New state legislation that provides relief to tenants overlooks financial difficulties for small property owners and should only be an interim measure, until financial help for renters can be included in the next COVID-19 stimulus package, a rental housing business advocate said.
Gov. Gavin Newsom signed AB 3088 on Aug. 31, at the end of the shortened Legislative session. It was the only compromise that could be reached, though many solutions had been offered, Sid Lakireddy, president of the California Rental Housing Association (CalRHA) told the Northern California Record.
“We recognize this was a stopgap solution because a comprehensive solution couldn’t be found,” Lakireddy said. “We asked for a higher burden of documentation, to show whether or not a person could afford their rent – how they are financially impacted by COVID-19 – and we were not given that. We were trying to prevent weaponization of this legislation for people who choose to abuse it.”
It is unclear how AB 3088 will apply in view of an executive order, issued the next day through the CDC, which halts any evictions from Sept. 4 through Dec. 31, though a news release from Newsom's office notes AB 3088 does extend eviction protections through January 2021.
In some cases, small property owners haven’t been able to pay obligations like convalescent home bills for elderly family members because tenants aren’t paying.
“At least if they got the unit back, they would have a chance of renting it,” Lakireddy said. “It doesn’t balance the burden; it places an enormous portion of the burden on the private property owner.”
Lakireddy said AB 3088’s concessions to landlords were narrow in scope.
“The only reprieve they give the small business owner is to ask the bank for forbearance – good luck doing business with that bank again. Obviously, they could as a last resort, but they would probably drain all their savings and credit before they do that,” Lakireddy said.
The shared goal among policymakers and business groups is another round of federal funding that would include financial help for renters.
“The wish list we have aligned with lawmakers,” Lakireddy said. “We would love to see a renters’ assistance fund set up. The best thing we could ask for is to pressure Washington, D.C. to get some money out for renters. I don’t see this getting solved any other way, in an equitable manner at least.”