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HomeMy WebLinkAboutItem 11c.1 - Adopting Los Angeles County Evicion Moratorium Policy DATE: May 5, 2020 TO: Honorable Mayor and City Council FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director SUBJECT: PROCLAMATION OF THE CITY MANAGER/EMERGENCY SERVICES DIRECTOR ADOPTING THE LOS ANGELES COUNTY EVICTION MORATORIUM POLICY Recommendation: Approve SUMMARY On March 17, 2020, the City Council adopted Resolution No. 7300, declaring a local emergency in reaction to the COVID-19 pandemic. The emergency declaration included a provision placing a temporary moratorium on evictions in the City for a 60-day period. Since that time, the County of Los Angeles has adopted an eviction moratorium that applies to all unincorporated areas throughout the County, as well as jurisdictions that currently do not have their own moratoriums. In an effort to establish consistency and clarity with the countywide moratorium, it is recommended that the City Council provide direction on whether to adopt the countywide moratorium, which extends through May 31, 2020. BACKGROUND In reaction to the public health threats posed by COVID-19, the State of California and Los Angeles County declared a State of Emergency on March 4, 2020. Subsequently, Governor Newsom issued Executive Order N-28-20, which suspended provisions of State law in order to enable counties and cities to adopt moratoria on evictions in their respective jurisdictions. These orders are viewed as critical in ensuring safe and stable living conditions in residential situations, and to maintain continuity in commercial situations, to the extent it is possible during the pandemic. Arcadia was one of 127 cities and counties in California that adopted such a moratorium, doing so as part of the local declaration of emergency on March 17, 2020. Additionally, on April 6, the Judicial Council of California issued emergency rules that prohibit courts from issuing a summons for unlawful detainer actions (i.e. allowing commencement of eviction lawsuits) unless the court finds that there is a health and safety necessity for the eviction. The emergency rule also suspends judicial County Eviction Moratorium May 5, 2020 Page 2 of 4 foreclosures. This remains effective until 90 days after the Governor lifts the state of emergency. These rules would take precedence over any local moratorium because it procedurally puts nearly all evictions on hold until well beyond the current moratorium time limits. Nevertheless, the Judicial Council rules do not prevent evictions; eviction notices could still be issued. It would prevent the ability to go to court to remove tenants however. DISCUSSION The eviction moratorium adopted by the City applies to both residential and business tenants impacted by the COVID-19 crisis, and extends for a period of 60 days (until May 16, 2020). During the period of local emergency, no landlord shall endeavor to evict a tenant for either 1) the nonpayment of rent if the tenant demonstrates that the tenant is unable to pay rent due to financial impacts related to COVID-19 or, 2) for a no-fault eviction unless necessary for the health and safety of the tenants, neighbors, or landlord. Tenants were directed to provide documentation supporting their claim of inability to pay the rent within 30 days of the due date of the rent and the declaration also provided categories for the definition of “financial impacts” related to COVID-19. Nothing in the declaration relieves the tenant of paying the rent. The full text of the City’s emergency declaration, which includes the eviction moratorium language, can be found as Attachment No. 1. The City’s Order mirrored similar eviction moratoriums adopted by other cities as well as the Order adopted by Los Angeles County. The County’s Order (originally adopted on March 19) includes similar language to the City’s declaration. However, on April 14th, 2020, the County Board of Supervisors expanded the temporary moratorium to include all unincorporated portions of the County and all jurisdictions countywide unless they have already adopted their own moratoria. The expansion also included mobile home parks who rent space to mobile home owners. The April 14 Order differs from the City Order in that tenants must notify their landlord within 7 days after their rent is due, unless extenuating circumstances exist, that they are unable to pay due to a loss of income related to COVID-19 (the City declaration says 30 days). Additionally, the payback period is longer in the County Order; tenants will have twelve (12) months following the end of the moratorium period to pay back any amount due (it is six (6) months in the City Order). The orders to date have been focused primarily on protection of tenants. The City has explored whether there are measures that can be taken to protect landlords from foreclosures in the event that tenants do not pay. This is a challenging situation. Based on a review from Best Best and Krieger, it is not apparent that any cities have taken actions to prevent foreclosures. Most foreclosures are non-judicial foreclosures – the bank appoints a trustee. Upon default, the trustee can sell the property at auction. This is typically done by contract, without the need for court proceedings. This makes it more difficult for the City because the foreclosure is accomplished through private contract. County Eviction Moratorium May 5, 2020 Page 3 of 4 There isn’t a good mechanism for us to prohibit it without affecting private contractual rights. However, there are some actions that have been taken at the state level, including the March 25 action from the Governor to agree with major lenders on a 90- day grace period on foreclosures, as well as proposed legislation which, in part, would suspend non-judicial foreclosures (AB 828). The City and Best Best and Krieger will continue to track these efforts and provide information to Arcadia landlords as it becomes available. The County Order extends through May 31. In order to provide some clarity and consistency in the way this issue is applied and enforced, it is recommended that the City Council adopt the County’s policy and timeline. It is unclear if the County’s policy would automatically govern if the City’s policy is allowed to sunset. The County’s policy extends until the end of the month of May, which may avoid some confusion as to a mid-month ending date. While the City’s moratorium could be extended past the County’s date, this is not recommended at this time. If the Council wishes to adopt the County’s policy, this action can be completed by Proclamation by the City Manager/Emergency Services Director. A sample draft of this Proclamation is included as Attachment No. 2. If this recommendation is adopted, the City’s policy will mirror the County’s policy whether or not it is extended or if it sunsets. It should be noted that there is some risk that a landlord or landlord group could sue the City if the moratorium is not allowed to sunset. While Arcadia has not received any letters or comments to this effect to date, other cities have received such letters threatening litigation. Given the fact that the Judicial Council Order is in place, evictions cannot be effectuated so the level of risk is deemed to be low. It would likely follow that risk would be minimized if the City were to adopt the County Order, which applies to much of the region. FISCAL IMPACT There will be no direct fiscal impact incurred by the City as a result of this action. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”) per Section 15061(b)(3) of the CEQA Guidelines as it can be seen with certainty that it will have no impact on the environment. Thus, this matter is exempt under CEQA. RECOMMENDATION It is recommended that the City Council determine that this action does not constitute a project and is therefore exempt under the California Environmental Quality Act County Eviction Moratorium May 5, 2020 Page 4 of 4 (“CEQA”); and approve a proclamation of the City Manager / Emergency Services Director adopting the Los Angeles County eviction moratorium policy. Attachment No. 1: Resolution No. 7300 Attachment No. 2: Draft Proclamation of City Manager on Eviction Moratorium ADOPTEDAttachment No. 1 /s/ April A. Verlato /s/ Gene Glasco 10 /s/ Gene Glasco 11 PROCLAMATION OF THE CITY MANAGER OF THE CITY OF ARCADIA IN HIS CAPACITY AS EMERGENCY SERVICES DIRECTOR ADOPTING COUNTY-WIDE EVICTION MORATORIUM Effective May 6, 2020 WHEREAS, On March 4, 2020, the Health Officer of Los Angeles County determined that there is an imminent and proximate threat to the public health from the introduction of COVID-19 in Los Angeles County and declared a Local Health Emergency and the Los Angeles County Board of Supervisors concurrently proclaimed the existence of a local emergency for the County of Los Angeles; and WHEREAS, on March 4, 2020, California Governor Gavin Newsom declared a State of Emergency due to the spread and effects of COVID-19; and WHEREAS, on March 16, 2020, Governor Newsom issued Executive Order N-28-20, which suspended provisions of state law in order to enable counties and cities to adopt moratoria on evictions in their respective jurisdictions; and WHEREAS, On March 17, 2020, the City Council of the City of Arcadia (“City Council”) adopted Resolution 7300, ratifying the City Manager’s proclamation of a local emergency and declaring a local emergency; and WHEREAS, Resolution 7300 orders a moratorium on the eviction of tenants during the local emergency for non-payment of rent if the tenant is unable to pay rent due to the financial impacts of the COVID-19 crisis and enables repayment within six months of the end of the local emergency; and WHEREAS, Resolution 7300 by its express terms “shall be superseded by a further order of the Director of Emergency Services adopted during the local emergency that expressly supersedes” the orders contained in Resolution 7300; and WHEREAS, on March 19, 2020, the Chair of the Los Angeles County Board of Supervisors issued an Executive Order placing a moratorium on evictions in unincorporated areas of Los Angeles County until May 31, 2020; and WHEREAS, on March 27, Governor Newsom issued Executive Order N-37-20 imposing a statewide moratorium on evictions, which does not restrict counties and cities from ordering more stringent tenant protections; and WHEREAS, on April 14, 2020, the Board of Supervisors of the County of Los Angeles adopted a motion extending the County’s eviction moratorium to incorporated cities within the County and increasing tenant protections, which exempts incorporated cities such as the City of Arcadia who already have eviction moratoria in place; and WHEREAS, Resolution 7300’s orders related to a moratorium on evictions shall be superseded by this Proclamation in order to establish consistency and clarity with the countywide moratorium. Attachment No. 2 NOW, THEREFORE, IT IS HEREBY PROCLAIMED THAT: 1. The Executive Order of the Chair of the Board of Supervisors, as adopted on March 19, 2020, ratified on March 31, 2020, and as amended by motion and resolution of the Board of Supervisors on April 14, 2020 (the “County Order”), shall apply within the incorporated City of Arcadia to the extent that it is applicable to incorporated cities in the County of Los Angeles. 2. The County Order is incorporated by reference as if fully set forth herein. Any changes to the County Order, including but not limited to any extension of the time period during which it is applicable, shall likewise apply within the City of Arcadia without further action or order of the City of Arcadia. 3. Pursuant to the authority delegated to the Director of Emergency Services to issue orders superseding Resolution 7300, this Proclamation shall supersede and withdraw all portions of Resolution 7300 that relate to a moratorium on evictions, except as set forth in paragraph 4 below. 4. Resolution 7300 provides that tenants shall notify their landlords of inability to pay rent in writing within 30 days of the date that rent was due. This 30-day notice period shall remain in effect for any rent that was due on or prior to the date of this Proclamation, even if the notice of inability to pay has not yet been given. The County Order requires such notice within seven (7) days of when rent was due, which shall apply to any rent that becomes due after the date of this Proclamation. 5. The County Order’s prohibitions on rent increases, which are specific to rent-controlled properties in unincorporated areas of Los Angeles County, are not applicable in the City of Arcadia and are not adopted as part of this Proclamation. 6. This Proclamation shall terminate upon termination of the County Order unless the Emergency Services Director or the City Council terminates or modifies this Proclamation at an earlier time. 7. This Proclamation is enforceable pursuant to Arcadia Municipal Code section 2215 et seq. To the extent any part of this Proclamation is deemed unenforceable or invalid, then such part shall be severed and the remainder shall remain in full force and effect. If this Proclamation is unenforceable or invalid, then the City of Arcadia shall be deemed to not have a local eviction moratorium and the County Order shall nonetheless apply as it applies in other incorporated cities without a local eviction moratorium. 8. The City Clerk shall maintain copies of the various documents constituting the County Order, which shall be made available to the public on request and posted on the City’s website. 9. Additional information about the County Order is available on the Los Angeles County Department of Consumer and Business Affairs website at https://dcba.lacounty.gov/noevictions/. Dated: May 6, 2020 By:______________________________ Dominic Lazzaretto Director of Emergency Services/ City Manager City of Arcadia, California