Tenants and landlords in Pa. and N.J. are seeking rental assistance to fend off evictions

The Pennsylvania Apartment Association, which represents property owners and managers, and the Housing Alliance of Pennsylvania, which looks out for renters, are not typically on the same side of housing issues. But the groups agree on one way to help people struggling during the coronavirus pandemic: rental assistance.

As Pennsylvania and New Jersey ease restrictions on residents, businesses, and government services, eviction bans also soon will come to an end. Advocates fear a wave of evictions once hearings in landlord-tenant court resume in Philadelphia on July 6 and suspended evictions begin July 10 in Pennsylvania. New Jersey’s ban on evictions ends two months after the governor declares an end to the health crisis.

Tenant advocates and landlords fear tenants will be in trouble once boosts in federal unemployment benefits expire in July and federal stimulus checks are long gone. They see rental assistance as a win-win, helping landlords continue to operate and helping tenants stay in their homes. New Jersey and Pennsylvania created assistance programs a couple of weeks ago and plan to distribute funds in the coming months.

Victoria Lambert, 63, and her 19-year-old son will be evicted from their West Philadelphia studio apartment as soon as possible after court reopens, their landlord told them. They had been current on their rent before they lost their jobs as a restaurant hostess and a student helper because of the pandemic.

“I really want to pay my landlord. But I need time. I need rental assistance,” Lambert said during a May hearing on City Council bills aimed at helping Philadelphians stay in their homes. She applied for rental assistance from the city’s now-closed program but doesn’t know her status. Council also asked the federal government for funds for rental subsidies.

Lambert and her son have been homeless before.

“And I was working. I was working. I had money and couldn’t find a place to live,” she said. “Now I got a place to live and can’t find the money.”

Pennsylvania and New Jersey have joined at least 11 other states and 52 cities or counties in creating pandemic-related rental assistance programs as of May 24, according to the National Apartment Association. Most other states are working to create them.

» READ MORE: No evictions or foreclosures in Pennsylvania through July 10, officials announce

Using some federal funds for rental assistance is a “great start,” said Phyllis Chamberlain, executive director of the Housing Alliance of Pennsylvania. “But we’re looking ahead to make sure there is adequate funding, so we don’t have a huge eviction crisis, which is not good for renters and is also not good for landlords.”

The national unemployment rate is more than 13%, and renters are disproportionately represented in industries hit hard by the pandemic. State and local programs tend to run out of funds quickly, so the National Apartment Association is advocating for a federal rental assistance program.

More than a third of renters worry that their landlords will evict them in the next six months, according to a national Apartment List survey of more than 4,000 renters and homeowners. Roughly 2.7 million adults moved back in with parents in March and April, according to a Zillow analysis. More than 80% are young adults in Generation Z who pay about $726 million in rent every month, payments at risk if the moves home are permanent.

“We know that there are just too many households that were living paycheck to paycheck that are likely to fall behind,” Chamberlain said. “Because most Americans don’t have much savings to rely on.”

Connor Woodward, president and chief executive officer of Woodward Properties, a company that manages roughly 2,500 units in 30 buildings across Philadelphia and its collar counties, has waived fees, suspended rent increases, and offered payment plans.

“And a rental assistance program will provide additional relief to Pennsylvanians that desperately need it,” said Woodward, who is on the Pennsylvania Apartment Association’s board of directors.

» READ MORE: Advocates, officials try to prevent Philly’s coming wave of coronavirus evictions

Pennsylvania’s rental assistance program comes in the form of a change to the state’s fiscal code, which now allocates $150 million for renters. Both tenants and landlords seeking funds on behalf of tenants have until Sept. 30 to apply.

Eligible tenants must have lost their jobs after March 1 or had their household income reduced by at least 30% due to reduced wages because of the pandemic. The agency will pay up to $750 per month for six months to households that earn no more than the area median income, which is $96,600 for a family of four in the Philadelphia region. The Pennsylvania Housing Finance Agency will run the program and will release additional details by the end of June.

New Jersey’s rental assistance program, which will distribute at least $100 million, will launch Monday, start accepting applications in July, and begin payments in September. Under the program, the state will encourage landlords to agree to repayment plans for rent past due, to refrain from evicting tenants due to unpaid rent before the start of rental assistance, and to refrain from evicting tenants due to unpaid rent for six months after rental assistance ends.

The COVID-19 Short-Term Rental Assistance Program will provide funds to low- and moderate-income households, which must put 30% of their incomes toward rent while the state pays the rest. With about 20% of the funds, the state will provide up to 12 months of rental assistance for people with very low incomes and those who are homeless or in danger of becoming homeless. The state will distribute the rest of the funds through an online lottery. Those selected will receive up to six months’ rent.

» READ MORE: Do I have to pay my rent? Renters’ rights in Philadelphia during the coronavirus pandemic.

Applicants must be current on their rent as of March 1, have proof that the pandemic hurt them financially, and earn not more than 80% of area median income. If New Jersey receives additional federal funds, the program allows for increased funding for rental assistance.

New Jersey Gov. Phil Murphy chose to start his own rental assistance program instead of signing a bill the state Legislature passed. The bill offered funds to renters with higher incomes — 120% of area median income.

The Pennsylvania Apartment Association followed the lead of the New Jersey chapter in seeking statewide rental assistance, said Leah Sailhamer, vice president of government affairs at the Pennsylvania association.

“From the beginning, we knew we had to do something,” especially because stimulus payments and other temporary fixes could only go so far, she said.

Some states, including Pennsylvania, are using money from the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act for their rental assistance programs. Many are drawing from state housing trust funds. New Jersey is using a combination of federal and state funds. The Garden and Keystone States’ programs both will pay landlords directly.

Pa. State Sen. Tom Killion (R., Chester-Delaware), who proposed Pennsylvania’s rental assistance program in the legislature, said the program “is one of those things where the governor and the Democratic caucuses and the Republican caucuses all agreed on a good use for the federal funds we were receiving.”

A rental assistance program causes “a positive domino effect that not only helps tenants and landlords, but it also helps the economy,” said David Brogan, executive director of the New Jersey Apartment Association. Tenants have more money to spend and landlords can pay vendors. Small landlords relying on only a few units for income could face bankruptcy without assistance, he said. In Philadelphia, small landlords own 46% of licensed units.

“The reality is landlords are feeling the financial strain of this crisis just as tenants are,” Brogan said. “Just as you wouldn’t tell a supermarket to give free food for two months, you can’t expect a landlord to provide free rent without any assistance.”