What landlords should know about the CDC’s eviction moratorium

On September 4, 2020, the United States Centers for Disease Control and Prevention (CDC) issued a wide-sweeping eviction moratorium, which is effective through December 31, 2020. Unlike the now-expired CARES Act eviction moratorium that only impacted tenants in certain rental properties with federal assistance or federally related financing, the CDC eviction moratorium has broad applicability.

According to the CDC, the moratorium has been issued to provide housing stability and to prevent the further spread of COVID-19. The CDC’s Order states,

While the Order precludes a landlord from pursuing an eviction, the Order does not relieve a tenant of his or her obligations under the applicable lease agreement. Accordingly, tenants remain obligated to make payments to their landlords, which may include late fees, penalties, and interest charges pursuant to their lease agreements.

Tenants may still be evicted for reasons other than not paying rent or making a housing payment, including for the following reasons:

1. engaging in criminal activity while on the premises;
2. threatening the health or safety of other residents;
3. damaging or posing an immediate and significant risk of damage to property;
4. violating any applicable building code, health ordinance, or similar regulation relating to health and safety; or
5. violating any other contractual obligation, other than the timely payment of rent or similar housing-related payment (including non-payment or late payment of fees, penalties, or interest).

In order to obtain the protections of the CDC Order, tenants must sign a declaration that states, under penalty of perjury, that:

1. The individual has used best efforts to obtain all available government assistance for rent or housing
2. The individual either (i) expects to earn no more than $99,000 in annual income for 2020 (or no more than $198,000 if filing a joint tax return), (ii) was not required to report any income in 2019 to the IRS, or (iii) received an Economic Impact Payment (stimulus check) pursuant to the CARES Act;
3. The individual is unable to pay the full rent or make a full housing payment due to substantial loss of household income, loss of compensable hours of work or wages, a lay-off, or extraordinary out-of-pocket medical expenses;
4. The individual is using best efforts to make timely partial payments that are as close to the full payment as the individual’s circumstances may permit, taking into account other nondiscretionary expenses; and
5. Eviction would likely render the individual homeless—or force the individual to move into and live in close quarters in a new congregate or shared living setting—because the individual has no other available housing options.

The penalties for individuals who violate the Order are severe, including:

• a fine of up to $100,000 and up to one year in jail, if the violation does not result in a death; or
  • a fine of up to $250,000 and up to one year in jail, if the violation results in a death.

The penalties for an organization violating the Order are even more severe.

Because of the broad applicability and severe penalties, landlords should consult their attorney and exercise extreme caution before proceeding with an eviction of a residential tenant.

Disclaimer: The materials contained in this blog post are for educational and informational purposes only. Nothing in this blog post is to be considered as the rendering of legal advice. Readers are advised to obtain legal advice from their own legal counsel. Please call Eric Kerkvliet at (605) 275-5936 or email him at ekerkvliet@lynnjackson.com if you wish to discuss this further or have specific questions.