COVID-19 exacerbates California housing shortage for renters

COVID-19 exacerbates California housing shortage for renters

It is no secret that California continues to face a significant housing shortage, particularly for low-income renters. The problem has troubled the state for years, and will continue to do so as California renters navigate through the onslaught of challenges brought by the Covid-19 pandemic.

“Pre-Covid,” over 1.3 million renters statewide had incomes at or below federal poverty guidelines.[1] At the same time, there were only 304,197 affordable rental units available in California.[2] The majority of California renters (more than 3 million households) pay more than 30% of their income toward rent.[3] Over one-third of renters (more than 1.5 million households) pay a staggering 50% or more of their income toward rent.[4] Women of color are more likely than other groups to be rent-burdened.[5] With such high housing costs, many families live paycheck to paycheck with very little to spare. Seemingly small changes in income—a few missed shifts—could mean missing next month’s rent.

The Impact of Covid-19

The Covid-19 pandemic and its associated economic fallout have exacerbated this already difficult situation. The National Low Income Housing Coalition estimates that over 1.6 million California renters will need a total of over $21 billion in emergency rental assistance between May 2020 and June 2021.[6] Federal, state, and local agencies have implemented various eviction moratoriums and other relief programs since March 2020. Amidst a patchwork of local protections, the Judicial Council of California paused most eviction filings through the end of August 2020, providing some relief to cash-strapped renters while lawmakers in Sacramento debated solutions. On the eve of expiration, Governor Gavin Newsom signed Assembly Bill 3088, providing additional extensions and protections but stopping short of barring all evictions during the pandemic. Under the new law, tenants who pay at least 25% of their rent from September 1, 2020, through January 31, 2021, will be protected from eviction, and the balance of any rent owed during this period cannot be used as a basis for eviction. It would instead be converted to civil debt.[7] If landlords ask for the rent, they must do so using a 15-day notice instead of the usual three-day notice, and renters then have 15 days to return a declaration affirming that they have a Covid-related hardship to qualify for protection. Those who do not pay the minimum rent by January 31, 2021, could face eviction beginning February 1, 2021.[8] Crucially, the bill also prevents evictions based on unpaid rent between March and August 2020 if renters submit a declaration of a Covid-related hardship to their landlords. Any back rent due from this period would be converted to civil debt, which landlords could sue to recover in small claims court beginning in March 2021.[9]

The most recent extension offers much-needed relief, but many tenants are likely to slip through the cracks. People facing the various hardships brought by the Covid-19 pandemic, people with limited English proficiency, and those who are not aware of the law and its protections may have difficulty submitting the required paperwork to qualify for the bill’s protections. Others are facing eviction (or threats of it) despite the moratoriums. Over 1,600 households have been evicted since early March 2020.[10]

Tenant Representation Leads to Better Outcomes for Everyone

Once the eviction moratorium is lifted, there is likely to be an onslaught of eviction cases. The vast majority of tenants will not have legal representation, but the landlords will. Indeed, in many housing courts around the country, about 90% of landlords have representation. About 90% of tenants do not. Increasing tenant representation is a must. In “normal” times, tenant representation significantly impacts eviction process outcomes; it will be essential to meet the demands of the Covid-19 emergency.

Since 2011, California has been studying the impact of legal representation for indigent tenants through the Sargent Shriver Civil Counsel Act. The project’s June 2020 report shows several important findings, benefitting both tenants and landlords:

Tenant representation decreases default rates and the number of trials, which are burdensome for landlords, tenants, and courts. Most cases were settled.
Most tenants do end up moving, but only 3% of cases ended with a court judgment of eviction. Reducing eviction judgments is an important step in alleviating the broader housing crisis, as such judgments make it difficult for tenants to obtain housing in the future.
Tenant representation resulted in median savings of almost $2,000 per tenant, savings that can help secure new housing.
71% of represented tenants had obtained a new rental unit within a year of their cases, compared to 43% of unrepresented tenants.
Settlements also benefitted landlords, who secure dates certain when tenants will leave, generally with agreements to leave the home in good condition.[11]

Tenant representation will be even more important during the Covid-19 era, given the complex and fluid nature of the emergency moratoriums, the availability of new sources of funding for rental assistance to prevent eviction, and the dynamic public health situation. Lawyers can help guide tenants through this complicated landscape and secure results that allow more tenants to keep their homes while getting rent money to their landlords.

How to Help

Many tenant legal services organizations are predicting a dramatic increase in the need for lawyer assistance in eviction cases and are calling on pro bono volunteers to help meet demands. Pro bono volunteers can work with legal aid organizations—like Community Legal Services in East Palo Alto in the Bay Area—to help meet these demands. Pro bono opportunities range from taking eviction cases for full representation to participation in court-mandated settlement conferences, which occur in many counties throughout California and provide tenants with brief services at a strategic point during the case timeline. Pro bono attorneys will also be needed to represent tenants before an eviction case is filed, providing legal advice to tenants about how to protect themselves under California’s new law and pushing back against invalid eviction notices or threats by unscrupulous landlords. Pro bono tenant representation offers unique opportunities for professional development, particularly for junior attorneys in larger firms. Eviction cases run on compressed schedules, allowing attorneys to experience the full “life” of a case in a much shorter time than they might in their traditional practice. Junior attorneys also take on primary responsibilities and ownership over pro bono matters, leading to practice milestones like depositions, brief writing, negotiations, and trials. Participation in settlement conferences helps attorneys develop skills in client communication, fact gathering, issue spotting, negotiating, and in-court appearances, all in the span of a few hours.

There will be an unprecedented need for tenant representation in the coming months, a need that tenant legal services organizations cannot fulfill alone. Attorneys can and should help meet this demand by offering invaluable pro bono services to their communities and providing essential services for those in need, while honing important professional skills that transfer to their everyday practice.

Article provided by:
Morgan E. Smith
Morgan is an associate at Finnegan, Henderson, Farabow, Garrett & Dunner LLP and co-leads Finnegan’s pro bono service with Community Legal Services in East Palo Alto (CLSEPA) representing tenants facing eviction. She focuses on trademark and false advertising litigation, litigating cases and managing enforcement efforts for some of the world’s most renowned brands. She regularly represents tenants in landlord/tenant disputes through Finnegan’s partnership with CLSEPA.

Jason H. Tarricone
Jason is the Directing Attorney of the Housing Program at CLSEPA. CLSEPA’s housing attorneys combine impact litigation and policy advocacy with traditional legal services to prevent the displacement of low-wage workers and communities of color from Silicon Valley. CLSEPA defends tenants facing eviction, files affirmative litigation to keep families in healthy and safe housing, and partners with grassroots community organizations to enact tenant protection policies and encourage new affordable housing development.

Ming-Tao Yang

Ming is the managing partner of Finnegan’s Palo Alto office. Ming also supervises Finnegan’s pro bono partnership with CLSEPA. He focuses on litigating patent and trade secret disputes, counseling clients on licensing and portfolio management matters, and advising on inter partes reviews, opinions of counsel, and IP strategies.