Real Estate Law Client Alert: CDC Orders Nationwide Moratorium on Eviction Proceedings

Meyer Unkovic & Scott LLP

On September 1st, the Centers for Disease Control (CDC) announced a nationwide moratorium on eviction proceedings. A copy of the CDC’s order itself can be found here.

In brief, the rationale for the CDC’s order is that evictions may lead to both homelessness and an increase in “congregate” living (multiple families sharing the same dwelling). Both of these circumstances are likely to further the spread of the COVID-19 pandemic. In order to avoid this, the CDC has decreed a moratorium on evictions as follows:

  1. CDC’s order barring eviction proceedings from going forward is adopted under the Public Health Service Act. It is effective as of September 4, 2020, applies nationwide and will be in effect until December 31, 2020.
  2. The CDC order broadly bars all eviction proceedings where the basis for the eviction is non-payment of rent. It does not prevent evictions on other grounds (e.g., criminal behavior, damaging property). The order does not directly address hold-over situations but does permit evictions for “violating (any other) contractual obligation…”. 
  3. The order does not relieve tenants of their obligations to pay rent, late fees or interest. Those obligations will continue to accrue during the moratorium period.
  4. The order applies to the tenants who:
    • Expect that their 2020 income will be less than $99,000 for an individual or $198,000 for those filing a joint tax return; or
    • Were not required to file a federal income tax return in 2019; or
    • Received a stimulus check under the CARES Act.
  5. In addition, to be covered by the order the tenant must sign a declaration that:
    • The tenant has made best efforts to obtain government assistance to pay rent (presumably in Pennsylvania this would include applying for help under the state’s CARES Rent Relief Program);
    • The tenant is unable to pay full rent due to substantial loss of income, loss of work, lay-off or extraordinary out-of-pocket medical expenses (i.e., exceeding 7.5% of adjusted gross income);
    • The tenant is using best efforts to make timely partial rent payments as close to full rent payment as circumstances permit; and
    • Eviction would render the tenant homeless or require the tenant to live in “close quarters” because the tenant “has no other available housing options.”
    • The form of the declaration to be signed by the tenant can be found at the end of the order.
  6. Violations of the order may be subject to criminal penalties including fines between $100,000 to $250,000 for individuals and $200,000 to $500,000 for “organizations.” The U.S. Department of Justice is authorized to pursue these penalties for violations of the order.

CDC has not yet provided any guidance or other materials relating to the order.

If you have questions about the Centers for Disease Control (CDC) nationwide moratorium on eviction proceedings please contact Kevin McKeegan (kfm@muslaw.com), any member of the Real Estate & Lending Group, or any other Meyer, Unkovic & Scott attorney with whom you have worked.

 

This material is for informational purposes only.  It is not and should not be solely relied on as legal advice in dealing with any specific situation.

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