By: Kevin Oklobzija//May 7, 2021
By: Kevin Oklobzija//May 7, 2021//
As the COVID-19 pandemic grew worse last year and employers were forced to reduce their workforce, impacted workers found it difficult to pay rent.
To ensure no one would lose their home during the crisis, federal and state eviction moratoriums were enacted. At the same time, tenants and landlords often worked on temporary solutions for rent payment.
“Most people want to do the right thing and I had property owners say, ‘Reduce their rent by $200, they’ve been good tenants,’ ” said Michelle Wheeler, who along with her husband, Alex, have owned and operated High Falls Property Management, LLC, for nearly 20 years. Their firm oversees around 250 rental units.
Not everyone, however, chose to ask for help, Wheeler said. She cited a tenant who, after being fully vetted for income requirements and current employment, took occupancy of an apartment on Oct. 1.
“As of November, she has refused to pay rent, saying she doesn’t have to because of the moratorium, even though she is still working — and there’s nothing we can do,” Wheeler said. “The state is giving these tenants permission not to pay. We have tenants that owe $10,000, $15,000, and they’re never going to pay, they’re just going to move on. They’re going to be midnight moves.”
High Falls Property Management, with the overdue rent balance soaring past $250,000 last month, is hardly the only management company or landlord expressing concern and frustration. Assembly member Marjorie Byrnes (R-Avon) said her office receives calls on a regular basis from property owners or managers who are seeing past-due rent balances pile up.
“One company manages 2,400 units in New York state and their delinquency amount is approaching $1 million,” said Byrnes, a former Rochester City Court judge who oversaw eviction proceedings for 10 years. “Tenants know the landlord can’t evict them. A lot are employed but they refuse to pay.”
Those tenants won’t be required to confront the issue until at least Aug. 31, either. Gov. Andrew Cuomo signed into law on May 4 an extension of the eviction moratorium after the bill was passed by the state Senate and Assembly. Every Republican senator and Assembly member voted against the bill.
The extension means the past-due balance on the rent rolls will continue to climb.
“Even just a few missed rental payments can really affect the cash flow of an affordable housing community,” said Peggy Hill, president and CEO of Rochester Management, which oversees 16 affordable housing communities in the area.
Byrnes is sympathetic toward tenants with bona fide financial issues, and there are many, especially those with families. While many firms are hiring, child care costs have climbed and finding available slots at day care centers is a significant challenge.
Overall, however, Byrnes said the system is broken because the courts have been idled by the moratorium and the funding set aside for landlords isn’t being distributed.
“It’s a very anti-landlord environment right now and it has to change,” Byrnes said. “These are private properties. People signed a contract on what the rules would be and all this time, the government has run interference on the enforcement of those rules.”
Eviction petitions are on hold with the courts because of the moratorium. That’s a mistake, said Byrnes.
“Let them go to court, let the judge look at the petition and determine if the hardship exists,” Byrnes said. “The judge always has the authority to stay the eviction. This way the judge can make decisions on an individual basis.
“By the time the courts ever resolve the backlog, you could be looking at people who have remained in a property without paying rent for the better part of two years,” Byrnes said.
Adding to the frustration and financial burden for landlords is that $2.3 billion in federal money allotted to New York in December to pay past-due rent still hasn’t been distributed.
“Nobody’s ever seen a dime or heard anything about what’s happening with the money,” Byrnes said.
That will change, colleagues across the aisle say. The Office of Temporary Disability and Assistance (OTDA) will now have oversight of distribution of that federal funding, along with another $100 million in landlord assistance approved by the state Legislature on May 3.
Not only will money be doled out, legislators also created a new path for landlords to apply for hardship funding, according to Sen. Samra Brouk (D-Rochester).
“The economic disruption caused by the COVID-19 pandemic has created a crisis situation for renters, homeowners and small landlords,” Brouk said in an email to The Daily Record and Rochester Business Journal. “Thousands of families and businesses are still hurting as we try to exit this crisis. Every day our office receives calls from concerned landlords and tenants in need of assistance.
“We will continue to advocate on behalf of the hardworking families of the Greater Rochester area to ensure that the OTDA sets up a fair and manageable process for accessing these much-needed assistance funds.”
Equally important, though, might be better communication with renters on what the eviction moratorium means, landlords say. They say too many tenants assume their past-due rent has been, or will be, forgiven.
“The continuation of the eviction moratorium is somewhat confusing for some of our residents,” Hill said. “It has led some residents to believe that nonpayment doesn’t matter. Some residents are not understanding that the debt doesn’t go away and that they still need to follow other requirements of their lease.”
Tenants also have found the application process for rent assistance funding to be cumbersome and even onerous.
“This beautiful picture that there’s all this assistance money available … I’m working seven days a week, a minimum of 10 hours a day, trying to help tenants apply for funding,” Wheeler said. “I tell them, ‘I can do all the work for you, I just need the documents.’ Some never even respond and won’t answer the door.”
It’s a familiar story.
“We are working very hard to try and educate and encourage our residents and link them to rental subsidies which have become available as a result of the pandemic,” Hill said. “After trying to reach them by letter and by phone multiple times, we are literally knocking on doors to try to help them apply. We are also working out payment plans, but this again requires residents to work with us. It has not been an easy process.”
Wheeler senses some landlords will just give up or, worse, be forced to give up properties to the bank.
“This is going to cause landlords to lose property, it’s going to cause landlords to stop doing business in New York,” she said.
But Byrnes says those who try to sell in the near future will be confronted with another issue.
“Who’s going to buy that property with a pre-existing, non-paying tenant?” she said.
Eventually, the moratorium will end, relief funding will be exhausted and past-due rent will need to be paid. The consequences could be dire as tenants end up in court to fight eviction petitions.
“This is concerning as we do not want to see homelessness increase,” Hill said. “That not only works against our mission to provide affordable housing, but is a tragic outcome for the individual and our community.”
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