To Jumpstart Relief Program, Wolf Gives Landlords More Flexibility To Collect Unpaid Rent
After Pennsylvania lawmakers failed for months to fix a troubled rent relief program, Gov. Tom Wolf intervened Tuesday, giving landlords flexibility to collect outstanding balances in the hope that more would agree to participate.
As a result of the change, landlords will no longer be required to forgive rent that is owed if they collect the state relief money. Landlords can receive a monthly maximum of $750 per tenant, but previously were forced to forgive any rent due in excess of that amount.
Landlords who take part in the program will now be able to enter into payment plans with tenants for the remaining balance owed.
In many parts of the state, $750 is significantly less than the average monthly rent, and the forgiveness requirement was a driving factor in many landlords choosing not to participate. Without their landlords on board, renters cannot take advantage of the relief.
“These are positive steps, but we still need a larger solution,” Wolf said in a news release. “I continue to urge the legislature to fix the program’s other flaws so more struggling families have a place to live.”
The shortcomings of the $150 million rent relief program, funded with federal CARES Act dollars, have been clear since it launched in early July. But the Republican-controlled legislature has so far dragged its feet on addressing them, despite urging from the governor, the agency overseeing the program, and advocates for both landlords and tenants.
Wolf’s changes do not increase the amount of money landlords can receive, which would require the legislature to amend the state law that created the program.
In many cases, property management companies have already been working out payment plans with tenants who have fallen behind, said Leah Sailhamer, vice president of government affairs at the Pennsylvania Apartment Association.
“Allowing us to participate in the program and still work out our plans definitely makes the program more attractive,” she said, adding that, ultimately, the group still wants to see a legislative fix to the program.
The program has also been hampered by a lengthy application process that requires tenants to submit extensive paperwork to prove they are eligible. By the end of September, only $9.6 million of the $150 million available had been paid out, raising concerns that the program could end with money left over despite the urgent need.
Thousands of families across the state are at risk of losing their homes amidst the economic crisis caused by the coronavirus pandemic. A federal order protects some tenants from eviction until the end of the year, but advocates warn of a surge in evictions come January.
“This change potentially sets up tenants with significant debt that they will be unable to pay,” said Phyllis Chamberlain, executive director of the Housing Alliance of Pennsylvania, an advocacy group. “For many, it will only temporarily delay an eviction filing.”
Lawmakers are weighing a proposal to streamline the application process and make the program more appealing to landlords. The legislation would replace the $750 cap with a more flexible standard that varies from region to region, reduce the amount of paperwork applicants must submit, and eliminate a requirement that tenants must already be at least a month behind on rent to apply.
But a crucial House vote on the bill was delayed earlier this month after a Republican lawmaker announced he had tested positive for the coronavirus and the voting session was abruptly cancelled.
Rep. Sue Helm (R., Dauphin), the bill’s sponsor, said she hoped for a vote on Monday. The state Senate would still need to pass the legislation before the changes could go into effect.
Even if that happens, the changes would not have long to take effect. The current deadline for accepting applications, which Wolf extended by executive order last week, is Nov. 4.
Lawmakers could extend that deadline further, but not by much: under state law, all of Pennsylvania’s CARES funding must be spent by the end of November.
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