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    Applications Now Open for the 2021 Oregon Landlord Compensation Fund

    **This article does not constitute tax or legal advice and should be used for informational purposes only. Please contact your attorney or tax adviser for specific legal and tax questions. PLEASE NOTE THAT ROUND ONE OF APPLICATIONS ARE CURRENTLY CLOSED. THERE WILL BE A ROUND TWO IN THE FUTURE.

    The Landlord Compensation Fund is a landlord-based program where the landlord submits applications for funding to cover unpaid rent from tenants who MUST submit a Declaration for Financial Hardship. A tenant cannot initiate this application. 

    What is the Oregon Landlord Compensation Fund?

    In 2020, Governor Brown prohibited landlords from evicting non-paying residents through a series of Executive Orders and HB 4213 through December of 2020, which was later extended to June 30, 2021. As part of the bill, a fund was created with an allocation of $150 million to help struggling landlords – that fund is now live and accepting applications. 

    According to Oregonlive, “Applications for Oregon’s new landlord compensation fund opened… nearly two months after state lawmakers allocated $150 million to seed the program.

    Landlords [could] apply for relief to cover 80% of the rent they are owed by tenants dating back to April 2020. However, they will be required to forgive 20% of unpaid rent.” 

    While criticized for being much too small for the losses that were potentially caused to landlords who were forbidden to evict non-paying tenants, it is nonetheless now open to requests for relief. A report commissioned by the National Council of State Housing Finance Agencies estimated that Oregon renters would miss between $249 million and $378 million in rent payments by January.

    There are also several lawsuits pending regarding the eviction moratorium, and it is important to note that by accepting funds from this program, you may lose standing in any court case. Please consult an attorney if you have concerns about pending litigation. 

    Step-by-Step How to Apply Video

    How to Apply for the Oregon Landlord Compensation Fund (LCF) 

    PLEASE NOTE: ROUND ONE OF APPLICATIONS ARE CLOSED. THERE WILL BE A ROUND TWO IN THE FUTURE.

    According to the program website, there is a five step process which must be followed in order to be eligible, and, while it’s not too cumbersome, it is not going to be quite as straightforward as you might have hoped. Here’s what you need to do to apply for the Oregon Landlord Compensation Fund:

    1- Provide notice to tenants with past-due rent:
    A standard Building Notice must be provided to all current tenants with past due rent to let them know of the opportunity to have their past due rent covered through this program. When you submit your application, you will need to attest that this notice has been provided. This notice is available in English, Spanish, Vietnamese, Russian, Traditional Chinese, and Simplified Chinese on the program website.

    2- Create an Account in the Application Portal and Add Your Property:
    Once you set up your account, you will be able to add your property(s). The following is the documentation you will want to have handy:

    – W9 information or form for the ownership entity (this will be used to help verify property ownership).

    – If you want your payment sent electronically you will need to provide the ACH / electronic routing information (or indicate you would like to receive your payment by check).

    3- Add Tenant Data to Your Property:
    Once the property is added, you will need to add your rent roll history for the property using the provided template available on our website as well as within the application portal. Please be sure to follow the instructions provided, including: one row per unit, per month from April 1st 2020 through February 16th 2021. Information for all units is needed, including those that do not owe rent. In addition, for current tenants with past-due rent, you must provide a household name, email, and phone number.

    4- Add Tenant Declarations of Financial Hardship:
    Once the rent roll information is added to a property, you will need to add to each eligible unit their signed Declaration of Financial Hardship. The system will allow you to upload files in many formats, including PDF and picture files. NOTE: if you do not have a signed Declaration of Financial Hardship from a current tenant with eligible past-due rent, you will also have the ability to send a notice to tenants (via email) and allow them to provide it directly into your application electronically.

    5- Add to your Compensation Request and submit:
    Once you have completed those steps for all current tenants with past due rent, you will be able to add the rent for those with Declarations into your Compensation Request.

    Keep in Mind

    The LCF only covers rent for existing tenants. If you have a tenant that owed you back rent but has already moved out, you will not be eligible. 

    How the Applications are Scored

    Due to the fact that applications will almost certainly outstrip the funds available, there is a scoring system in place. Luckily for most Oregon investment property holders, this system puts small landlords at an advantage. Here’s roughly how they score:

    -The number of rental units owned (more points for less units)
    -The higher percentage of unpaid debt (debt to collection ratio)

    What Happens After I submit my Oregon Landlord Compensation Fund Application?

    If you are recommended for funding, you will have to sign a program agreement and your property or properties will then be assigned to the local Public Housing Authority. The local Public Housing Authority will verify property ownership, confirm tax information and make direct payments to landlords. Your tenants will also be informed that their rental debt has been covered.

    Helpful Links and Contacts:

    Oregon Landlord Compensation Fund Webinar 

    Oregon State Website for Landlord Compensation Fund

    Compensation Fund Portal Link

    Tenant Declaration of Financial Hardship

    FAQ Webinar Oregon Law Center – FAQ’s HB 4401

    Questions regarding the program can be sent to:  HCS.LCF@oregon.gov

    The Sue Long Realty Group has over 30+ years helping investors in Corvallis and the Mid-Willamette Valley find their next purchase. Contact us for more info or follow us on Facebook.

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