On January 12, 2021, New Jersey State Senator Brian P. Stack introduced Bill 3357, appropriating $300 million dollars of Cares Act funding to help landlords and tenants that have been impacted financially by Covid 19. Eviction moratoriums are effective in keeping families in their homes but have caused many small landlords to suffer financially, and tenants remain anxious about their ability to ever get up to date. Bill 3357 would create the “Landlord Emergency Compensation Program,” allowing landlords to apply for financial assistance to cover unpaid rent during the assistance period. Eligibility would be limited, so it’s important for landlords to work with an experienced New Jersey landlord-tenant attorney to ensure that receive what they’re entitled to.
New Jersey Real Estate is an Endangered Ecosystem
According to David Brogan, Executive Director of the New Jersey Apartment Association (NJAA), the real estate ecosystem that includes “tenants, landlords, homeowners, municipalities and the State” are “inextricably connected.” When rent isn’t paid, property taxes can’t be paid that, without rental assistance, the burden would either shift to homeowners or force reductions in state services. According to Brogan, the beauty of this bill is that doesn’t simply pit tenants against landlords, instead providing a holistic solution to the problems caused by job loss during the Covid 19 pandemic. With this bill, says Brogan, “We can start helping both tenants and landlords in a meaningful way.”
What Is The Criteria For Eligibility?
The bill would compensate landlords for rent that residential tenants owe, but have not paid, during the assistance period. The landlord must show that the compensation is needed in order to cover the costs associated with that particular building, when combined with the rent that was received by the landlord. Costs are defined as the following:
- Mortgage principal and interest;
- Property taxes;
- Private and homeowner mortgage insurance;
- Condominium, HOA or similar fees and
- Maintenance costs (including anticipated increases.)
The program would not provide landlord assistance for any costs prior to March 9, 2020 and for costs that the landlord anticipated paying for through sources other than rent. Costs that were already compensated, or that have a pending application for compensation through a different program, are also excluded. Landlords that have pending criminal charges against them, are not substantially in compliance with housing codes or owe substantial tax payments would not entitled to compensation under 3557.
How Bill 3557 Would Help Tenants?
The bill would help tenants that have fallen so far behind in their rent they fear they’ll never be able to pay back what they owe. It would accomplish this by providing that when a landlord accepts an assistance payment, it would be considered as payment in full of all rent and late fees owed for this building, and would bar any eviction proceedings for unpaid rent during the assistance period. The Bill would require notifying the tenants in a building when the landlord received assistance, and informing them of their rights under the bill.
New Jersey Landlord Tenant Attorney
If you’re a landlord that suffering financially because your tenants can’t pay their rent, Bill 3357 would help you, even before you obtain your assistance payment. The Bill specifies that landlords that live New Jersey, and (together with close family members) have more than fifty rental units in the state, can assert their application as an affirmative defense against foreclosure on any property owned by the landlord. Speak to a New Jersey landlord tenant attorney about how Bill 3357, and other types of Covid 19 relief, could help your business recoup losses from the pandemic.