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CDC's Moratorium on Rent Evictions Overturned in Federal Court

Jay Hershman - May 10 2021
Published in: Public Policy
Here’s what you need to know about the Centers for Disease Control’s (CDC) rent eviction moratorium, its impact on mobility, and where it goes from here after being struck down by a federal judge.

Throughout the COVID-19 pandemic, public policy initiatives in the United States have centered on providing much-needed economic relief while keeping people safe and healthy. Part of these efforts is the moratorium on all evictions nationwide, which has been extended multiple times and was set to expire on 30 June 2021. Now, a federal judge has struck down the moratorium following several challenges to the Centers for Disease Control’s (CDC) overall authority to ban evictions.

Here’s what you need to know about the rent eviction moratorium:

What is the rent eviction moratorium in the U.S.?

In March of 2020, Congress passed the CARES Act, which included a moratorium on all evictions nationwide. The CARES Act moratorium was set to last for 120 days and expire on 24 July 2020. After the expiration, and because there was no longer government protection against evictions, the Centers for Disease Control (CDC) passed an Order on 4 September 2020 under Section 361 of the Public Health Service Act which put a temporary halt on evictions to hinder the spread of COVID-19. The CDC Order was originally slated to run through 31 December 2020, however it has since been extended three times. The CDC eviction moratorium was set to expire on 30 June 2021 before it was struck down by a federal judge on 5 May.

Who is covered under the moratorium and what are the criteria?

Any tenant, lessee, or resident of a residential property who provides to their landlord, the owner of the residential property, or other person with a legal right to pursue eviction or a possessory action, a declaration under penalty of perjury that they meet all the eligible criteria.

Criteria to be covered:

  • The individual must have used "best efforts" to obtain government assistance;
  • The individual does not expect to earn more than $99,000 in 2021 (or $198,000 if married and filed a joint tax return) or did not need to report income to the federal government in 2020, or received an economic income payment (stimulus check) this year;
  • The individual has been experiencing a "substantial" loss of household income due to a layoff or reduced work hours, or has "extraordinary" out-of-pocket medical expenses (defined as an unreimbursed medical expense that exceeds 7.5% of adjusted gross income for the year);
  • The individual has been making best efforts to make partial rent payments as close to the full amount as possible;
  • Being evicted would cause the individual to become homeless or would force them to move in with a friend or family member.

What is the future of the rent eviction moratorium?

With the moratorium struck down in federal court, its future will likely depend upon upcoming court battles. A Department of Justice (DOJ) spokesman said that it planned to appeal the ruling and will seek a stay of the decision, which means that the ban will remain in effect for the foreseeable future.

How This Impacts Mobility

The moratorium may affect transferees in that apartments that a transferee thought would be available for temporary housing may not become available if the current tenant refuses to leave at the end of a lease term. Additionally, closings have been delayed as tenants have refused to vacate when an investment property is being sold that the transferee may plan to occupy as his or her primary residence. With the moratorium headed to more court battles, Worldwide ERC® will update members with important relevant updates to this issue. Should any member have questions, please reach out to our Vice President of Member Engagement and Public Policy Rebecca Peters, rpeters@worldwideerc.org.

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Jay N. Hershman, Esq., SCRP, is an attorney at Baillie & Hershman P.C. and Chair of the Worldwide ERC® Real Estate and Mortgage Forum. Taylor Weitz, litigation attorney with McManamy McLeod Heller, LLC also contributed to this update.