MINNESOTA'S EVICTION AND LEASE TERMINATION MORATORIUM - PRESENTED BY CECIL SMITH PRESIDENT AND CEO, MINNESOTA MULTI HOUSING ASSOCIATION

MINNESOTA’S EVICTION
AND LEASE TERMINATION
MORATORIUM
PRESENTED BY CECIL SMITH
PRESIDENT AND CEO, MINNESOTA MULTI HOUSING ASSOCIATION

INDUSTRY SELF-IMPOSED MORATORIUM
EFFECTIVE MARCH 22, 2020 TO MAY 31, 2020

• MHA and its members unanimously initiated a self-imposed eviction
  moratorium due to COVID-19 in advance of the Governor’s Executive Order
• Self-imposed moratorium included:
  • Halt evictions on renters affected by COVID-19, absent extraordinary
    circumstances.
  • Waive late fees for residents who pay rent after the rent due date because they
    have been affected by the COVID-19 pandemic and related government actions.
  • Offer flexible payment plans for residents who cannot pay rent by the due date.
  • Cease new rent increase notifications on all residents.
  • Direct renters to available resources to assist with food, health, and financial
    assistance.

EXECUTIVE ORDER 20-14
EFFECTIVE MARCH 24, 2020

• Did not allow evictions or lease terminations with two exceptions
• Exceptions:
  • Tenant seriously endangers safety of other residents;
  • For violations of 504B.171, subd 1 (unlawful possession of a firearm,
    controlled substance on premises, stolen property or property obtained
    by robbery on premises, or prostitution-related activity).

EXECUTIVE ORDER 20-73
EFFECTIVE JUNE 5, 2020

• Continued to not allow evictions or lease terminations with the same
  exceptions but with a clarification of who a tenant could seriously
  endanger.
• Exceptions:
  • Tenant seriously endangers safety of others;
  • For violations of 504B.171, subd 1 (unlawful possession of a firearm,
    controlled substance on premises, stolen property or property obtained
    by robbery on premises, or prostitution-related activity).

WHERE WE ARE TODAY:
EXECUTIVE ORDER 20-79
EFFECTIVE AUGUST 4, 2020
• Continued to not allow evictions or lease terminations with limited
  exceptions.
• Exceptions:
  • Tenant seriously endangers safety of others;
  • For violations of 504B.171, subd 1 (unlawful possession of a firearm,
    controlled substance on premises, stolen property or property obtained
    by robbery on premises, or prostitution-related activity);
  • Tenant remains on property after receiving notice of property owner
    or family members intent to move into the property;
  • Tenant significantly damages the property.
• Added a 7-day notice period for any filing of an action allowed
  under this Executive order.

CDC EVICTION MORATORIUM
EFFECTIVE SEPTEMBER 4, 2020 THRU MARCH 31, 2021
• Does not allow for evictions until March 31, 2021 for a “Covered Person.” To be
  considered a “Covered Person” they must provide a declaration under penalty of
  perjury indicating that:
  • Resident used best efforts to obtain all available government assistance for rent;
  • Individuals earn no more than $99,000 (or couples no more than $198,000);
  • Resident is unable to pay full rent due to a substantial loss of income, loss of work or
    wages, a lay-off, or extraordinary out-of-pocket medical expenses;
  • Resident is using best efforts to make timely partial payments that are as close to the full
    payment as the individuals' circumstances may permit;
  • Eviction would likely render the individual homeless or move into a congregate or shared
    living setting because they have no other available housing options.

MINNESOTA AND OTHER STATES COVID
MORATORIA
• Minnesota is among the most restrictive moratoria in the country
• 35 states are already effectively at the point where our off-ramp would end:
  deferring to federal CDC regulation.
• When considering the Moratorium on Evictions and Lease Terminations, Minnesota
  is only matched by the States of Washington and Connecticut.
• Of the 15 states that currently have a statewide moratorium, Minnesota is joined by
  only 5 states which have lease termination restrictions. Among these six states, 3
  provide for termination for breaches of the lease.
• President Biden has asked Congress to extend the effective date of the CDC
  Moratorium beyond March 31 in the next stimulus.

Percent Collected on the 6th
  98%

                                   96%
 96%                 95%

  92%                              92%

                     92%                      Class A
                                              Class B

                                   86%        Class C
                     86%

                                                        MINNESOTANS
                                                        CONTINUE TO
 Feb 2020          Jan 2021      Feb 2021

      Percent Rent Collected After 30 days
      99%           99%
                                                        PAY THEIR RENT
                                 98%
98%

                    96%
                                 96%
                                             Class A
                                             Class B
                    95%          95%         Class C

 Feb 2020          Jan 2021     Feb 2021

MINNESOTANS CONTINUE TO PAY THEIR RENT
                                                Rent Collected on the 6th
100%

95%

90%

                                                                                                                   Class A
                                                                                                                   Class B
                                                                                                                   Class C
85%

80%

75%
       Feb-20   Apr-20   May-20   Jun-20   Jul-20   Aug-20   Sep-20   Oct-20   Nov-20   Dec-20   Jan-21   Feb-21

WHAT DOES AN
EFFECTIVE OFF-RAMP
LOOK LIKE?

A FOUNDATION FOR AN OFF-RAMP:
• A concurrent functioning and efficient state and local program to
  administer federal rental assistance is vital to a successful off-
  ramp.
• Federal funds could be available through the end of 2021.
• Federal rental assistance is a crucial tool to avoid evictions.
  Studies indicate 93% of eviction filings in Minnesota are due to
  nonpayment.

STEP 1:
• Termination and nonrenewal of leases permitted for material
  breaches of lease.
  • Breaches of lease does not include nonpayment of rent for
    households with income less than 80% AMI.

STEP 2:
• Permit termination and nonrenewal of leases for those with
  outstanding rent but ineligible for rental assistance.

STEP 3:
• Permit eviction filings for material breaches of the lease.
  • Breaches of lease does not include nonpayment of rent for
    households with income less than 80% AMI.

STEP 4:
• Permit eviction filings for nonpayment of rent for those ineligible
  for rental assistance.

ENDING OF STATE MORATORIUM
• Return to pre-pandemic Chapter 504B regulation of the market.
• Sunset/repeal of off-ramp policy and defer to any federal
  regulation on eviction limitations.

The Minnesota Multi Housing Association
 (MHA) represents 1,800 members who
 own or manage nearly 400,000 units in
              Minnesota.

      FOR MORE INFORMATION
            CONTACT:

            Kyle D. Berndt
       Director of Public Policy
  Minnesota Multi Housing Association
       kyle.berndt@mmha.com