutdown lasts that long.’’

The HRA informed participating Willmar, Kandiyohi County and McLeod County landlords of the situation by letter this week.

“If the government shutdown continues into November and thereafter, the HRA will be unable to forward any further Section 8 payments until the shutdown is over,’’ Bengtson wrote.

“Each month, the federal Department of Housing and Urban Development forwards funds to the HRA for the landlord payments. With the shutdown, no further funds will be distributed to the HRA and therefore the HRA will not be able to make payments to you.’’

The joint HRA serves 397 households: 44 in Willmar, 101 in McLeod County, and 252 in Kandiyohi County; and serves 174 landlords: 26 in Willmar, 47 in McLeod County, and 101 in Kandiyohi County.

Bengtson said she appreciates landlords’ participation in the Section 8 program and apologized for the frustration and inconvenience the shutdown may cause.

“I realize you need rent money to pay your property’s operating costs,’’ she said. “I strongly encourage you to contact your federal senators and representatives to voice your comments and concerns.’’

Bengtson said the shutdown 17 years ago lasted about six weeks. She said the HRA will be unable to keep the office open for that length of time.

“We would have to seriously look at closing our office, other than essential people like maintenance staff who have to respond to apartment emergencies and that type of thing because not only are we not getting the funding for the landlords, we’re not getting funding to operate our internal operations either,’’ Bengtson said, which amounts to about $60,000 a month for staff and project operations.

“Yes we have some reserves. But is it appropriate for us to dip into some tax levy reserves to cover the federal shutdown? I don’t know because I haven’t seen anybody say that we’re going to get those funds back and how promptly would we get them back. None of that has been communicated,’’ she said.

Tenants are required to report any changes in their monthly income to the HRA. If tenants increase their wages or lose their job, the HRA adjusts the monthly payment, Bengtson said. If the office closes, however, the delay in reporting could cause a problem for tenants.

“If they have job changes and should be paying more rent and we should be paying less, we wouldn’t know that until later on and then they’re going to have to reimburse us for any overpayments we made,’’ she said.

Bengtson hopes tenants are not asked to vacate their apartments because landlords are not receiving their payments.

“Landlords are very good with working with us and I would hope that this would not last long to where landlords take that kind of extreme measures,’’ she said.

David Little
David Little covers the Willmar City Council, Willmar Municipal Utilities and other city news.
(320) 235-1150