NJ’s Law Against Discrimination Protects Tenants Paying Rent with Section 8 Housing Choice Vouchers

BY YULIYA V. TEDESCHI, ESQ., NJ REALTORS® GENERAL COUNSEL

The New Jersey Law Against Discrimination prohibits discrimination in the housing market by establishing legal protections for renters who pay rent with Section 8 Housing Choice Vouchers, commonly referred to as HCVs, or any other source of lawful income. This prohibition applies to housing providers as well as real estate licensees and makes it illegal to discriminate against prospective renters who qualify for HCVs or similar rental assistance subsidies.

Protections under the NJLAD

The NJLAD is a broad anti-discrimination statute which, among other things, prohibits discrimination against protected classes when advertising, selling, renting, leasing, subleasing, assigning, and showing property. More specifically, the law makes it illegal to discriminate against a renter or buyer because of their race or color; religion or creed; national origin, nationality, or ancestry; sex, pregnancy, or breastfeeding; sexual orientation; gender identity or expression; disability; marital status or domestic partnership/civil union status; liability for military service; familial status (having children under 18); as well as their source of lawful income.

The establishment of source of lawful income as a protected class furthers a statewide initiative to promote equal access to safe, decent, and sanitary housing for all New Jersey residents. Under the law, housing providers, landlords, real estate agents, and brokers, among others, are prohibited from engaging in discriminatory practices based on the source of a prospective tenant’s legal funds. For example, housing providers may not refuse to rent a unit and may not modify the terms of a rental agreement because the tenant intends to pay a portion of their rent with HCVs or another subsidy. Similarly, real estate agents are not permitted to promote or engage in such discriminatory practices, even at the express direction of their clients. Accordingly, it is unlawful for a brokerage to state, in an advertisement or otherwise, that “the owner does not accept HCVs,” “this property is not approved for Section 8,” “the cap for HCVs has been met at the property,” or something similar. Therefore, a real estate licensee must refuse a listing if the housing provider indicates an intent to discriminate on any basis prohibited by the law.

What Qualifies as a Source of Lawful Income

The NJLAD requires housing providers to accept all sources of lawful income when reviewing a rental application. Sources of lawful income include subsidies provided by federal, state, or local rental-assistance programs including HCVs, COVID-19 Emergency Rental Assistance Program, State Rental Assistance Programs, temporary rental assistance, Eviction Prevention Program, unemployment benefits, child support, alimony, supplemental security income, and more.

Housing providers must consider all sources of lawful income equally when reviewing a rental application and may not impose different standards upon renters who are recipients of HCVs. This means the calculation of any minimum income or financial requirements on rental applications must take into consideration the applicant’s receipt of rental assistance subsidies. Accordingly, any such income thresholds must be calculated only on the portion of the rent to be paid by the tenant, not the entire rental amount.

Understanding the HCV Program

The HCV Program is designed to provide limited financial assistance to very low-income households, the elderly and the disabled who are in imminent danger of eviction or foreclosure due to financial struggles beyond their control. The program is federally funded but administered by New Jersey Public Housing Agencies. By law, PHAs allocate at least 75% of HCVs to individuals whose incomes do not exceed 30% of the median income in the area.

Once a PHA deems an individual eligible for the program, the individual may choose any suitable rental property—the individual is not limited to properties located in subsidized housing areas. When the lease is executed, the PHA enters into a ‘housing assistance payment contract’ with the housing provider which remains in effect for the duration of the lease term. Thereafter, the PHA submits payments directly to the housing provider and the tenant pays the difference between the actual rent owed and the amount subsidized by the program.

Violations

Violations of the NJLAD are subject to penalties of up to $10,000 for a first violation; up to $25,000 for a second violation occurring within five years of the first offense; and up to $50,000 for two or more violations occurring within seven years. Victims of discrimination may recover economic damages as well as damages for emotional distress, pain, and humiliation. In some cases, a victim may also be entitled to punitive damages.

For additional information about the NJLAD or for questions about discrimination in the rental or sale of real property, including how to report a complaint, please contact the New Jersey Division of Civil Rights' Housing Hotline at (866) 405-3050 or visit NJCivilRights.gov.

Key Takeaways

1. HCVs are a ‘lawful source of income’ in NJ.

Real estate licensees cannot endorse a housing provider’s discriminatory practices.

3. Housing providers must accept all rental assistance subsidies as lawful income.

4. There is no “cap” on acceptance of rental assistance subsidies at any property.