Yesterday, the Administration, via an order filed by the U.S. Centers for Disease Control and Prevention (CDC) in the Federal Register, cited a public health emergency to halt residential evictions until December 31, 2020 to prevent the further spread of COVID-19. The White House Press Release can be found here.
Needless to say, we are deeply disappointed that this moratorium is being enacted, particularly without the backup of a meaningful rental assistance program. Within an hour of the notice being published, we issued the following press statement, noting that eviction moratoriums do nothing to solve renters' real financial stress problem. Moreover, they do not address the financial pressures and obligations of rental property owners. Without mortgage forbearance protections and protections from other property-level financial obligations such as property taxes, insurance payments, and utility service, the stability of the entire rental housing sector is thrown into question.
We are analyzing the order and will provide additional guidance based on our review. Importantly, unlike the moratorium included in the CARES Act, this moratorium applies to all residential rental properties even if they do not have a federally backed mortgage.
Notably, the Order does not forgive rent or relieve any individual of their obligation to pay rent under their lease terms. It simply precludes eviction actions through December 31, 2020. It also does not preclude late fees or penalties from being assessed. It also imposes several limitations on when and how the moratorium applies. Specifically:
- The moratorium only applies to individuals making $99,000 or less or families making $198,000 or less.
- Renters must certify, under penalty of perjury, that:
- They have made a “good faith” effort to seek rental assistance.
- They are unable to pay due to COVID-19-related hardship.
- Eviction would cause them to become homeless or live in close quarters.
- The Order provides a sample Declaration form (Attachment A) for renters to provide to their housing provider when seeking the eviction protection.
- Evictions would still be permitted for lease violations unrelated to inability to pay because of COVID-19.
NMHC continues to urge Congress to enact a robust rental assistance program and to oppose blanket eviction moratoriums. Importantly, enacting this measure through public health authority provides the Administration with potentially more legal justification for the action, but also fails to address or provide for the economic considerations needed to support the apartment industry going forward. There are certainly questions surrounding the legality of this Order; but the industry should be prepared for this measure to be in effect September 4.
We know that you, our members, are on the front lines of providing shelter to millions of Americans and that you cannot do it without federal support in these unprecedented times. NMHC will continue to monitor the implementation of this new Order and the impact to the industry, while also making the case to policymakers that renter protections must be paired with rental assistance.