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Covid relief; Senate Bill 91 explained

Covid relief; Senate Bill 91 explained

As Covid continues to wreak havoc on California and the country at large, the California legislature has passed new laws to prevent tenants from being evicted in an effort to prevent the situation from getting worse. Millions are out of work and cannot pay their rent. Landlords are being faced with the squeeze of not receiving rent payments, while often still owing mortgage payments on the rental properties. This is an untenable situation, and Senate Bill 91 aims to both protect renters and property owners from the ravages of Covid. Let us walk you through the California eviction moratorium legislation, Assembly Bill 3088, Senate Bill 91, and what it all means for you as a landlord.

What is Assembly Bill (AB) 3088

At the beginning of the pandemic, in March of 2020, the California justice system put a complete hold on all evictions, commercial and residential, until further notice. This eviction moratorium remained in place for six months, when Assembly Bill 3088 was passed. AB 3088 was enacted on September 1, and allowed terminations of tenancy to continue once again, but with strict restrictions. One such restriction was on evictions related to payment of rent:

Any back rent owed between 3/2020 and 9/1/2020 would not be considered for eviction purposes.
If the tenant paid at least 25% of the rent incurred after 9/1/2020, they could not be evicted for non-payment of rent.

The 25% rule was written to last until 1/31/2021.

Other restrictions enforced by AB 3088:

  • A landlord cannot turn off utilities as a repercussion of non-payment.
  • A landlord can’t withhold unit maintenance or reduce services provided as a repercussion of non-payment.
  • A landlord can’t threaten to do these things either.

AB 3088 also required a landlord to provide a blank “notice of hardship” form to a tenant, with the tenant having 15 working days to fill it out and return it to the landlord, with completion ensuring protection from eviction.

Senate Bill 91 modifies AB 3088.

What is Senate Bill (SB) 91?

On January 29th, Governor Gavin Newsom signed Senate Bill 91, extending and modifying the termination of tenancy restrictions from AB 3088. Note: This law only applies to residential units. The biggest change in SB 91 is the due dates of AB 3088. Instead of tenants having until 1/31/2021 to pay 25% of owed rent from 9/1/2020 onward, SB 91 extends the eviction relief until 6/30/2021, with the option for further legislation to extend this date even further. This means if a renter is not at the 25% mark by 1/31/21, they now have five more months to build up to that 25% rent owed mark.
Another date that has been pushed is the opening of small claims court for landlords looking to go after back taxes owed (pre-March 2020). Originally these courts were to open March 1, 2021. With SB 91, the courts are set to open for back tax retrieval on 8/1/2021. Additionally, the restrictions on maximum value of a court case has been lifted, and a landlord can go to small claims court for each case pertinent, rather than being limited to just two cases per year, as before Covid.
New to SB 91 is that landlords are not allowed to charge late fees on back rent owed. This wasn’t addressed in AB 3088, but depending on your municipality it may have still been restricted on a more local level. SB 91 makes that mandate universal to California.
The biggest novel addition in SB 91 is the declaration of the use of federal Covid stimulus funds for a California rental assistance program for eligible tenants. $1.5 billion will be set aside to assist landlords in covering the rent that their tenants cannot provide. This can be used to cover rent in arrears, prospective rent, or utilities.

For help determining whether you qualify, how to use this rent relief, or how to handle “no fault” terminations of tenancy, contact the landlord-tenant legal experts at Marinaccio Law for a free consultation. Make sure you’re receiving the relief you’re owed.

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