With the Supreme Court having struck down any further extension of the federal eviction moratorium, the onus now falls on states to determine the fate of renters facing the prospect of losing their housing while the pandemic seems anything but over.
At the height of the pandemic, at least 43 states had implemented eviction moratoriums. Today those broad prohibitions remain in effect only in California, Illinois, Minnesota, New Jersey, New Mexico, New York, and Washington.
Connecticut additionally bars landlords from filing eviction claims unless they have also filed for federal rental assistance, while Nevada, Oregon and Massachusetts bar evictions on tenants with a pending rental assistance claim.
The New York measure actually expired on August 31st, but lawmakers last week endorsed a measure that extends the moratorium through Jan. 15th, 2022. Gov. Kathy Hochul (D), who previously called the SCOTUS ruling “appalling and insensitive” and vowed to work with lawmakers on how “best to deliver relief to renters and homeowners in need as quickly as possible,” quickly signed it into law.
The Illinois moratorium was also set to expire the same day as the New York measure, but Gov. J.B. Pritzker (D) extended the Prairie State prohibition through September 18th.
Some states, however, have been moving in the other direction. Texas began allowing eviction proceedings to move forward in March, while Ohio and Tennessee have been doing so since July.
The protections afforded in state moratoriums also varied from state to state. In some states, the ban barred landlords from filing eviction claims at all, while in other states only the final eviction removal itself by law enforcement was placed on hold.
Poor Bear Brunt of Eviction
Exactly how many of the nation’s 43 million renters are facing eviction is not clear. One report from Goldman Sachs estimates that approximately 3.5 million households across the nation are behind on their rent, with at least 750,000 facing eviction before the end of the year.
Meanwhile, a report from the National Equity Atlas (NEA) estimates that at least six million households are currently in arrears by an average of three months and $2,730. The group pegs total rent debt nationwide at almost $17 billion.
What is clear is that the vast majority of those facing eviction – approximately 84 percent - are low-wage workers who have lost jobs during the pandemic. That group is also disproportionately represented by people of color, with at least 66 percent being comprised of Black, Latino, Asian or other non-White groups.
“Allowing an eviction tsunami to take place would be a moral travesty and a policy failure that would deepen inequities at a moment when the federal government has prioritized addressing systemic racism and ensuring an equitable recovery,” the report says.
Federal Eviction Moratoriums
The federal government has also imposed its own nationwide moratoriums, predominantly as part of the multiple aid packages it has developed for states to mitigate the economic hit they took as the nation went into lockdown.
The first partial ban came as part of the Coronavirus Aid, Relief, and Economic Security (CARES Act), signed into law in March of 2020 and intended to expire that December 31st. The Centers for Disease Control and Prevention (CDC) later enacted a broader nationwide band that was to expire at the end of 2020 but which was extended five different times, with the last one expiring on July 31st this year.
With that deadline approaching the CDC tried to extend it again, this time to Oct. 3rd, but was challenged by a group consisting of landlords, real estate companies and trade associations. On August 26th the Supreme Court ruled in favor of the plaintiffs, leaving only the handful of state and local bans in place.
Federal Aid Flounders
With both renters and property owners reeling, Congress included almost $47 billion of rental assistance funding in the American Rescue Plan Act (ARPA), the $1.9 trillion economic stimulus plan signed into law in March.
But while the program is funded and overseen by the federal government, state and local governments are responsible for developing their own systems for dispensing the money to the renters and landlords who need it.
That distribution has been sluggish at best.
While both renters and landlords? agree things are speeding up and more money is now getting out there, by the end of July state and local governments had distributed only $3 billion, or approximately 11 percent, of those dollars.
With that in mind, the Biden administration released new guidance for the program intended to break the gridlock and get more money into the hands of people who need it.
Directives in that guidance include requiring local officials to accept self-reported financial information from tenants on aid applications without documentation to back up their claims. This prompted pushback from locals fearing that could lead to widespread errors or even fraud. But as the New York Times reports, “the White House has countered by telling them that those risks are insignificant compared with a wave of evictions hitting tenants who did not get their aid quickly enough to keep a roof over their heads.”
The U.S. Treasury Department has taken other steps as well, including warning state and local governments doing a poor job of processing federal funds they could face losing those dollars to other areas which are getting the money out more efficiently.
“The president is clear: If some states and localities can get this out efficiently and effectively there’s no reason every state and locality can’t,” Gene Sperling, the administration's COVID relief bill rollout coordinator, said. “There is simply no excuse, no place to hide for any state or locality that is failing to accelerate their emergency” rental assistance.
It is also encouraging local governments to take advantage of a stipulation in ARPA that allows them to use 10 percent of their funding on legal representation for those facing eviction, which has historically shown to drastically cut eviction rates.
The administration has also directly encouraged state and local leaders to extend their own moratoriums.
There is also growing pressure from some Democrats to take up legislation to extend the moratorium. But while House Speaker Nancy Pelosi (D) called the SCOTUS ruling “arbitrary and cruel” and said in a statement that “Congressional Democrats have not and will not ever accept a situation of mass evictions,” there is no indication such a bill is forthcoming.
“If there were enough votes to pass an eviction moratorium in Congress it would have happened,” said White House spokesperson Jen Psaki said. “It hasn’t happened."
Landlords Baring Burdens Too
While the end to moratoriums will almost certainly lead to more eviction proceedings, it is not clear how fast actual broad scale removals could commence, even in states with no current freeze in place.
“You just can’t flip a switch and evict people,” Paul Getty, CEO of real estate investment and broker firm First Guardian Group, told Yahoo Finance. “You still need a legitimate case to do that. It’s very problematic.”
Those cases in fact could take many months to reach conclusion, he said.
In the meantime, some property owners find themselves sandwiched between compassion and their own increasingly desperate fiscal situations brought on by having properties that are occupied but for which they are unable to collect a dime of rent.
It can be a knife’s edge to maneuver.
Scott Kirchner and his wife Mary own three properties in the Sacramento area they are counting on for additional income in retirement. Long before the pandemic hit, they made the decision to list all of their rentals at below market rate as part of a strategy to keep turnover down.
The results have been extremely positive.
He says their renters have faced many of the same challenges others have during the pandemic, including job loss, that has at times made it very tough for them meet their bills. But he says those renters have so far done everything possible to stay up to date, something he credits both to the lower rates and his efforts to get to know the tenants a bit so they don’t see each other as only a business transaction.
“We’re not getting screwed by tenants because we’re not screwing them,” he says. “They are not just objects. They are human beings in crisis.”
--By RICH EHISEN
Handful of States Still Have Eviction Bans in Effect
As of Aug. 31 only 7 states still had in place eviction moratoriums protecting renters during the pandemic, with the majority of states having let their moratoriums lapse due to the federal ban on such evictions. New York’s moratorium, set to expire on Aug. 31, was extended to Jan. 15, 2022, following the Supreme Court’s ruling on Aug. 26 striking down the latest extension of the federal eviction ban. At least four states have other restrictions on evictions.