Arizona landlords struggling because tenants have stopped paying rent during the novel coronravirus pandemic can apply for as much as $50,000 in assistance from the state, the Arizona Department of Housing announced this week.
In all, the state set aside $5 million for the landlord assistance program. This is in addition to $5 million the state set aside in March, and millions more that local governments have begun distributing, to help tenants — and consequently landlords — pay rent.
“While there is nearly $90 million currently allocated for rental assistance throughout the state of Arizona, we heard from rental property owners that there was a portion of renters that were choosing not to seek out the rental assistance or engage in figuring out a payment plan,” said Patrik Ptak, spokesperson for Gov. Doug Ducey.
A rental property owner does not have to be on the verge of foreclosure to qualify for the financial help. But the property owner cannot have received payment through a renter assistance program for any rental unit included in their application.
Many Arizona landlords, particularly those with smaller properties, have been struggling during the state’s eviction moratorium that started in March and has been extended until the end of October.
The moratorium is supposed to halt the removal of tenants who haven’t paid rent if tenants show they’ve been impacted by COVID-19 and have applied for rental aid.
“This fund is a good first step to help property owners who for months have been suffering because of the pandemic,” said Courtney Gilstrap LeVinus, CEO of the Arizona Multihousing Association. “There’s very little red tape, and that’s encouraging for property owners who need relief immediately in the face of the eviction moratorium.”
She said because of the eviction moratorium, many mom-and-pop rental owners have been forced to provide free housing since March.
An estimated 7% of U.S. renters didn’t make full or partial payments to landlords in July, according to the National Multifamily Housing Council.
The council’s data doesn’t include student or low-income apartments, renters in single-family home or tenants in small apartment complexes typically owned by individual investors.
Some landlords are concerned the new fund won’t provide enough help. Housing advocates worry that the way the new fund is managed could create a “double-dip” problem, where rental property owners could receive money from both the landlord and the tenant-aid fund.
Help for landlords
William Vickrey tapped all of his 401K savings to buy a few metro Phoenix houses and turn them into rentals during the housing crash more than a decade ago.
Vickrey said because he can’t evict tenants who aren’t paying while he has to keep paying property taxes, insurance and maintenance on his rentals, he is considering selling them.
“I need the rental income to live on and pay my medical bills,” said the Chandler resident, who thinks the state should’ve stepped up with financial help much sooner.
To qualify for the Arizona Rental Property Owner Preservation Fund, rental property owners must submit:
How many units they need funding for, the total months they have not received rental payments for each of those units, the total loss of income and the steps taken to secure rent payments from tenants.
Copy of a lease ledger or lease agreement for each claimed unit.
A five-day notice or any other documentation that shows the tenant was notified and given an opportunity to pay the total amount due, but has not responded or paid.
Documentation of the outstanding unpaid balance per unit. If the information is located in the lease ledger, specify where.
W-9 and ACH payment forms to receive direct deposit payment from the state.
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Landlords can receive up to five months of rent subsidies per tenant for April through August. The assistance must be equal to the tenant’s actual monthly rent or $2,000 per month, whichever is less.
Landlords must return funding to the state within 10 days if they later receive a subsidy through a tenant assistance program.
The pot of money, which will be distributed on a first-come, first-served basis, will be split in half between small and large rental property owners.
Small rental property owners are defined as those who own up to five single-family properties or up to 20 multi-family units. Large property owners are defined as those owning more than five single-family properties or more than 20 multi-family units.
Apply at https://arizonatogether.org/grants, and scroll down to “Rental Housing Support.”
Renter aid still slow to arrive
Arizona landlords may have an easier time getting assistance than tenants have experienced.
More than 20,000 tenants have applied for help paying rent from the Arizona Department of Housing since the state launched the $5 million eviction prevention program in late March.
Close to half were still waiting for review as of Monday, state data shows. Another roughly 8,000 renters were rejected for incomplete documentation. Only about 1,400 renters have been approved for help.
They include renters such as Chris Frisby, a laid-off furniture mover in Phoenix. He hasn’t been able to get rental assistance after four months of trying, emails show.
To speed things up, Ducey recently put more money toward staffing. But there still are more applications coming in than being processed.
“Providing additional staffing … was a positive step, but we are working on additional improvements and changes to the program to speed up processing and limit the number of incomplete applications,” Ptak said.
Renters also can seek assistance from Maricopa County and the city of Phoenix, which set aside more than $50 million in rental aid from federal CARES Act funding.
MORE: 4 steps struggling renters must take by Aug. 22 to avoid eviction.
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Concerns about the landlord fund
Unlike renters, landlords must apply for help through the Governor’s Arizona Together grants program.
The program will be administered by a team of experts within the Department of Housing, the Office of Strategic Planning and Budgeting and the state grants team at the Arizona Department of Administration, Ptak said.
“We expect this partnership will fully meet the needs of administering the program and will allocate additional staffing as needed,” he said.
Housing advocates worry the set-up could allow landlords to be paid twice for the same tenant if the rental-aid programs that pay landlords don’t share information.
“I see some issues with how the landlord aid fund is being administered because it looks like there’s no reconciliation with it and renter aid programs,” said Joan Serviss, executive director of the Arizona Housing Coalition. “If neither the state housing department or community action agencies are involved, then there could be a double dip issue.”
The group representing Arizona landlords is concerned $5 million isn’t nearly enough to help the state’s struggling landlords.
“Our economic analysis has shown that if only 1 percent of Arizona renters haven’t paid rent since the beginning of the Governor’s eviction moratorium, the lost income for property owners would be more than $87 million,” said Gilstrap LeVinus. “So a $5 million fund relief fund is a good start, but property owners need much more help and they need it ASAP.”
Are you a renter or landlord affected by COVID-19? Do you need help? Do you have a question? Contact consumer reporter Rebekah L. Sanders at email@example.com or follow her on Twitter at @RebekahLSanders.
AUTHORS: Rebekah L. Sanders and Catherine Reagor