Rent: Government agencies are hoping to avoid a mass eviction scenario with distribution of rent relief money but many renters have not applied to the program. SMDP Image

After 13 months and two extensions the State eviction moratorium is expiring in a matter of days, on Sept. 30.

This means that if a tenant does not pay their rent owed for October and onwards, landlords will be able to pursue eviction proceedings.

So long as tenants have submitted monthly “COVID-19 related financial distress” forms they can never be evicted for rent owed between March 1, 2020 and Sept. 30, 2021. However, once the moratorium expires landlords can decide to pursue this back rent as consumer debt in a small claims court.

While fears have been floated that the moratorium’s expiration will cause an eviction tsunami, strong tenant protections alongside an abundance of rent relief funds suggests that non-payment of rent evictions in Santa Monica are much more likely to resemble a drip than a flood.

Currently all households making 80 percent or less of the area median income are eligible to have their back rent and utilities bills owed paid for by the State. In Santa Monica the qualifying income is $66,250 for a household of one, $75,700 for a household of two, $85,150 for a household of three and $94,600 for a household of four.

So far, 1,806 households in Santa Monica have availed themselves of this opportunity and requested a total of $28.9 million in rent relief funds. Of these applicants, 867 have already been served and $14.33 million has been paid out with households receiving an average assistance of $16,526.

“For Santa Monicans who are struggling to pay their rent or utility bills due to the impact of COVID-19, and are income-eligible, they should absolutely apply for rent assistance,” said Eda Suh, chief deputy city attorney. “It could be the key to keeping them housed.”

Applying for rental assistance funds has the additional benefit of staving off eviction proceedings as a tenant who has applied for assistance can ask the court to pause their eviction case until funding has been approved or denied. If the funding then allows the tenant to pay their rent the case will be dismissed.

The rental assistance program is also intended to support landlords’ financial needs. While an earlier version of the program asked landlords to forgive 20 percent of back rent to receive assistance, the current version covers 100 percent of rent. Landlords are able to initiate and file a relief request on behalf of their tenant, who then has to respond and prove their eligibility in order to receive funding.

“I think Governor Newsom has done a great job of coming up with support money for landlords whose tenants could not pay,” said local landlord Jay Johnson. “Having an eviction moratorium temporarily, given the virus, was the logical thing to do because it protected the tenants, and then he came back in with support for both the landlords and the tenants.”

Johnson has been part of a family-owned residential rental business since 1987 and currently manages a dozen Santa Monica properties containing around 100 units in partnership with his wife, son-in-law, step-son and step-daughter.

According to Johnson, prior to the pandemic his tenants almost always paid their rent on time, but several started experiencing financial difficulties after the onset of Covid-19.

“As the virus progressed we had an increasing amount of tenants who said ‘I’ve lost my job, I’m vacating the unit and moving out’,” said Johnson. “We had a number of them who said ‘my business, for one reason or another, has been reduced and constrained’ and requested temporary rent decreases, which we granted in a number of situations.”

In total, around 20 of Johnson’s tenants either moved out, paid a reduced rent or couldn’t pay rent during the pandemic. Two of his tenants applied for the state rent relief program and have already received their money. Overall, Johnson was not significantly negatively financially impacted by the eviction moratorium.

Local landlord Evan Wilkes shared a similar experience. He is a mom and pop landlord who, alongside 14 other partners, collectively owns five small Santa Monica buildings. Around five of his tenants experienced short-term financial hardship due to Covid-19 and one has applied for the state rent relief program.

Wilkes had one tenant vacate a unit without notice and without paying $20,000 in back rent, but he has decided not to try and track down the individual, who left no follow up information.

“I would think that whatever has happened to that person that they’re probably pretty devastated monetarily anyway, so why make life more difficult?” said Wilkes, adding that the legal fees to pursue his tenant’s debt in court would likely cancel out or minimize the potential financial gains.

Wilkes’s property management company does not have any mortgages to pay and was still able to cover insurance, utilities and repairs during the pandemic, but he acknowledged that not all property owners have been as fortunate.

“It’s a large bump in the road for a lot of these owners and unfortunately, I’m sure some of them have gone into receivership and not been able to pay mortgages,” said Wilkes. “But I think it’s equally, if not worse, for some of these renters by a longshot.”

The City of Santa Monica has made strong efforts to ensure tenants are aware of their rights and the resources available to them. It launched a “Right to Counsel” pilot program offering free legal services to tenants facing eviction and is running an outreach program to help tenants apply for rent relief.

“The outreach plan is focused on ensuring equitable access to the rental assistance for the most vulnerable community members, and targets those who are unaware of the program, and those who are unable to apply due to lack of access to technology, disability, language barrier, and other challenges,” said Suh.

Renters who are still facing financial hardship due to Covid-19 are encouraged to apply for relief immediately as having an application in place will help them pause eviction proceedings once the moratorium is lifted.

Of the households that have applied so far, a little over half were at or below 30 percent of the area median income (AMI). Around 30 percent of applicants have 50 percent AMI, while 7 percent of applicants have 60 percent AMI and another 7 percent have 80 percent AMI.

White residents make up 55 percent of applicants, Latino residents represent 15 percent, Black residents represent 13 percent and Asian residents represent 6 percent.

Clara@smdp.com