Minnesota begins distributing $40 million in rental assistance

The divided Legislature approved the extra housing assistance in the 2026 legislative session, funneling the money to the Family Homeless Prevention and Assistance Program, which provides supportive services and financial assistance, such as rent deposits, rent payments or utility payments.

Gov. Tim Walz proposed the rental assistance funding in the wake of Operation Metro Surge, when thousands of immigration agents flooded Minnesota, causing many immigrants to hide at home — in some cases, forgoing work — for fear of arrest, deportation and violence. Hundreds of immigrants were detained despite holding valid work permits, causing some immigrants to lose their jobs, and families their breadwinners. 

The $40 million is expected to provide housing stability to 11,000 Minnesotans, according to a press release from Walz’s office. 

Minnesota Housing will begin executing contracts for the funding this summer, working with the 24 agencies that currently distribute the housing funds to families in need. 

Amber Holmstrom, director of family and community services for West Central Minnesota Communities Action, said the funding boost — nearly $300,000 — is more than her agency’s yearly grant from the Family Homeless Prevention and Assistance Program. She said her organization can begin distributing the funds as soon as the contract with Minnesota Housing is signed, hopefully in the next week or two. 

Holmstrom said she consistently must turn away families in need due to lack of funding, though her area wasn’t as highly impacted by Operation Metro Surge as the Twin Cities.  

Regardless, she said “It’ll be in really high demand. I don’t think we’re going to have any issues spending it.”