The Santa Barbara City Council voted for a series of emergency limitations on evictions Tuesday in what they described as an emergency measure necessary for the immediate preservation of the public peace, health and safety.
The ordinance prevents eviction of commercial and residential tenants through May 31, with the requirement that on or before April 21, any tenant who wishes to take advantage of this ordinance needs to provide a detailed written notice to their property owner demonstrating their inability to make rent payments due to COVID-19.
On March 16, Gov. Gavin Newsom issued an executive order which suspended any provision of state law that would restrict a local government’s ability impose limitations on residential or commercial evictions
“This executive order does not enact any tenant protections,” wrote City Attorney Ariel Calonne. “Instead, it suspends those portions of state law that might preempt local authority. This means the city is legally responsible for the terms of the proposed moratorium.”
With this in mind, the city council voted unanimously to pass the ordinance giving protections to both residential and commercial tenants, albeit with different financial hardship standards.
“We know that many tenants have or will be experiencing dramatic reductions to their income as a result of COVID-19. Evictions resulting from that, certainly on the residential side, are going to cause sick people to be on the street. That is not in the interest of the community’s public health,” explained Mr. Calonne.
“The proposed ordinance creates a legal structure for what I believe will be a mass non-payment. In that sense, the legal structure is intended to mitigate the burden on owners by creating a structure for temporary forgiveness of rent.”
According to the ordinance, the owner of a residential unit must grant a rent or lease payment deferral to a tenant who has notified the owner of a “Significant Negative Change to Their Household Financial Condition” within 20 days after rent is due.
Upon receipt of the notice, the owner cannot terminate the tenancy or evict a tenant for nonpayment of rent if the tenant’s notice states that they are unable to pay all or part of their rent (including lease payments) because of the change in financial condition as a result of COVID-19 or any private or governmental actions resulting from the pandemic.
“The tenant, by April 21, would need to send by mail or email, a notice to their property owner or landlord that said, ‘I can’t pay all or part of my rent for these reasons,’ and they would include documentation. A lay-off notice, a medical bill, medical records, anything along those lines,” said Mr. Calonne.
Commercial tenants also have 20 days to send a similar notice to their landlords, but must must describe “Unforeseeable Emergency Commercial Conditions” and include the amount of the rent or lease payment that they believe they can make on a current monthly basis and the amount the tenant seeks to defer during the emergency, with documentation.
All medical or financial information contained in a notice will be kept confidential, except when disclosure is both necessary to enforce the owner’s rights under this ordinance in court.
Mr. Calonne said a frequently asked questions form outlining what qualifies as documentation will be posted online soon.
The ordinance will expire at the end of Gov. Newsom’s executive order on May 31, but can be kept in effect if he extends said order.
“The ordinance is designed to protect tenants when they cannot pay rent through no fault of their own. By the same token, the ordinance is designed to protect property owners from fraud,” said Mr. Calonne. “You don’t want to create a situation where we have a city wide rent holiday.”
The council made clear that this is not a rent “waiver,” and tenants are not relieved of liability for deferred rent. If a tenant fails to pay deferred rent, an owner may enforce the tenant’s obligation by any remedy available “at law or in equity.” However, an owner may not charge a late fee for rent that is deferred and repaid in a timely manner.
When asked by Councilmember Kristen Sneddon what will happen to landlords who, because they are not receiving rent payments, cannot in turn make mortgage payments, Mr. Calonne said he did not know.
“That’s a significant concern here. The manner in which we attempted to address it is by limiting it to two months, so we have a very specific number for owners to grapple with,” said Mr. Calonne. “We’ll need to look at the due process fairness under the 5th Amendment, the protection of property owners not to have their property taken by the government, we’ll need to look hard at that if we need to extend beyond May 31.”
While the ordinance originally required the tenant to pay the deferred rent to the owner in full within six months of the expiration of the ordinance, the council ultimately voted to remain silent on the repayment period to allow tenants and landlords to negotiate their own repayment schedules before the council revisits the matter on May 12.
Without the timeline for repayment, Councilmember Eric Friedman said he believed there would be more of an incentive for landlords and tenants to come to an agreement to stabilize or decrease rent.
“If we have a six month (repayment schedule), on June 1 it’s almost like giving a rent increase,” said Mr. Friedman. “I’d like to see if there is a way that the parties, the landlords and the tenants, could work it out.”
Come May 12, the council will assess what work if any has been done to negotiate repayment schedules in the city, as well as any relief from the state or federal government, and will determine whether or not they must step in to set a timeline for payment of deferred rent.
“This is very serious. If you can pay your rent, please do, because there’s a whole chain of responsibility that we have,” said Mayor Cathy Murillo. “We’re doing this to protect our most vulnerable.”