On August 26, 2021, the U.S. Supreme Court (SCOTUS) ruled 6-3 to strike down the U.S. Centers for Disease Control and Prevention’s (CDC) federal eviction moratorium (CDC Order). This important decision is not about pursuing evictions for all residents, but rather it restores the ability of housing providers to effectively manage their properties and recognizes that the CDC lacked the authority to impose an unfunded, federal housing mandate that disrupted court processes, housing operations, and the rental housing stock nationwide.
“It is indisputable that the public has a strong interest in combating the spread of the COVID–19 Delta variant,” read the unauthored majority opinion issued along ideological lines. “But our system does not permit agencies to act unlawfully even in pursuit of desirable ends.”
Please note that this SCOTUS ruling only applies to the CDC Order – the CARES Act 30-day notice requirement and state and local eviction moratoria remain in effect. Housing providers should continue to follow all applicable laws and regulations, including state and/or local eviction restrictions, and consult trusted local counsel for clarification as needed.
The ruling emphasized that if a federal eviction moratorium is to continue that Congress must specifically authorize it, which the National Apartment Association (NAA) continues to oppose. There is a possibility that the U.S. House of Representatives will pursue such legislation when Congress returns in September; however, the possibility of an eviction moratorium bill passing through both the House and Senate is slim.
Instead of continuing to pursue flawed and unlawful eviction restrictions, the focus must shift to the distribution of federal emergency rental assistance funds. A recent Treasury report revealed that only 11% of funds have been distributed, meaning $41.4 billion still has not reached renters and housing providers who need the funds the most. NAA, alongside our real estate industry coalition partners, is urging Congress to implement critically needed reforms to the Emergency Rental Assistance Program (ERAP) that will accelerate distribution. By taking the steps to make responsible and necessary reforms to this program, lawmakers can address the underlying financial distress faced by rental housing providers and their residents and ensure the long-term stability of the nation’s rental housing infrastructure.
Critically, NAA continues its lawsuit seeking more than $26 billion in damages brought on by the CDC’s order. This lawsuit’s primary intention is to ensure unfunded rent debt accrued under the CDC order is paid, wiping $26 billion in unfunded rent debt from housing providers’ books and, subsequently, from residents’ records. The SCOTUS ruling is a good first step in making housing providers and residents whole again, and further affirms the lawsuit’s goal of recovering lost rent suffered under an unlawful federal mandate. Your support is encouraged.