Editor’s Note: This story has been updated to say that the state has so far received $1.2 billion in aid, not distributed it.
The New Jersey Department of Community Affairs says it has received about $1.2 billion so far to help people who were unable to pay rent because of COVID-19, and to help landlords whose rental income has dropped since the pandemic began in March 2020.
The first tranche of funding, $91.75 million, was fully distributed last year after Congress passed the CARES Act, said Lisa Ryan, a spokeswoman for the DCA. Since then, it has also disbursed 65% of a second tranche of federal money, $353 million, under the U.S. Treasury’s Emergency Rental Assistance Program (ERAP). Funds distributed from that program as of Tuesday total about $232 million and have gone to 26,000 households, Ryan said.
Another $272 million from the same Treasury program will be distributed when the first phase has been spent, she said.
In addition, the DCA is responsible for distributing another $500 million in federal funds authorized by a new state law (S-3691). The measure phases out the state’s moratorium on evictions for nonpayment of rent during the pandemic, helps landlords, and prevents tenants being evicted because of unpaid rent arrears.
The $500 million is being used for an Eviction Prevention Program that began Tuesday. The money will prioritize future rent for low-, moderate- and middle-income tenants for up to two years. Because it aims to meet future needs, the money will not be spent right away, Ryan said.
Landlords hurting as well as tenants
DCA’s breakdown of its rental-relief spending follows attacks by the New Jersey Apartment Association, which accused the agency of dragging its feet on helping landlords recoup months of unpaid rent that would normally have allowed them to evict tenants. The association estimates that landlords are owed some $2.3 billion in rent accrued since the pandemic began.
The trade group’s executive director, David Brogan, said it was misleading for the DCA to claim that it has paid out 65% of the $353 million tranche of federal funds because it has actually given out a much smaller proportion of the total in rental relief that it is responsible for distributing.
“A government-mandated eviction moratorium has placed an unreasonable burden on private-sector landlords and government has, up until now, provided little help,” Brogan said. “At the same time, government has demanded property tax payments from those landlords in full and on time or they could lose their properties. How is that fair?”
The rental assistance that’s been authorized so far represents about half of what landlords are owed, and what has been distributed “hasn’t come fast enough,” he said.
But DCA’s Ryan noted that New Jersey on Tuesday already met a Treasury requirement of spending at least 65% of the first allocation of ERAP funds by Sept. 30 and ranks third in the nation for monthly state distribution of the funds.
DCA in position for further funds
Having met that Treasury requirement puts the DCA in a position to receive additional rent-relief funds that would be reallocated from any other states that do not meet the standard, she said.
Still, she said the agency recognizes that many tenants remain in need, and so it is working on ways of speeding its payment of rent relief by conducting daily lotteries of applicants, twice-weekly check runs, and adopting Treasury guidelines for quick distribution.
The DCA is also working with the court system to track tenants who are subject to eviction actions, and reaches out to affected people through mail, email and phone, Ryan said.
“We know that many New Jersey renters need immediate help and we are continually working to increase the pace of distribution,” she said.