August 17, 2020
The Judicial Council of California voted 19-1 last week to end the COVID-19 emergency moratorium eviction and foreclosure rules in place since early April. The state can resume those legal proceedings on Sept. 2, though Governor Gavin Newsom and state legislators are working on new longer-term proposals to extend protections into 2021.
California Chief Justice Tani G. Cantil-Sakauye said, “The judicial branch cannot usurp the responsibility of the other two branches on a long-term basis to deal with the myriad impacts of the pandemic. The duty of the judicial branch is to resolve disputes under the law and not to legislate. I urge our sister branches to act expeditiously to resolve this looming crisis.”
More than 10 million people have filed for unemployment benefits in California since the start of the coronavirus pandemic in March. Advocates for the protections fear there will be a wave of evictions if renters fail to meet their obligations. Multifamily property owner advocates argue there also must be protections worked in to keep them from losing their investments should they not be able to meet loan obligations or cover other expenses such as staff, property maintenance or needed repairs.
Two proposals are under consideration to halt evictions during the pandemic, although each differ in how landlords will be compensated for lost rent payments. Assembly Bill 1436 would protect property owners from foreclosure, while the Senate version, SB 1410, provides options for property owners to take credits against state taxes starting in 2024.
The California Apartment Association (CAA) says the Assembly bill is akin to a “free rent bill.” The organization supports the Senate’s proposal, which is a more expensive option that could cost the state more than $12 billion and comes as lawmakers are seeking to solve multibillion budget deficits.
CAA’s Tom Bannon says, “We urge lawmakers to pass legislation that keeps tenants housed but also compensates landlords for providing that housing. Otherwise, mortgages won’t get paid, employees won’t get paid, and rental housing will disappear from the market.”
The final version is likely to be a combination of the two proposals and is expected be hammered out before the current legislative session ends on Aug. 31.
For comments, questions or concerns, please contact Dennis Kaiser