In a surprise move earlier this week, the CDC issued an executive order prohibiting residential lease evictions until December 31, 2020 to prevent the spread of COVID-19.  The moratorium goes into effect when the order is published in the Federal Register (which is expected to happen on Friday, September 4, 2020).  The order applies to any state or territory in the U.S. affected by COVID-19, which at this time only excludes American Samoa as the only territory that has not experienced any cases of the disease.  A copy of the order can be obtained here. The Michigan Supreme Court Administrative Office also issued this guidance regarding the CDC’s moratorium.

The order only applies to the remedy of eviction.  Housing providers may enforce other remedies under the lease, such as imposing late fees and penalties. It also does not apply to foreclosures of residential mortgages.  Moreover, the protections provided by the order are not automatic. In order to qualify, residential tenants must execute a declaration under penalty of perjury certifying that:

(1) they have used their best efforts to obtain all available government assistance for rent or housing;

(2) they either (a) do not expect to earn 2020 calendar year income of more than $99,000 for individuals and $198,000 for joint filers, (b) were not required to report any income in 2019 to the IRS, or (c) received a stimulus payment under the CARES Act;

(3) they are using their best efforts to make timely partial payments as close to the full rental payment as circumstances permit;

(4) they would likely become homeless or move into a homeless shelter or other residence shared by people in close quarters;

(5) they understand that they must continue to pay rent and comply with other obligations under the tenancy and are still subject to applicable fees and penalties; and

(6) when the moratorium expires their housing provider may require full payment for all arrears and failure to comply may result in eviction.

Federal, state or local authorities may pursue stiff criminal penalties if the order is violated.  Individuals may be subject to jail time and fines of up to $100,000 if the violation does not result in death and $250,000 if it does.  Organizations may be subject to fines of $250,000 if the violation does not result in death and $500,000 if it does. Please contact Kemp Klein if you have any questions about this order.