SENATE COMMUNITY AND URBAN AFFAIRS COMMITTEE

STATEMENT TO

SENATE, No. 4347

with committee amendments

STATE OF NEW JERSEY

DATED:  NOVEMBER 10, 2025

      The Senate Community and Urban Affairs Committee reports favorably and with committee amendments Senate Bill No. 4347.

      As amended and reported, this bill, known as the "Safeguarding Livable Units through Municipal Landlord Oversight and Regulation by DCA" or "SLUMLORD Act," strengthens protections for residential tenants for violations of the implied warranty of habitability and other code violations that severely affect the habitability of the tenant’s rental unit.  The bill requires the Commissioner of Community Affairs (commissioner) to establish a Habitability Enforcement and Affirmative Litigation Program (program) in the Department of Community Affairs (DCA).  The bill also: codifies the implied warranty of habitability; authorizes a private cause of action for residential tenants (tenants) for habitability violations and provides certain remedies; imposes personal liability and criminal penalties on certain landlords and their agents for severe habitability violations; extends a tenant’s ability to recover attorney’s fees and certain costs to actions arising from habitability violations; and establishes a habitability database to enhance the efficacy of the program.

      Specifically, the bill requires the establishment of the program to: provide information to tenants regarding habitability violations, as defined in the bill; and engage in litigation, through public-private partnerships, on behalf of tenants to enforce habitability violations.  The program is to consist of a Tenant Advocate Service and Affirmative Litigation Initiative, which are not to expend resources representing residential tenants in defense of an eviction action, unless for certain cases involving reprisal.

      The bill requires a landlord, as defined in the bill, to designate at least one principal agent, as defined in the bill, who is to be the primary agent of the landlord for the purposes of complying with the bill, receiving habitability violation complaints from tenants, directing the property management company to abate violations, and, who is to be authorized to accept service of process from the registered agent or process server, receive confidential communications, and be personally and criminally liable for severe habitability violations, as defined in the bill.  The bill provides the principal agent is to meet certain requirements described in the bill.  The bill requires a written lease to clearly provide certain contact information of the principal agent, and the principal agent to continuously update this information as necessary.

      The bill provides a private cause of action and permits a tenant to bring an action alleging a habitability violation, which remains unabated following written notice to the landlord and a reasonable opportunity to cure.  A tenant is not to bring an action pursuant to the bill under certain circumstances enumerated in the bill.  The bill provides that it is an affirmative defense against an action alleging a habitability violation if the tenant is currently in arrears on any rent lawfully due and owing to the landlord, unless the rent is in arrears under certain circumstances.  The bill authorizes the court to award all appropriate damages.  The bill specifies that for habitability violations, the landlord would be subject to the penalties set forth in the bill for each violation against each tenant.

      The bill further provides that a habitability violation is to constitute an unlawful practice pursuant to the New Jersey consumer fraud act, P.L.1960, c.39 (C.56:8-1 et seq.), and prescribes certain penalties depending on whether there exists a habitability violation or a severe habitability violation.  If a court determines that a severe habitability violation exists, the bill requires a court to order the landlord to abate the violation in a specified time period, which, if not timely abated, would enable the program, or the municipality in which the landlord’s unit is located, including a municipal enforcing agency or other similar agency of the municipality (municipality), to abate the condition giving rise to the violation, at the landlord’s expense, which expense would constitute a lien against the premises.  If the lien is held by the municipality, the lien is to be held and enforced in the same manner, time, and proceedings as taxes owed to the municipality pursuant to Title 54 of the Revised Statutes.

      The bill provides that a court may hold a principal agent personally liable for a severe habitability violation, as specified in the bill.  The bill also establishes that a principal agent is guilty of a disorderly persons offense if the principal agent intentionally, recklessly, or negligently commits or engages in conduct resulting in a severe habitability violation.  A disorderly persons offense is punishable by a term of imprisonment of up to six months, a fine of up to $1,000, or both.

      The bill provides that if a property is being managed by a property manager or property management company that is a licensed real estate broker, broker-salesperson, or salesperson, other than a beneficial owner of the landlord's rental business or entity, and that property manager or property management company requests that the principal agent or landlord make repairs to the property but the repairs are not made, through no fault of the property manager or property management company, the property manager or property management company arel not to have any direct or indirect liability under the bill or otherwise, including but not limited to the principal agent or landlord, for the failure to make those repairs.

      To facilitate the efficacy of the program, the bill requires the commissioner, in coordination with the Administrative Director of the Courts, to establish and maintain a habitability database, which is required to contain certain information pertaining to habitability violations, as described in the bill.  The bill permits a landlord to petition the DCA for removal from the habitability database if the landlord can demonstrate that they do not meet the requirements under the bill for inclusion in the database.

      The bill amends section 2 of P.L.1974, c.50 (C.46:8-28) of the "Landlord Identity Law," to expand the information and individuals required to provide information for purposes of the certificate of registration, to include the principal agent, certain corporate officers and directors, and to facilitate the identification of a beneficial owner, as defined in the bill.  Further, the bill amends P.L.2013, c.206 (C.2A:18-61.66), which permits a tenant to recover attorney’s fees to the same extent as the landlord, if the residential lease permits the landlord to recover attorney’s fees for actions arising out of the lease.  The bill extends and modifies the tenant’s ability to recover attorney’s fees and certain costs to actions arising from habitability violations.

      The bill appropriates $5 million from the General Fund to the Habitability Enforcement and Affirmative Litigation Program to effectuate the provisions of the bill. 

COMMITTEE AMENDMENTS:

      The committee amended the bill to:

· modifies the definition of "landlord" to exclude certain rental circumstances;

· exclude seasonal rental units from the definition of "rental unit" and provide a definition of "seasonal rental unit;"

· add a definition for "municipality;"

· clarify the meaning of "transient accommodation" in the definition of "rental unit; "

· specify that a court may require a tenant to place rent monies in escrow in light of the habitability violations alleged or proven in litigation;

· remove certain restrictions on a tenant bringing an action if the tenant is in arrears under certain circumstance;

· clarify when a tenant is not permitted to bring an action after a landlord has authorized the tenant to make certain repairs;

· establish an affirmative defense against an action alleging a habitability violation if the tenant is in arrears, unless the tenant is in arrears under certain circumstances;

· supplement Title 2C to establish that a principal agent is guilty of a disorderly persons offense if the principal agent intentionally, recklessly, or negligently commits or engages in conduct resulting in a severe habitability violation (accordingly, the amendments also remove language from the bill that previously provided that a severe habitability violation would have constituted a crime of the fourth degree);

· provide that if a property is being managed by a property manager or property management company that is a licensed real estate broker, broker-salesperson, or salesperson, other than a beneficial owner of the landlord's rental business or entity, and that property manager or property management company requests that the principal agent or landlord make repairs to the property but the repairs are not made, through no fault of the property manager or property management company, the property manager or property management company are not to be liable under the bill;

· specify that the habitability database is to be used exclusively by the DCA and municipality for the purposes of the bill;

· provide that the habitability database show any case filed by a tenant alleging a habitability violation pursuant to the bill that resulted in favorable disposition to the plaintiff-tenant by a judge of the Superior Court of New Jersey;

· permit a landlord to petition the DCA for removal from the habitability database if the landlord can demonstrate they do not meet the requirements for inclusion;

· include nonprofit legal services or pro bono counsel in the implied covenant that requires a landlord to pay certain legal fees; and

· remove the requirement that 30 percent of any damages or penalties recovered in an action brought pursuant to the bill be awarded to the attorneys that represent a tenant.