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Philanthropy Cannot Be Expected to “Fill the Gap” in Rental Assistance Need Caused by Lack of Government Support

Reposted from the Funders Together to End Homelessness website, available here.

A statement from Amanda Andere, CEO, Funders Together to End Homelessness and Jeanne Fekade-Sellassie, Project Director, Funders for Housing and Opportunity, on the September 1 CDC eviction moratorium notice.

On Tuesday, September 1, the Centers for Disease Control and Prevention (CDC) ordered an eviction moratorium for renters through the end of the year. While we welcome this overdue order and the relief it will provide many households, without combining it with funds for rental and unemployment assistance, the federal government is failing people who face eviction due to the COVID-19 pandemic. Ignoring that the rent will eventually become due and many will be unable to pay only exacerbates the financial crisis for renters, especially Black, Indigenous, and people of color, as well as small and nonprofit landlords.

The order suggests that nonprofit organizations should tap philanthropic funds to address gaps in critical needs like rental assistance. The administration’s ongoing claim that private philanthropy can be used to fill the gap in our nation’s immense housing needs is deeply flawed and concerning to us. Private funding cannot -- and should not -- be a substitute for a responsive and effective government. According to Candid, in 2018, philanthropy granted nearly $739 million towards housing and homelessness programs and services. This doesn’t touch the $100 billion in rental assistance needed, a figure calculated by our partners at the National Low Income Housing Coalition. What’s more, it pales in comparison to the $49.1 billion budget of the U.S Department of Housing and Urban Development in 2020, a federal department whose explicit purpose is to address our nation’s housing needs.

 "While the CDC's eviction suspension order will prevent the immediate loss of housing for millions of vulnerably housed tenants, it is incomplete without significant federal investment in rental assistance to support long-term housing stability, said Angela D’Orazio, Senior Program Officer of Housing at Sisters of Charity Foundation of Cleveland. “Here in Cuyahoga County, nearly 5,100 tenants have requested $8.5 million in rental assistance in just two months; this demand alone would nearly exhaust all of the $8.6 million in philanthropic funds raised for pandemic response. The scope and scale of the need for emergency rental assistance is simply outside the limits of what philanthropy alone can do."

If philanthropy is expected to invest additional funds into rental assistance, it would take critical resources away from other crucial investments in housing, homelessness, preventative programs and solutions, and create yet another crisis that would require federal resources. 

“It’s important to note that philanthropic funding is not distributed evenly in all parts of the country, which could result in funding disparities in places that need it most, including Black and Brown communities that have been historically marginalized and excluded from federal resources,” said Amanda Andere, CEO of Funders Together to End Homelessness

“Over the past three months, HealthSpark Foundation has been facilitating a series of community conversations on the impact of the pandemic on the social safety net. What has become clear is that decades of disinvestment in the social safety net, and in poor and Black and Brown communities, has created a dire situation where millions of renters and homeowners are at risk of losing their housing and the safety net isn’t resourced enough to meet the needs,” said Russell Johnson, President & CEO of the HealthSpark Foundation. “While eviction moratoriums are a necessary component of keeping people in their housing in the short term, we also need significant funding for rent and utility assistance so that landlords aren’t also forced to go without payment, and renters aren’t going deeper and deeper into debt. The magnitude of these needs are far beyond what the philanthropic sector can provide, especially in the level needed as the impact of the pandemic continues through fall.” 

“In the absence of federal assistance, cities, states and funders have stepped up to provide COVID-19 relief to protect people pushed to the financial brink by a coronavirus-fueled recession.” said Jeanne Fekade-Sellassie, Project Director of Funders for Housing and Opportunity.  “But these funds run out in a matter of days, like in Santa Clara County, or even in mere minutes, as was seen in Houston. Many of our grantee partners like Greater Minnesota Housing Fund have nearly exhausted all of their rental assistance funds and see demand still rising steeply.” 

A Community COVID Impact Survey by Beyond Housing in St. Louis found that 90% of respondents were worried about their ability to pay rent and utilities in September and beyond. More than half of survey respondents said that paying for housing was the top issue facing families right now. Chris Krehmeyer, President and CEO of Beyond Housing said  “Philanthropy can only do so much. The size and scale of this health and economic problem requires a federal government response to stave off great harm to so many families in this country."

The notion that philanthropic funds can meet the growing and urgent needs caused by inaction from the federal administration is misleading, and a gross misunderstanding of private philanthropy’s capacity and purpose. The administration must stop using private philanthropy as a “catch-all” to remedy funding gaps and crises the federal government has itself created.

Amanda Andere
Funders Together to End Homelessness

Jeanne Fekade-Sellassie
Project Director
Funders for Housing and Opportunity