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How Louisiana cities are using the CARES Act to save small businesses, keep people in homes



MONROE, La. – Coronavirus hit at the worst possible time for Quincy Powell. His 33-year-old wife is on the winning side of a bout with an aggressive cancer, but it cost her one breast and a regimen of radiation and chemotherapy to get her cancer-free, weakening her immune system ahead of the pandemic. The bills ate the Powells’ savings, and that was before Powell had to close up his barber shop in Monroe’s Pecanland Mall.

“We’ve been going on three months with no income” from the shop, Powell says. Drawing on a regional clientele, Headz Up Barbershop had built a steady business of walk-ins from the mall’s regular crowd, which pulls people from townships around Ouachita Parish. Through the downturn, the Powells have struggled to keep up with costs. Even with Louisiana’s expanded unemployment, he takes in less than half of his normal income. Powell at one point stopped paying rent, working out the hardship with his landlord, who’s become a friend over the years. Just recently, he was able to send her $1,000 to help her stay current on her mortgage. She hasn’t been able to access unemployment in Florida where she lives now. Lenience from her mortgage company will help her keep the house, but rent money is her sole income.

About the only run of good fortune for Powell, a minister and a man of deep faith, was dodging by a couple of miles three tornadoes that touched down on Easter, blowing up homes in the area and forcing 300 people into emergency hotel shelters.

Powell’s financial predicament is relatively common in Monroe. And it’s that fragility the city’s government is trying to address with a line of flexible emergency dollars distributed by the federal government through the CARES Act. Monroe, like several other major Louisiana cities, is pooling housing dollars to keep people in their homes.

Monroe is relatively impoverished with more than 60% of its residents living in rented housing and 30% of them living below the poverty threshold. The median income there is $30,000, according to data from the U.S. Census Bureau. That nexus of poverty and a rampant outbreak of COVID-19 has put residents in this north Louisiana city at elevated risk in the pandemic and decimated the city’s budget. Early this month, the mayor began donating a portion of his salary and announced a round of budget reductions and furloughs to help stabilize the city’s budget; the city’s still waiting on federal aid to prop up the finances, and that’s not guaranteed to materialize.

Monroe housing advocates say approximately 1,900 people become homeless in the area each year, and they expect to be “inundated” once evictions resume in June. Sarah Johnson, director of Monroe’s HOME Coalition, projects the city’s homelessness will skyrocket above the 45% increase widely expected by national researchers, potentially reaching 2,700.

Despite the constraints and uncertainty, Monroe is putting housing first and finding room to help businesses. Taking advantage of emergency block grant dollars from the U.S. Department of Housing and Urban Development, Monroe’s city council voted unanimously to fund a program that helps people pay rent or their mortgage, or sustain their businesses.

That’s how several major Louisiana cities are using emergency funds from HUD. As part of the CARES Act, Congress sent $45.6 million in HUD dollars to Louisiana cities, including Shreveport, New Orleans, Baton Rouge, Monroe, Lafayette and several others.

Each of those five cities, except Lafayette, is working to balance the needs of businesses and housing in how they use the outlay and are in the midst of public application processes to get the money flowing.

By contrast, Lafayette’s Mayor-President Josh Guillory has proposed using all of the money on small businesses, arguing it’s the best way to shore up the city’s flailing economy and save those companies from failure. In turn, he says, that will help stabilize people poised to lose their homes. The plan has drawn ardent criticism from housing advocates who warn they don’t have the resources to catch families that may yet fall into homelessness. The conflict arises from a potentially tragic reality facing communities everywhere: They don’t have the resources to tackle the problems they face.

On Tuesday, Lafayette’s city and parish councils approved Guillory’s plan. The mayor-president committed to rerouting at least $200,000 from Lafayette’s annual HUD housing appropriation toward rent and utility assistance. Lafayette Economic Development Authority was tapped to administer the small business fund and will put up a $200,000 match to expand that program’s reach.

There isn’t enough money to tackle it all, says Brett Theodos, a senior fellow at the Urban Institute, of the dilemma before governments. “Communities are comprised of many parts. One part is their homes and one part is their businesses. They all make up a fabric of the community; they all matter. They all need the support right now.”

HUD delivers these funds through three basic channels — Community Development Block Grants (CDGB), Emergency Solutions Grants (ESG) and Housing Opportunities for Persons with AIDS (HOPWA) — not all of which are available to every jurisdiction. In Monroe’s case, as in Lafayette, only new CDBG money was made available.