In the final week of the legislative session in California, the governor and legislative leaders struck a deal on eviction relief for residential renters and foreclosure protections for small landlords financially impacted by the COVID-19 pandemic. California Assembly Bill (AB) 3088, known as the Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020 (the Act), received legislative approval before the midnight deadline on Monday, August 31, and Governor Newsom signed the bill shortly thereafter. The new law, effective immediately, allows the state to delay the anticipated resumption on September 1, 2020 of unlawful detainer actions by California courts. Assembly Member David Chiu, the author of the Act, explained that AB 3088 is a temporary solution meant to provide some level of certainty to renters, modest protections for small landlords and time for the state to determine what additional relief may be needed in the future. Notably absent from the bill are any protections for commercial real estate tenants and landlords.

 For residential tenants, however, the Act provides protection against unlawful detainer actions for unpaid rent for the period from March 1, 2020 to August 31, 2020 due to COVID-19-related financial distress. For the period from September 1 to January 31, 2021, a COVID-19-impacted tenant will be responsible for at least 25 percent of the rents due for that period in order to receive such eviction protection. The Act doesn’t waive unpaid rent but instead converts that amount to consumer debt, collectible in small claims court as of March 1, 2021. Further, to the extent a COVID-19-impacted tenant is not able to meet that 25 percent minimum, AB 3088 would provide eviction protection only until February 1, 2021. Importantly, a landlord who resorts to extrajudicial self-help, such as shutting off utilities, to force a tenant to vacate will be liable for new penalties of $1,000 to $2,500.

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