Brand Story – As the COVID-19 vaccine roll-out continues and summer approaches, there is optimism that life may slowly be returning to normal—or at least a new type of normal.
However, residential tenants who have been unable to pay rent throughout last year’s global pandemic are facing serious concerns regarding how to pay overdue rent. This is a scary prospect for individuals struggling to make ends meet and there is a sizable population of Oregonians behind on their rent payments. According to the U.S. Census Bureau, almost 17% of Oregon renters surveyed in early March were not caught up on rent payments.
In response to this concerning statistic, in December 2020 the Oregon Legislature passed HB 4401, extending a pre-existing moratorium on residential evictions for nonpayment of rent from December 31, 2020 to June 30, 2021. The bill also created a landlord compensation fund making grants available for up to 80% of unpaid rent not collected from qualified tenants after April 1, 2020. However, participation in this program is optional and, while the exact details on participation rates are not public, there is no question that certain landlords may prefer to litigate for unpaid rent, rather than utilize the compensation fund.
On May 11, the Oregon Legislature passed Senate Bill 282 to extend until February 28, 2022 the grace period for repayment of residential rent accrued between April 1, 2020 and June 30, 2021. Signed into law by Governor Brown on May 19, the bill provides significant relief to renters and may encourage increased participation in the landlord compensation fund as well. SB 282 will also temporarily prevent landlords from enforcing rental occupancy limits and prevent landlords from reporting unpaid rent to credit agencies, amongst other remedies.
On the federal level, significant news came out of the U.S. District Court for the District of Columbia on May 5, as the court ruled that the Center for Disease Control’s September 4, 2020 residential eviction moratorium was unconstitutional. The moratorium applied to residential properties nationwide and was set to expire on June 30, 2021. In her opinion, Judge Friedrich wrote that while the CDC has the ability “to combat the spread of disease through a range of measures…these measures plainly do not encompass the nationwide eviction moratorium set forth in the CDC Order.” The case was immediately appealed by the U.S. Department of Justice and the ruling was stayed pending the appeal. The ramifications of the appellate ruling could be significant. If the district court ruling is upheld, it may discourage further congressional efforts to protect renters through moratoria and other related measures.
Mick Harris, Business Attorney, Tonkon Torp LLP
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