The state moratorium on evictions expires June 30, 2021, after being extended twice during the COVID-19 pandemic. First enacted by an executive order from Gov. Roy Cooper in October 2020, and twice extended by a vote of the Council of State, the government order prevented property owners from enforcing eviction due to nonpayment of rent.
Despite the state action, an existing order from the federal Centers for Disease Control prevents evictions for another month.
“Like many other industries, small business housing providers are struggling to recover from the pandemic and deserve to be included in the economic recovery at hand,” said the N.C. Realtors Association after the vote. “We particularly appreciate the stance of the Council of State in supporting our hardworking small business housing providers. They will now be able to start rebuilding their financial wellbeing, which provides crucial stability to the rental sector of the housing economy.”
Council of State members are individually elected statewide. Most voted against another extension, saying it was overreach for the state to continue emergency pandemic policies during a post-pandemic time. Voting to end the moratorium were Lt. Gov. Mark Robinson, Treasurer Dale Folwell, Commissioner of Labor Josh Dobson, Commissioner of Agriculture Steve Troxler, Commissioner of Insurance Mike Causey, and Superintendent of Public Instruction Catherine Truitt. Attorney General Josh Stein, Secretary of State Elaine Marshall, and Auditor Beth Wood voted in favor of continuing to block evictions for nonpayment.
“Property owners can work with tenants on equitable solutions that are unique to each situation without a ‘one-size-fits-all’ government-mandated order,” Folwell said in a press release this week.
The HOPE Program, a rental relief fund set up by the governor’s office, has distributed more than $66 million to almost 20,000 renters since May and has more ready to go. The office says applications are still being accepted.
“Governor Cooper’s revamped NC HOPE 2.0 rental relief fund has over a billion dollars to assist renters with continuing COVID-related rental needs,” said NC Realtors. “With this vital safety net in place, it is time to allow housing providers to participate in the economic recovery that has been afforded to so many other struggling industries.”
Still, Cooper’s office petitioned the council to extend the moratorium for another month to align with the Centers for Disease Control edict banning evictions until July 31, for those who qualify.
“It’s disappointing to see Council of State Members revoke eviction protections for people still struggling to stay in their homes,” Cooper said in a written statement. “Many North Carolinians still need help, and we will work to make sure landlords abide by the CDC evictions moratorium and that tenants can access rent and utility assistance from counties and the state HOPE program.”
There’s debate whether the CDC, as a health agency, had the authority to reach into private leasing contracts and housing at all. In May a federal court said no it does not, but the U.S. Justice Department is appealing that ruling. The CDC moratorium does require that once the moratorium expires, renters must pay the amount they owe in fees, interest, penalties, and back rent unless they work out a different payment plan with the property owner, and they can still be evicted for reasons other than non-payment.
Due to the moratorium, property owners have been unable to enforce rent collection for some renters for more than six months, leading some to reconsider renovations or buying more property to lease.
“An eviction moratorium might have made sense in the early days of COVID-19, when government forced people to stop working and essentially ordered them to stay home,” said Mitch Kokai, senior political analyst at the John Locke Foundation. “Now, well over a year after the state started dealing with the consequences of the coronavirus, an ongoing moratorium has the negative unintended consequence of allowing some bad actors to avoid honoring their contractual obligations to pay rent. A further consequence has been the reluctance of some renters to make property available to tenants, thus driving up rental prices.”
From a political angle, this vote was split along party lines. It could indicate trouble ahead as Republican lawmakers present the state budget to Cooper. The Republican-led appropriations bill contains language that would require the governor to seek council approval for future emergency orders beyond 30 days.
“If Democratic legislators agree with their counterparts on the Council of State, it will be difficult for the General Assembly to pass veto-proof bills making the reforms they seek,” said Kokai.
The Senate passed its budget last week, and the House is working now on its version of the spending plan.