Last year, in an effort to mitigate the impact of the COVID-19 pandemic, former President Donald Trump enacted the CARES Act, which included a massive stimulus bill and a federal eviction moratorium for most residents of federally subsidized apartments.1 While much has changed since then, including President Joe Biden taking office, the federal eviction moratorium has remained in place. Though Biden and the CDC’s intentions for extending the moratorium were to help keep people in their homes and to mitigate the further spread of COVID-19 in the event of an eviction crisis, in practice it might make matters worse for renters and tenants alike.
Following in the footsteps of the Trump administration, Biden has extended the federal eviction ban without any much-needed amendments to it.2 As a result, renters and landlords may find themselves in the same situation they stood back in August. With our next few blogs, we will discuss the logic behind the eviction moratorium and the mounting criticisms against it, as well as provide some advice to help landlords manage the situation.
Different Administration, Same Policy
When discussing the current federal eviction policy, it is important to consider how it first emerged. Even before COVID-19 first emerged, there was a long-standing housing crisis that had been building for some time.3 This was issue has been only been exacerbated by the pandemic, which has left millions of Americans struggling to pay their household expenses. Additionally, renters are falling farther behind on rent: 13 million are currently behind on their rent, with around 12 million expected to owe an average of $5,850 in back rent and utilities.4 As such, it will be a challenge to get money and assistance to those in need before the moratorium expires, leaving many fearing that the government is just biding time and allowing people to fall behind with little-to-no assistance.
Of course, there is a good reason to want to keep people in their homes at all costs: with nearly 530,000 U.S. deaths due to COVID-19 as of this writing,5 it is important to keep people off the street to avoid the further spread of the virus. To an extent, this has been successful: of the roughly 107 million renters across the U.S., around 40 million have been protected in some form by the eviction moratorium since the onset of the pandemic.6 Yet the lack of follow-up support or coordination across local, state, and federal lines means that navigating these protections has been challenging. Additionally, only one in five eligible households receives housing assistance,7 leaving many ill-equipped to deal with future fallout of the eviction ban. All of this means that thousands of U.S. households are at risk of tumbling through gaping holes in these orders that were designed to keep people housed during the pandemic.8
Looking For Relief
With all of the issues that renters and landlords have faced over the past year, some were optimistic about the recently passed $1.9 trillion COVID-19 relief bill. There is certainly some good news: with extending the eviction moratorium would be extended until the end of March, the bill sets aside $25 billion in rental assistance to households that have lost jobs during the pandemic, in addition to the $25 billion that had already been approved by Congress.9 Another $5 billion has also been set aside to pay for utilities, and the recent stimulus package also provided some help for renters who lost their jobs or had their work hours reduced because of the pandemic. But with an extra $300 a week in unemployment, there is still going to a be struggle, with employed renters expected to spend approximately 43% of their unemployment on rent.10
To make matters more difficult, not all renters qualify for financial assistance. To qualify, renters must meet three requirements:11
- Their household income must not exceed 80% of the median income for the area in which they live.
- The household must include at least one member who can demonstrate a risk of becoming homeless without assistance.
- There must be at least one household member who either qualifies for unemployment benefits or has experienced financial hardship due either directly or indirectly to the pandemic.
Even those who qualify might have to wait, as priority will be given to the most financially insecure among those households, meaning that the first households to receive aid should include those whose income does not exceed 50% of the area median income and includes members who are currently unemployed and have been unemployed for 90 days or more.12 Plus, any money received through is program is nontaxable, limiting some of the potential benefits it could have otherwise had.13
Outlook For The Future
The Biden administration has promised to ask lawmakers for an additional $30 billion in rental assistance and $5 billion in emergency assistance for people facing homelessness, citing the extension of the rental moratorium as a way to bide time so that better relief can be passed and distributed. Unfortunately, landlords and tenants cannot afford to wait another year, and there is still uncertainty as to whether this additional support will even be approved.14 With local support having been limited, landlords and renters are left wondering how to move forward.
In our next blog, we’ll be looking more closely at President Biden’s “American Rescue Plan,” along with the general criticisms and concerns surrounding it. Until then, if you have legal questions or concerns, contact CCSK Law at (219)-230-3600 or via email at email@example.com.
1. As a refresher, you can read more about the original eviction moratorium in our previous blog series on the matter, starting with COVID-19 and the Eviction Moratorium: Part One – Stimulus Bills. https://ccsklaw.com/2020/09/covid-19-and-the-eviction-moratorium-part-one-stimulus-bills/.
2. Ruiz-Goiriena, R. (2021, February 2). Millions of Americans could lose their Homes despite President Biden’s Eviction Moratorium order. USA Today. https://www.usatoday.com/story/news/nation/2021/02/02/bidens-federal-eviction-moratorium-may-not-protect-all-renters/4300051001/.
3. Miranda, L., &; McCausland, P. (2021, January 29). Biden’s plan to halt evictions does not address ‘structural problems,’ housing advocates say. NBCNews.com. https://www.nbcnews.com/business/business-news/biden-s-plan-halt-evictions-does-not-address-structural-problems-n1255590.
4. Miranda, L., &; McCausland, P.
5. Institute for Health Metrics and Evaluation. COVID-19 Projections. https://covid19.healthdata.org/united-states-of-america.
6. Ruiz-Goiriena, R.
7. Ruiz-Goiriena, R.
8. Capps, K., Dottle, R., &; McCartney, A. (2021, February 11). Why Can’t the Government Stop Evictions? Bloomberg. https://www.bloomberg.com/news/articles/2021-02-11/renters-are-falling-through-eviction-ban-loopholes.
9. Ruiz-Goiriena, R.
10. Miranda, L., &; McCausland, P.
11. Smith, D. (2021, January 21). Biden extends eviction moratorium until March 31: What renters should know. CNET. https://www.cnet.com/personal-finance/biden-eviction-moratorium-what-renters-should-know-if-ban-extends-to-sept-30/.
12. Smith, D.
13. Smith, D.
14. Miranda, L., &; McCausland, P.