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Real Estate Company Agrees to Pay NJ Section 8 Tenant $30K for Discrimination

By kbm0423 on
Bergenfield

In their latest action to enforce New Jersey’s law prohibiting discrimination against tenants paying rent with public assistance, Attorney General Gurbir S. Grewal and the Division on Civil Rights (DCR) announced today that a real estate company that manages a 237-unit apartment complex in North Jersey has agreed to pay a former prospective tenant $30,000 to resolve allegations the company unlawfully rejected him because he intended to pay with federal Section 8 housing assistance.

Under the settlement, Tower Management Services, L.P., which manages the Ivy Lane Apartments in Bergenfield as well as at least 17 other apartment communities, also has agreed to make significant policy changes across all of its properties that will ensure nondiscrimination generally, and particularly protect applicants seeking to use rental assistance to pay for housing.

“Individuals and families who rely on Section 8 housing assistance have just as much right to safe and affordable housing as anyone else,” Attorney General Grewal said. “Too often, those who seek to pay rent using government assistance are turned away for no reason other than bias-driven stereotypes. We are committed to fair and equal housing opportunity.”

Tower Management was accused of unlawfully discriminating against the apartment-seeker by turning him away for a one-bedroom unit because he failed to meet a $33,000 minimum annual income requirement for tenants at Ivy Lane.

That requirement did not take into account any public assistance that a tenant might receive.

The would-be applicant filed a Complaint with the Division on Civil Rights and, in June 2019, the Division issued a Finding of Probable Cause against Tower Management.

DCR found that holding a prospective tenant who intends to pay part of their rent using Section 8 to a minimum income requirement that is based on the entire monthly rent, and not the portion of the rent the tenant would actually pay, violated the New Jersey Law Against Discrimination (LAD).

Section 8 is a federally funded voucher program designed to provide rental assistance to low-income families, the elderly and the disabled.

Participants receive housing choice vouchers and then find their own available rental housing in the private market, typically paying between 30 and 40 percent of their monthly income toward the rent, while Section 8 pays the balance of the rent.

In this instance, the prospective tenant would have been responsible for covering no more than $386 of his overall monthly rent of $995, while the balance would have been paid by the federal Section 8 program.

Despite that fact, Tower Management informed the man they had a minimum annual income requirement of $33,000, which Tower said applied to all applicants – including those who planned to pay their rent with Section 8 vouchers.

“In order to be eligible for Section 8, a person generally must have a very low income, so applying a minimum income requirement to them without regard to the portion of the monthly rent they will actually be required to pay defeats the purpose of Section 8 and could lead to widespread discrimination,” Director Rachel Wainer Apter said. “But there are many other obstacles to fair housing, including landlords categorically rejecting applicants because of a prior landlord-tenant action that did not result in eviction, or rejecting applicants who have less-than-perfect credit, even if they seek to pay with state or federal housing vouchers.”

Tower Management owns approximately 18 apartment communities located throughout New Jersey. In addition to paying the rejected rental applicant $30,000, Tower Management has worked with the Division to adopt reforms and implement a non-discrimination policy to assist tenants using rental assistance through the application process.

Under today’s settlement, Tower Management will implement a written non-discrimination policy that's applicable to all of its properties.

The policy will reiterate that Tower Management accepts rental assistance, including Section 8 vouchers, Temporary Rental Assistance (TRA) and COVID-19 rental assistance.

It will also state that Tower Management will not categorically reject an applicant because of a landlord-tenant action that did not result in eviction, will not consider in its evaluation of an applicant any eviction judgment more than four calendar years old, and will consider applicants who seek to use rental assistance who would otherwise be considered to have insufficient credit.

As part of the settlement, Tower Management will provide all of its property managers and leasing agents training on its new non-discrimination policy, with particular focus on compliance with the LAD and “ensuring that all tenancy decisions are made in a non-discriminatory manner.”

The training will include a component dedicated to the consideration of applicants seeking to use rental assistance, including Section 8 vouchers.

This enforcement action follows other major efforts to combat discrimination against those who use government assistance to pay rent.

In September, the Attorney General and DCR announced “Project HOME” (Housing Opportunity Made Equal), a comprehensive initiative to combat discrimination against those who seek to pay rent with federal, state, or local rental assistance, such as Section 8 housing choice vouchers, the State Rental Assistance Program (SRAP), Temporary Rental Assistance (TRA), or the COVID-19 Emergency Rental Assistance Program.

The Project HOME initiative combined enforcement, prevention, and public awareness efforts, and reflects New Jersey’s national leadership and innovation in promoting fair housing and combating discrimination through the LAD.

Among other things, the initiative included approximately 100 enforcement actions against New Jersey landlords for LAD violations, voluntary compliance agreements with New-Jersey-based companies to end their discriminatory practices, collaborations with various national real estate listing companies – including Zillow, CoStar, and ApartmentSmart.com – to introduce new anti-discrimination software on their platforms, and a new “Model Fair Housing Policy” issued by DCR to help landlords comply with the LAD.

A video of a Town Hall on Project HOME is available [**here**](https://www.youtube.com/watch?v=RPyL7MWZx_E).

Deputy Attorney General Geoffrey R. Gersten of the Division of Law represented DCR in the Tower Management matter. Tower Management did not admit to any wrongdoing as part of the settlement.