SB 91 – What Does It Mean for CA Tenants?

Today, the California Assembly and Senate passed SB 91, a tenant and landlord assistance package designed to continue state assistance to the thousands of Californians who have lost income and are at risk of default or eviction. This post will summarize the main components of the bill, and explain how they impact CA’s low-income tenants, with a specific emphasis on consequences for these tenants and legal aid practitioners who serve them.

This bill has two main provisions:

1. An extension of the eviction moratorium passed last year in AB 3088, and
2. The establishment of a Rental Assistance Program to provide funds in satisfaction of tenants’ rental arrears.

Each of these provisions will be addressed in turn.

Extending the Eviction Moratorium

Last year, AB 3088 detailed and codified protections that Governor Newsom and the California Judicial Council had extended by executive order to halt the eviction of tenants due to COVID-19-related financial distress or debt. SB 91 extends these protections, which were due to expire on February 1, 2021, to July 1, 2021.

As a reminder, AB 3088 protects tenants in the following ways:

1) It requires any landlord who delivers a 3-day notice to pay or quit during the COVID-19 crisis to provide state-specified language and an associated form declaration informing the tenant of their rights regarding COVID-19-related debt.

2) It requires tenants to, in response to the notice, complete, sign, and return to their landlord, a legal declaration attesting that their rent debt is due to COVID-19.

3) It provides that no court may find a tenant guilty of unlawful detainer who has complied with these requirements.

4) Finally, it provides that tenants who pay 25% of their total arrears in one or more installments on or before the expiration of these protections (now extended to June 30, 2021), cannot be evicted based on non-payment of the remaining arrears (but may still be civilly liable for that amount).

In addition, SB 91 adds the following protections:

1. Landlords may not use COVID-19 related rental debt as a factor in denying a housing application or refusing to rent a unit to an otherwise qualified tenant.
2. No person is allowed to sell or assign COVID-19 related rental debt, until June 30, 2021.

As with AB 3088, legal aid programs should continue to ensure that 1) any 3-day notices their clients receive have appropriate language and disclaimers as required by state law 2) that their clients who have COVID-19 related rental debt timely return their declarations and 3) that any settlement agreement reached in satisfaction of the arrears is not more restrictive than the current protections.

The Rental Assistance Program

SB 91 also creates a new program, the State Rental Assistance Program, to allocate the state share of the federal rental assistance fund. It distributes these funds to different localities based on population.

Individuals and entities (tenants and landlords) will be allowed to submit applications to their local program implementer for reimbursement of rental arrears. Landlords who apply will receive up to 80% of a tenant’s arrears as compensation, as accrued between April 1, 2020 and March 31, 2021. However, they must agree that this payment represents a full satisfaction of the debt the tenant owes. In other words, the tenant will no longer owe the remaining 20%.

A tenant whose landlord decides not to participate in the program can also apply and receive assistance individually, up to 25% of the total amount owed. This will allow tenants to make the minimum payment, as described above, to avoid eviction for non-payment of COVID-related rental debt. However, the tenant may still be civilly liable outside of unlawful detainer for the remaining amount.

Thus, the program is structured to encourage landlords to participate in the program, as those who do so receive 80% of the arrears, as opposed to nonparticipants, who may receive as little as 25% of the arrears (or less).

Importantly, this section of SB 91 also requires that each locality must implement this program according to the following rules:

1. The implementer must create a technology-driven system which has a mobile application, multi-language capability, and enough capacity to handle service without disruption.
2. The program must be up and ready to accept applications by March 15, 2021.

These are significant requirements, particularly in counties like Los Angeles that have a large number of threshold languages that vary by neighborhood. Legal aid advocates should keep a close eye on the local implementation of this program and coordinate to raise problems with the app or language access.

Finally, the bill makes sure that the aid provided to tenants or landlords from this program cannot be used to calculate personal income tax or eligibility for state programs (such as CalFresh). For a more detailed summary, I recommend consulting the CA Assembly’s Floor Analysis of the bill, linked here.

Legal aid practitioners should familiarize themselves with these county/locality programs as they are rolled out. In addition, legal aid language access expertise or teams should be deployed to help spread the word about this program. Finally, legal aid firms should set up intake processes or clinics to help small landlords and tenants complete the necessary application paperwork to avoid denials and associated complications.

That’s all for today – as always, please reach out to the author at andrew.chen@ccwro.org if you have any questions or suggestions.