AB 3088 Extended Through June 30, 2021- Rent Forgiveness Finally Happened, Sorta
California is pulling out its emergency powers again. The provisions of AB 3088 in which tenants are to pay 25% of rent for September 2020 through January 2021 is now extended through June 30, 2021. While still being negotiated, below is what I anticipate is going to be the final deal.
Of course- there are always strings attached! The extension of AB 3088's protections came as the result of California receiving $2.6 billion in Federal aid specifically for COVID-19 delinquent rent. California is going to establish a program to pay landlords directly the stimulus funds. The catch- Landlords are essentially forced to accept 80% of the rent that has accumulated between March 1, 2020 and March 31, 2021 from the government stimulus funds in exchange for forgiving the remaining 20% and cannot file an unlawful detainer based on such. This is the rent forgiveness we all saw coming.
FURTHER, if landlords don't let tenants know about this program and landlord's don't take the money then a judge has the discretion to reduce the monetary judgment in an eviction.
Tenants have until June 30, 2021 to pay 25% of rent that accumulated between September 1, 2020 through June 30, 2021.
The "Transition Period" is now defined as September 1, 2020 through June 30, 2021.
Landlords are required to serve a general notice of the extension on tenants. Specific statutory language is required, including language about the California rent assistance program (80% to forgive 20%). This notice is different from the general notice that was supposed to be served back in September 2020.
15 Day Notice to Pay Rent or Quit (Transition Period) served on or after February 1, 2021 has entirely new and different language from the older notice.
Localities cannot allow pay back periods further than August 30, 2021, previously it was March 31, 2022.
Landlords cannot initiate a small claims matter for back rent until August 1, 2021.
Landlords cannot apply the security deposit to any COVID-19 related back rent unless tenant agrees in writing.
Attorneys fees awarded to a prevailing party in an unlawful detainer based on COVID-19 rent is limited to $500 for uncontested and $1,000 for contested.
If landlord refuses to partake in the rental assistance program (80% to forgive 20%) tenants can seek to be paid the 25% of their back rent that accumulated from April 1, 2020 through March 31, 2021. This money can be paid to the tenants or landlords.
All landlords know a monetary judgment is not worth the paper it is printed on because collections is a nightmare. So an 80% collection of COVID-19 rent is not the worst deal on the planet. It just is not the best deal. I think the above provisions will be the final ones. I will update this when I know more.
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