The author of a proposed law to erase rents for New Yorkers hurt by the COVID-19 crisis said Wednesday he believes the state will move to protect tenants. It’s just clear how or when.
“I want to see action taken now and I’ve asked the governor to do this by executive order since we’re not in session at this point,” Queens’ Michael Gianaris, the deputy leader of the Democratic majority in the Senate, told the WBAI Max & Murphy Show. “I am confident we’ll get somewhere on it. We just need to figure out exactly where we land.”
Gianaris’s bill stipulates that “any residential tenant or small business commercial tenant in the state that has lost income or has been forced to close their place of business as a result of government ordered restrictions in response to the outbreak of coronavirus disease 2019 (COVID-19), shall have all rent payments suspended for 90 days following the effective date of this act.”
Under the law, the waived rent would never be charged, nor would any late fees. Leases that lapse during the 90 days would automatically renew. The law would also mandate forgiveness of mortgage payments by landlords who face “financial hardship” as a result of the rent cancellation.
According to Gianaris’s office, support for the bill is overwhelming: Comments on the bill via the State Senate website were so voluminous, he says, they nearly crashed the server (although not all of the remarks supported the bill). National figures like Sen. Bernie Sanders and former Vice President Joe Biden have followed local leaders like Comptroller Scott Stringer and Council Speaker Corey Johnson in backing the measure.
The rationale behind the bill is that the 90-day eviction moratorium that Gov. Cuomo declared early in the crisis does not provide robust enough protection for tenants because any unpaid rent would be due at the end of the 90-day period. Amid widespread unemployment, the bill’s supporters argue, many tenants will be no more capable of paying April’s rent in July than they would have been in April.
“The government effectively pulled the plug on the economy. We had to do it for obvious reasons but we denied people their income stream and they continue to have their financial obligations accrue in the form of rent and that doesn’t make any sense at all,” Gianaris said. “If the government is saying you can’t work, you can’t make money to people that live paycheck to paycheck and all of a sudden no longer have a paycheck, we cannot realistically expect them to continue to pay rent and other obligations in that time.”
Some landlords have countered that unemployment benefits ought to provide most people with the means to pay for necessities. But not everyone is eligible for those benefits, there could be delays in accessing them and the payment amounts could fall short of what’s needed to pay rent and buy essentials.
Property owners’ other concern is that eliminating rental payments could impair their ability to stay solvent. “No rent from tenants would mean property owners can’t pay the web of people and companies who are connected to them,” a user identified as John Pire commented on the State Senate website. “Property maintenance staff and maintenance related vendors can’t be paid, the products they use sit on the shelf: These industries would be destroyed and the people they employ would out of work, if not already.”
Gianaris contends that his bill goes further than federal measures that permit landlords’ mortgage payments to be deferred (which likely means those amounts would be tacked on to the end of the mortgage). His measure would actually cancel mortgage payments in proportion to income lost because of rent cancellation. However, the state can only demand such forgiveness for mortgages held by banks regulated at the state level.
“The bill I proposed includes straight-up mortgage forgiveness for the three-month period,” he said. “We can only do that for people as it relates to mortgages in state-chartered banks.”
The way Gianaris frames it, the question isn’t whether or not many tenants are going to stop paying rent, but whether they face a hard or soft landing after doing so.
“Just to be clear, the rent is being canceled, whether we authorize it by law or not. There was a report that one-third of the rents across the entire nation wasn’t paid in April,” he said. “So, we’re either going to face a mass wave of evictions in 90 days or we can set up some structure to make sure that people are safe and continue to have homes.”
Listen to our conversation below, or hear the full program, which includes an interview with former New York City health commissioner Dr. Mary Bassett about social disparities and the COVID-19 toll.
Sen. Michael Gianaris on ‘#CancelRent’ and Bail Reform
Max & Murphy: Full Show of April 15, 2020
Max & Murphy is heard every Wednesday at 5 p.m. on WBAI, 99.5 FM. Ben Max is the co-host, Reggie Johnson the engineer and Anika Chowdhury the intern.