Michigan’s COVID-19-Related Housing Assistance Program

By James E. Schaafsma posted 07-02-2020 14:53

  

In issuing Michigan Executive Order 2020-134 (Eviction Diversion Program for COVID-19-Related Debtors), Governor Whitmer extended until July 16 the moratorium on most evictions (most recently declared in Mich Exec Order No 2020-118). Mich Exec Order No 2020-134 also fills in details of the COVID-19-related housing assistance program established by §506 of 2020 PA 123 (SB 690).

2020 PA 123 is a supplemental appropriations act that allocates $880 million of the $3.1 billion the state received from the federal CARES Act’s Coronavirus Relief Fund (Pub L No 116-136, §5001). This money must be spent by the end of 2020. Sixty million dollars went to a “rental assistance” program, and $50 million is to “pay for rent arrearages and rent subsidies to minimize evictions due to economic hardship due to COVID-19.”

Ten million dollars is for costs of administering this program, which includes expansion of Eviction Diversion Programs (EDP) statewide ($4 million “to legal aid organizations for legal services provided as part of the program”; $4 million to community action agencies/Housing Assessment and Resource Agencies (HARAs) for “program case management staff and related costs”; and, $2 million to Department of Labor and Economic Opportunity for administrative costs and “to support a public awareness campaign”). The program must work “within the procedures created by the [M]ichigan [S]upreme Court and [SCAO] to assist in preventing evictions.” See, e.g., amended Administrative Order 2020-17.

The program is voluntary for landlords and will structure payments “for COVID-19[-related] rent debt” (rent incurred during a COVID-19 state of emergency March 1 and beyond). Landlords who participate must agree to a 10 percent concession of COVID-19-related rent in exchange for a program assistance payment (which will cover up to the rest of any remaining COVID-19-related rent arrears). Locally based HARAs will administer the payment process.

A tenant will have up to 12 months to pay off in installments any remaining rent arrears. Landlords must also agree to not evict tenants current on payments, to “waive fees and penalties,” and to not take action “that would affect the credit report of the renter” or “pursue collections” for the payment program period.

For cases in which a landlord files a summary proceedings nonpayment of rent complaint (the eviction moratorium prohibits issuance of nonpayment of rent demands for possession as of April 17, if not sooner), the case must be handled according to the terms and the “prioritized approach” outlined in AO 2020-17. Those cases will go through the EDP process, which makes frequent use of conditional dismissals under MCR 2.602.

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