Renters Alliance sees the COVID-19 relief promised to taxpayers and businesses as wanting. Taxpayers get a one-time payment of $1,200 per adult and $500 per child and some who need it won’t even get it. But businesses (including apartment landlords) already get plenty of tax breaks and now they’ll get more while small landlords lose out. If tenants and landlords can agree on one thing it is that providing relief to tenants will provide relief to landlords too.
What is needed by tenants is relief from the payment of rent and not forbearance in delaying the payment of rent. The eviction moratoriums enacted in Beverly Hills and beyond are about forbearance. In contrast, relief would mean release from the rent obligation. As jobs are lost, pay is cut, and economists are envisioning a years-long economic recovery ahead, relief from the rent (or alternately a universal basic income) may be the best way to keep people housed (and landlords in business).
Landlords agree. In a letter to some localities that have implemented a moratorium on evictions, the Apartment Association of Greater Los Angeles (AAGLA) backs the notion of rent relief. “It is critical that the City establish an emergency assistance fund to provide essential financial support to all impacted residents and businesses struggling during these uncertain and turbulent times,” writes AAGLA executive director Dan Yukelson to city of San Buenaventura.
The need for rent relief is there. According to the latest (2018) census survey, 4-in–10 Beverly Hills tenants pay more than one-third of their household income in rent. That relatively high rent burden means many tenants don’t have a reserve for a lost job or reduced working hours. (Yet we have seen some landlords try to raise the rent at this difficult time.)
Where tenants and landlords disagree is on the value of a moratorium on eviction during the pandemic crisis. Earle Vaughan, past president of AAGLA, has an opinion about forbearance and it is suggested by the URL on his post: aagla.org/2020/04/a-moratorium-on-evictions-no-f-ing-way/
It is unfortunate that tenant rights groups are using the Coronavirus scare as an excuse to let our renters skip paying rent as if we rental housing providers, particularly those of us that are smaller, “mom and pop” owners, do not need to collect rent to pay our operating costs and living expenses… It seems that California is getting crazier and crazier. Perhaps if California were to fall into the ocean, it would cleanse us of its stupidity.
It is fair to say both tenants and landlords are concerned about the back rent owed once the emergency declaration is rescinded. There is the one-year repayment period, of course, but some tenants will be on the hook for back rent that they cannot afford to pay back. Some landlords will suffer some loss and some tenants will go packing. That’s what has animated tenant advocates to call for more significant relief: cancelled rent and the unpleasant alternative, the rent strike.
If no help is coming from the federal government in the form of rent relief, then advocates in California are supporting a statewide initiative: #CancelRent.
Two housing advocacy organizations have taken the lead: Housing is a Human Right, the group behind last year’s failed Proposition 10 initiative, and Tenants Together, the statewide tenant group based in San Francisco. “An eviction moratorium is NOT ENOUGH and tenants deserve a #DebtFreeFuture,” says the campaign to #CancelRent.
These pro-tenant groups have recruited 140 co-sponsors to sign a letter LINK to the governor asking for:
- Emergency rental and mortgage assistance;
- Suspension of rent and mortgage payments;
- Debt forgiveness for back rent and mortgage arrears during the crisis.
Elected officials from West Hollywood, Los Angeles, Culver City and Santa Monica have put their names to the campaign. No official from Beverly Hills has yet to sign on.
The #CancelRent campaign looks to Governor Newsom to order relief in part because the state legislature has not been tenant-friendly. Landlord associations like the Apartment Association of Greater Los Angeles (AAGLA) and the California Apartment Association (CAA) have their tentacles wrapped around many legislators. The legislature is slow to act too. That means relief should come from the Governor’s office.
The Los Angeles Times editorial board instead favors a federal response. In an editorial titled ‘It’s not just renters. Landlords need help, too,’ the Times suggests federal rent vouchers is a good idea. Landlords like vouchers because vouchers are rent. Tenants like vouchers because there is direct relief — not a delayed rent payment. (We can support rent vouchers because we believe that no family in rental housing is too small to bail.)
It is not just tenants that is the concern of the Times. The editorial notes the relatively large proportion of small and economically-vulnerable landlords in California “We want landlords to stay in business,” says the editorial board. “They provide an essential service: a roof over one’s head.” While the editorial does not say ‘bailout,’ the term does appear in the web address for the editorial.
Why hide from the term ‘bailout’? There is precedence for a direct handout to tenants. After all, the federal government has given public money to banks and airlines to weather a crisis, and that assistance has gone directly to stockholders (in the form of dividends and stock buybacks) and executives with stock-indexed compensation packages. That largesse has disproportionately benefited the wealthiest 10% of Americans who own 84% percent of all stocks, and those gains went disproportionately to 1-in–10 of them top decile — or the proverbial ‘one percenters.’
The COVID–19 ‘Coronavirus Aid, Relief, and Economic Security Act (or CARES Act) provides even more tax breaks and other financial goodies to the property industry. Why should the federal government bail out corporations and real estate investors while leaving tenants on the proverbial street and small landlords with a unit that is not contributing to operating expenses?
The trickle-down philosophy in an emergency will only encourage more radical responses like the rent strike campaign which is already on the political agenda in California.
Where tenants and landlords definitely do not agree is the tactic of the rent strike. Ordinarily a rent strike is mobilized to fight substandard conditions and to protest poor housing services. Here it is repurposed to put pressure on Sacramento to step in because evidence is mounting that COVID–19 emergency measures are disrupting housing arrangements for tenants.
Says statewide tenant advocacy group Tenants Together: “In the face of corporate bailouts, rent strikers demand relief. If the Governor fails to #CancelRent for those affected by Coronavirus, we are preparing to call for a statewide rent strike May 1st or June 1st.”
Activists are organizing rent strikes in a number of California cities, with landlords in Los Angeles, Oakland and San Francisco as apparent targets. In this politically-combustible atmosphere, the landlord’s statewide California Apartment Association is seeing trouble on the horizon. From a letter-to-tenants template provided to association members:
I understand you have decided to participate in a “rent strike,” electing not to pay the rent during this time…While we understand the frustration people are feeling and the uncertainty that the current situation presents, choosing to defer rent for any reason other than a COVID–19-related loss of income is a violation of your rental agreement as well as all state and local orders. In order to maintain the property and continue services, we will have to take the necessary legal actions to recover possession of the property and collect the rent you owe. This could result in your default being reported to credit bureaus and negatively affecting both your credit and ability to find housing in the future. — California Apartment Association
But it is not only the advocacy organizations with rent strike on the brain. It is also everyday tenants who suffer poor housing services, tolerate cold-hearted (or absent) management and NOW find themselves in a jam due to COVID–19 emergency measures.
Landlords like to say, “We’re all in it together,” but sometimes the signals suggest otherwise. And a careless email like this one can put a match to the accumulated dry tinder of tenant grievances. It seems like the febrile atmosphere around COVID-19 may overwhelm longtime efforts by AAGLA and CAA to keep a lid on tenant calls for rent control.
And our governor may find it increasingly difficult to hide from tenant calls to #CancelRent here in California and to duck an effort in Washington, D.C. to put rent relief on the national agenda. Tenants are asking ourselves, Why let this crisis go to waste when systemic reform is long overdue?
Newsflash:The California Apartment Association has backed a bill amendment in Sacramento that would cover at least 80% of unpaid rent if a tenant can demonstrate that they have been affected by the pandemic. SB 1410, an unrelated housing bill authored by State Senator Lena Gonzalez (D-Long Beach) is expected to be gutted to accommodate legislation that would have the state make direct rental payments to landlords. With the legislature not in session, however, it is not clear when the bill may be amended, much less scheduled to go to any senate committee.