DCA Commissioner’s Statement to the Assembly Budget Committee

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  • Posted on: 04/12/2021

Testimony of Lieutenant Governor Sheila Y. Oliver, Commissioner New Jersey Department of Community Affairs Before the Assembly Budget Committee

TRENTON, NJ – Good Morning, Chairwoman Pintor Marin, Vice Chair Burzichelli, and members of the Budget Committee. Thank you for the invitation to appear before you today to highlight the achievements, challenges, and ongoing efforts of the Department of Community Affairs.

First, I would like to introduce the DCA staff who are here with me today.

Before I begin, I would like to publicly acknowledge and thank the entire DCA staff. This past year has been a tumultuous time due to the COVID-19 pandemic, which has had a devastating impact on our communities and has shifted our priorities as a result of business closures, record-setting unemployment numbers, and tenants not being able to pay their rent, leading to food insecurity and housing instability like we’ve never before seen.

The State has had many emergencies to respond to during this public health crisis and DCA staff did not miss a beat. Against the backdrop of the pandemic, the Department continues to deliver essential services to help New Jersey residents navigate the different impacts of COVID-19. I am incredibly proud of the work we have done in these unprecedented times to fulfill our mission of revitalizing communities, maintaining permitting and inspections, providing affordable housing opportunities, and helping towns and cities grow stronger.

If I may, I would like to share some of the Department’s accomplishments over the past year and note our ongoing work and the steps we are taking to move the Department forward.

Because the pandemic has deeply affected tenants, I will start with what DCA is doing to help our friends, loved ones, and neighbors who are renters.

Even though New Jersey has one of the strongest eviction moratoriums in place in the country, we know the moratorium will not and cannot last forever. Data shows that when the moratorium ends, the eviction crisis will likely be worse in New Jersey than the rest of the nation because a higher share of renter households are behind on payments than in other states. Therefore, DCA’s immediate goal is to serve as many people as possible who need rental assistance right now to prevent them from being evicted.

Last month, DCA launched the second phase of the COVID-19 Emergency Rental Assistance Program, which provides up to 12 months of rental assistance to low- and moderate-income households that have had a substantial reduction in income or incurred significant costs as a result of the pandemic. To date, we have received over 55,000 applications.

The Department is actively accepting applications and will continue to do so until an adequate number of applications have been received to distribute the approximately $353 million in federal funds allocated to the program. We are giving people as much time as possible to apply because we know the pandemic has been an extremely stressful and disorienting time.

Twelve months of rental assistance is a meaningful benefit that we believe will make a difference in people’s lives and keep families stably housed. 

DCA held the first phase of the COVID-19 Emergency Rental Assistance Program last year during which more than 15,000 households received financial help to pay their rent. In fact, we were able to help 7,000 more households than originally anticipated with the $91.75 million that was ultimately allocated in the program’s first phase.

We know that landlords are struggling, too. In August 2020, the New Jersey Housing and Mortgage Finance Agency (NJHMFA) launched a COVID-19 Small Landlord Emergency Grant Program to assist property owners with no more than 10 rental units by covering the rental payments their tenants missed due to the pandemic. Through this program, approximately 800 small landlords and more than 1,400 renter households were helped.

Also, in the second phase of the COVID-19 Emergency Rental Assistance Program, landlords may apply for assistance on behalf of their tenants provided they get the tenant’s permission to do so.

The Department is working with the Administrative Office of the Courts to obtain data about the s landlords and tenants involved in the more than 50,000 eviction filings that have accrued during the moratorium. With this information, DCA intends to send direct mail pieces to this population to encourage them to apply to the Emergency Rental Assistance Program in an effort to avoid eviction.

More directly on the issue of evictions, DCA awarded $1.25 million from the Affordable Housing Trust Fund last December to the Housing and Community Development Network of New Jersey to develop and implement outreach strategies to raise awareness of tenant rights, the eviction process, and eviction prevention resources across the state. With this funding, the Network is also providing training and technical assistance to 48 housing counseling agencies across the state to enable them to help renters and small and nonprofit landlords benefit from a mediation process to prevent eviction.

Also, NJHMFA has been aggressively promoting its free housing counselor services to ensure that all tenants at risk of eviction are made aware of their rights, protections, and available resources. HMFA would like to work with the legislature on statutory changes that could permanently expand the Foreclosure Mediation Program to include rental support, increase eviction filing fees to deter the use of frivolous evictions against tenants, and protect tenants with more thorough provisions against blacklist. The pandemic has further highlighted the importance of these kind of common-sense protections for New Jersey’s most vulnerable renters.

As part of this wide-ranging effort to inform tenants of their rights during the eviction moratorium, DCA maintains the State’s Eviction Moratorium web portal and responds to questions and concerns submitted through the website. Since late April 2020 when the portal opened, DCA has received and handled approximately 2,300 inquiries.

In May 2021, DCA plans to launch the Expanded Access to Counsel and Homelessness Diversion Anti-Eviction Pilot Program. The pilot program will provide a coordinated and comprehensive service to divert low-income households in New Jersey from evictions and homelessness by expanding their access to legal representation and other supportive safety net services when threatened with or facing eviction.   

When launched later this spring, the pilot program will operate in three target municipalities: Atlantic City, East Orange, and Trenton. These municipalities were selected based on their eviction filings, shelter entries, homelessness rates, local poverty levels, and where eviction is the main contributing factor of displacement. The selected target municipalities also reflect geographic parity and where networks of supportive services on the ground are strong.

As DCA learns more about the funds that will be available through the American Rescue Plan Act that President Biden signed into law last month, DCA will determine additional eviction prevention efforts.

Since many tenants struggling to pay their rent are also unable to pay their utilities, DCA is assisting residents with their utility bills.

The Department has always played a vital role in providing energy assistance resources to New Jerseyans in need. In January 2019, DCA launched the DCAid Screening Tool to quickly and anonymously determine an individual’s eligibility for programs such as energy assistance. This past October, we opened a website portal where New Jersey residents can apply directly online for the Low-Income Home Energy Assistance Program (LIHEAP) and Universal Service Fund (USF) program. Previously, people had to fill out and submit a paper application. So, the availability of an online application, especially during the pandemic, makes the process of applying much easier for New Jersey residents to receive assistance.

Together with the New Jersey Board of Public Utilities, which also runs utility assistance programs, we are doing our best to reach residents, including those financially impacted by the pandemic, who need help paying their utility bills. These programs are being supported by federal Coronavirus Relief Fund monies that DCA received to assist low-income households in paying off utility arrearages. Utilities have been given approval to credit the accounts of COVID-19-impacted customers who applied for the Universal Service Fund Arrearage. More than $3.6 million will be disbursed to different utilities for the USF Arrearage Program and will benefit more than 5,500 low-income households. The Department also anticipates that credits for arrearages for residents in the LIHEAP program will be issued this month.

Because people have been largely staying home this past year, lead poisoning is an increasing concern for DCA for people who live in housing constructed prior to 1978 where there is an identified lead-based paint hazard. The Department administers the Lead-Safe Home Remediation Program to help combat aspects of lead poisoning. The purpose of the program is to identify and remediate lead-based paint hazards to prevent elevated blood lead levels in children and pregnant women. The program targets municipalities in New Jersey with high reported incidence of elevated blood lead levels in children under the age of six.

Last month we announced the award of $6.8 million in grant funding to 12 nonprofit organizations across New Jersey to help reduce the threat of lead poisoning in the state’s older housing stock where lead-based paint is frequently found. The nonprofits can use the funding to remove lead-based paint hazards; conduct specialized cleaning, repairs, maintenance, painting, and temporary containment of these hazards; and monitor on an ongoing basis lead-based paint hazards or potential hazards. These nonprofits will report program data back to DCA for analysis to determine best practices and potential program expansion.

While the pandemic has had a devastating impact on individuals and families in New Jersey, it has also affected local governance at the municipal and county level. Indeed, local governments are facing increased costs in health benefits, health and human services, public safety, overtime, equipment, and supply expenditures.

For this reason, DCA last fall allocated $60 million in federal Coronavirus Relief Funds to create the Local Government Emergency Fund, which is helping counties and municipalities that didn’t receive direct aid from the federal government for pandemic response. This Local Government Emergency Fund is supporting essential government services like garbage collection, public health officers, and information technology related to the local COVID-19 response. The Department’s Division of Local Government Services has processed 221 Emergency Fund applications and disbursed between nearly $60 million in funding to municipalities and counties, which has made a world of difference for short- and long-term municipal recovery efforts.

Before the pandemic, the Division of Local Government Services was very proactive in encouraging shared services agreements between towns. This focus has continued throughout the pandemic, especially in light of the rising costs local governments are facing due to COVID-19. The Division’s Local Assistance Bureau in conjunction with the state-appointed shared services czars Jordan Glatt and Nicholas Platt have conducted shared services PowerPoint presentations with county commissioners in 12 counties. I have also participated in these symposiums to encourage municipalities and their respective elected officials to take advantage of shared services.

In fact, the total estimated cost savings for calendar year 2020 from shared service agreements currently in place was nearly $28 million.

In November, DCA announced $10 million in available funding for the Local Efficiency Achievement Program (LEAP) for fiscal year 2021. This program provides financial assistance to local government entities such as counties, municipalities, and school districts to help them identify, study, and implement shared services initiatives that increase efficiency and help save taxpayer dollars. Applications were due by the last week of February and DCA received 25 LEAP applications, which are now being reviewed in earnest in order to make funding recommendations.

In a sign of the Murphy Administration’s commitment to shared services, the Governor is proposing another $10 million in the fiscal year 2022 budget to continue the LEAP Grant program so that municipalities can take advantage of this cost sharing initiative.

DCA’s Division of Local Government Services has also expanded technical assistance in a wide variety of areas to local governments at no cost to them through its Local Assistance Bureau. The Bureau’s job is to cultivate best practices in local governments and to link local agencies that might be facing challenges to the State’s comprehensive network of resources. It employs advisors with professional expertise and skills in such areas as administration, finance/purchasing, human resources, labor negotiations, police dispatch/communications, public safety, public works, and risk management.  Since it was established in 2019, the Bureau has been involved in more than 120 engagements, providing guidance in many areas including training services, operational expertise, and analysis of operational and financial benefits in areas of shared services and consolidation.

The Division of Local Government Services continues to pay particular attention to the City of Atlantic City.

When Governor Murphy took office in 2018, he was able to recruit Jim Johnson to work as a pro bono advisor to him on Atlantic City. Jim did the initial boots-on-the-ground analysis of Atlantic City in which he went out and visited families, public safety personnel, members of the city administration, and community and civic organizations. Then with this collected data, he and his team created the Atlantic City Transition Plan. Once the Transition Plan was issued, it was DCA's job to develop the Atlantic City Initiatives Project Office to assist with implementing the priorities outlined in the Transition Plan. 

We have made considerable progress in the areas of community policing, building municipal capacity, job training, youth development, public health, city planning, economic diversification, and budget stabilization. In the last several months alone, the City of Atlantic City received two consecutive positive outlook credit opinions from S&P Global Ratings and Moody’s Investors Service Ratings, and the City joined the South Jersey STEM & Innovation Partnership, which is a community of collaborative partners seeking to improve science, technology, engineering, and math education and career pathways for people across southern New Jersey. This concentration on STEM resulted in the Mark Cuban Foundation selecting Atlantic City as one of only 16 cities nationwide to host one of its Artificial Intelligence Boot Camps in 2021. The free AI Boot Camp will introduce underserved students in grades 9 through 12 in the Atlantic City area to basic AI concepts and skills, which addresses recommendations in the Atlantic City Transition Plan to create pathways to opportunity for city residents and to build a diverse economy based on the principle of shared prosperity. 

While we have much to be proud of, DCA’s work in Atlantic City is far from finished. Through its continued partnership with the City of Atlantic City, the State can help the City access resources that were never tapped into by this community. For example, there are resources available at the state level that can be targeted to support further growth, development, and the expansion of opportunity in Atlantic City.  

The Murphy Administration has made a commitment to the Atlantic City community to be a partner and a collaborator. Our number one goal is to invest in the people -- the residents -- who call Atlantic City home. We believe it is essential that Atlantic City emerge and evolve in parallel with the uplifting of the resident population. We look forward to working with our partners in the State Legislature to continue honoring this commitment. 

I will conclude my remarks by returning to the topic of housing. Renters and homeowners have been hit hard over the past year, and even with the protections the Murphy Administration has put in place, including a moratorium on evictions and utility shutoffs, direct rental assistance, and mortgage forbearance, we know we need to do more. 

We are maintaining our commitment to ensuring that Affordable Housing Trust Fund dollars go to the cause of providing families an affordable home, whether they rent or own. Also, we are increasing our investment in mortgage down payment assistance for qualified first-time home buyers, particularly those in low-to-moderate income households. The resources in the Affordable Housing Trust Fund allow us to meet the needs of the DCA small grants program with existing Trust Fund dollars and a $30 million investment in the Governor’s proposed FY 2022 budget, and to devote over $70 million to critical affordability projects including rental unit production, rental assistance, streamlining housing permitting, and down payment assistance.  This comprehensive housing affordability agenda invests in long-term housing solutions and reducing housing insecurity and wealth disparities in our most underserved communities. 

Regarding the small grants program, DCA is allocating Affordable Housing Trust Fund dollars to smaller rental and homeownership housing projects sized at 25 or fewer units that often have difficulty obtaining financing. The idea is these smaller projects will fill the gaps within existing affordable housing, add value to neighborhoods, and largely be developed by community-based organizations that have a strong connection to the housing equity issues in their communities. The Trust Fund dollars are being allocated through three funds – Municipal Settlement Fund, Neighborhood Partnerships Fund, and Innovation Fund – all of which are focused on creating housing for households earning less than 80 percent of Area Median Income, with preferences for providing units with deeper affordability. 

Applications are still being accepted and are being reviewed on a rolling basis. Last December, DCA announced several Affordable Housing Trust Fund awards that went to Paterson Habitat for Humanity, Inc. in Passaic County, Montvale Family Apartments, LLC in Bergen County, Affordable Housing Alliance Inc. in Monmouth County, Habitat for Humanity of Burlington and Mercer Counties, E & B Housing, LLC in Camden County, and Ocean City Community Development Corporation in Cape May County. 

As the awards demonstrate, DCA is getting the Affordable Housing Trust Fund monies out to nonprofit organizations to develop different types of affordable housing projects all across the state that will strengthen and create more vibrant neighborhoods.

Undoubtedly, we will face continued challenges as we near what we hope is the end of the COVID-19 pandemic, but we are ready and able to address them.

Thank you for allowing me to take the time to make this statement.

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