How Beverly Hills Tenants Lost Local COVID-19 Eviction Protections

The ‘COVID-19 Tenant Relief Act of 2020’ took effect on September 1st to protect COVID–19 affected tenants from eviction for nonpayment of rent. And it came in the nick of time. That day the California courts resumed the processing of unlawful detainers. But lawmakers had another motive besides tenant protection: they wanted to impose uniform terms across localities by preempting local measures like our own eviction moratorium. Beverly Hills city council unwittingly played right into the hands of the lawmakers!

Note: The city attorney maintains that the Beverly Hills moratorium on eviction for nonpayment due to COVID 19 is NOT preempted by the Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020. In that case Beverly Hills tenants are affected by some of its provisions — namely a new deadline for repaying back rent of March 1, 2021 — but not others such as the new process for obtaining forbearance. Our reading is that our moratorium is preempted and this post is offered in keeping with that reading.

The Backstory

August was crunch time in Sacramento because the state’s Judicial Council, the body that governs the administration of the superior courts, was getting impatient with the legislature. Nearly six months into the pandemic, the courts were still closed to the routine business of filing unlawful detainers. But pipeline cases were waiting resolution and landlords were champing at the bit to oust nonpaying tenants. As of September 1st the courts said eviction cases could again proceed so it  was up to the governor and the legislature to sort out the looming eviction crisis.

The legislature moved AB 3088 to the governor’s desk in record time as a ‘hail Mary’ pass. The governor signed it with only hours to spare. The bill enacted the Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020. The legislation not only mandated eviction protection but also imposed a new statewide process for delaying the payment of rent and repaying that delayed rent.

Of course our own moratorium specified a process by which Beverly Hills tenants could request (and qualify for) forbearance. But the law was crafted specifically to preempt local measures like our moratorium. When preempted, the terms of a local measure would yield to the statewide process. That is codified in a 30-word clause that is buried 24,000 words deep into the 25,000-word legislation (in bold):

CCP §1179.05. (a) Any ordinance, resolution, regulation, or administrative action adopted by a city, county, or city and county in response to the COVID–19 pandemic to protect tenants from eviction is subject to all of the following:
(1) Any extension, expansion, renewal, reenactment, or new adoption of a measure, however delineated, that occurs between August 19, 2020, and January 31, 2021, shall have no effect before February 1, 2021.

Both the eviction protection and the preemption clause is in a section of the legislation known as the COVID-19 Tenant Relief Act of 2020 (heretofore referred to as Tenant Act).

Preemption Triggered

On September 1st city council repealed the urgency ordinance that enacts the local moratorium and replaced it with a successor urgency ordinance 20-O-2818 in order to make a very small change unrelated to tenant protections. The new ordinance imposes a cap on the service charge that a food delivery service adds to the restaurant bill. Otherwise the text of the prior ordinance was unchanged. However the small addition had the unintended effect of changing the terms for delaying the rent for COVID-19 affected tenants.

Repeal-and-replace is not new; city council had repealed and replaced the urgency ordinance a half-dozen times since the moratorium was enacted in March. The difference is that the latest repeal-and-replace came about 10 days after the August 19th cutoff date in the legislation. By repealing-and-replacing it looks like council unwittingly ceded the relatively better tenant protections in our moratorium for the statewide terms of the Tenant Act.

Briefly these are the new terms that will affect tenants who have delayed the payment of after September 1st, or who will delay the payment of rent in the months through January:

  • Tenants who delay the payment of rent that was due on or after September 1, 2020 must pay a minimum of 25% of the total rent due for the period September through January. This will primarily affect tenants who delay a substantial amount of the rent in that period.
  • Tenants may receive from the landlord a 15-day to pay-or-quit notice which is the first step in declaring financial hardship related to COVID-19 that protects a tenant from eviction for non-payment. A notice may be served for each month after September 1st in which full rent is not paid.
  • Having filed the city’s form for requesting forbearance may not be sufficient to protect a tenant against eviction for nonpayment if the tenant has not also returned the declaration of financial need as required by the Tenant, Homeowner, and Small Landlord Relief and Stabilization Act.

The Tenant Act also requires of tenants documentation of financial hardship if household income is greater than $100,000 and the landlord already has in his possession prior documentation of household income at that level or above. (This provision is a bit complex so please get in touch if you have delayed rent after that date and household income exceeds that threshold.)

Regardless of preemption, the Tenant Act also includes a new mandate: a firm deadline of March 1st to repay all delayed rent since the start of the pandemic. Failure to pay back rent by that date will expose the tenant to a money judgement for rent owed.

Insult to Injury: Tenants Get Scant Guidance from the Rent Stabilization Office

The Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020 took our city council by surprise. And it is complex legislation that requires localities to understand and explain exactly how it changes the terms for tenants affected by COVID-19 who have delayed the payment of rent.

Unfortunately tenants in Beverly Hills have gotten only scant guidance from the city. For example, we have received no definitive or persuasive statement from the city attorney as to how, or whether, certain terms in our moratorium are preempted. When tenants are surprised to receive unfamiliar notices mandated by the law, the city merely refers them to the city’s legal services provider, Bet Tzedek.

But Bet Tzedek has better things to do that to explain to each tenant individually what other cities provide their tenants: an explanation of the state law and how it applies. Instead, our rent stabilization office has emailed and posted guidance that amounts to fewer than 100 words on this complex law:

Please be informed that the recent state Assembly Bill 3088, does not affect the ongoing eviction protections provided to residential tenants in the City of Beverly Hills. The requirement under AB 3088, that the tenant pay at least 25% of their total rent between September 1, 2020 and January 31, 2021 (either in installments or as a lump sum paid before January 31, 2021), does not apply to residential tenants residing in the City of Beverly Hills. The current City of Beverly Urgency Ordinance remains in effect and applies to residential tenants residing in the City of Beverly Hills.

Other cities have posted explainers, FAQs, and even explanatory videos for tenants. Not Beverly Hills. That is not surprising. Communication with tenants is not our city’s strong suit.

How City Council Could Have Avoided Preemption

Had city officials reviewed the text of Tenant, Homeowner, and Small Landlord Relief and Stabilization Act they could have recognized that repealing our urgency ordinance, even for a minor change like the cap on a food-delivery charges, would trigger preemption of certain aspects of our moratorium. The Act plainly says that “extension, expansion, renewal, reenactment, or new adoption of a measure” would allow the Tenant Act to preempt.

Council could then have imposed the food delivery cap with a standalone ordinance. Indeed the food-delivery cap was the only change made to the entire urgency ordinance; it didn’t really require repeal-and-replace; the actual council discussion on the cap lasted only six minutes. Yet by repealing-and-replacing the urgency ordinance, council effectively changed the rules for tenants who delay the payment of rent. AB 3088 was not even mentioned during the discussion.

So we unwittingly played right into the legislature’s hands! Adding insult to that injury, our rent stabilization office has not even clarified the scant guidance it has posted. Eight weeks after the law was enacted, the posted guidance doesn’t even mention the most important change imposed by the Tenant Act: that new March 1st deadline for repaying delayed rent. Seriously.

 

RSO AB 3088 guidance screencap
The guidance on AB 3088 posted to the rent stabilization website on September 21st and still posted as of October 5th.