Reducing documentation burdens to accelerate and broaden access to emergency rental assistance

What is the agency priority?

At the outset of the COVID-19 pandemic, housing advocacy groups warned that 20% of renting households would be at risk of eviction by the end of 2020 if the government did not act. Housing instability was especially high among renters with low incomes and renters who identified as people of color.

The U.S. Department of the Treasury (Treasury) administered the Emergency Rental Assistance (ERA) programs, which collectively provided over $46 billion to state, local, territorial and Tribal governments (grantees) to prevent eviction and housing instability in the wake of the pandemic. The ERA grantees provided direct cash assistance to renters, landlords, and utility providers to assist with rent, utilities, and other housing-related expenses. Individuals were eligible for ERA assistance if their household income fell below an area-specific threshold, in addition to being at risk of housing instability and experiencing hardship due to the pandemic.

When the procedures used to verify income caused a bottleneck in distributing much-needed assistance, Treasury encouraged grantees to streamline their income verification procedures. Several program design flexibilities were proposed to enable more efficient delivery of ERA program benefits to communities disproportionately impacted by the pandemic.

What did we evaluate?

Virginia’s Department of Housing and Community Development (VA DHCD) simplified income documentation requirements through a Fact-Specific Proxy (FSP) that used the applicant’s ZIP code as a proxy for income eligibility. Renter households with three or fewer members residing in the 500 ZIP codes whose median income fell below the federally-defined low income threshold for Virginia were able to corroborate their eligibility through a written attestation included in the application form. We partnered with VA DHCD to conduct a retrospective impact evaluation to understand if streamlining the requirement for providing individual income eligibility documentation improved access to assistance for low-income renters in the state.

How did the evaluation work?

We partnered with VA DHCD to understand if streamlining the income verification process broadened and accelerated access to ERA assistance. Using data on over 98,000 tenant-initiated applications, to estimate impact, we compared the outcomes of applications from ZIP codes that were right near the cutoff for FSP-eligibility. Because ZIP-level median income was the only determinant of receiving FSP, the ZIP codes that did not qualify for the FSP served as a comparison group for the ZIP codes that did, after controlling for income. The Analysis Plan at the right has more details, and also indicates the date it was locked. You can verify our upload date on GitHub.

What did we learn?

The results show that using a FSP made getting much-needed assistance faster and more likely for individuals facing housing instability during the COVID-19 pandemic. Simplifying income documentation:

• Reduced application processing time by two weeks
• Increased the approval rate by 11 percentage points
• Did not significantly increase the total number of applications
• May have increased the total amount of ERA paid out

Figure 1. Impact of simplifying income documentation on days spent processing applications, approval rate, total number of applications, and total amount paid to applicants

We found no evidence that reducing barriers through FSP brought substantially more people into the ERA program. For an oversubscribed program such as ERA, this may constitute good news: there is no evidence that program staff were overwhelmed by an influx of new applicants due to FSP.

In summary, a FSP can be an important tool to accelerate and broaden access to assistance in programs where application volume is high, when specific application criteria may be slow to verify, when it may be difficult for some applicants to upload supporting documentation, and when applications for funding assistance are potentially time-sensitive. For example, our findings suggest settings such as applications for financial assistance after storm-related disasters could be suitable for an FSP.

Read the technical appendix.

Verify the upload date of our Analysis Plan on GitHub.