COVID-19 Tenant Relief Act – SB91 Update

Generally speaking, things are looking better when we think about the COVID-19 pandemic. While we haven’t managed to erase it yet, there are more people getting vaccinated and the promise of additional available vaccines on their way.

It’s going to take a while for things in the California rental market to return to “normal,” however.

A lot of tenant protections are in place, especially when it comes to evictions and rent collection. While the Tenant Relief Act (AB 3088) did a lot to protect residents from losing their homes if they couldn’t pay rent, there have been some important updates.

Today, we’re talking about SB 91 and what it means for you and your Santa Rose rental properties.

Eviction Moratoriums Began with AB 3088

Last year, the Tenant Relief Act (AB 3088) was enacted to help tenants who could not pay their rent due to the economic fallout from the COVID pandemic. You may have tenants who lost jobs, saw their hours reduced, or had to voluntarily give up their work in order to care for children who were now at home instead of at school.

The largest part of the Tenant Relief Act was an eviction moratorium. Under this law, California landlords were prevented from evicting their tenants for nonpayment of rent if those tenants declared that their financial hardship was due to the pandemic.

Updates to the Eviction Moratorium with SB 91

The passage of SB 91 extends the statewide eviction moratorium to June 30, 2021. Something important that both landlords and tenants need to understand is this: The law does not forgive any of the overdue rent that your tenants are not able to pay. That debt is still owed to you.

However, even while that money is owed to you, it’s not permissible for you to use those months of unpaid rent as a cause for eviction. This is going to be difficult for landlords to adapt to even after the moratorium is lifted. You may have a very hard time collecting rent from tenants who have very large balances.

State Rental Assistance Program

There’s federal rental assistance available to states. California is expected to receive $2.6 billion, which will go directly to the State Rental Assistance Program. This program is in place to assist the California tenants who are at risk because of overdue rent. Most of the beneficiaries of this program are low-income tenants, and the goal is to keep them in their homes.

Tenants and property owners can apply for this program and qualify for some of the benefits provided. If you think one of your tenants might qualify, it’s worth it to begin an application on their behalf or to direct them towards the appropriate resource.

This program can potentially ease the liability that landlords have had to take on with tenants who cannot pay rent. Under the state program, you can agree to waive 20 percent of what the tenant owes in unpaid rent. In exchange for that consideration, you can receive government assistance to cover the rent you’ve lost. That means an 80 percent reimbursement in rent that was owed but unpaid between April 1, 2020 and March 31, 2021.

State Rental Assistance ProgramWe’d be happy to help you understand the particulars of this program and how they may apply to you and your tenants. Contact us at Redwood Residential Property Management.