What Will California Do About the Rent?

Monday, May 4, 2020

Publication: CalMatters

Every first of the month, California’s past due rent bill gets bigger. 

As the state enters May sheltering in place for the seventh straight week to stop the spread of COVID-19, nearly 1 in 5 California workers have filed for unemployment, with millions more wondering if their next paycheck will actually materialize. 

A disproportionate share of the abruptly laid-off and underemployed are lower-wage renters, who were already struggling to afford the state’s sky-high housing costs before the pandemic shuttered the restaurants, retail stores and rideshare operations that employed them. 

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Assemblyman Phil Ting, Democrat from San Francisco and chair of the Assembly budget committee, says that some type of general public assistance bond floated on the November ballot could potentially be used to fund additional rental help while buttressing state coffers. But he cautioned the lion’s share of the money would have to come from Washington D.C. 

“It will have to primarily come from the federal government,” said Ting. “They have the ability to borrow money, and we don’t.” 

Billions of dollars from the federal CARES Act headed to California could conceivably be redirected for rental assistance, although experts say more rounds of federal funding will be necessary to meet the need in any meaningful way. Given Senate Republican Majority Leader Mitch McConnell’s comments on allowing states to pursue bankruptcy in lieu of additional federal support, Ting says he’s unconvinced that funding will be forthcoming. 

“I’m not confident the federal government can do anything at this point,” said Ting

Ting has his own proposal for rental help that doesn’t require a major infusion of state dollars: AB 828 would allow renters facing the prospect of eviction for non-payment of rent to petition the court for a 25% reduction in rent payments for the next year, with the renter making up missed rent in monthly 10% installments. The rent reduction would only proceed if the court determined renters were unable to afford rent because of COVID-19, and small landlords would have an opportunity to demonstrate their own financial hardship resulting from reduced rents.

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