Attorney Derek Reed on Nov. 19 again spoke up for property owners against a proposed bill making its way through the New Jersey state legislature that would delay payments on rent arrears.
The People’s Bill was originally drafted in April 2020 as an answer to the sudden economic crisis caused by government restrictions meant to curb the spread of COVID-19. Despite numerous iterations, the bill fundamentally provides tenants with six months to pay back each month of missed rent payments. When a tenant has five or more months of missed rent payments, he or she has up to 30 months to pay it all back in more manageable installments according to tenant activists. In effect, the bill imposes up to a 30 month interest free loan term on a property owner without any security interest for a tenant to pay back the rent that became due since March 2020 starting two months after the public health emergency is over.
While tenant activists have praised The People’s Bill, it would be devastating to property owners and homeowners.
As Attorney Reed stressed in the media this month, The People’s Bill is deficient in how it addresses the needs of not just rental property owners, but private homeowners who could suffer an increase in property taxes as an unintended consequence.
“It’s not the People’s Bill, it’s the tenants' bill,” he told northjersey.com. “It doesn’t speak for housing providers and doesn’t speak for the homeowners who will see a huge shift in property taxes.”
As the result of a precipitous decline in rental revenue, , northjeresey.com reports, multifamily property owners are likely to file tax appeals to lower their property tax assessments and, in turn, their property taxes. Covering the loss in revenue could result in a corresponding increases in property tax assessments for homeowners across the state.
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