By David Lawder

WASHINGTON (Reuters) – State and local governments disbursed over $2.3 billion in Emergency Rental Assistance Program funds in August, up from $1.7 billion in July, the U.S. Treasury said on Friday, well behind the pace needed to keep up with mounting evictions after a moratorium expired.

According to the Treasury Department, total payments under the program that helps families coping with the coronavirus pandemic reached $7.7 Billion this year. This figure is based on $46.5 billion authorized by Congress in March and December.

The program helped 420,600 households last August. This compares to 364,600 in July. It brings the total for the year up to 1.4million.

Rental assistance programs are administered by state and local governments. They verify that landlords and tenants meet eligibility requirements. Due to lack of staff, infrastructure, and documentation to distribute the aid and some political resistance within certain areas, it took time for this program to be launched.

Treasury is trying to increase the availability of rental assistance funds. They are urging the communities to use practices from better performing cities and states, as well as following the department’s guidelines to minimize documentation.

Wally Adeyemo, Deputy U.S. Treasury Secretary, sent Friday a notice to state and local governments notifying them that Treasury will start the process of reallocating funds to communities who fail to meet certain disbursement rates.

Adeyemo explained that reallocations will occur gradually, starting with the initial determination of expenditure data in October and ending with final reallocations in the spring of 2022.

Adeyemo stated that jurisdictions who have committed at least 65% to their first round of funding will be eligible for more reallocated funds.

Adeyemo stated in the letter that “Reallocation according to the statute is important to ensure resources are available to areas with greatest need and highest ability to deliver these resources.”

On a conference phone call, U.S. Treasury representatives stated that they hope to maintain reallocated funds in the state they originally were allocated.

The current disbursement rate is estimated at $16.5 billion. This would help approximately 3 million households, and 60 percent of those most vulnerable to eviction.

According to a U.S. Treasury official, it is possible to raise disbursements to close to $20 billion for 2021 if more communities follow best practices. Rental assistance is available through September 2025.