Skip to main content
You have permission to edit this article.
Edit
Bungled NJ-federal attempt to protect and help tenants hurts them and landlords

Bungled NJ-federal attempt to protect and help tenants hurts them and landlords

  • 0
{{featured_button_text}}
Gov. Phil Murphy

New Jersey Gov. Phil Murphy, seen at a June event at the Port of New York and New Jersey in Elizabeth, has required landlords to keep providing housing to those who don’t pay at least until the start of next year.

New Jersey’s efforts to help renters get through their financial losses in the pandemic have been an odd, slow-moving fiasco.

The state has received lots of federal money to pay the rent for qualifying tenants, has distributed a small fraction of that over the course of many months, and has extended the crisis freeze on a normally functioning rental market through the end of this year.

It’s kind of backward. First, all renters were told they couldn’t be evicted if they quit paying rent for whatever reason. Then much funding was announced to pay the rent of those hurt by the pandemic. Only then was some effort made to create a system to figure out who is eligible and get them money. And so far neither state nor federal officials has figured out how many renters actually need help and how much.

No problem. The aid money can be spread around for the next four years.

Federal and state bans on evicting tenants were put in place fairly early in the pandemic when it became apparent that government shutdowns and altered behaviors were resulting in massive job losses, especially for people whose work couldn’t be done from home.

The federal government sent New Jersey $600 million in December to be used for rental assistance. Additional funding has brought the federal aid total to the state Department of Community Affairs to $1.2 billion.

But going on three-quarters of a year later, New Jersey has only distributed about a quarter of that aid — $92 million through one program and $232 million through another which helped 26,000 households.

Atlantic County has received $15 million to pay rent for COVID-distressed tenants. But in two months, the program has spent just $600,000 paying back rent for 66 tenants.

The county’s director of its Community Development Block Grant program, Bob McGuigan, has appealed to renters to apply for the aid. “I love spending the money here, helping people in the county,” he said.

Seldom does government entitlement spending fail to find recipients, so two possibilities are suggested: Either there is a government failure for more than a year to communicate to tenants the help available, or there aren’t as many affected as much by the pandemic as federal and state officials imagine. To get money to pay their rent, they must have had a COVID hardship defined as losing a job, being on unemployment, losing shifts, having increased expenses or being denied a job.

They also must have an income no more than 80% of the median for the area, and show proof of financial instability such as owing back rent or having rent to pay that takes up more than half of their income.

On the other side of this government shutdown of the rental housing market, the damage and need are clear.

The New Jersey Apartment Association estimates that the state’s landlords are owed $2.3 billion in unpaid rent that has accrued since the pandemic began and governments started requiring them to provide housing even if tenants didn’t pay.

Even if all the state’s $1.2 billion in aid finds its way through qualifying tenants to their landlords, that would be only a little more than half of what housing providers have lost. In New Jersey, Gov. Phil Murphy and the Legislature have prohibited providers from ever evicting a tenant because of rent unpaid during the pandemic, limiting them to seeking payment of the debt in civil court.

The federal ban on eviction has just ended, but Murphy and the Legislature have extended the New Jersey ban to the start of next year, despite a strong economic rebound and an abundance of jobs unfilled. This can only deepen the pandemic rent assistance debacle.

New Jersey already had a significant shortage of affordable housing. Requiring landlords to provide free housing for many months will drive some out of the business and sour many others on the feasibility of maintaining the current rental housing stock, let alone investing in the expansion of it.

The effects of this botched government effort will be felt by renters, the housing industry and the whole New Jersey economy for many years.

Catch the latest in Opinion

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

The best local coverage, unlimited

Sign up for a digital subscription to The Press of Atlantic City now and take advantage of a great offer.

LEARN MORE

Get up-to-the-minute news sent straight to your device.

Topics

Breaking News