California Suspension of Eviction Orders

During these tough times, it’s hard to remember every little thing we have to do to keep our businesses running: keeping in mind the Families First Coronavirus Response Act , figuring out taxes , and paying rent on office buildings. Especially if your business has lost out on some crucial projects, you might start to think—especially with the new suspension of eviction notice in California—do I actually have to pay rent right now? The answer is: kind of.

Although we have offices around North America, our home base is Long Beach, where we have a physical office space. We’re figuring out these rules with you!

Here’s what we understand about the suspension of eviction in California.

On March 4th, Governor Gavin Newsom signed an executive order saying additional measures were needed to stop the spread of coronavirus. One of those measures for California is to keep people in their homes and offices for as long as possible so everyone can practice safe social distancing.

An eviction suspension alleviates business owners’ concerns they’ll be kicked out of their office if they can’t afford to pay rent. This also extends to utilities like water, gas, and electricity. Many of these utility providers voluntarily stopped late fees and shut-offs, as did some telecommunications companies.

These measures are in effect until the end of the month—May 31, 2020. Quite a few states have taken similar steps to preventing evictions. With Massachusetts in a state of emergency, Mayor Martin Walsh has put a stop to evictions. And Denver Mayor Michael Hancock is allocating resources to more pressing needs rather than evictions. For all the bad news that we get, there’s still so much hope. We see successes in other countries who have limited or eliminated COVID-19 such as New Zealand, thanks to Prime Minister Jacinda Ardern.

A few weeks ago, Governor Newsom announced that he’s considering six points before extending our own shelter-in-place order:

Can we test people who show symptoms, trace the disease, and keep those individuals in isolation until coronavirus has run its course while supporting their health and wellbeing?
Can we stop the spread of COVID-19 to at-risk communities?
Can our hospitals handle the amount of people coming in?
Do we have measures in place to prevent the virus and therapeutics available?
Can businesses, schools, and other entities allow for a safe, six-foot distance between individuals?
If we do end the stay-at-home order, do we have the option to reinstate it?

These orders seem to be in constant flux, and could change drastically as we learn more about COVID-19. The eviction moratorium specifically could be extended or reinstated based on the governor’s assessment in the coming weeks.

For now, neither residential nor commercial renters and owners will be kicked out. This suspension of eviction only applies if there was a significant loss of income or billable hours within your household; and that loss of income has to be related to COVID-19. This also applies to individuals whose medical expenses have increased as a result of coronavirus.

So, can I stop paying rent?

Not unless you suffered significant business losses which prevent you from paying for your office space. The order also specifies that landlords can collect the rent that was due that you didn’t pay. While you may not be able to find the money now, the order doesn’t remove those missed payments. That is at the discretion of your landlord and/or financial institution.

We look forward to a world without coronavirus, and we know you do as well, so you can start getting back to what your small businesses do best. As you think about your game plan for the future, you might start thinking about sustainability—how to save energy while also saving money. If any questions come up about smart lighting and HVAC systems, please contact us with your project planning and prep questions. We’ll do our best to answer any questions you have!