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What Landlords Need to Know about the Covid-19 Tenant Relief Act of 2020

On August 31, 2020, Governor Gavin Newsome signed Assembly Bill 3088, named the Covid-19 Tenant Relief Act of 2020 (“CTRA”) into law. If you are a rental owner in California whose tenants have been financially impacted by Covid-19, then it is important that you aware of the mandatory notices you must provide to your tenants and the new eviction guidelines in place during the pandemic. This article will provide a brief overview of the informational notices and procedures property owners must follow for collecting past due rent and terminating a tenancy.

 Informational Notices

 On or before September 30, 2020, landlords must provide, in at least 12 point font, an informational notice to tenants who, as of September 1, 2020, have not paid one or more rental payments from March 1, 2020, through August 31, 2020. The informational notice provides residents information about the CTRA and legal resources that are available should the resident need assistance. The exact text of the informational notices may be found here: AB 3088

The informational notice may be served by mail or by following the service procedures specified in California Civil Code Section 1162. The CTRA clearly states that a landlord must serve the informational notice prior to serving a notice for non-payment of rent or concurrently with a notice for non-payment of rent, if the notice is served prior to September 30, 2020.

Rent Owed from March 1, 2020 through August 31, 2020

If the tenant owes rent from March 1, 2020, through August 31, 2020, then the landlord must serve the tenant with a 15 Day Notice to Pay Rent or Quit. The 15 day period for which a tenant may pay rent or surrender possession of the property, excludes Saturdays, Sundays, and judicial holidays. The notice must also include the following: 

  • The amount of rent demanded and when it became due;
  • Advise the tenant that the tenant cannot be evicted for failure to comply with the notice if the tenant delivers a signed declaration of COVID-19-related financial distress to the landlord on or before the date that the notice to pay rent or quit or notice expires;
  • A statutorily mandated disclosure in at least 12 point font which can be found here: AB 3088

 The 15 Day Notice must also include an unsigned copy of a declaration of COVID-19-related financial distress. The declaration must include specific language required by AB 3088.  Landlords can require “high-income” tenants who claim to have a COVID-19 related financial distress to provide documentation of their lost income or increased expenses. “High-income” is defined as having an annual household income of at least 130% of the median income, as published by the Department of Housing and Community Development (HCD) in the Official State Income Limits for 2020, for the county in which the rental property is located. Landlords should carefully review the text of  AB 3088 before requesting additional documentation.

 If the tenant signs and returns the declaration to the landlord within the 15 day period, then the tenant cannot be evicted for nonpayment. Instead, the landlord can collect the amount of rent owed in a small claims action on or after March 1, 2021. If the tenant fails to return the signed declaration within the 15 day period, then the landlord can file an eviction action on or after October 5, 2020.

 Rent Owed from September 1, 2020 through January 31, 2021

If the tenant owes rent from September 1, 2020 through January 31, 2021, then the landlord must serve a 15 Day Notice to Pay Rent or Quit that contains a different statutorily mandated disclosure than the disclosure that that is required for notices of nonpayment of rent for rent owed from March 1, 2020 through August 31, 2020. The 15 day period for which a tenant may pay rent or surrender possession of the property, excludes Saturdays, Sundays, and judicial holidays. The notice must also include the following:

  •  The amount of rent demanded and when it became due;
  • Advise the tenant that the tenant cannot be evicted for failure to comply with the notice if the tenant delivers a signed declaration of COVID-19-related financial distress to the landlord on or before the date that the notice to pay rent or quit or notice expires;
  • A specific disclosure in at least 12 point font which can be found here: AB 3088

 The 15 Day Notice must also include an unsigned copy of a declaration of COVID-19-related financial distress. The declaration must include specific language required by AB 3088. Landlords can require “high-income” tenants who claim to have a COVID-19 related financial distress to provide documentation of their lost income or increased expenses. “High-income” is defined as having an annual household income of at least 130% of the median income, as published by the Department of Housing and Community Development (HCD) in the Official State Income Limits for 2020, for the county in which the rental property is located. Landlords should carefully review the text of  AB 3088 before requesting additional documentation.

If the tenant signs and returns the declaration to the landlord within the 15 day period, then the tenant cannot be evicted for nonpayment if the tenant pays 25% of the rental payment due for the month by January 31, 2021. The landlord can collect any remaining balance by filing a small claims action on or after March 1, 2021.  If the tenant fails to return the signed declaration within the 15 day period, then the landlord can file an eviction action on or after October 5, 2020. If the tenant fails to pay 25% of the rental payment due for the month by January 31, 2021, then the landlord can file an eviction action on February 1, 2021.

Properties Subject to the CARES ACT

If the rental property is subject to the Federal Coronavirus Aid, Relief, and Economic Security Act (“CARES ACT”), then landlords must provide the tenant with a 30-day notice if terminating the tenancy for non-payment of rent. Examples of properties that are subject to the CARES ACT include those that have a Federally back mortgage or multifamily mortgage loan, or federally subsidized properties.

Impact of Local Eviction Moratoria

Various cities and counties have enacted local emergency ordinances that prohibit a landlord’s ability to serve a notice for nonpayment of rent. Landlords should also be aware of any additional procedural requirements imposed by local eviction ordinances.

Termination of Tenancy for Reasons other than Non Payment of Rent

If a landlord wishes to terminate a tenancy for reasons other than nonpayment of rent then they must follow the “just cause” procedures outlined in AB 1482 as additional eviction protections have been temporarily extended to all properties through January 31, 2021.

Because the requirements of CTRA can be complex landlords are strongly encouraged to consult with an attorney if they have a resident who has not paid rent during the COVID-19 pandemic as there are strict penalties for non-compliance with the law.

NOTE: This article is for informational purposes only and should not be construed as legal advice. For legal advice please contact an experienced attorney. For more information visit the PKS Law Group, P.C. at www.pks-lawgroup.com or email info@pks-lawgroup.com .