Trenton – In an effort to address the looming eviction crisis, the Senate Budget and Appropriations Committee passed legislation today sponsored by Senators Brian Stack, Ronald Rice and M. Teresa Ruiz, which would provide financial relief to certain landlords and tenants in response to the COVID-19 pandemic.
“This past year has been some of the hardest times in most people’s lives. I’ve been desperately trying to help my constituents in Union City since the very beginning of the pandemic, and have heard first hand all that they have gone through,” said Senator Stack (D-Hudson). “We have to recognize that includes many landlords, especially those with only a few tenants, who are also struggling to pay their own bills. This is why we have to figure out a solution that helps both landlords and tenants to prevent mass evictions from occurring.”
“As a Newark resident, I understand the struggles most families are going through and have dealt with long before the pandemic. A large majority of Newark residents are renters, and a significant portion of that group was rent-burdened even before the pandemic started,” said Senator Rice (D-Essex). “There are countless numbers of other cities and towns across the state that have struggling renters. Simultaneously, I recognize many landlords are at risk of foreclosure or bankruptcy due to uncollected rent. Any loss of residential properties would be catastrophic to both tenants and the municipalities. This is why we introduced this bill we want to be decisive and prevent both evictions and foreclosures.”
“Residents here in Newark and around the state were hit hard during the COVID-19 pandemic, resulting in unemployment and a loss of income for many. Tenants have been unable to make rent and will face eviction when the moratorium is lifted if there is not a plan in place,” said Senator Ruiz (D-Essex). “Many are struggling to figure out how to make up for past rent payments as the state begins to re-open over a year after the declaration of the state of emergency. Individuals should not have to worry about being displaced as the state, itself, is working to get back on its feet. This legislation will provide residents a means of rent assistance and eviction protection while allowing property owners to recuperate the money lost due to missed payments.”
The bill, S-3691, would protect low, moderate and middle-income households from residential evictions based upon nonpayment or consistently late rent payments accrued between March 1, 2020 and August 31, 2021. Additionally, eviction cases would be moved from the Landlord/Tenant Court to a small claims civil court to prevent evictions and turn back-rent into civil debt that is paid off over time.
The bill would establish the “Eviction Prevention Program” to supplement the COVID-19 Emergency Rental Assistance Program Phase II started in March by the Department of Community Affairs. The program would be funded by $750 million in federal assistance, with $500 million dedicated to rental assistance and up to $250 million for utility assistance. Eviction protections would continue until August 31, 2021 for those making over 80 percent of the area median income. The eviction moratorium would be in place until December 31 2021 for those with very-low, low and moderate incomes.
According to Moody’s Analytics and the Urban Institute, an estimated 9.4 million U.S. renter households owed an average of $5,586 in back-rent, utilities and other bills as of January 2021. In total, the countrywide back-rent debt is around $52.6 billion. According to the New Jersey Apartment Association, tenants across the state alone owe around an estimated $2 billion in back-rent.
There are currently more than 60,000 eviction cases pending statewide and another 194,000 filings expected by 2022. Separately, according to the New Jersey Division of Rate Counsel, close to 500,000 residential utility customers in debt are on the cusp of being disconnected from both their electricity and gas services.
The bill was released from committee by a vote of 11-0.