Bill Text: NJ A2275 | 2024-2025 | Regular Session | Introduced
Bill Title: Establishes "Guaranteed Rental Payment Pilot Program" for certain low-income tenants; appropriates $10,000,000.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Housing Committee [A2275 Detail]
Download: New_Jersey-2024-A2275-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblywoman YVONNE LOPEZ
District 19 (Middlesex)
SYNOPSIS
Establishes "Guaranteed Rental Payment Pilot Program" for certain low-income tenants; appropriates $10,000,000.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act establishing a "Guaranteed Rental Payment Pilot Program" for certain low-income tenants in need of rental assistance, supplementing Title 52 of the Revised Statutes, and making an appropriation.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. The commissioner shall establish a "Guaranteed Rental Payment Pilot Program" within the State Rental Assistance Program, established pursuant to P.L.2004, c.140 (C.52:27D-287.1 et seq.), to study ways of maximizing housing opportunities for households who lack adequate credit histories and to better understand the relationship between a tenant's credit rating and the tenant's subsequent performance under the lease, including making required rental payments. Specifically, this pilot program will collect data from low- or moderate-income pilot program participants who receive rental assistance under the State Rental Assistance Program. The pilot program shall track defaults on lease payments for pilot program participants who have a credit rating of "poor" or lower, comparing these default rates to tenants who maintain a credit rating of "fair" or higher.
b. The pilot program shall select at random 1,000 low- or moderate-income households who are qualified and approved to participate in and receive benefits under the State Rental Assistance Program or, at the discretion of the department, the Section 8 Housing Choice Voucher Program and who have completed a housing and credit counseling program through agencies or individuals that have been certified by the department to provide such counseling.
c. The pilot program shall guarantee to the landlord of a pilot program participant that, in the event of a violation of any portion of the obligations under the rental agreement, including, but not limited to rental payment, damage to the rental unit beyond ordinary wear and tear, legal fees and court costs, and any other lawful fees or charges for which the pilot program participant is responsible, the pilot program shall pay the amount due and owing to the landlord pursuant to the terms of a duly executed lease agreement between the landlord and pilot program participant tenant. This pilot program guarantee provided to a landlord shall not limit the ability of that landlord to initiate an eviction action, pursuant to subsection a. of section 2 of P.L.1974, c.49 (C.2A:18-61.1) or any other remedies provided by law.
d. Within 30 days following payment from the pilot program to a landlord, the commissioner shall provide the tenant with written notice of the amount paid from the fund, established pursuant to subsection f. of this section, and provide the tenant with notice of the tenant's obligation to repay it. On the 90th day following a payment to the landlord from the pilot program, an amount equal to the amount paid to the landlord from the pilot program shall be due and owing to the pilot program from the tenant, to be reinvested in the fund upon payment.
e. During the course of the payment period, if a participant household experiences conditions that violate the implied warranty of habitability, the tenant may certify those conditions to the department in writing. Based on the tenant's written certification, the department shall order an inspection be conducted on the dwelling. Upon confirmation that the violation of the implied warranty of habitability exists, the department shall, after serving the landlord with written notification of such violation and providing the landlord with sufficient opportunity to cure, consider whether and in what amount to withhold rent based on the conditions.
f. There is established in the General Fund a separate, non-lapsing, dedicated account to be administered by the commissioner in association with the State Rental Assistance Program, established pursuant to P.L.2004, c.140 (C.52:27D-287.1 et seq.), which shall be known as the "Guaranteed Rental Payment Fund." The purpose of this fund is to provide reimbursements to a landlord whose pilot program participant tenant defaults in making all or a portion of a lease payment due pursuant to subsection c. of this section. The commissioner may allocate up to $10,000 annually from the fund to pay for administrative expenses.
g. The commissioner shall submit a report to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature on or before the 18th month next following the beginning of the pilot program's operation, which shall provide the following information:
(1) The percentage of pilot program participants who fail to make one or more rental payments;
(2) The number of times a pilot program participant failed to make all or part of a rental payment;
(3) The credit rating score for any pilot program participant who fails to make a rental payment; and
(4) Any other information the commissioner may deem appropriate.
h. As used in this section:
"Commissioner" means the Commissioner of Community Affairs.
"Department" means the Department of Community Affairs.
"Fund" means the "Guaranteed Rental Payment Fund," established pursuant to subsection f. of this section.
"Pilot program" means the "Guaranteed
Rental Payment Pilot Program," established pursuant to subsection a. of this
section.
2. The Commissioner of Community Affairs may promulgate rules and regulations in accordance with the "Administrative Procedures Act," P.L.1968, c.410 (C.52:14B-1, et seq.) as necessary to effectuate the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).
3. There is appropriated $10,000,000 from the General Fund into the "Guaranteed Rental Payment Fund" to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).
4. This act shall take effect on the first day of the fourth month next following enactment, but the Commissioner of Community Affairs may take such anticipatory administrative action in advance thereof as shall be necessary for implementation of this act.
STATEMENT
This bill establishes the "Guaranteed Rental Payment Pilot Program" ("pilot program") within the Department of Community Affairs ("DCA") to study ways of maximizing housing opportunities for households who lack adequate credit histories and to better understand the relation between credit rating and the tenant's performance under the lease, including making required rental payments. Specifically, this pilot program will collect data from low- or moderate-income program participants who receive rental assistance under the State Rental Assistance Program ("SRAP"). The pilot program will also keep track of default rates for lease payments by tenants with less favorable credit ratings as compared to similar tenants who maintain a credit rating of "fair" or higher.
The pilot program would select at random 1,000 low- or moderate-income households who are qualified and approved to participate in and receive benefits under SRAP or, at the discretion of DCA, the Section 8 Housing Choice Voucher Program and who have completed a housing and credit counseling program through a DCA-approved agency.
Under this pilot program, a landlord whose tenant fails to make a rental payment required by a lease agreement would be made whole and be reimbursed for this failure to pay through funding made available by the pilot program for this purpose. The bill creates the "Guaranteed Rental Payment Fund" ("fund") as an account within the General Fund, to be administered by DCA. The fund will provide reimbursements to landlords in the case of a default or other lease violation by a pilot program participant tenant that causes a loss to the landlord. Participation in this pilot program will not impact a landlord's right to statutorily evict a tenant.
Within 30 days following payment from the program to a landlord, DCA would be required to provide the tenant with written notice of the amount paid from the fund and provide the tenant with notice of the tenant's obligation to repay it. On the 90th day following a payment to the landlord from the pilot program, an amount equal to the amount paid to the landlord would be due and owing to the pilot program from the tenant, to be reinvested in the fund.
During the course of the payment period, if a participant household experiences conditions that violate the implied warranty of habitability, the bill authorizes the tenant to certify those conditions to DCA. Based on the tenant's written certification, DCA would be required to order an inspection be conducted on the dwelling. Upon confirmation that the violation of the implied warranty of habitability exists, DCA would notify the landlord and provide an opportunity to cure. DCA would then consider whether and in what amount to withhold rent based on the conditions.
The bill provides DCA with authority to create rules and regulations for the pilot program established by the bill.
Finally, this bill appropriates $10,000,000 from the General Fund into the fund.
