In September 2020 California Legislature passed the COVID-19 Tenant Relief Act of 2020 which prohibited landlords from evicting certain “qualified” residential tenants that could not pay their rent due to a Covid-19 related illness or loss of income. Landlords were required to serve a 15 Day Notice with the proper language to tenants. Tenants who submitted a declaration under penalty of perjury of their Covid-19 related financial distress could not be evicted and were protected under the Act as “qualified” tenants. The Tenant Relief Act was set to expire on January 31, 2021 and required qualified tenants to pay 25% of the rent due from September 1-January 31, 2021 by January 31, 2021 or face eviction as of February 1, 2021.
In an effort to limit a wave of evictions, the California legislature passed Senate Bill 91 (SB-91) on 1/28/21. SB-91 extends the protection of qualified tenants and extends the time for tenants to pay the 25% of rent due between 3/1/21 and 6/30/21 to June 30, 2021. SB-91 also adds new notice language that is required to be provided to tenants on or before 2/28/21, as well as new language to be added to the 15 Day Notice to Pay Rent or Quit served on or after 2/1/21.
Under this new law, SB-91 prohibits landlords from evicting these qualified tenants unless they fail to comply with these terms by June 30, 2021 and continue to provide the Declarations of Covid-19 related hardships each month if served with a 15 Day Notice. Tenants who fail to pay the 25% owed from 3/1/20-6/30/21 can be evicted starting 7/1/21. Any remaining unpaid rent may be converted to consumer debt collectible in small claims court starting 8/1/21.
An important distinction of the new act SB-91, however, is Federal Housing assistance has been made available for a tenant (or a tenant’s household) where at least one member has a Covid-19 related financial hardship and income of 80% or below the average area median and face a documented risk of housing instability.
SB-91 allows a landlord to apply (with the tenant’s permission) for the funds to repay up to 80% of certain qualified tenant’s past-due rent accumulated between 4/1/20 and 3/31/21 conditioned however on the landlord agreeing to forgive the remaining 20% of the rent owed for that timeframe. If the landlord does not agree to these terms, and if the tenant qualifies, federal assistance will pay 25% of the past due rent directly to the tenant instead. Funds for future rent may also be paid by this assistance if the tenant qualifies, but future rents are limited to 25% of the future rent due.
A few additional notes on SB-91, it prohibits landlords from charging late fees, collection fees or to damage a tenant’s credit for rent owed by qualified tenants during this time period. Landlords are also prohibited from using the security deposit of a qualified tenant to pay for these past due amounts. There are penalties for landlords who violate the provisions of SB-91.
If a landlord seeks to evict a qualified tenant for unpaid rent, landlords will be required to prove they made good-faith efforts to help tenants obtain household assistance. Courts can reduce damages to the extent landlords refused those funds.
“Just cause” evictions are still allowed under SB-91, so evictions may still go forward for a violation of a tenant’s lease terms other than non-payment of rent/utilities (ie. unauthorized roommates, guests, pets, nuisance) or to recover pre- pandemic rent (rent owed prior to 3/1/20). “No-fault” evictions are also allowed (ie. owner move-ins, remodels/demolitions, and taking the unit off the market) under SB-91.
If a city or county has a more protective local ordinance, the eviction or other protections of that local ordinance-rather than those of SB 91-may apply. If tenants live in a town or county with a pre-existing unexpired local eviction moratorium that provides more protection, this local ordinance may still apply. Local ordinances may also have better protections against rent increases, etc., or protect tenants who don’t qualify under SB-91.
SB-91 does not cover commercial tenants, but most local eviction moratorium ordinances may.
Please contact us for any additional questions regarding this new law.