Photo courtesy of Insider
Eviction moratoriums were instituted at both the federal and state level during the pandemic. The federal moratorium put in place by the Centers for Disease Control and Prevention has been repeatedly extended over the course of the pandemic; it is now, however, reaching its expiration date at the end of this month. Thankfully, New Yorkers have had a state eviction moratorium in place that doesn’t expire until the end of next month; although this program has also been repeatedly extended, it looks as though August will be the true end point.
New York’s moratorium has saved countless renters from being evicted over the last 16 months. As such, its end will drastically change the fate of tenants who are struggling with rent arrears, eviction cases, and back rent.
According to the National Equity Atlas, a comprehensive data tracker developed by the University of Southern California, has found that almost 500,000 households in New York City have rent arrears; this totals over $2.2 billion. The Eviction Lab at Princeton University has found that over 62,000 eviction cases have been filed in New York City Housing Court since the pandemic began; the lab’s scope covers 29 large cities across the U.S., and New York City’s cases represent 20% of all eviction cases filed. Additionally, the Eviction Lab found that between 400 to 800 new housing cases are filed in New York City every week. Although these cases were allowed to be filed during the pandemic, almost all of them are on hold, pending the moratorium’s end. New York state’s Office of Court Administration spoke on behalf of housing courts, stating that a possible reopening is scheduled for September; at that point, in-person hearings and trials will resume.
Two demographic factors have complicated the situation. For one, the eviction crisis is most acutely felt by residents of color. The city’s Black and Latino residents not only were the most at risk of the pandemic’s health effects, but are now also most at risk of the pandemic’s housing effects. Secondly, the disparity between neighborhoods, especially those that are primarily working-class, has also been highlighted. The Bronx, for example, has been the hardest hit due to its high rate of residents working in the service and hospitality industry. According to the National Equity Atlas, 8 of the Top 10 ZIP codes with the highest rates of eviction cases filed during the pandemic are in the Bronx.
Lastly, back rent is also an important, yet not well-documented, facet of the situation. While the Association for Neighborhood and Housing Development reports that renters who have been sued in housing court owe an average of $8,150 in unpaid rent, that number is not completely up-to-date. In reality, the number is likely much higher given that court cases are not updated to reflect missed payments following the lawsuit’s filing.
All of these issues are converging at the most sensitive of times for renters, and yet there is a program that could greatly ease the process – rent relief – but the city has simply not been doing enough.
The city’s rent relief program was launched in June with $2.7 in financial aid coming from the federal government available to help tens of thousands of residents behind on rent. Applicants are able to have up to a year’s worth of unpaid rent and utilities covered by the program and sent directly to landlords; additionally, lower-income tenants qualify for an additional three months of payments. The restrictions only qualify those who earn less than 80% of the area median income for a family of 4 in the City (under $95,450); applicants must also prove that their financial difficulties arose because of the pandemic, which has jeopardized their ability to pay rent or even put them at risk of homelessness. Landlords of qualifying applicants are not able to raise rent or evict the tenant for at least a year, if they accept the money.
The program initially prioritized low-income tenant applications when it opened in June, limited to households making less than $60,000 for a family of 4. Applications that are being submitted from July on are then being processed on a first-come-first-served basis. As of now, the program has seen over 160,000 completed applications, 75% of which have come from renters and landlords.
The general consensus: the flow of aid has not nearly been enough. As of the end of June, New York state was 1 of just 2 states that had not yet sent out financial assistance to renters. State officials recorded only $117,000 disbursed aid last week – which was only reportedly only disbursed to test the payment system. On Monday, the state confirmed that another $700,000 was disbursed and that more payments would follow soon. Aside from the slow monetary rollout, several technological issues have made the program slower as well. Applicants have reported that glitches and errors have prolonged, or even completely erased their progress on, the application process. The system is widely criticized for being too complex, requiring too many documents, and taking too long to complete. Additionally, many have become worried of 2 other potential outcomes: 1) that the program’s slow pace will result in residents of low-income neighborhoods not receiving aid and 2) that landlords will choose evictions over the payments.
Although the rent relief program certainly has its downfalls, it still remains a vital economic lifeline for struggling residents. The sheer size and scope of the program was sure to hinder a timely rollout process, but it will be monumental once it improves its efficiency.
The latest program update, according to Governor Cuomo, is that New York will be rolling out a revamped application process to streamline and speed up the process. The state will also take until the end of August to disburse the funds from the approved applications.
Founded by attorneys Andreas Koutsoudakis and Michael Iakovou, KI Legal focuses on guiding companies and businesses throughout the entire legal spectrum as it relates to their business including day-to-day operations and compliance, litigation and transactional matters.
Connect with Andreas Koutsoudakis on LinkedIn.
Connect with Michael Iakovou on LinkedIn.
This information is the most up to date news available as of the date posted. Please be advised that any information posted on the KI Legal Blog or Social Channels is being supplied for informational purposes only and is subject to change at any time. For more information, and clarity surrounding your individual organization or current situation, contact a member of the KI Legal team, or fill out a new client intake form.