Help Is On The Way! The American Rescue Plan Act Becomes Law

Last week, as the Alliance was wrapping up its virtual conference on ending homelessness, the federal government responded to the health and economic consequences of the COVID-19 pandemic with a massive, $1.9 trillion relief bill. The new law, the American Rescue Plan Act (ARPA), will provide significant relief to struggling families, workers, farmers, governments, and industries.

Thanks to a surge of advocacy across the nation, ARPA included important low-income housing and homelessness provisions – most notably $5 billion in new funding specifically to reduce homelessness, more than $21.5 billion to replenish the emergency rental assistance fund, and $5 billion in emergency housing vouchers.

The Alliance congratulates everyone who advocated for this landmark legislation. Using Alliance advocacy tools, more than 2,800 letters were sent to members of Congress since November. Meanwhile, 600 providers across the nation participated in a sign-on letter to Congress, and partners at the Salvation Army issued a joint statement with the Alliance. 

The Substance

The American Rescue Plan Act contains provisions that will mean more housing – and more stable housing – for people who would otherwise be homeless. The following outline provides more detail on these measures:

Homelessness Assistance and Supportive Services Programs

This $5 billion investment could be used for several different purposes:

  • tenant-based rental assistance
  • the development and support of affordable housing
  • supportive services to qualifying individuals, including housing counseling and homeless prevention services
  • acquisition and development of non-congregate shelter units, which may be converted to permanent housing or permanent affordable housing, used as emergency shelter, or left as non-congregate emergency shelter

Except for funds used specifically for administration, these funds would be available through September of 2025. Funding would be distributed through the HOME program formula.

Emergency Rental Assistance

The $21.5 billion allocated for Emergency Rental Assistance adds to $25 billion provided by Congress for rental assistance in December. The money will be distributed by the Department of the Treasury to state and local governments. The funds will help to stabilize renters and rental property owners during the coronavirus pandemic. This potentially includes people who are using the money to pay rent in a new apartment after a period of homelessness. This assistance is temporary, paying up to 18 months of rent. It must be used by September of 2025.

Housing Choice Vouchers

The plan provides $5 billion for five years of funding for Housing Choice Vouchers for people experiencing or at risk of homelessness, survivors of domestic violence, and victims of human trafficking.  These Housing Choice Vouchers can provide a permanent solution for individuals and families who have higher needs and thus cannot be stably housed with more time-limited rental subsidies.

Other Provisions

Income and Benefits

  • One-time payments of $1,400 – Like earlier stimulus payments adopted by Congress last May and again in December, these will be distributed quickly to people with low or moderate incomes who filed tax returns last year. Others may need help securing their payments. Virtually every homeless person is eligible to receive the payments.
  • Extension of supplemental unemployment benefits – These benefits were scheduled to run out on March 15 but are now extended until September.

Families, Children, and Youth

  • Child tax credits – Most families with low or moderate incomes will receive one-time payments of $3,600 for each child under 6, and $3,000 for each child age 6 to 17. Again, families that are homeless may need help securing these benefits.
  • Elementary and Secondary School Emergency Relief Fund – In the plan, $800 million can be used for schools to identify homeless children and youth, and then provide them with COVID-related wrap-around services that are sufficient for them to attend school and participate fully in school activities. This provision was offered as an amendment by Senator Lisa Murkowski (R-AK) and accepted by voice vote. The Alliance was pleased to endorse Senator Murkowski’s amendment.
  • Additional support for families through TANF – The Temporary Assistance for Needy Families program received an additional $1 billion.


  • Emergency Assistance for Rural Housing – $100 million can be used to support unassisted households living in USDA-subsidized properties and who are struggling to pay rent during the coronavirus pandemic. This funding is available through the end of September 2022.
  • Housing Counseling – $100 million is available for Neighborhood Reinvestment Corporation through September of 2025, to support housing counseling services that help renters, people experiencing homelessness, people at risk of homelessness, and homeowners navigate their housing option, rights, protections, and resources provided through coronavirus relief legislation.

Tribal Supports

  • The Rescue Plan provides $20 billion that will go directly to tribal nations for general COVID-19 relief, and another $6 billion for Indian Health programs. 

State and Local Governments

  • The plan provides $350 billion for state and local governments to address their priority needs. This can be a primary source of funding for homelessness programs that do not fit within the specific programs described above.

Medicaid and CHIP Coverage and Funding

  • The Act requires Medicaid and CHIP programs to cover, with no cost sharing, COVID-19 vaccines and administration, as well as COVID-19 testing and treatment, for program enrollees through one year after the end of the public health emergency. The Act also temporarily sets the Federal Medical Assistance Percentage (FMAP) for states at 100%, with respect to amounts expended for vaccines and vaccine administration; incentivizes states to adopt Medicaid-expansion (if they have not already done so) by temporarily increasing their base program by five percentage points; and increases the FMAP for Medicaid programs by 10 percentage points (not to exceed 95%) for expenditures for home and community-based services provided from April 1, 2021, to March 31, 2022.

The Future

Over the next several weeks, the Alliance will offer recommendations for how these new ARPA funds can best be used to reduce homelessness.  The opportunity to quickly reduce the number of people who are homeless is unprecedented. We cannot overstate how important it will be to spend these funds effectively and quickly. Besides helping thousands and thousands of people, these kinds of results (along with the amazing advocacy we’ve seen across the country) will help get more resources in the future. 

Meanwhile, opportunities for additional resources are coming up. Work will begin soon in Congress on both the “regular” spending bills for fiscal year 2022, and on a second stimulus package. Whether it’s called a recovery bill, a stimulus bill, or an infrastructure bill, whether it’s pursued through regular order or the reconciliation process, the Alliance will seek to use the legislation as a vehicle for universal housing vouchers and other measures that will lead to significant reductions in homelessness. 

The American Rescue Plan Act is an unprecedented effort, and the resources provided can enable communities to make significant strides to end homelessness. Please look out for future resources from the Alliance that detail how to best use these massive investments.