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Governor Signs the Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020 

Resources from The State of California

Monday, August 31, was the last day of session and the final opportunity for the legislature to pass bills on to the Governor. AB 3088 (Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020) passed out of the Senate midday and the Assembly passed the bill just before 10 p.m. Governor Newsom signed the bill. The bill will take effect immediately as an urgency measure. SCRHA remains concerned that this bill does not do enough to provide actual financial relief to keep tenants in their homes and property owners in a position to continue to provide housing.  

SCRHA is still analyzing the bill and will immediately begin work to create or update forms as needed. Here are the major components of the bill: 

  • There are two separate repayment periods under the bill.
    • The “protected period” is for rent due between March 1, 2020, until August 31, 2020. This period requires a property owner to provide a written declaration form to renters informing them that they have rental payments due, but cannot be evicted if they attest that they have a COVID-19 financial hardship. Only tenants who make at or above 130% Area Media Income (AMI) are required to provide additional proof of hardship. 130% AMI is determined by what has been published by the Department of Housing and Community Development in the Official State Income Limits for 2020, for the county in which the residential rental property is located. Once confirmed, SCRHA will publish the amounts specific to Imperial, San Diego, and southern Riverside counties.
    • The “transitional period” applies to rent due between September 1, 2020, until January 31, 2021.  During this period, a renter who has not made rental payments cannot be evicted if they pay 25% of their rent either monthly or in the aggregate by January 31, 2021.
  • Renters are still responsible for repaying unpaid rent, but it cannot be the basis of an eviction through January 31, 2021. 
  • The bill provides that, until February 1, 2025, a small claims court has jurisdiction in any action for recovery of COVID-19 rental debt, regardless of the amount demanded and would provide that a claim for recovery of a COVID-19 rental debt is exempt from the prohibition on filing more than 2 small claims actions. 
    • Small claims court is an option. A rental housing owner can still file a lawsuit in the civil division of the Superior Court. Rental housing owners desiring to recover unpaid rent should consult with their attorney as to the benefits and risks of proceeding in small claims court. 
  • Evictions to protect health and safety will be allowed. 
  • Evictions that began prior to March 1, 2020 may proceed.  
  • In order to evict a renter on or after February 1, 2021, property owners must give a 15-day written notice (not including weekends and judicial holidays).   
  • The bill provides limited preemption from local eviction moratoriums. Any extension, expansion, renewal, reenactment, or new adoption of an existing local rent moratorium, that occurs between August 19, 2020, and January 31, 2021, shall have no effect before February 1, 2021.  
  • Mortgage forbearance is provided, but on a very limited basis for owners of small rental properties only.

    • The first lien mortgage or deed of trust is secured by owner-occupied residential real property containing no more than four dwelling units. “Owner-occupied” means that the property is the principal residence of the borrower and is security for a loan made for personal, family, or household purposes

      --or--

    • The first lien mortgage or deed of trust is secured by residential real property that is occupied by a tenant, contains no more than four dwelling units, and meets all of the following conditions:

      • The property is owned by an individual who owns no more than three residential real properties, or by one or more individuals who together own no more than three residential real properties, each of which contains no more than four dwelling units.
      • The property is occupied by a tenant pursuant to an applicable lease.
      • A tenant occupying the property is unable to pay rent due to a reduction in income resulting from the novel coronavirus.
  • The bill directs the State Consumer Services and Housing Agency to work on a rent assistance program, something that SCRHA has been asking for since the pandemic began. The Governor’s office has committed to working on a rental assistance program in the future, pending federal funding. 

SCRHA will continue to provide updates and inform members when new forms are available. Thank you again to all those who wrote to their elected officials this legislative session. The final outcome may not have been as we hoped, but your voice helped stop far worse legislation. 

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