By Ryan Colquhoun
Prior to March 2020, most industry professionals and legal experts would have concurred that a local, let alone a state and/or national, eviction moratorium would be about as likely as a Bigfoot sighting. However, this fair-reaching and unlikely outcome was about to become a national reality. Not only did the eviction moratoriums become a reality, the eviction moratoriums, in some form, carried on for the following 16 months. An extend period that the full impact on the housing market, landlords, tenants, and other stakeholders is still unknown.
It is foundational to the discussion to understand the various acts and actors that played a role in the eviction moratoriums. More specifically, what actions were taken, when, by whom, and what constraints did each place on landlords and property managers. The earliest actor in PA, was the PA Supreme Court. On March 18, 2020, the PA Supreme Court declared a judicial emergency to restrict potential exposure to COVID-19. The judicial emergency mandated a statewide court closure that included Magisterial District Courts (MDJ). The MDJ court closure, restricted access to the court that most evictions in PA begin and end. As a result, new eviction cases could not commence with the filing of new landlord/tenant complaints, nor could existing eviction judgments conclude with the requisite order for possession and physical lockout. While the sole intent of the Court was not an eviction moratorium, indirectly they enacted the first eviction moratorium in PA. The Court’s action was first to end in early-April 2020, but it was extended before finally ending in May 2020. While the Court’s action was the first in PA, it was far from the most impactful.
Over the next few months, the federal, state, and local governments began to each impose their own variations of eviction moratoriums. From this point forward, the array of eviction moratoriums became a challenge for many MDJ courts to fully understand the overlaying actions. As a result, MDJ courts, in many jurisdictions, did not proceed with eviction matters even though the actions were not prohibited by an active regulatory or statutory prohibition. Therefore, not only were there express eviction moratoriums, but there were also eviction moratoriums that arose from MDJ courts’ decisions to not permit eviction matters to proceed.
The first eviction moratorium action to follow the PA court closure occurred at the federal level, when President Trump, on March 27, 2020, signed into law the Coronavirus, Aid, Relief and Economic Security Act (CARES Act). The CARES Act, in short, established a 120-day national eviction moratorium for evictions based on non-payment of rent for certain covered properties. In PA, the impact of the CARES Act eviction moratorium was mooted, because the PA Supreme Court mandated court closure was in place through May 4, 2020, and Governor Wolf issued an executive order on May 7, 2020. Both the court closure and Governor Wolf’s executive order were more restrictive than the CARES Act.
Governor Wolf’s May 7, 2020, executive order read in part that “the notice requirements mandated by the Landlord and Tenant Act of 1951 and the Manufactured Home Community Rights Act are stayed for 60 days, thereby tolling the ability to commence the timelines necessary for the initiation of eviction proceedings. All eviction proceedings requiring compliance with the Landlord and Tenant Act of 1951 and the Manufactured Home Community Rights Act cannot commence for 60 days until July 10, 2020. All eviction timelines must be computed with a start date of July 10, 2020, at which point any previously delivered Landlord and Tenant Act of 1951 and Manufactured Home Community Rights Act notices will be deemed delivered and any eviction proceedings may commence.” There was debate as to the application of Governor Wolf’s executive order to leases where the lessee waived their right to notice, however most MDJ courts would not entertain such an argument and remained closed to eviction actions. On July 9, 2020, Governor Wolf extended his executive order through August 31, 2020. At the time of extension, Governor Wolf expressed that he lacked the authority to extend the eviction moratorium beyond August 31, 2020.
By August 2020, most PA landlords and property managers had been unable to facilitate evictions, for any reason, for almost five months. Was Governor Wolf’s comments an indication that the end of eviction moratoriums was in sight? Not quite. Almost seamlessly, or coordinated, with the conclusion of Governor Wolf’s executive order on August 31, 2020; the Centers for Disease Control and Prevention (CDC) issued a national eviction moratorium commencing on September 4, 2020, through December 31, 2020. However, a narrow window opened for landlords and property managers.
The CDC eviction moratorium was the first opportunity, since the PA court closure on March 18, 2020, for PA landlords and property managers to commence and conclude evictions. The CDC eviction moratorium applied only to non-payment of rent evictions; meaning evictions based on holdover tenancy, other lease violations such as property damage, and the like were permitted to commence. As it pertained to non-payment of rent evictions, those too were permitted to commence, however, only if the tenant did not comply with the CDC eviction moratorium tenant declaration prerequisite. The tenant declaration prerequisite required the tenant to complete and provide to the landlord a written declaration indicating a variety of items such as qualifying income level, receipt of stimulus funds, using best efforts to make partial payment, and eviction would likely render the individual homeless or force the individual to move into and reside in close quarters in a new congregate or shared living setting.
Under the CDC eviction moratorium, evictions immediately commenced, and a considerable number concluded under what many came to refer to as the “holdover loophole.” The CDC eviction moratorium was extended from December 31, 2020, to March 31, 2021, by way of a President Biden executive order. The CDC later extended the eviction moratorium through June 30, 2021; and, later through July 31, 2021. There were several legal challenges to the authority of the CDC as it pertained to the eviction moratorium; although, none of the legal challenges were successful in achieving an enforced national injunction. In June 2021, the US Supreme Court finally weighed in and asserted that July 31, 2021, was the end of the CDC authority and any further extension would require Congressional action. The Court’s commentary was acquiesced by the CDC via a comment that July 31, 2021, would be their last extension. Although, it would not be the CDC’s last. On August 3, 2021, CDC Director Walensky extended the CDC eviction moratorium until October 3, 2021. This extension was widely condemned as unconstitutional, however the matter unable to work its way through the court system to the US Supreme Court until August 26, 2021. On that date, the US Supreme Court finally brought an end to federal rental eviction moratoriums.
In addition to the previously discussed eviction moratoriums, which applied to all of PA; locally, the City of Harrisburg enacted its own eviction moratorium. On December 18, 2020, in response to the approaching December 31, 2020, suspected end to the CDC eviction moratorium; Harrisburg City officials enacted an emergency order that suspended evictions for City residents for 30 days. The emergency order also provided for 30-day extensions. Mayor Papenfuse proceeded to extend the City of Harrisburg eviction moratorium multiple times until ultimately ending in mid-June 2021. The application of the City of Harrisburg eviction moratorium was unclear at commencement, and many understood it to apply only to non-payment of rent, similar to the CDC eviction moratorium. However, it was later clarified to permit evictions only for criminal activity, threats to the health and safety of other residents, or damage to property. Even though the application was clarified, most MDJ courts with jurisdiction in the City of Harrisburg did not process eviction matters. If evictions were processed and hearings were held, the order for possession to finalize the eviction were not issued. Therefore, in this specific local market most evictions were restricted or strongly impaired through at least mid-June 2021; if not the entire way to August 26, 2021, the end of the CDC eviction moratorium.
The impact the collage of eviction moratoriums will have on the housing market, landlords, tenants, and other stakeholders is still unknown. Absent the reimplementation of eviction moratoriums, clarity of the impact should begin to emerge in the fourth quarter of 2021 and first quarters of 2022. As unfettered access to evictions became available on August 26, 2021, it will soon become clear how many evictions were truly restricted. If the number is vast in specific markets, there may be an immediate localized impact (e.g., hundreds of new vacancies, hundreds of new tenants recently evicted seeking housing, potentially hundreds of new sales listings if landlords decide to exit the rental business, etc…). Alternatively, if the number is limited, the impact may be almost unnoticed. Most importantly, as the unprecedented eviction moratoriums end and the housing market transitions, it is imperative industry professionals remain alert to the potential localized market changes.
Ryan is the Broker of Record/Partner at Harrisburg Property Management Group (HPMG), a full-service property management firm that offers management, maintenance/construction, and sales services. As a founding partner, Ryan has operated HPMG for more than a decade and has provided full-service property management services (sales, leasing, management, etc…) for thousands of property owners throughout Central PA. In addition, Ryan is a solo practitioner with a practice focus on real estate and business law; and, also operates Key Closings, LLC, a PA title insurance and real estate closing company.
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