A "For Rent" sign is hung next to shuttered windows.
New rules from the Maine State Housing Authority are designed to extend the life of the state's $350 million federally funded pandemic rent relief program. Credit: Troy R. Bennett / BDN

Some 80 people who live in Bangor hotels could lose their housing next month after a set of changes designed to extend the life of Maine’s pandemic rent relief program take effect.

The Maine State Housing Authority is making a number of changes to the $350 million pandemic rental assistance program funded by two federal COVID relief packages as it projects it could run out of funding this fall. The changes further limit who can receive assistance and for how long, and the range of housing-related costs the assistance can cover.

The new rules take effect June 1, said Scott Thistle, a spokesperson for the Maine State Housing Authority, which runs Maine’s rent relief program.

Recipients will only be able to receive a year’s worth of assistance, instead of 18 months, and only those who earn 50 percent or less of the area median income will qualify, Thistle said.

The program currently covers those who make 80 percent or less of their area median income. The Bangor-area median income for a household of four is $81,300, so only those making $40,650 or less would qualify for rental assistance after June 1.

The changes will apply to new applicants and current recipients of the assistance.

Current recipients who are in their 11th month of receiving rent relief or are past the 12-month mark will be given a two-month grace period after the changes take effect, Thistle said. Rent relief money will also only apply to rent, back rent, security deposits and electricity bills, and it will no longer cover subsidized housing tenants.

The program currently covers other utilities like water, sewage, trash, internet and heat.

In addition, rental assistance will only cover the government standard rate for hotel rooms, which is $96 per night in Bangor, according to the U.S. General Services Administration.

That means as many as 80 people currently living in 51 hotel rooms in Bangor will lose out on their housing after June 1 because six hotels that accept rental relief funds may no longer qualify for the program because they charge more than the federal per diem rate, Bangor city manager Debbie Laurie told city councilors during a Monday night workshop.

Some 731 people in Bangor use rent relief funds to pay for private housing in addition to the 80 hotel room occupants, she said.

Housing specialists are working to ensure that people know their options, like applying for FEMA or general assistance funds, but “it may be a rough 30 or 60 days,” Laurie said.

“We will do our very best to find alternative housing for those impacted by this, keeping in mind that we currently have a very challenging housing market, in general,” said Kara Hay, chief executive of the Bangor social services agency Penquis, which handles pandemic rent relief in Penobscot and Piscataquis counties.

The new rules are supposed to preserve money after projections showed that MaineHousing could run out of its federal rental relief funds by October or November, Thistle said.

“The goal of [the new rules] is to preserve the funding for the people who need it the most for the longest period possible to try to get us through next winter,” he said.

MaineHousing had disbursed or approved $192.6 million in rental assistance for 25,801 households as of last week, according to an agency data report. That’s 55 percent of Maine’s $350 million federal aid package.

The state’s ability to quickly allocate its relief funds has spared it the fate of other similarly sized states like Montana, which had to give back $53 million of its COVID funds to the U.S. Treasury because it didn’t use enough, Thistle said.

The evictions of long-term residents at a Wells hotel last week are not related to the agency’s new rules, Thistle said.

The Majestic Regency Resort on Route 1 tried to force out its tenants, some of whom had lived there for years and paid for their rooms using public assistance money, after the Wells board of selectmen threatened its license due to repeated complaints about residents’ behavior.

A Maine Superior Court judge ruled on Monday that the hotel’s sudden eviction notices were illegal and that it could not force people out without formally filing for eviction.

Maine has the highest rate of tenants who are behind on rent of any New England state.

Lia Russell

Lia Russell is a reporter on the city desk for the Bangor Daily News. Send tips to LRussell@bangordailynews.com.