Homeowner Assistance Fund

Section 3206 of the American Rescue Plan Act of 2021 (the “Act”), Pub. L. No. 117-2 (March 11, 2021) established the Homeowner Assistance Fund and provides $9.961 billion for the U.S. Department of the Treasury (“Treasury”) to make payments to States (defined to include the District of Columbia, the Commonwealth of Puerto Rico, U.S. Virgin Islands, Guam, Northern Mariana Islands, and American Samoa), Indian Tribes or their Tribally designated housing entities, as applicable, and the Department of Hawaiian Home Lands (collectively the “eligible entities”) to mitigate financial hardships associated with the coronavirus pandemic, including for the purpose of preventing homeowner mortgage delinquencies, defaults, foreclosures, loss of utilities or home energy services, and displacements of homeowners experiencing financial hardship after January 21, 2020, through qualified expenses related to mortgages and housing. Section 3206(d) of the Act prescribes that the funding must be allocated as follows: (1) $30 million reserved for making payments to U.S. Virgin Islands, Guam, Northern Mariana Islands, and American Samoa; (2) $498 million reserved for making payments to the Department of Hawaiian Home Lands (DHHL) and Indian Tribes, or the tribally designated housing entity, as applicable; and (3) the remainder allocated to the 50 States, the District of Columbia, and Puerto Rico. Each State, the District of Columbia, and Puerto Rico will receive a minimum payment of $50 million. Amounts that will be paid to States, the District of Columbia, and Puerto Rico are based on homeowner need as it relates to unemployment and mortgage delinquencies or mortgage foreclosures in those jurisdictions. Amounts paid to U.S. Territories (excluding Puerto Rico) are based on share of population and amounts paid to Tribal entities are based on a formula under section 3206(f) of the Act.