LINCOLN — The Legislature’s push to collect at least part of $120 million in federal rental aid that Congress set aside for Nebraska — and that Gov. Pete Ricketts rejected — remains very much alive.
That’s the word Thursday, a day after 26 state lawmakers passed a bill that would force the governor to apply for American Rescue Plan Act funds earmarked for Nebraska’s renters and landlords recovering from the coronavirus pandemic.
But before Legislative Bill 1073 can become law, it has to get past a possible Ricketts veto. Hansen has said he has the 30 votes needed to override the governor. Ricketts has dug in his heels for months against the rental assistance. He has said the state is beyond the pandemic, and “we must guard against becoming a welfare state.”
State Sen. Matt Hansen of Lincoln, who prioritized LB 1073, said the state can still secure at least 40% of the $120 million, or $51.4 million of the total. Hansen and other anti-poverty advocates point to a section of federal law that requires the Treasury Department to hold onto 40% of each state’s allotted funds beyond the March 31 deadline to apply for the full amount.
“These funds will be secured as soon as Nebraska applies,” Hansen said. “We certainly haven’t lost all of it.”
Hansen and supporters of LB 1073 tried and failed to add an emergency clause to the bill that would have required the governor to apply before next week’s deadline. If the bill, as passed, survives a possible veto, it would take effect in July, Hansen said.
The March 31 deadline still matters because that’s when the Treasury Department will start to reallocate some of the unused funds to other states, Hansen said. However, he said, Nebraska still would have the $51.4 million that it could claim through 2025.
One of two states rejecting aid
Nebraska would lose all $120 million if LB 1073 does not become law, said Erin Feichtinger, a local fair-housing advocate. The state could secure more than $51 million, depending on how quickly it allocates and spends the initial batch.
A Treasury Department spokeswoman in Washington, D.C., said Thursday that the department is about to publish new guidance that will address the timeline for states to draw down the rental assistance funds. The department is aware of Nebraska’s legislative effort.
The latest round of rental assistance can be used as direct payments to landlords on behalf of people behind on their rent. It can also be used on utilities and counseling related to housing.
Currently, Nebraska and Arkansas are the only two states to reject the funds.
Hansen said that, of course, the governor still has the option to change his mind and apply for the funds or let the bill become law. Hansen and allies are reaching out to constituents to encourage them to nudge their elected officials.