COVID-19 – Costa-Hawkins.com

January 18, 2021August 20, 2021

Ordinance 216-20 (2020): San Francisco Prohibits Recovering Possession of Rental Units During Pandemic

San Francisco landlord-tenant relationships have been anything but predictable in the last year. Governor Newsom enacted Executive Order N-28-20 on March 16, 2020, which suspends certain state laws to open the field for local regulation on evictions. Mayor Breed declared a local state of emergency on February 25, 2020 (with several dozen supplements through the rest of the year) seeking to curtain efforts to recover possession of rental units, other than for health and safety reasons or pursuant to the Ellis Act (which the City can’t prohibit). The California Judicial Council even stepped in (arguably in excess of its authority or even any authority that Gov. Newsom could delegate under the Emergency Services Act) to prohibit the issuing of summonses in residential eviction lawsuits through August of 2020.

California enacted AB 3088 on September 1, 2021, as a comprehensive scheme to address the patchwork efforts of the different branches and different levels of government. It prohibited cities from adopting, extending, renewing local regulations protecting tenants from evictions, imposing its own.

Not to be deterred, the Board of Supervisors passed Ordinance 216-20 (known colloquially as “Preston 2” following the supervisor’s previous legislation prohibiting evictions for non-payment of rent at the local level). Ordinance 216-20 prevents landlords from recovering possession of a rental unit “on or before March 31, 2021 unless necessary due to violence, threats of violence, or health and safety issues”. The restriction even applies to owners who rent out individual rooms in their homes. Deferential to (some of) AB 3088, the ordinance acknowledges that it does not apply to “evictions due to unpaid rent or any other unpaid financial obligation of a tenant under the tenancy that came due between March 1, 2020 and January 31, 2021” or evictions under the Ellis Act, but it otherwise fails to address the comprehensive prohibition on local eviction regulations imposed by AB 3088.

October 18, 2020January 18, 2021

AB 3088 (2020): The COVID-19 Tenant Relief Act of 2020

In the face of a global pandemic affecting all levels of economic activity and threatening massive tenant displacement, it was no surprise that existing law was unfit to the task of moderating the deluge of unpaid rent by residential tenants who were ordered to shelter-in-place at the cost of their paychecks.

Patchwork laws emerged from the California Governor and , San Francisco’s Mayor and even from the Federal Government. The Judicial Council’s freeze on unlawful detainers was set to thaw at the end of August, so Sacramento finally passed a long-awaited answer to months of open questions.

Among other things, AB 3088 enacted the COVID-19 Tenant Relief Act of 2020. The CTRA makes comprehensive changes to state unlawful detainer law, it supersedes many local ordinances and orders addressing COVID-19, it excuses certain tenant nonpayment of rent during the covered period, and it expands non-eviction remedies for collection of rent.

First, for non-payment of rent evictions, the CTRA covers what it calls the “Covered Time Period” (i.e., March 1, 2020 through January 31, 2021), which encompasses the “Protected Time Period” (March 1, 2020 through August 31, 2020) and the “Transition Time Period” (September 1, 2020 through January 31, 2021).

During the entire Covered Time Period, a tenant still owes their rent, however, most of it will become a form of consumer debt, as the CTRA significantly alters the unlawful detainer statutes in issuing rent default notices and prosecuting evictions. If a tenant owes rent during the Protected Time Period, they can cure a “15-day notice to cure or quit” by paying the full amount due, quitting the property, or merely by signing a declaration stating that they’ve suffered “COVID-19-related financial distress”. The same scheme applies in the Transition Time Period, except that the tenant must also pay at least 25% of the rent due for each of the five months in this period before the end of January of 2021. If they do, they have cured the eviction notice.

The CTRA also significantly expands small claims jurisdiction (the obvious purpose being to lower the transaction costs for landlords in collecting this consumer debt). Formerly, a small claims plaintiff could seek $10,000 in damages (or $5,000 if they are a fictitious entity), and they may bring two such lawsuits per year. The CTRA removes the dollar limit, as well as filing limit. However, landlords cannot avail themselves of this expanded jurisdiction prior to March 1, 2021.

September 14, 2020

San Francisco Legislative Update (2020) COVID-19 Edition: Ordinance 158-20 Continues Suspension of Rent Increases Pending Eviction Moratorium

San Francisco has enacted its third emergency rent increase freeze. Like the previous one, Ordinance 158-20 was meant to apply (retroactively) upon the expiration of its predecessor.

However, Section 2.107 of the San Francisco Charter dictates that emergency ordinances are effective immediately upon passage, not “whenever the Board of Supervisors feels like”. Therefore, the previous ordinance (probably) expired later than it claimed to, which makes it unclear when the Board believes the 60 days of emergency Ordinance 158-20 is supposed to start running.

According to the Charter, its passage on August 25, 2020 means that it will expire October 25th.

July 22, 2020

San Francisco Legislative Update (2020) COVID-19 Edition: Ordinance 114-20 Continues Suspension of Rent Increases Pending Eviction Moratorium

Ordinance 114-20, passed as an emergency ordinance, re-enacts its predecessor Ordinance 68-20 to suspend the annual allowable rent increase for 60 days, per Section 2.107 of the San Francisco Charter (unless re-enacted again).

According to Section 2.107, an emergency ordinance is effectively immediately upon passage (which, for this ordinance was July 7, 2020). However, Ordinance 114-20 states that it is instead effective immediately after the expiration of Ordinance 68-20 (which is likely because the first emergency ordinance expired on June 23, 2020, before it this one was passed.

When in doubt, follow the charter. Ordinance 114-20 probably expires on the 61st day after passage – or September 6, 2020.

July 1, 2020

San Francisco Legislative Update (2020) COVID-19 Edition: “Preston Amendment” Ordinance 93-20 Prohibits Evictions Based on Non-Payment of Rent Owed During Governor’s Moratorium

San Francisco passed legislation, sponsored by Supervisor Preston, which prohibits evictions for non-payment of rent, for any rent due during Governor Newsom’s eviction moratorium, which is currently extended through September 30, 2020. Therefore, for rents due between the original March 16th order and September 30th (as may be further continued), San Francisco landlords cannot collect this rent (and the unit) via an unlawful detainer lawsuit.

Unsurprisingly, several industry groups – the San Francisco Apartment Association, the San Francisco Association of Realtors, the Coalition for Better Housing, and the Small Property Owners of San Francisco Institute have sued to overturn the ordinance.

The full text of Ordinance 93-20 is available here.

May 14, 2020June 1, 2020

San Francisco Legislative Update (2020) COVID-19 Edition: Ordinance 68-20 Suspends Rent Increases Pending Eviction Moratorium

Signed into law on April 24, 2020, but retroactive to April 7, 2020, Ordinance 68-20 temporarily suspends certain rent increases during the Mayor’s eviction moratorium prompted by the COVID-19 epidemic. The suspension applies to increases under Section 37.3(a) of the Rent Ordinance (which covers annual allowable increases, as well as any banked increases from previous years, and various passthroughs).

Now, it’s questionable whether even the Mayor’s emergency powers under the San Francisco Charter permit retroactive laws, though they may permit immediate ones. And otherwise, the authority of local governments to manipulate landlord’s state law procedural protections is strictly limited. Cities also lack authority to impose rental rate restrictions that prevent rents from keeping pace with inflation.

That said, Ordinance 68-20 contains specific references to the “anniversary date not being affected by deferral of the increase”. Likewise, it states that the right to impose the increase shall “immediately resume” when the moratorium expires. Likely, a landlord may send the increase, preserve the anniversary date, and simply not require the additional payment.