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HomeMy Public PortalAbout06) 9A - Staff Report - Eviction Moratorium Discussion_staff reportAGENDA ITEM 9.A. ADMINISTRATIVE SERVICES DEPARTMENT MEMORANDUM DATE: June 2, 2020 TO: The Honorable City Council FROM: Gregory Murphy, City Attorney SUBJECT: DISCUSSION OF OPTIONS FOR ORDINANCE NO. 20-1041U, AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMPLE CITY TEMPORARILY PROHIBITING EVICTIONS OF RESIDENTIAL AND COMMERCIAL TENANTS ARISING OUT OF FINANCIAL IMPACTS OF THE COVID-19 PANDEMIC RECOMMENDATION: It is recommended that the City Council: 1. Discuss the effects of the existing moratorium on tenants and landlords in the City, receive additional information from City staff and the City Attorney; and 2. Give direction regarding actions related to the moratorium, if any, that the City Council would like brought back for further consideration. BACKGROUND: 1. On March 4, 2020, the Health Officer of Los Angeles County declared a local health emergency regarding Novel Coronavirus 2019 (COVID-19) and the Los Angeles County Board of Supervisors concurrently proclaimed the existence of a loc al emergency for the County of Los Angeles. 2. On March 4, 2020, Governor Newsom of the State of California declared a State of Emergency in response to the COVID-19. 3. On March 13, 2020, the President of the United States declared a national state of emergency regarding COVID-19. On this same day, the City Council adopted Resolution No. 20-5457, declaring a local state of emergency which gave authority to the City Manager in his role as Director of Emergency Services to implement City Council June 2, 2020 Page 2 of 4 measures in line with state and county health officials’ recommendations to slow the spread of COVID-19 while not impacting critical services. 4. On March 16, 2020, Governor Newsom issued Executive Order N-28-20 that aided Californians affected by COVID-19 by authorizing local governments to halt evictions for renters, encouraging financial institutions to slow foreclosures, and protecting renters and homeowners against utility shutoffs, with the authority to do so elapsing on May 31, 2020. 5. On March 19, 2020, Kathryn Barger, Chair of the Los Angeles County Board of Supervisors issued an Executive Order prohibiting residential and commercial evictions in the unincorporated portions of the County under certain circumstances related to COVID-19. 6. On March 21, 2020 the Los Angeles County Department of Public Health issued a clarifying Safer at Home order, requiring all persons to remain at home to the extent possible, unless engaged in essential businesses. 7. On March 27, 2020 Governor Newsome issued Executive Order N-37-20 placing a Statewide moratorium on evictions of residential tenants arising from nonpayment of rent due to circumstances related to COVID-19; this order and N-28-20 have been interpreted by the Governor to allow more restrictive orders by local governments. 8. On March 31, 2020 the City adopted an urgency ordinance providing certain eviction protection for residential and commercial tenants as a result of fi nancial impacts resulting from the COVID-19 pandemic. The City’s ordinance mirrored the County of Los Angeles order providing similar protection for tenants in the unincorporated portions of the County to ensure that residents of the City would have the same level of protection as that provided in the County. 9. On April 14, 2020, the Los Angeles County Board of Supervisors adopted a revised eviction protection moratorium order, providing additional protections not set forth in the existing County order including protection of tenants in any incorporated city lacking its own moratorium. 10. As of the date of this staff report, the Governor has not extended the authority of local governments to halt evictions for renters, encouraging financial institutions to slow foreclosures, and protecting renters and homeowners against utility shutoffs. ANALYSIS: As a result of the COVID-19 public health emergency, the initial precautions recommended by health authorities, and the State and County Safer at Home orders requiring residents to stay at home and requiring “non -essential” businesses to close and essential businesses to curtail operations, many residential and commercial tenants City Council June 2, 2020 Page 3 of 4 in the City have experienced sudden income loss. Continued economic impacts are anticipated even with the gradual reopening of some sectors of the economy, leaving some tenants unable to pay rent and therefore vulnerable to eviction. Businesses that were temporarily closed by the Safer at Home orders have not been generating tax revenues needed for public services, and evictions and replacement of such tenants would delay generation of tax revenues once the Safer at Home orders are lifted. Further, even businesses that continued in operation as “Essential Businesses” or that have begun to reopen under modified conditions are still subject to reductions in income as a result of the Safer at Home orders. On March 31, the City Council adopted an urgency ordinance pursuant to the authority granted to local governments by the Governor in Executive Order N-28-20 to prohibit evictions of residential and commercial tenants due to non -payment of rent during the period of the moratorium ordinance. Executive Order N-28-20 only authorized local governments to act until May 31, 2020. The city’s moratorium as adopted is substantially similar to the March 19 Los Angeles County order as well as moratoria adopted by cities such as Pasadena, Glendale, Alhambra, and Duarte. A key purpose of adopting the ordinance in the form the City did was to give its residents and businesses the same protections that were being granted to tenants in unincorporated County areas and in other cities in the region. The first protection is simple protection from losing one’s home or place of business during the pandemic. The second is the right to negotiate with one’s landlord for a payment plan that will last for up to 6 months after the end of the moratorium period so that the tenant is not evicted in short order immediately after the period ends. From a legal perspective, the ordinance applies to situations in which a tenant cannot pay rent due to COVID-19 related financial issues. In covered circumstances, the initial responsibility falls on the tenant to explain to the landlord that the inability to pay stems from COVID-19 issues. The ordinance provides a tenant with a defense in an eviction proceeding, which makes such proceedings difficult or fruitless to file as against covered tenants. The ordinance did not affect evictions unrelated to non-payment of rent or for which non-payment is not a result of COVID-19 related financial issues. However, the City Attorney’s office has learned that some landlord’s-rights attorneys believe that certain language in the ordinance is broad enough to cover such evictions and they are hesitant to file legal proceedings of any kind on behalf of landlords. On April 14, 2020, the Los Angeles County Board of Supervisors adopted a revised eviction protection moratorium order, providing some protections not set forth in the previous County order on which the City’s moratorium is based. For example, the new County regulation provides tenants up to 12 mont hs to repay rent not paid during the moratorium period (the prior order and City ordinance provide 6 months). More importantly, the new County regulation applies in all areas of the County that do not otherwise have an eviction protection moratorium , including incorporated cities. As of the date of this Staff Report, the Governor has not extended Executive Order N - City Council June 2, 2020 Page 4 of 4 28-20, nor has he modified Executive Order N-37-20, which prohibited judges and sheriffs from carrying on eviction proceedings. Therefore, it is presumed that the Governor’s office finds current protections sufficient. This presumption may change by the time this matter comes to the City Council, and if it does a verbal report will be given to explain any changes. In addition, the State Legislature is currently considering Senate Bill 939, which would legislatively prohibit evictions of commercial tenants for a n extended period of time, as well as a number of bills seeking to prohibit residential evictions. If the Legislature acts between the completion of this Staff Report and the Council hearing this matter, a verbal report of such action will be given. In reviewing Ordinance No. 20-1041U, the City Attorney’s office has focused on the following options for the City Council:  If the State has acted to extend the May 31 termination of the City’s authority over this area, leave the moratorium in place with no changes; or  If the State has so acted, affirmatively revoke the moratorium to allow the County’s moratorium to govern City residents and businesses; or  If the State has so acted, modify the City’s eviction moratorium; or  If the State has not acted to allow modifications , allow the moratorium to lapse on its own terms with the understanding that its protections will provide no further protection for tenants as of November 30, 2020. CONCLUSION The City Council is asked to consider the various policy and legal issues raised in this Staff Report and by members of the public, and to provide City staff and the City Attorney with direction on whether any further actions should be taken. CITY STRATEGIC GOALS: Adoption of the proposed ordinance would align with the City’s strategic goal of good governance. FISCAL IMPACT: There is no fiscal impact arising from the ordinance.