AB 832: Sacramento Continues Moratorium and Expands Rent Relief

Governor Gavin Newsom and the state legislature came to agreement on June 28th to enact AB 832 (COVID–19 relief) and to administer $27 billion in federal COVID–19 rent relief funds. The bill extends tenant eviction protection under SB 91 to September 30, 2021 (still contingent on 25% partial payment) and, in a win for tenants, makes federal relief money available for both back rent and prospective rent payments. For landlords the reimbursement percentage increases from 80% to 100% to make landlords whole. Let’s take a look at what is likely to be the last update to the state moratorium.

AB 832 is the successor legislation to AB 3088 and SB 91 that extends current tenant protections to September 30th. AB–832 requires the tenant to provide the landlord a signed hardship declaration in response to a 15-day notice to pay rent from the landlord; and makes protection against eviction for nonpayment contingent on the tenant paying at least 25% of the total rent owed for the period between September 2020 and September 2021 and to make that payment by no later than September 30, 2021. It can be lump-sum or monthly payments.

Pursuant to AB 832, on or before July 31, 2021 the landlord must provide to tenants who not paid full rent prior to September 30, 2021 an updated COVID–19 Tenant Relief Act notice. The is given before, or concurrent with, the 15-Day Notice to Pay or Quit that triggers the state moratorium protections. Read more about the state’s moratorium program or have a look at the Southern California Rental Housing Association’s guide to AB 832.

We’ve been contacted by tenants asking about the extension of state tenant protections and because City of Beverly Hills hasn’t updated its Eviction Moratorium Update since March 2021 it falls to Renters Alliance again to get the word out.

Background

AB 3088 was enacted in the fall to create a statewide framework for the delaying and repaying of rent — and to shield tenants from eviction for nonpayment due to COVID–19 hardship. The legislation also blocked eviction in nearly any case except where the tenant was at fault. The latter is consequential because it prevented displacement during the pandemic where tenancy termination would otherwise be allowed (for example redevelopment or no-just-cause termination where allowed).

SB 91 extended those protections from March 30 to June 30th and also imposed ‘debt masking’ to protect COVID–19 hardship tenants from adverse credit reports

AB 832 extends all of those provisions — plus enhances the state rent relief program — through September. The 11th-hour haste to enact the successor legislation came as statewide eviction protections were due to expire on June 30th. And it was an uncharacteristically fast trip through the legislature to the Governor’s desk: AB 832 sailed through two Assembly committees and was passed (by big majorities) in both the Assembly and Senate and signed by the governor all in the same day.

Local Protections Remain in Place — For Now

In the background, even as the state has enacted tenant protections through AB 3088, SB 91 and now AB 832, localities have enacted their own protections. The local measures (mostly) supersede state measures. For example, localities have imposed their own moratoriums on eviction for nonpayment. Some have also put a moratorium on no-fault evictions too (allowing only at-fault evictions to proceed).

Most tenants are concerned with eviction for nonpayment, of course. Here City of Beverly Hills has our own process for delaying the payment of rent — and no 25% minimum is necessary (although hardship must be documented). In Beverly Hills landlords can’t raise the rent (yet) and cannot evict for any no-fault reason.

However in Beverly Hills and beyond it is still lawful to evict for any at-fault reason which can be maintaining a nuisance, allowing unauthorized occupants in the household, damaging the premises or breach of the rental agreement. Lease breaches can include keeping unauthorized pets, failing to maintain renters insurance, or leasing through AirBnB (as long there is a relevant prohibition in the lease).

AB 832: More Help with Rent Arrears, Future Rent and Utilities

Besides protecting against eviction the other key provision of Assembly Bill 832 is an enhanced state rent relief program that increases reimbursement to the landlord (100% less partial payments from the tenant) and that makes relief available for both rent arrears and prospective rent obligations (through September). And past and future utility obligations are covered too.

Current applicants will see their applications automatically adjusted to reflect the greater reimbursement. Tenants who have already vacated are now newly eligible to apply for rent relief. Find more details at the COVID–19 Rent Relief program webpage.

The enhanced relief program puts both affected tenants and their landlords at some ease. Landlords who are concerned about recovering rent debt from tenants long gone now have a mechanism to be made whole, potentially, while tenants who vacated under pressure from the accumulating rent debt may see that debt discharged. For more information call the COVID–19 Rent Relief Call Center at 833–430–2122.

AB 832 also addresses an oversight in SB 91 where a landlord who didn’t want to accept 80% reimbursement could refuse to participate — and effectively deny tenants most of that relief. (An unscrupulous landlord could deny participation to increase pressure on a tenant with rent arrears to vacate.) AB 832 in contrast effectively takes the uncooperative landlord out of the process by allowing a tenant relief for 100% relief of rent arrears and then within 15 days pay that money to the landlord.

Compared to the other complicated provisions of AB 832, rent relief is straightforward! Find the details over at the Housing is Key program. The enhanced rent relief program covers utilities too!

A New Backstop on Eviction for Nonpayment

Most important, AB 832 prevents the landlord from proceeding with an eviction for nonpayment if the landlord itself had not attempted to obtain relief for rent arrears under the state program. The landlord can only proceed with eviction if the tenant’s application was denied; or if the tenant has taken no action to participate in the relief program.

For the court to actually order an eviction one of three conditions must be met: the tenant didn’t qualify; the landlord attempted to obtain rent relief but the tenant did not participate; or the program ran out of money. (The latter is a warning to tardy tenant-applicants: the money will run out!) In any case, rent relief or no relief, unpaid rent for qualifying tenants still cannot be ground for eviction.

Finally there one last new backstop: if the landlord proceeds with eviction and the court orders the eviction, the tenant gets a last chance to apply for rent relief before the sheriff locks-out the tenant. If the tenant qualifies, and the landlord is paid for the rent arrears which is the basis for the eviction, then the court calls-off the sheriff. (Read more about how evictions generally proceed in our post: The Sheriff is a Sight No Neighbor Wants to See.)

What Does AB 832 Mean for Beverly Hills Tenants?

Tenants in Beverly Hills who have delayed the payment of rent due to COVID–19 hardship under the city’s moratorium have until next year to repay the back rent. They cannot be evicted only for owing the delayed rent.

Tenants who would delay the payment of rent may still do so up until the time that city council ends the local moratorium as long as the tenant notifies the landlord within 7 days of rent due and files a city form within 30 days. If the landlord accepts the hardship documentation the rent is delayed.

When will City of Beverly Hills ends its local moratorium? The Courier reported recently that council will discuss it on July 15th. The end could come soon: West Hollywood has already ended its moratorium and that city now refers tenants seeking protection to the county’s moratorium.

Regardless of what the city does, tenants in Beverly Hills can also take advantage of the state’s process to delay the payment of rent. So long as a minimum 25% of rent owed from September 2020 through September 2021 is paid by September 30, 2021, the owed can be converted to debt but cannot be a ground for eviction. Under AB 832 the landlord can go to small claims court to recover rental debt on or after November 1, 2021 and the usual $10k small claims limit does not apply.

(Additional note: Under the state moratorium a tenant need not present proof of hardship to the landlord unless household income is more than 130% of the median household income.)

As for rent relief, City of Beverly Hills ended its local rent relief program back in January and it did not go entirely smoothly. Because there is no prospect for additional local rent relief anymore the state is the place to go for help with the rent…and California makes it relatively easy to apply.

Resources

Phone: COVID–19 Rent Relief Call Center (833–430–2122) and rent-relief partner organization finder (833–687–0967)

Southern California Rental Housing Association AB 832 fact sheet

State-Required COVID-19 Notice to Tenants Who Owe Rent (July 2021)

Renters Alliance: How the COVID–19 Tenant Relief Act Affects You

Renters Alliance: Local Moratorium vs. Tenant Act Which Rules Apply?

Renters Alliance: Moratorium on the Rent Increase: What You Need to Know