Buckle up. California is speeding towards a cliff, and its last chance at avoiding disaster is about to disappear.
On June 30, the statewide eviction moratorium enacted by the California Judicial Council last April is set to expire. Should Los Angeles County’s renters be left without any further protection, experts believe a worst-case scenario could be on the horizon, with nearly 300,000 renters facing eviction come July 1, with a larger group (512,000) reporting little-to-no confidence they will be able to pay their next month’s rent.
That’s about 15 percent of L.A. County renters who may face eviction, and over a quarter who don’t think they can pay August’s full sum, says Gary Blasi, professor emeritus at UCLA Law. Last May, Blasi released a report predicting 365,000 renters would face eviction if the moratorium was lifted in August 2020. Since then, “the numbers have not changed significantly,” Blasi says. “The difference is we have better numbers.”
In the year since his report was initially released, Blasi was able to incorporate U.S. Census survey data, unemployment figures, and other factors to reach his revised 295,147 number—a clearer (and lower) total, yes, but still within the margin of error of his original prediction.
It’s a precarious situation, and one that would send the state’s already-extreme homeless crisis into hyperdrive. L.A. County currently estimates that over 66,000 people are living on the streets and in shelters. A swell of thousands more is almost unimaginable. So what’s to be done?
Tackling this potential eviction tsunami requires splitting the problem into two parts. First, the massive amount of consumer debt that has been accumulated over the last 15 months as hundreds of thousands of renters either missed payments entirely or only paid a partial amount needs to be addressed. “California got quite a bit of federal aid to pay down some of this debt,” says Barbara Schultz, director of housing justice for the Legal Aid Foundation of Los Angeles. Unfortunately, the implementation of that money by the state has been slow and it has not reached the communities most in need of the aid. “So we really need to kind of hold off and let that work so that folks can get the rental assistance before we start saying that they can be evicted or sued for the consumer debts,” Schultz adds.
One of the reasons that SB91 (the COVID-19 Tenant Relief Act that was passed in January) hasn’t been working well for struggling renters is that it was drafted behind closed doors by “landlord lawyers from the Apartment Association,” says Blasi. “They didn’t consult anybody who actually represents tenants.” And it’s unclear whether future tenant protection bills will be drafted by the same group.
In L.A. County, the Board of Supervisors is exploring the option of using some or all of the $211 million in federal aid given to the county for rental assistance to buy up this consumer debt. “As we continue on our path to recovery, we want to ensure that our low-income residents who have historically faced racial and economic injustices are able to emerge stronger from the pandemic without being suppressed by the mounting rental debt accrued during the pandemic,” Board Chair Hilda Solis said in a June 8 statement.
The board has asked the County Counsel and other agencies to report on the cost of this plan and it’s feasibility within 45 day (mid-July). It’s unclear whether this plan will be enacted, or how effective it will be, but it’s a novel approach.
Yet, settling consumer debt from the past is only half the equation. The second and perhaps more pressing issue is that renters are suddenly being made to go back to normal when their economic circumstances haven’t improved much since the start of the pandemic.
According to the Opportunity Insights, a non-partisan think tank at Harvard University, low-wage earners in California (those making less than $27,000) have a higher unemployment rate in April 2021 than they did in April 2020, and have seen employment decrease by over 38 percent as compared to January 2020. Meanwhile, middle- and high-wage earners have seen employment rates increase over 10 percent as compared to January 2020.
To make matters worse, extended unemployment benefits (an economic lifeline for millions who are struggling) are set to expire in September.
The economic situation for poor and working-class people, explains Blasi, “is that they were already close to underwater or have very few resources, and now there’s this crushing rental debt” which was brought about by circumstances outside their control. “Tenants didn’t do anything,” Blasi continues. “All that happened was a virus came and people lost their jobs.”
But Blasi sees a glimmer of hope. The good news, he says, is that Governor Gavin Newsom is facing a recall election. “There’s increased pressure to lower the probability of more disasters happening on this governor’s watch,” Blasi notes, “and this would be an unprecedented level of displacement of poor people, at least since the Great Depression.”
The political pressure bodes well for an extension of the moratorium or some sort of stop-gap measure in the short-term—but for how much longer can we stem the tide?
“We are absolutely kicking the can down the road,” Schultz concludes. “And unfortunately, it needs to be kicked down the road more until we can come up with some better policy solutions.”
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