The LA Podcast

LA (and California) Got Jobbed by the Rent Relief Package

by Hayes Davenport
February 3, 2021

In the last federal stimulus package, the one from December, there was $25 billion dedicated to rental assistance for low-income tenants. This is good!

California is getting a little more than 10% of that money — $2.6 billion. This seems stupid. We should be getting more.

  1. California makes up 12% of the population of the US.
  2. We have a higher percentage of renters than the average state (45% to 37% nationally).
  3. Our median rent is the second-highest in the country, just behind the state that is an actual island paradise.
  4. California has the third-highest unemployment rate right now (Hawaii also #1).

You’re telling me Montana got $200 million for rent relief in this package? That’s like $200 per person! We only got $62 a person! $62 in California buys you a carton of eggs. Montana doesn’t even want this freaking money! They’re holding back $183 million of it “in reserve”!!!

Why is it only the Republican administrations that shamelessly reward the states that voted for them and punish the ones that didn’t? Where is our graft?? California voted harder for Biden than any other state except Vermont. Wait — Vermont also got $200 million!?!? With half the population of Montana?!?!

So it definitely looks like California got screwed. But instead of complaining about this or rectifying in any way, Gavin Newsom appears to have further visited the injustice upon his own people.

The rent relief bill Newsom’s office wrote, then passed over the weekend, gives out rental assistance money to California cities and counties exactly the way it came in: purely based on population, with no regard for where the money is most needed.

Here’s what the bill says:

(2) One hundred fifty million dollars ($150,000,000) total set aside for smaller counties with a population less than 200,000, allocated based on proportional share of population from the 2019 federal census data.

(3) The remainder of the state allocation distributed to eligible localities with a population 200,000 or greater, based on their proportional share of population from the 2019 federal census data.

“Based on their proportional share of population from the 2019 federal census data.” That means the money will be distributed without any regard to which cities and counties have more tenants, more debts, or more COVID hardship. They’ll get the same funding per person, no matter who the person is. As far as the state of California is concerned, local governments will receive the same amount of rental assistance dollars for an unemployed restaurant worker who owes their landlord $5,000 as for, like, George Lucas.

Obviously none of this money will actually go to George Lucas. Federal guidelines designate it specifically to tenants making less than 80% of the median income in the area (more specifically, to their landlords). So why wasn’t this money targeted where low-income tenants actually live?

Ignoring low-income tenant populations in this process is really bad for places like Los Angeles. Not only does LA County have a higher percentage of renters in its population (51%, compared to 35% in Marin County and 43% in Orange), we also have a lower median income than the state average.

Most importantly, our median income is especially low compared to our median rent. Here are some maps our friend Scott Frazier made:

Median Rent/Median Income Quintiles, by Census District

The red/orange blobs are where median rent makes up the highest percentage of median income. As you can see, LA is full of red/orange. That’s where rent burden is highest. That’s where tenants are in most debt, and where people are often at highest risk of eviction. That’s where the money to alleviate rent debt should be going.

I was kind of surprised to see LA state and local electeds not put up more of a fight about this. They’re usually very engaged when it comes to asking the state for more money! But there’s still a chance to improve this system. Only $1.5 billion of the $2.6 billion was allocated in the most recent bill. Can we be smarter with the next billion? The Census gathers information on renter populations! Use that data and send the funding proportionate to where the tenants are, or ideally where the low-income tenants are. No more rental assistance money for Skywalker Ranch.