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Poor Rollout of State Rent Relief Creates Major Dilemma Over Summer

Despite months of anticipation for New York’s Emergency Rent Relief Program (ERAP), the State Office of Temporary and Disability Assistance (OTDA) received immense backlash over the summer for ongoing website issues and the poor rollout of much-needed funds to building owners and tenants.

On June 1st, New York officially became the last state in the country to open its federally-funded rent relief program. Now, over $2.7 billion in relief is available to eligible tenants who were financially-impacted by the COVID-19 pandemic. Although tenants can apply on their own, building owners can apply on behalf of eligible tenants as long as they have their consent. If applications are approved, all funds will go directly to the building owner.

To no one’s surprise, owners and tenants faced numerous technical issues on the OTDA website immediately following the opening of the application portal. Many of these technical issues still existed as we went to press with this issue of the RSA Reporter. Although OTDA continues to periodically address the technical issues, by the end of July, the agency had yet to begin sending out money to approved owners and tenants. By the middle of August, just under 4% of the billions of allocated dollars had been sent out.

With the expiration of the (now enjoined) statewide eviction moratorium approaching at the end of August, the State Assembly held a hearing on August 10th to address why OTDA continued to have major issues with getting the money into the hands of applicants. At that hearing, RSA President Joseph Strasburg and General Counsel Olga Someras provided testimony, criticizing not only OTDA for a poorly run rent relief program, but all State lawmakers for delaying the entire rent relief process to begin with.

Mr. Strasburg pointed out that New York State had been in possession of at least half of the federal funds dedicated for rent relief since January, but chose instead to make the prospective rent relief program part of the State budget that passed in April, further delaying any program implementation by OTDA until June. Despite causing a delay on their own, Governor Andrew Cuomo and lawmakers assured owners and tenants that the ERAP application portal would be fully operational and prepared to handle the large quantity of applications expected to be submitted by owners and tenants. Not only have rent relief funds been delayed, but an extension to the statewide eviction moratorium was set through the end of August in order to buy the State more time to start distributing the money.

With only a small percentage of all funds distributed to approved applicants by the time the Assembly held their hearing, Mr. Strasburg said the rollout and execution of the ERAP program has been a complete disaster and that more urgency to get money out the door needs to be shown by the State. The following recommendations were made to the Assembly by Mr. Strasburg:

1. Before Housing Court reopens, rental assistance applications must be processed expeditiously, followed by an avalanche of rent assistance payments, so that limited Court resources are not misallocated.
2. Courts need to be able to directly communicate with the OTDA application system so they can determine who has applied and the status of applications when a court case is commenced.
3. OTDA needs to provide on-the-spot application assistance in the courthouses to deliver an immediate determination of eligibility the first time a tenant appears in court – and the program for building owners whose tenants walked away, and for tenants who would otherwise be eligible but for income restrictions, needs to be opened.
4. A targeted tax credit of limited duration to provide small owners with an offset for the losses in rental income caused by the eviction moratorium and continuing delays in the ERAP’s rollout.

Mr. Strasburg stressed that building owners have been considerate of tenants’ financial situations due to the pandemic. Owners are solely interested in collecting the rent money that is owed to them rather than going to Housing Court and putting tenants out of their homes. Mr. Strasburg further stressed that RSA and the entire rental housing industry share a mutual commitment with tenants and the State government to work cooperatively to ensure these rent relief funds are distributed at a much more efficient rate.

To read RSA’s full testimony submitted at the Assembly hearing, click here

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