Court Leaves Eviction Ban in Place
An unfunded mandate remains in place.
Reuters/YahooNews (“U.S. appeals court leaves CDC residential eviction ban in place“):
A federal appeals court on Wednesday refused to overturn the U.S. Centers for Disease Control and Prevention’s (CDC) national ban on residential evictions.
In a blow to landlords, a three-judge panel of the U.S. Court of Appeals for the District of Columbia said it would not lift a stay of a lower court ruling that had declared the eviction ban unlawful.
In language suggesting that the government’s eviction ban was lawful, the panel said the government “has made a strong showing that it is likely to succeed on the merits” of its appeal. The moratorium, which is set to expire on June 30, covers renters whose incomes were hit by COVID-19.
Ever since the CDC implemented the eviction ban in September, landlord groups, arguing that they are on the brink of financial collapse after going months without being paid, have filed challenges in courts across the country, with mixed results.
Legal experts said that Wednesday’s ruling means that for now, the eviction ban will remain in effect until its planned expiration date on June 30, though other court challenges are pending.
For low-income housing advocates, “This is a sigh of relief,” said Eric Dunn, director of litigation for the National Housing Law Project.
As the coronavirus pandemic moves into its second year, an estimated 7 million renters across the country owe $40 billion in back rent, utilities and fees, Moody’s Analytics estimates. This is more than twice the number of homeowners who lost their homes to foreclosure in the 2008 financial crisis.
Many eviction cases are pending, and some tenants may receive a lifeline from the $50 billion in rent relief approved by Congress, even though so far that aid has been slow to trickle out.
“If the CDC eviction moratorium expires or is overturned before those funds are expended, millions of renters would be at immediate risk of losing their homes. The result would be a historic wave of evictions, with tremendous, harmful consequences to individuals, communities, and our nation’s public health,” said Diane Yentel, president of the Low Income Housing Coalition.
Landlords and real estate groups that challenged the moratorium in court said the CDC lacked the power to impose it, and unlawfully took away their right to deal with delinquent tenants.
Both the policy and the law rather baffle me.
On the one hand, it’s obvious that, for humanitarian reasons, we don’t want people losing their homes because of a pandemic. On the other, it’s not the duty of property owners, who rely on rent to make a living or to finance the buildings, to serve as a social welfare agency. If the federal government wants to prevent homelessness, they should subsidize rents, not impose an unfunded mandate on landlords.
Beyond that, it’s not at all obvious where the government—much less the CDC—gets the authority to impose this policy. It’s rather obviously an unconstitutional “taking.” Indeed, at least two lower court judges have ruled that way. The government’s rationale, upheld here pending appeal, strikes me as thin:
The agency has said its authority comes from the Public Health Service Act, a nearly 80-year-old federal law that gives the federal government tools to stop the spread of communicable diseases. The act is clear about some measures the agency can take, such as isolation and quarantine of people who have or may have the virus. But it’s less clear on other measures, like the eviction moratorium, according to some legal scholars. Larry Gostin, a public health law expert at Georgetown University, said he believes the CDC has the legal authority to stop evictions, but acknowledges: “This is definitely a stretch because the Public Health Service Act doesn’t specifically mention evictions and traditionally CDC’s power doesn’t extend to housing.”
How in the world does preventing evictions stop the spread of disease?
The CDC has said the policy, first enacted in September and recently extended through the end of June, helps stop the spread of the coronavirus by limiting the number of people who lose their housing and have to live in shared housing, homeless shelters or on the streets.
That’s rather absurd. And, hell, by that rationale, every vacant rental or hotel room should immediately go to currently homeless people. At the expense of landlords and hoteliers, naturally.
Again, it seems perfectly reasonable for the federal government to step in here to prevent people from losing their homes. But, given how much money we’re already spending on mitigating economic losses from COVID, mortgage/rent support seems a rather obvious path for subsidy. And, frankly, one that makes a lot more sense than sending another round of checks to people who haven’t lost their jobs.
Mass evictions, not evictions as a whole should absolutely fall under the CDC’s purview during a pandemic as it prevents the unwilling mobilization of tens of thousands of germ carriers. Here’s the thing: being homeless is a dirty business. No place to shower or go about your personal hygiene, nowhere to store whatever food you might have safely, no location to isolate if ill. You’re literally now living within the public domain and guess what the CDC has jurisdiction over?
It makes nine kinds of sense to not let people be forced from safe places into unsafe conditions during an emergency just because it satisfies some capitalist impulse of “fairness”. It absolutely affects public health to suddenly have an uncontrolled influx of people in public spaces; history has plenty of examples of how secondary pandemics can kick in from an unhoused population during an outbreak coming down with all sorts of things straining already maxxed-out social system. It makes economic sense to keep people where they live so they can keep buying things so a struggling economy doesn’t take another body blow; Amazon or UberEats doesn’t deliver to the third box under the bridge, dontcha know. Landlords wouldn’t getting money anyways if the renter’s gone so what’s issue other than somebody feeling a down-on-their-luck soul gets housed “for free”? Does it suck they’re not getting any money from people staying in their units? Yes but they wouldn’t be getting it regardless as no renter = no rent and nobody was renting. Those apartments would have been empty and no income would have been forthcoming for months since if nobody can pay to keep living there, they definitely can’t pay to get a new apartment.
As for the government subsidizing this, why yes they absolutely should have. Funny how Republicans were all fired up for money for business but seemed to forget landlords in all this. I wonder why they didn’t think it was necessary to help mitigate this situation…… Could it be the same instinctive capitalist cringe factor of paying unemployed people’s rent or giving away hotel rooms for free to the unhoused? The idea that someone’s gotta get paid during an large-scale emergency for basic human decency is a major reason the CDC should be able to step in and say “nope, this is for the greater good and temporarily authorize the right to stay regardless of cost”.
Considering the number of Republican-led states that have decided to get rid of the federal government support payments because they want to push people back into taking ill-paid jobs, I have no sympathy for the squealing of the landlords at present.
I own a rental property, so I guess I’m a landlord. In normal times if a tenant quit paying rent I’d have them evicted, but these are not normal times and if my tenant lost his job due to the pandemic I would instruct my management company to let him stay even if there weren’t an eviction moratorium. We’d certainly be able to work something out, maybe a gradual repayment of missed rent, when he got his job back. But I’m not putting someone out on the street mid-pandemic, and even now when things appear to be improving, the pandemic is not “over.”
Maybe that’s easier for me since the property doesn’t give me much income, but still, it would be the right thing to do.
Also, everything @KM said.
Not really. The CDC mandate stays the process of eviction. It notably does not toll the accrual of rents or effect the seizure of property. These renters still owe every dime of it. There is an exceedingly ugly reckoning looming on the horizon when this mandate ends (as it eventually must).
It’s also worth noting that this is only a procedural ruling, not a ruling on the merits. The panel simply said “no, we’re not going to lift the stay”, leaving the matter to continue on its otherwise normal course through the courts (where it will eventually face a different panel on the merits of the arguments assuming it doesn’t become moot in the interim if the policy is rescinded prior to adjudication).
@Mikey:
Same here. When the pandemic started, my wife and I discussed our contingency plan for if/when a renter couldn’t pay due to a loss of job. We pretty quickly realized that, doing the right thing aside, what would be the point of eviction? So we could offer the apartment up to tens of people who decided “now would be the perfect time to move?” To the other people evicted for inability to pay rent? Best to work out with our tenant a partial payment plan, a repayment plan, etc.
Perhaps our calculus would be different if our properties were our main source of income rather than a lucrative side hustle, but still.
One bird in the hand worth two in the bush, and all that.
Another aspect of this is I imagine the word “landlord” evokes very different imagery depending on who you’re talking to the same way “small business” does. @James’ phrasing of “property owners, who rely on rent to make a living or to finance the buildings” evokes the idea of a single person, possibly older, who has one or two units that they used to subsidize their income or even live off of. Think of an elderly lady renting out the top floor of a two-story or someone who invested their life savings in a second house to make money off. Those are the people I suspect @James is thinking of when he’s unhappy they are being “cheated” out of money due to the moratorium – you know, average folks no different really then the renter who lost their job.
Now when I hear “landlord” I think of a corporation with dozens of shoddy buildings, many of them run down and overpriced for their level of hell-holeness. Perhaps a bitter soul who complains about “section 8” and makes their renters’ lives hell if the check’s a second late but think nothing of leaving the heat broken for months. A rich person who dabbles in real estate but doesn’t need it to put bread on the table or a millionaire slumlord *cough Jared* who’s willing to throw people out on the streets and take the tax write-off of business loss for empty apartments.
Of the two, who’s more likely to do the human thing and let the renters stay even if they can’t pay? Of the two, who’s more likely to be screaming about their money and doesn’t give a damn what happens to the human beings inhabiting their halls so long as they get paid? As @HarvardLaw92 notes, there’s still going to be a TON of evictions on the horizon and it will mostly be coming from the later who are the ones currently demanding we care about their pain.
@HarvardLaw92:
So, the government can compel loans from property owners, but cannot take property permanently? Specifically loans to third parties with no guarantee that they will ever get paid back?
That seems… wrong. Not sure about legally incorrect, but wrong. At least in normal times. I would expect the fact that it’s a national health crisis changes things, but in normal times, I would want limits on that.
Support for the landlords should have been in the covid relief bills. And Republicans were complaining about it, and probably could have gotten it in if they really cared. But even Democrats should have done so.
Tailoring it, along with the extra unemployment, could have been a challenge, but some form of relief for landlords being overly harshly effected should have been in there.
And, it would have softened the coming exceedingly ugly reckoning. We’re not done with covid, or the covid shocks to our economy, and that extremely ugly reckoning is going to be one.
@Gustopher:
I don’t disagree, but you’re expanding the scope of what I said well beyond what was actually said.
It was. At least $47 billion worth of it, probably more. The problem was what it always is – bureaucracies do not deal with emergencies well, so actually getting the funding to renters (and by association their landlords) proved (and in some places continues to prove) to be a challenge.
@KM: So, again, my solution is to subsidize the rent so that it got paid. But, realistically, most apartments, condos, and the like would in fact be rentable right now. The housing market is under-supplied.
@grumpy realist: I don’t know where the idea that “landlords” are all a bunch of billionaires sitting on piles of money comes from. Either it’s somebody who is renting out his upstairs floor or a starter home they’ve moved out of—in which case they may well need that cash flow to pay the mortgage—or it’s a larger company but one that therefore is experiencing the problem on a mass scale. Regardless, it’s not their responsibility to pay for this problem.
@Mikey: @Neil J Hudelson: So, if I had kept the house my former mother-in-law lived in and rented it out, I imagine I would have the same attitude. I can afford to take the short-term loss for a few months. But that’s a very different thing than being forced to do so by the federal government.
@KM: I don’t think we should make public policy around our resentments of a handful of celebrity assholes.
@HarvardLaw92: Yes, fair point on their eventually getting paid. But I’m with @Gustopher that it seems unfair to force people who very well not have the money to extend indefinite loans. Someone who makes an hourly wage is never going to recoup the money lost from the pandemic and will therefore almost surely default on the loan at some point. Regardless, if the landlord is relying on that loan to pay their mortgage, they’re hosed.
In addition to the CDC moratorium, some states also issued them. Some of the renters have been using this to their advantage, not paying rent regardless of their financial situation. Some friends had a rental (former house he had lived in) and the tenants intentionally trashed the place over 6 months and the house became unsafe. After the tenants moved out my friends decided to sell as they didn’t want this to happen again (plus they still had a mortgage on the place). Many other small landlords did the same, reducing the rental home inventory. Meanwhile the largest landlord in my area is Invitation Homes NYSE: INVH, spun off of Blackstone Group), who has lots of resources and can weather the storm. Many of the larger apartment complexes have been bought in recent years by private REITS out of California (Silicon Valley). But the eviction crisis is coming; I was talking to a local apartment developer the other day (he recently opened a 135-unit complex) and he said they were not going to rent to anyone who was evicted after the moratorium expires = problem tenant. Some of these folks have been milking the system, and some who were given grants to help pay rent pocketed the money instead.
@HarvardLaw92:
I’m just trying to understand the implications of what you said, not trying to change what you said, or shove words into your mouth of approval or disapproval for those implications.
Narrow legal issues on what constitutes a “taking” can have broad impact.
I was more than half expecting (hoping for?) a “well, no, because of X, Y, and Z, once the renter fails to pay back after N days then it becomes a taking, but not before. And at that time there are remedies…”
@Gustopher:
Apologies. The legal implications for the renters are that once the moratorium is up, they’ll either have to work out payment arrangements or they’ll get evicted, still owing the unpaid balances of their rental contracts. Some will undoubtedly be sued over it. There is no happy ending there that I can see.
Taking has a very specific meaning within constitutional law, namely the seizure of private property for a public use. Title passes to the state, with recompense to the private owner. It requires an affirmative action on the part of the state to assert ownership of the property. I think I understand where you are going with the above (not 100% sure, but I think I do), but it wouldn’t really constitute a taking. The “no evictions” mandate issued by the state certainly causes financial difficulties for the property owners, and I’m sure that those difficulties will inevitably result in some of them being unable to perform the conditions of their own mortgage contracts / tax burdens / etc, resulting in them losing the property to either foreclosure or tax sales, as the case may be, but neither of those would constitute a taking. They both result in the transfer of a property from one private owner to another in satisfaction of fiscal obligations. A taking is by definition the state affirmatively “taking” the property away from its private owner(s) for its own public use.
@James Joyner:
I don’t disagree. It’s entirely unfair, and in my view the state has a concurrent burden in concert with its mandate to mitigate the financial consequences caused by it. The law mostly wouldn’t agree with that viewpoint, but from a moral standpoint, there isn’t really an alternative. Putting people out of business full stop not only isn’t right, it isn’t good public policy.
On a related note, I haven’t thought about tenancy law since law school, and I didn’t care for it then (lol) but my read of the terms of this mandate indicates to me that there is nothing in it that really prevents landlords from evicting tenants for non-compliance with the other terms of the lease. You just can’t evict them for non-payment. Evicting them for causing nuisances, being too noisy, damaging the rental unit, and whatever other razor thin violation of the terms you can dream up is perfectly fine.
@Richard Gardner: I would be in this category. They got a 8 month free ride–stimulus checks, enhance unemployment, and not a dime came to me. The fact that people (ahem Progressives) even advocate for this shows they only care about certain little guys. Im not in the freaking charity business and the bank is not extending me any charity.
When the sheriff threw my covid squatting bums out–they had brand new flatscreen TVs throughout the house and a deep freezer full of steaks. They didn’t offer me so much as a dollar from Jan-Oct 2020. Im glad they were too stupid to know about or try and use the CDC moratorium to fight the eviction
The moratorium should be lifted–its causing all sorts of imbalances in the housing market and the Gov’t is forcing small landlord to run shelters without compensation.
@HarvardLaw92:
I don’t know why the rent isn’t “property” that is being taken for public use. It’s clearly a public policy, which sounds like public use to this layperson.
Covid required (and continues to require) a lot of imperfect decisions and balancing free-riders with a temporarily stronger safety net. This is a spot where the government should have stepped up a bit more for the landlords — even if it was targeted for landlords with fewer than 5 units.
As it is, it was still likely better than not doing it — a crapload of homeless people because of an economic contraction during a highly infectious pandemic would have been a disaster.
If you didn’t like the unrest of last summer and fall, you wouldn’t have wanted it worse. Probably would have resulted in Trump winning — maximize unrest and run as the law and order candidate, it almost worked just because of BLM.
@Gustopher:
Takings require a change of ownership – i.e. the governmental entity actually assumes ownership of the property in question. With respect to rents, that would be a situation where the government assumes the landlords rights to the rent payments – in other words the tenants would no longer owe rent to their landlords, they would instead owe it to the government (and we are really torturing the definition of property in that hypothetical, tbh. Courts would largely frown on it.)
In this scenario, the landlords haven’t lost their contractual right to be paid. Ownership of the rents payable hasn’t changed at all. They’re still owed in full to the individual landlords sitting on the other side of the lease contracts. Those landlords are just temporarily prevented by this mandate from exercising a legal remedy (eviction) proceeding from the breach due to non-payment which would otherwise be available to them. Even there, these proceedings are local matters handled by state courts & the actual text of this mandate has holes in it large enough to drive aircraft carriers through them, so as a result the interpretations of the mandate at that level have varied wildly in practice and there have been many evictions despite the mandate being in place. Evicted or not, however, they still owe every dime. Once the ban eventually goes away (as it honestly eventually has to), you will absolutely see some of these landlords not only evicting their affected tenants, but also suing them and obtaining judgments against them for the rents still owed. The fallout from this one will just go on and on.
As I said above as well, there is nothing in this mandate preventing landlords from getting creative with the other terms of their leases – i.e. maybe they can’t evict you for non-payment, but they can evict you for just about anything else in the lease. They’re already doing it.
@HarvardLaw92:
It’s been a very long time since I studied the Takings Clause but SCOTUS has long held that it applies beyond eminent domain. (Indeed, I had forgotten that the two are linked in the Constitution.) Upon reflection, I think you’re right that this order doesn’t constitute a taking because the landlord retains the rights to the rent and because the government is traditionally given wide berth in taking actions to protect the public health.
But a law that required landlords to take in homeless people without compensation, even with the pandemic as justification, would surely be a taking. Hell, under Loretto (1982), SCOTUS ruled that the required installation of cable TV boxes and wiring constituted a taking.
In this case, Cornell’s LLI does a better job summarizing the caselaw than FindLaw.