Billions of dollars in federal rental aid remains stalled in slow-moving states, localities

Supreme Court rejection of eviction ban increases pressure to distribute rental aid money

Protection for struggling tenants ends as Supreme Court voids CDC eviction moratorium

Defaulting renter with face mask receives letter giving notice of eviction from home on wooden table

NC Attorney representing tenants calls the ruling “cruel and horrific”

Hundreds of thousands of North Carolina households behind on rent lost an important legal protection, when the U.S. Supreme Court struck down the eviction moratorium issued by the Centers for Disease Control and Prevention in a 6-3 decision on Thursday.

The CDC stay on eviction, first issued by the Trump Administration in September 2020, was extended multiple times to expire at the end of July. On June 29, Justice Brett Kavanaugh became the pivotal vote in the 5-4 decision to let the moratorium run its course, denying the plaintiff Alabama Association of Realtors’ motion for emergency relief.

As Policy Watch previously reported, Kavanaugh said the CDC “exceeded its existing statutory authority by issuing a nationwide moratorium.” Yet he spared the federal rule given that the it was about to end in a month, to allow for the distribution of rental relief funds, he explained.

However, the CDC issued another eviction moratorium for two months starting August 3 that halts evictions in areas with “substantial and high levels of community transmission levels” of the coronavirus.

The plaintiffs came back with a new challenge, again green lighted by the D.C. District Court, and then sought an emergency injunction from the Supreme Court against the CDC order.

This time, Kavanaugh and his colleague Chief Justice John Roberts joined the four justices who previously ruled in favor of the plaintiffs.

The majority wrote in the opinion, “Apart from slightly narrowing the geographic scope, the new moratorium is indistinguishable from the old.”

However, the six justices reasoned that there was a need to vacate the eviction moratorium, considering the votes in the previous case and the situation across the country. The opinion read, “equities had shifted in the plaintiffs’ favor: Vaccine and rental-assistance distribution had improved since the stay was entered, while the harm to landlords had continued to increase.”

The six justices nominated by Republican presidents, including three nominated by Trump, took a narrow interpretation of the CDC’s authority granted by the Public Health Service Act to say its authority relates more to regulating quarantines and imports. They also said the moratorium interferes with the landlord-tenant laws within purview of individual states.

Gov. Roy Cooper’s moratorium, which first went into effect in October 2020, is no longer in effect. It would have added another layer of protection by preserving the requirements of the federal moratorium should the CDC order expire. However, the Republican-controlled Council of State rejected his request for a renewal the day the earlier SCOTUS decision was handed down, as Policy Watch previously reported.

Justices Stephen Breyer, Elena Kagan and Sonia Sotomayor, dissented in the case, writing that the court merely vacated a stay on the eviction moratorium without hearing any oral argument.

The three said the monetary losses claimed by the plaintiffs could still be recovered, as the CDC moratorium requests that tenants pay back their owed rents. They urged the majority to compare the landlords’ financial loss to the toll that COVID-19 is taking. “The public interest strongly favors respecting the CDC’s judgment at this moment, when over 90% of counties are experiencing high transmission rates,” the dissent read.

Nationwide, only 11% of the rental relief has been distributed, and seven million tenants are relying on the eviction moratorium to shore them up while they wait, according to the National Coalition for a Civil Right to Counsel.

In North Carolina, the Delta variant has caused another surge of COVID cases. On August 26, North Carolina daily new cases topped 8,600 for the first time in months. A month ago, the number was 1,401. Hospitalizations have tripled to exceed 3,500, compared to early July figures.

Kathryn Sabbeth, a law professor at UNC-Chapel Hill, called the decision “cruel and horrific.”

“There are people right now [against whom] the writ of possession was already issued and the sheriff is going to go out and throw them in the street now, like right now,” she said.

She urges judges to step up and help settle the cases through diversion and mediation programs. Sabbeth maintained that tenants still have their basic rights. It is well established that it’s illegal for landlords to lock people out without a court order and sheriffs’ execution, she said. The CARES Act has a key provision that requires landlords to give 30-day eviction notice for housing backed by federal mortgages or subsidies.

Tenants can apply for rental assistance to avoid nonpayment eviction and seek legal representation in court.

States still lag in getting assistance to struggling renters according to federal data

Report: One in seven North Carolinians behind on their rent with eviction moratorium set to expire

Image: The Pew Charitable Trusts — Source: National Equity Atlas, PolicyLink, USC Equity Research Institute

A recent report by the Pew Charitable Trusts news outlet Stateline offers more sobering findings on the national rental housing situation. According to data compiled in the National Equity Atlas, a data and policy tool maintained by the University of Southern California and the research firm Policy Link, the number of U.S. renters behind on payments has doubled from 2017 to 2021.

In North Carolina, from May 24 to June 7, the percentage of renters behind on their payments stayed at 14% — a strong indication that rental assistance is not reaching the hands of struggling North Carolinians fast enough with the end of the Center for Disease Control’s (CDC) eviction ban set for July 31. The report found a total nationwide rent debt of upwards of $20 billion and more than 5.8 million renters behind on their payments as of June 7.

While the CARES Act and two other emergency rental assistance packages enacted by the federal government have directed billions of dollars to individual states in hopes of getting rental and utility assistance into the hands of Americans in need, the distribution process has not been going smoothly in many places — chiefly because state and local agencies were not adequately prepared to deal with the distribution of such large sums in such short order. As a result, the timing for approval of an application for rental assistance can take anywhere from hours to months, depending on where you are located and what organization is helping you.

Since September 2020, the CDC eviction ban has served as a safety net preventing evictions for these renters. The ban has been extended multiple times, but with final expiration now just days away, many advocates and experts foresee a tidal wave of evictions and other negative consequences throughout the country. These fears would appear to be well-founded. When North Carolina didn’t have an eviction ban in place for the 11 weeks prior to the advent of the CDC’s order, the state saw in excess of 15,000 COVID-19 cases and 300 COVID-19 deaths related to evictions according to a study published by the Social Science Research Network. When the current eviction ban expires on July 31 this influx of cases and deaths could happen again.

Despite the recent sobering data, it’s important to note that the current rental housing affordability crisis predates the pandemic. According to the National Low Income Housing Coalition, in March of 2020, (i.e., pre-COVID) only 36 affordable and available rental homes existed for every 100 extremely low-income renters in need. But, of course, the pandemic made things significantly worse. Almost seven in 10 Americans who are behind on their rental payments lost employment at one point during the pandemic according to the research done by the National Equity Atlas.

While the current bleak situation is forcing families to make tough choices between paying the rent, putting food on the table, and paying the electric bill, there are policy options that would go a long way toward protecting renters from short-term and long-term harm. Here are two:

  1. Evictions in North Carolina should be paused while every effort is made to make sure landlords and tenants access the hundreds of millions of dollars of rental assistance that remain available in the HOPE (Housing Opportunities and Prevention of Evictions) program to resolve non-payment of rent eviction cases.
  2. The U.S. Consumer Financial Protection Bureau should act to seal the eviction records and rental debt of those hardest hit by this pandemic. Doing this would make that information private and help prevent tenants who have struggled during the pandemic to pay rent  from being rejected for future housing applications based upon pandemic related financial hardships.

Raquel Harati is a Housing and Health Policy Intern at the N.C. Justice Center.