The Latest COVID Relief Package: What Landlords Need to Know

Hey gang. Hope you’re doing well as we close out 2020 and start our new year. I wanted to give an update on where things stand right now. 

New COVID-Relief Package 

As most of you know, Congress passed and the President ultimately signed a new relief package. While the details of individual payments are still a bit fluid, here’s what we know about the rental issues in the package: 

1. The Bad News - The CDC Eviction Moratorium has been extended through January 31, 2021. This means that any eviction cases that were continued from 2020 into January 2021 will likely be kicked back into February and beyond.

It is almost certain that President Biden will extend the moratorium beyond January 31. It is my advice that we should not expect the moratorium to end until late spring at the earliest.

2. The Good News – The package includes $25 billion in rental assistance. These funds are to be made available to state and local within 30 days. The Governor has announced that Kentucky is set to get just under $300 million of those funds.

In order to qualify for the funds, a tenant must meet three criteria: 

• Have a household income that is no more than 80% of the Area Median Income. Lexington’s AMI is around $55,000.00 per year. So, those who make $44,000.00 or less per year would qualify for assistance.
• Have at least one household member who can demonstrate a risk of homelessness or housing instability; and
• Have at least one household member who qualifies for unemployment benefits or experienced financial hardship due to the pandemic. 

Of those who qualify, states are to give priority to tenants (1) whose incomes are 50% of AMI or less ($27,500) and (2) those who are currently unemployed and have been for 90 days or more. 

It is my expectation that these funds will be distributed via the Healthy at Home Eviction Relief Fund website (click here), but that has not been established for sure yet.

So, given that we’re going to have significantly more money for rental assistance (we had only $15 million this fall), it makes sense for landlords and tenants to apply for assistance. In fact, tenants who sign the CDC form must apply for all available assistance.

I’ll pass along more details as they develop.

Evictions during January

If you filed an eviction during September-December and your tenant signed a CDC form, your case may have gotten kicked to a January eviction docket. Those cases will likely get pushed back into February and beyond. 

However, if your tenant failed to seek rental assistance, you can and should bring that to the attention of the judge at your next court date, as it may be grounds to find that the tenant does not qualify for protection under the CDC moratorium. Whether judges will be willing to make that finding, I don’t know, but a tenant who swore that he was seeking assistance and failed to do so should not be protected under the law. 

A couple of other reminders: 

CARES Act Properties

CARES Act properties are still required to give a 30-day notice prior to filing an eviction based on failure to pay rent. The Kentucky Supreme Court’s latest order, linked here, makes that clear.

Eviction Process

All eviction hearings are still being done remotely. See this article for ways to use ZOOM effectively during evictions: 

If you have a non-payment of rent case, the tenant will get a two-week continuance if they appear in court. This is required by the Kentucky Supreme Court order referenced above. 

I strongly encourage you to put a sentence in your notice that provides the tenant with the ZOOM link for the court hearing or gives them the phone number to call to obtain the ZOOM link. Adding that to your notice may save you from having your case continued for an additional week or more. 

Late Fees 

As a reminder, late fees are allowed to be charged at all properties in Kentucky with one exception: CARES Act properties may not charge late fees on rent that accrued from March 27-July 25, 2020. Other than that, late fees may be charged. 

Happy New Year 

In closing, I wanted to thank you for working with me. It’s been a joy and an honor, regardless of anything else that happened in 2020. 

I’ll remind you that we control our own happiness. Because that’s true, 2020 has been a good year. And 2021 will be as well.

I hope that you have a wonderful new year. As always, be sure to reach out to me at (859) 685-0035 or at smarshall@tripleslaw.com if you have questions or need help with anything. Godspeed.