A Closer Look at Illhan Omar's Proposed Bill to Cancel Rent, Mortgage Payments

Rep. Ilhan Omar (D-Minn.) has introduced a bill that would cancel rents and individual mortgage payments nationwide until one month after the national emergency declaration is lifted.

“The federal government must act now to prevent a complete collapse of the housing market,” said Rep. Omar in a Facebook Live press conference [last week] announcing the bill. “In 2008 we had the ability to bail out Wall Street. This time we need to bail out the American people who are suffering.”

HR 6515, The Rent and Mortgage Cancellation Act, would apply to all tenants who have a lease, and all homeowners who have a mortgage on their primary residence. (It would only cancel mortgage payments for that primary residence.) The bill stipulates that payments would not have to be made up, though it leaves open the possibility that people over a certain income threshold might owe taxes on the relief they receive. Omar’s legislative director Kelly Misselwitz said on a call with tenant organizers last night that this decision was made because the first priority is getting relief out as simply as possible.

Under the bill, which if passed would be retroactive to April 1, tenants would not have to apply for rent cancellation. (Any rent paid for April or May before the bill passed would be reimbursed to tenants.) Instead, the bill would establish funds, which would be managed by HUD, to which property owners and lenders could apply for relief based on their lost income. That relief would make up the entire amount of lost payments, but would come with stipulations—for example, property owners accepting the relief must not increase rent for five years, follow just-cause eviction guidelines, and not discriminate against tenants based on their source of income, immigration status, conviction or arrest record, sexuality or gender, or credit score. The bill would prioritize payments to nonprofit owners and small landlords first, and require financial disclosures in order to determine this prioritization.

Linda Mandolini of Eden Housing, speaking last week about the concept of rent relief in general, not Rep. Omar’s bill, suggested that directing relief through landlords would be more efficient and easier on tenants. “It would be much faster than going one tenant at a time,” she noted....