A critical need to prohibit commercial evictions

Businesses in Cambria line a street usually bustling with customers, but now deserted due to the coronavirus (Photo; randy andy, via Shutterstock)

Under California’s police powers, Gov. Newsom’s gently named “Stay at Home” mandates the closure of all non-essential travel, activities and businesses.

Small businesses have been inevitably forced to shutter their doors. Similarly, non-profits which account for 10% of the U.S. GDP and employ 12 million workers, are no doubt also affected. They are often the life-blood of our communities and serve those most affected by the COVID-19 crisis.

For some, the cessation in revenue and funding will certainly lead to their inability to pay their rent, creating fear that this “temporary” closure could last forever.

That order took no affirmative protective steps; instead, it simply empowered local jurisdictions to pass their own orders.

This article applauds the governor’s attempt to address public health concerns but proposes stronger protections against commercial evictions. The landscape of state and local protections are changing very rapidly but the fact remains that commercial tenants that have been decimated by the virus remain unprotected.

What’s more, it has been reported that 1 million people from California have filed for unemployment, many of whom cited temporary employment. Stronger protections against commercial evictions is also necessary to ensure workers have a place to come back to.

California state Sens. Lena A. Gonzalez and Scott Weiner have proposed State Bill 939, which would prohibit commercial evictions. For the reasons demonstrated below, the implementation of a moratorium on commercial evictions – including the key terms set out below — is critical at this time.

Some will argue that the governor issued a prior order intended to protect renters, residential and commercial, alike. But that order took no affirmative protective steps; instead, it simply empowered local jurisdictions to pass their own orders.

Now, with SB 939, state legislators have an opportunity to provides a more cohesive approach to protect commercial tenants, especially those that serve the interest of individuals and community most at risk.

States and local governments must consider how to leverage their own resources to provide emergency lending.

As California lawmakers consider the new proposals, the following terms should be explicitly included in a statewide commercial eviction moratorium:

  • Commercial evictions arising from non-payment during the emergency declaration period COVID-19 related reasons rent should be prohibited. The tenant must notify the landlord in writing and provide appropriate documentation.
  • Tenants should have, at a minimum, up to six months after the emergency declaration has been lifted to pay their rent without incurring a late fee.
  • Only after this grace period can landlords file the eviction process – any evictions filed during the emergency declaration period should be unenforceable.
  • No utility shutoffs or associated late payments for delinquent water/sewer bills.
  • The state should encourage local governments to incentivize community collaboration by extending the period of payment beyond the grace period if the business or non-profit contributes resources or space to help the fight against COVID-19.

With the federal stimulus package recently passed, there is no doubt that will not be enough. States and local governments must consider how to leverage their own resources to provide emergency lending and auxiliary financial support.

Our California senators and assembly members should pass this policy to ensure a cohesive strategy to prevent evictions by marshaling state powers to ensure statewide coordination of cities, counties, courthouses, sheriff’s departments.

Incorporating these terms is a no-nonsense decision that will set a foundation for a more stable future when we finally emerge out of the COVID-19 era.

Ed’s Note: Ysabel Jurado is a Skadden Fellow at Bet Tzedek Legal Services, where she is a part of both the preventing homelessness rapid response team and  small business development

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