Opinion: Our stimulus plan will rescue renters

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Renters are among those hardest hit by the Covid recession. They are young, eager to work, low income and, disproportionately, people of color. And they are essential to the economic recovery and the stability of our housing market. That’s why, among a bipartisan coalition of mayors and local legislators, we’re pushing forward with a Renter Stimulus Plan, which would unlock a $45 billion stimulus at the local level — an average of nearly $1,400 per American renter.

That’s $200 more per person than the biggest stimulus checks sent out in March, and it’s being done without help from D.C. and without taking a penny from the federal coffers.

Our Renter Stimulus Plan works by unlocking $45 billion currently trapped in security deposits across the US. This money is sitting in escrow accounts, unused by tenants and landlords alike. Our bill requires that renters be given the choice between paying a traditional one-time security deposit or purchasing a low-cost monthly insurance plan instead.

The plan is available to new and existing renters in municipalities where the renter stimulus is available. It requires the landlord to allow tenants to claim back their security deposits, and then gives renters 90 days to purchase a low-cost insurance policy to protect the landlord. There are no criteria for renters who choose to purchase the insurance policy. If a renter is taking advantage of this program, they will have cash for the insurance policy because they will have just received the cash back from their deposit. These insurance policies are minimal so it’s extremely unlikely a renter would be in a financial position to rent an apartment without being able to afford the insurance.

By opting into the monthly insurance plan, we can put security deposits back into the pockets of renters, creating an instant stimulus that can be used toward mounting bills, building emergency savings or even paying next month’s rent, while keeping landlords protected. In short, while the federal government continues to delay, we’re bringing about the single largest rent relief initiative in the country.

The impact of the Renter Stimulus Plan cannot be overstated. With rising student debt, higher rent costs and growing credit card debt, about 40% of Americans say they would have trouble affording a $400 emergency expense. And given an average national rent of about $1,400 a month, according to Statista, a one-month security deposit is a huge financial strain.
Mayors, governors and local officials know this plan works because they’ve done it. Since the start of the pandemic, our coalition of mayors and city legislators has unlocked billions of dollars in cities around the country. Cincinnati Mayor John Cranley and Atlanta Mayor Keisha Lance Bottoms both worked with their respective city councils to make this program available to their constituents. Governor Andrew Cuomo mandated it via an executive order in New York.
All told, the Renter Stimulus has unlocked more than $200 million across the country.

To our fellow mayors, city councilmen and governors: Join us. Fix this. Winter is coming hard and fast and we can’t wait to bring relief to the American people.

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