SACRAMENTO, Calif. - Gov. Gavin Newsom on Friday signed an eviction moratorium extension -- the state’s first major attempt to clear unpaid rents that have piled up during the pandemic as millions of people lost their jobs because of government-ordered business closures.
The moratorium, which would have expired Sunday, is now good through June 30. If it expired, tenants' rights groups said countless renters could have been out on the streets.
"We're definitely talking about several millions of people," said Lupe Arreola, executive director of the statewide advocacy organization Tenants Together. "About 25% of tenants were paying over 50% of their income in rent pre-pandemic."
At a virtual news conference on Friday, President Pro Tem Sen. Toni Atkins said she was glad that legislators were able to "deliver a lifeline" to renters last year.
"This year, we knew if we didn't act, that lifeline would slip through our fingers and more Californians would suffer," she said.
In addition, California legislators also agreed to use $2.6 billion in federal stimulus money to pay off up to 80% of some tenants’ unpaid rent — but only if landlords agree to forgive the rest of their debt.
A mother named Graciella also spoke Friday about how she and her family all got COVID. Her landlord allows them to live in their home without pay.
"I get so excited. I get so happy. I want to say thank you. For my family to keep going," she said.
But the move is risky because of two big unknowns: Is $2.6 billion enough to cover all of the unpaid rent in the state, and how many landlords will take the deal?
No one knows for sure how much unpaid rent is in California, the nation’s most populous state with nearly 40 million people. Estimates range from a high of $3.6 billion by the advocacy group Housing NOW! California to a low of $400 million by the nonpartisan Legislative Analyst’s Office.
Last year, Newsom signed a law that banned tenants from being evicted for not paying their rent during the coronavirus, but only if they paid at least 25% of what they owed after Sept. 1. The move prevented what many feared would be an "eviction tsunami," but still required tenants to repay their debts, empowering landlords to take them to court to recoup their money.
Newsom officials say California is so far the only state using federal stimulus dollars to entice landlords to forgive the debt.
The legislation goes beyond protections enacted in New York last month that freeze evictions and certain foreclosures for two months, or until May 1 for renters who assert that they’ve faced hardship from the coronavirus pandemic.
Some housing advocacy groups worry California’s legislation gives too much power to landlords. If landlords refuse the deal, the law would only pay off 25% of the tenants’ debt — enough to ensure they could not be evicted.
That is "a troubling power imbalance," said Democratic Assemblyman David Chiu, among many objecting to that provision.
"This is not a perfect deal," Chiu, who heads the Assembly housing committee, said as he and Democratic Assembly Speaker Anthony Rendon noted lawmakers must do more to fill the gaps before the new protections expire in June. Yet "at this deadliest of moments in the pandemic, we can’t have tenants pushed out into the streets," with the current protections set to expire this weekend.
The legislation had rare bipartisan support, passing 71-1 in the 80-member Assembly and 34-0 in the 40-member Senate with some Republicans not voting.
"This isn’t perfect...but we are in a desperate time right now," said Assemblyman Devon Mathis, though he and other Republicans said they remain concerned that there will be bureaucratic complications over administering the program.
"We ask Gov. Newsom to please not screw this one up too," Mathis said, referencing ongoing delays and billions of dollars in fraud in allocating pandemic unemployment benefits.
Several lawmakers warned that disadvantaged communities could be left behind, though Democratic Sen. Dave Cortese said the measure requires setting up a statewide multilingual call-center in part to help landlords and tenants who lack internet access.
The federal money includes $1.5 billion sent to the state and another $1.1 billion sent to some cities and counties.
The money could also be used to pay for unpaid utility bills. A survey by the State Water Resources Control Board found 1.6 residential water customers, or 12% of all households, have unpaid bills amounting to $1 billion.
Associated Press reporters Adam Beam and Don Thompson contributed to this report.