New Orleans landlords get stiffed as tenants take federal rental assistance for themselves

NEW ORLEANS (WVUE) - The eviction moratorium is over and tenants have been given federal dollars to pay the rent they owe, but many landlords say they haven’t seen a penny.

“This is a colossal mistake that was made by the government, the Treasury Department, somebody,” landlord, Denise Irving said.

This is an issue across the country right now and many landlords in New Orleans are getting burned instead of getting a check for all the months they went without collecting rent.

“She trashed my home. She left furniture. It was filthy dirty. I have to take out couches, beds, boxes of junk,” Irving said.

Irving is out $8,000 in back rent after having to evict her last tenant.

“I could have used those funds to restore my home,” Irving said.

Her tenant stopped paying rent during the moratorium and got $5,000 to $6,000 in federal rental assistance.

“The tenant decided to give us one month of rent, the rest of the money she kept,” Irving said.

This federal money, specifically meant to pay back landlords, was given to the tenants, which Irving feels was the first mistake.

“The money was allocated by the Federal Government to make the landlords whole, not the tenants,” Irving said.

After paying the back rent, the money could also be used for utilities, future rent payments, and other housing issues, but who’s to say what you use it for?

“There’s no one checking. There’s no rental assistance policy and that’s the problem,” First City Court Clerk, Austin Badon said.

Badon says the first time he saw the policy from the U.S. Treasury, he realized there was so much room for this to be exploited.

“I was just talking to a tenant yesterday as she was coming out of eviction court,” Badon said. “She got a 24-hour eviction and I said, ‘Did you get emergency rental assistance?’ ‘Yes.’ ‘How much did you get?’ ‘$9,750.’ ‘How much of it did you give to your landlord?’ ‘Not a penny.’”

Now, it’s been changed so landlords can apply and they will get chosen over the tenant’s application to receive the money, but the landlord won’t get a penny if the tenant already got the check, unless the tenant gives it to them.

If they don’t, Badon says landlords would have to take them to his courtrooms and he’s seen plenty.

“You got to serve on the papers, so if that tenant has moved out, you don’t know where they are, it’s extremely difficult to serve them notice,” Badon said.

Badon says even if the tenant leaves with the money, they still have a debt to pay that will follow them around. It’s also fraud.

“I think that somebody needs to take a second look at this to see if they can find some kind of way to make the landlords whole because we were made to keep someone in our homes,” Irving said. “According to the CDC, we could not evict them, we had to keep them covered. We did that and I think we should be compensated.”

Badon says this is a nationwide problem that needs to be fixed before it explodes.

He is drafting a letter to the Treasury to see if they can go back and help landlords as well as change the policy

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