S391

An Act concerning homelessness prevention, amending and supplementing P.L.1984, c.180, supplementing chapter 27D of Title 52 of the Revised Statutes, and amending P.L.2013, c.206 and P.L.2014, c.31.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 1 of P.L.1984, c.180 (C.52:27D-280) is amended to read as follows:

1. This act shall be known and may be cited as the "Homelessness Prevention Program Act" or the "Prevention of Homelessness Act (1984)." [.]

(cf: P.L.1984, c.180, s.1)

2. (New section) As used in sections 2 and 3 of P.L. , c. (C. and ) (pending before the Legislature as this bill):

"Commissioner" means the Commissioner of Community Affairs.

"Department" means the Department of Community Affairs.

"Program" means the Homeless Prevention Program, established pursuant to the "Homelessness Prevention Program Act," P.L.1984, c.180 (C.52:27D-280 et seq.).

3. (New section) a. An applicant shall not be eligible to receive assistance under the Homelessness Prevention Program, established pursuant to the "Homelessness Prevention Program Act," P.L.1984, c.180 (C.52:27D-280 et seq.), unless the applicant is a New Jersey resident, and either homeless or in imminent danger of homelessness as a result of:

(1) an eviction action pursuant to subsections a., f., i., or j. of section 2 of P.L.1974, c.49 (C.2A:18-61.1), which is in any respect related to an inability to pay the rent or proposed rent;

(2) a mortgage foreclosure; or

(3) an inability to pay rent or mortgage payments that is likely to cause an imminent foreclosure or eviction action, as determined by the Department of Community Affairs.

b. An applicant shall be deemed to be in imminent danger of homelessness if:

(1) for an applicant who is a renter:

(a) the applicant is unable to make rental payments sufficient to meet monthly rental obligations; and

(b) either:

(i) the applicant’s inability to pay rent is likely to cause an imminent eviction action, as determined by the department; or

(ii) the applicant has been served with a summons and complaint for an eviction, pursuant to subsections a., f., i., or j. of section 2 of P.L.1974, c.49 (C.2A:18-61.1), which is in any respect related to an inability to pay the rent or proposed rent, which is not more than 12 months old and bears a docket number and court date; and

(i) is subject to a judgment for possession, which has entered for the applicant’s residence within the past six months, for which the warrant for removal has not yet been executed;

(ii) has entered into a settlement agreement with the landlord within the past 60 days that requires the tenant to vacate their residence within 120 days of the date of the settlement; or

(iii) has entered into a settlement agreement with the landlord within the past 60 days that requires the tenant to pay an amount of arrears to retain their tenancy which the tenant is currently unable to pay; or

(2) for an applicant who is a mortgagor, the applicant is unable to make mortgage payments, the applicant has been served with a notice of sheriff’s sale, which is scheduled to take place within 30 days of the date of application for homelessness prevention assistance.

c. No applicant shall be eligible for assistance if the applicant:

(1) has an annual household income, as of the date of the application, that exceeds 80 percent of the area median income for households of the same size within the housing region;

(2) has not exhausted all other available financial resources, according to criteria established by the department;

(3) has concealed or transferred assets to become eligible for assistance;

(4) has a delinquent loan with the program, or has caused the program to forfeit a security deposit, unless the department finds that the delinquency or forfeiture was due to a cause that was either beyond the control of the applicant receiving assistance, or constituted a violation of the rights of that applicant by another person, and that the cause of the delinquency or forfeiture is not likely to recur; or

(5) is renting from a family member, including: a spouse, parent, child, grandparent, grandchild, sister, brother, aunt, uncle, cousin, niece, nephew, mother-in-law, father-in-law, sister- in- law, and brother-in-law, except that the provisions of this paragraph limiting eligibility for the program, by virtue of the relationship to the applicant, shall not apply to a family member that is permanently disabled.

d. Assistance to any applicant under the program facing foreclosure as a result of mortgage or property tax arrearages shall be in the form of a loan, which shall be secured by a recorded mortgage.

(1) No applicant shall be eligible for a mortgage loan:

(a) unless the home, which may be an attached or detached house or a condominium unit, is an owner-occupied, single family dwelling that shall have been owned and occupied by the applicant for at least one year prior to falling into arrears on the mortgage loan or property taxes;

(b) if the applicant is subject to an initiated or ongoing bankruptcy proceeding; or

(c) if the property is encumbered by more than one mortgage, except that a tax title lien pursuant to the "tax sale law," R.S.54:5-1 et seq., or the In Rem Tax Foreclosure Act (1948), P.L.1948, c.96 (C.54:5-104.29 et seq.), shall not constitute a "mortgage" for the purposes of this subparagraph.

(2) The total amount of any mortgage loan to an applicant under the program shall not exceed an amount equal to 600 percent of the monthly applicable "payment standard" for the family size, as determined in accordance with guidelines published annually by the United States Department of Housing and Urban Development.

e. If an applicant is found eligible for assistance, but does not receive assistance due to a lack of program funds, the program shall give first consideration to those applicants most vulnerable in the event of homelessness. The program shall assign priorities for consideration for assistance among otherwise qualified applicants in the same applicant pool in an order to be established by the department at least annually using their most recent available data regarding demographic of people at risk of homelessness due to eviction, which shall include but not limited to:

(1) households with a person who is found to be disabled or handicapped by a government agency physician or other health professional at time of application;

(2) households with a person who is at least 62 years of age;

(3) victims of domestic violence, provided a referral from the Department of Children and Families, an emergency shelter agency, a county welfare agency, or other social agency is required;

(4) households with children, which have endured separation or face imminent separation due to homelessness, provided a recommendation from the Department of Children and Families, emergency shelter agency, county welfare agency, or other social agency is required;

(5) households with a history of homelessness; and

(6) other households as determined by the department.

f. An applicant’s rank or presence in paragraphs (1) through (7) of subsection f. of this section shall not alone entitle an applicant to assistance; however, among equal applicants who meet the same criteria pursuant to paragraphs (1) through (7) of subsection f. of this section, preference shall be given to households residing in sustainable housing.

g. Funds distributed pursuant to the program shall be distributed so that applicants in all regions of the State have equal access to assistance.

h. The Commissioner of Community Affairs shall, in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), adopt rules and regulations as necessary to implement the provisions of sections 1 through 3 of P.L. , c. (C. through ) (pending before the Legislature as this bill).

4. (New section) The Legislature finds and declares that:

a Research indicates that the expense of filing an eviction action has a substantial impact on the likelihood of a landlord to make this filing and initiate the process of forcing a tenant out of their home;

b. When eviction filing fees are low, a landlord is able to, in effect, use the court to help in the collection of rent, as the threat of being removed from a home is an effective means of compelling a tenant to pay;

c. Low eviction filing fees disincentivize landlords from communicating with tenants over rent payments that have passed their due dates, to consider possible payment plans and alternatives to eviction;

d. Even when an eviction filing does not result in the actual removal of the tenant, the record of the filing may nonetheless be attached to the tenant, making it more difficult for the tenant to obtain housing in future years;

e. The average eviction filing fee in the United States is $109, substantially higher than the filing fee of $50 required by courts in New Jersey; and

f. Therefore, it is in the public interest to establish a new charge for the filing of an eviction action, and to apply the monies received through this charge for the purposes of eviction and homelessness prevention services.

5. (New section) a. As used in this section:

"Commissioner" means the Commissioner of Community Affairs.

"Office of Eviction Prevention" or "office" means the office established pursuant to section 5 of P.L.2021, c.188 (C.52:27D-287.11).

"Resource navigator" means an experienced caseworker employed or contracted by the Office of Eviction Prevention to assist households facing an eviction action in accessing homelessness prevention services, relocation and rapid rehousing assistance, social service support, and rental assistance resources. The Office of Eviction Prevention shall require a resource navigator to have functions and responsibilities comparable to those established under the "Rental Assistance Navigation Program" established pursuant to section 2 of P.L.2021, c.313, as continued or reestablished pursuant to subsection b. of this section.

b. (1) In addition to the existing fees established pursuant to section 14 of P.L.1991, c.177 (C.22A:2-37.1), the Rules of Court, and any other rule, regulation, or law, and notwithstanding subsection b. of section 12 of P.L.2014, c.31 (C.2B:1-7), an amount of $150 shall be collected for the filing of an eviction action, and shall be transferred to the Office of Eviction Prevention. The office shall use the monies received pursuant to this section for the purposes of eviction prevention services the office directs and designs, including but not limited to, the employment or contracting of resource navigators through the Rental Assistance Navigation Program, as established by the Department of Community Affairs pursuant to section 2 of P.L.2021, c.313, which the department shall continue or reestablish as a permanent program as of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), which services shall include homelessness prevention services, relocation and rapid rehousing assistance, social services support, rental assistance resources, and connection to legal services.

(2) Notwithstanding the provisions of any residential lease agreement to the contrary, the responsibility to pay the fee required pursuant to this section shall not be shifted to the tenant, and shall not constitute "additional rent," regardless of the outcome of an action filed pursuant to N.J.S.2A:18-53 et seq. or section 2 of P.L.1974, c.49 (C.2A:18-61.1).

c. Notwithstanding the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the commissioner may adopt, immediately, upon filing with the Office of Administrative Law, rules and regulations to implement the provisions of sections 4 and 5 of P.L. , c. (C. and ) (pending before the Legislature as this bill), which shall be effective for a period not to exceed one year following the effective date of sections 4 and 5 of P.L. , c. (C. and ) (pending before the Legislature as this bill). The commissioner shall thereafter amend, adopt, or readopt the rules and regulations in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).

6. Section 1 of P.L.2013, c.206 (C.2A:18-61.66) is amended to read as follows:

1. If a residential lease agreement provides that the landlord is or may be entitled to recover either attorney's fees or expenses, or both, incurred as a result of the failure of the tenant to perform any covenant or agreement in the lease, or if the lease provides that such costs may be recovered as additional rent, the court shall read an additional parallel implied covenant into the lease. This implied covenant shall require the landlord to pay the tenant either the reasonable attorney's fees or the reasonable expenses, or both, incurred by that tenant as the result of the tenant's successful defense of any action or summary proceeding commenced by the landlord against the tenant, arising out of an alleged failure of the tenant to perform any covenant or agreement in the lease, or as the result of any successful action or summary proceeding commenced by the tenant against the landlord, arising out of the failure of the landlord to perform any covenant or agreement in the lease.

The court shall order the landlord to pay such attorney's fees or expenses, or both, that are actually and reasonably incurred by a tenant who is the successful party in such actions or proceedings to the same extent the landlord is entitled to recover attorney's fees and expenses, or both, as provided in the lease. The court shall have discretion with respect to awards of attorney's fees or expenses, or both, for tenants to the same degree as it has with respect to awards of attorney's fees or expenses, or both, for landlords as provided under the lease either explicitly or implicitly. An order based on this implied covenant shall require the landlord to pay the tenant such costs either as money damages or a credit against future rent, as determined by the tenant. Any waiver of this section shall be void as against public policy.

Notwithstanding the foregoing, in an action or summary proceeding for non-payment of rent a tenant who pays all rent currently due and owing on or after the filing of the complaint but prior to entry of a final judgment, and whom the court finds presented no meritorious defense to the complaint other than said payment, shall not be deemed to have successfully defended against the action or summary proceeding for the purposes of the award of attorney's fees or expenses, or both.

As used in [this act] P.L.2013, c.206 (C.2A:18-61.66 et seq.), "expenses" shall include expenses directly related to the litigation including, but not limited to [,] : court costs, except as provided in this section, and expenses for witnesses. "Expenses" shall not include personal expenses for travel [,] ; reimbursement for missed work time [, or] ; reimbursement for child care; or the fee required for the filing of an eviction action pursuant to subsection b. of section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill).

(cf: P.L.2013, c.206, s.1)

7. Section 12 of P.L.2014, c.31 (C.2B:1-7) is amended to read as follows:

12. a. The Supreme Court, subject to the limitations set forth in subsection b. of this section, may adopt Rules of Court to revise or supplement filing fees and other statutory fees payable to the court for the sole purpose of funding:

(1) the development, maintenance and administration of a Statewide Pretrial Services Program;

(2) the development, maintenance and administration of a Statewide digital e-court information system; and

(3) the provision to the poor of legal assistance in civil matters by Legal Services of New Jersey and its affiliates.

b. All existing filing fees and other statutory fees payable to the court on the effective date of this section, except as provided in subsection b. of section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), shall not be increased or supplemented more than $50 in the aggregate for each fee beginning on the effective date of this section.

c. As used in sections 12 through 19 of P.L.2014, c.31 (C.2B:1-7 through C.2B:1-13):

"Digital e-court information system" shall mean a Statewide integrated system that includes but is not limited to electronic filing, electronic service of process, electronic document management, electronic case management, electronic financial management, and public access to digital court records; and

"Pretrial Services Program" shall mean the pretrial services program established pursuant to section 11 of P.L.2014, c.31 (C.2A:162-25).

(cf: P.L.2014, c.31, s.12)

8. This act shall take effect on the first day of the fourth month next following the date of enactment, except that the Commissioner of Community Affairs shall take anticipatory action necessary to effectuate the provisions of this act.

STATEMENT

Sections 1 through 3 of the bill revise the Homelessness Prevention Program (program), established pursuant to the "Prevention of Homelessness Act (1984)," (act) P.L.1984, c.180 (C.52:27D-280 et seq.), and codify certain regulations promulgated by the Department of Community Affairs (department) pursuant to the act. Sections 4 and 5 of the bill require a new charge for the filing of an eviction action, and direct the Office of Eviction Prevention in the Department of Community Affairs to use the monies received through this charge for the purposes of eviction prevention services.

Specifically, sections 1 through 3 of the bill provide that an applicant is not eligible to receive assistance under the program unless the applicant is a New Jersey resident, and either homeless or in imminent danger of homelessness, as provided in the bill, as a result of certain eviction actions related to an inability to rent, a mortgage foreclosure, or an inability to pay rent or mortgage payments that is likely to cause imminent foreclosure or an eviction action. The bill also provides certain criteria excluding applicants from eligibility for assistance. The bill requires that assistance to an applicant facing foreclosure as a result of mortgage or property tax arrearages is to be in the form of a loan, which is to be secured by a recorded mortgage. The bill specifies criteria for a mortgage loan and requires that the total amount of any program loan is not exceed an amount equal to 600 percent of the monthly applicable "payment standard" for the family size. If an applicant is found eligible for assistance, but does not receive assistance due to a lack of program funds, the bill: (1) requires that first consideration is to be given to those applicants most vulnerable in the event of homelessness; and (2) provides certain priorities for receiving assistance among otherwise qualified applicants in the same applicant pool, which are to be determined by the department, except that the department is to include the priorities specified in the bill.

The bill further specifies that funds distributed pursuant to the program are to be distributed so that applicants in all regions of the State have equal access to assistance, and establishes an alternate title of the act.

Sections 4 and 5 of the bill require that, in addition to existing fees, and notwithstanding the current limit on filing fees and other statutory fees payable to the court of $50 in the aggregate, an amount of $150 is to be collected for the filing of an eviction action. Additional funding is required to be provided to the Office of Eviction Prevention, and used for eviction prevention services the office directs and designs, including but not limited to, the employment or contracting of resource navigators through the Rental Assistance Navigation Program, as established by the Department of Community Affairs pursuant to P.L.2021, c.313 and made permanent under the bill, which services include homelessness prevention services, relocation and rapid rehousing assistance, social services support, rental assistance resources, and connection to legal services. The bill specifies that the notwithstanding the provisions of any residential lease agreement to the contrary, the responsibility to pay the fee required by the bill is not to be shifted to the tenant, and is not to constitute "additional rent," regardless of the outcome of an eviction action. The bill also amends the definition of the term "expenses," as the term is defined pursuant to section 1 of P.L.2013, c.206 (C.2A:18-61.66), to exclude filing fees authorized under the bill.

The bill is to take effect on the first day of the fourth month next following the date of enactment, except that the Commissioner of Community Affairs is required to take anticipatory actions necessary to effectuate the provisions of the bill.