Landlords and Tenants Worry About Effects of Ruling on Eviction Moratorium

A hospital worker in Brooklyn said she had perpetually been behind on her rent since paying funeral and other expenses after her brother died of Covid-19 about two months ago. A landlord on Staten Island said she could barely make ends meet after tenants of the home she owns stopped paying rent and fell $70,000 into arrears.

Around New York State, both tenants and landlords were reminded of how precarious their living situations were, after the Supreme Court blocked part of an eviction moratorium that the state had imposed in response to the coronavirus pandemic.

The ruling on Thursday gave a glimmer of hope to struggling landlords, who will now be able to evict tenants through court proceedings banned under the moratorium, but it fanned fears among financially unstable tenants. Emotions were muted after the ruling, as tenants and property owners awaited possible legislative action as the Delta variant raged on.

The Supreme Court’s ruling means that Charmaine Cox, the hospital worker, is now in danger of eviction, and that landlords, like Mudan Shi in Staten Island, will be able to bring tenants to court and allow a judge to decide whether an eviction is warranted. The ruling took aim at state legislation, enacted last year and set to expire on Aug. 31, that prevented evictions based on self-reported declarations that tenants had suffered economic setbacks as a result of the pandemic, rather than on evidence provided in court.

There is speculation that Lt. Gov. Kathy Hochul, who is set to become New York’s next governor after Gov. Andrew Cuomo leaves office amid a sexual harassment scandal, may push for new protections. In a statement on Thursday, she promised to “strengthen the eviction moratorium legislation.”

More than 830,000 households in New York State, a majority of them in New York City, are behind on rent, according to an analysis of census data by the National Equity Atlas, a research group associated with the University of Southern California.

But a $2 billion rental assistance program aimed at helping tenants pay their landlords has given funds to fewer than 5 percent of applicants since its start in June.

Ms. Shi, 31, was worried about losing her family home if a moratorium was extended. “I’m very stressed out,” she said, adding that a tenant threatened to call the police on her when she asked about the rent. “She said, ‘Get out. This is my house.’”

But Ms. Cox said her salary hardly covered her monthly $1,900 rent and basic costs, and she had fallen two months behind. Her brother’s bout with Covid-19 and a stroke broke her financially, Ms. Cox said, adding that she had also gotten sick with the virus and took three months to recover. “I live paycheck to paycheck. Just because I’m employed doesn’t mean that I’m highly employed where I’m making over $100,000 a year,” she said.

“I tried my best, but I’ll always be at least a month late,” she said.

With Thursday’s ruling, landlords could technically start filing suits immediately to evict tenants, although it takes two weeks between sending a notice and executing an eviction. But the order does not block a tenant’s ability to mount a so-called hardship defense.

“It’s the difference between using just the declaration that the tenant provides and having a court do a fact-finding inquiry into whether the tenant has suffered financial hardship,” said Sophie House, a lawyer and a researcher at the N.Y.U. Furman Center.

Randy M. Mastro, a lawyer for the landlords who had challenged the law, said that “both tenants and landlords suffered from the pandemic, and this gives a level playing field, as a matter of fairness, so that both sides can be heard in court.” Lawyers said the ruling essentially allows housing courts to operate as they used to before the pandemic.

A moratorium on evictions in areas of high transmission, issued earlier this month by the Centers for Disease Control and Prevention, offers some protection to tenants but does not prevent landlords from taking them to court. That moratorium is set to expire on Oct. 3.

Legislators are divided over what action to take next, given that tenants already have some protection, in the form of the Tenant Safety Harbor Act, which prohibits courts from evicting tenants who experienced financial hardship from accrued rent during the pandemic. Some lawmakers are waiting to see if an increase in evictions will turn into a full-blown crisis.

“This is a serious setback for our efforts to protect tenants and all New Yorkers from the pandemic,” said State Senator Brian Kavanagh, who was the lead sponsor of that bill. “We think this was an effective and necessary tool, not just to protect the tenants from the economic hardship and danger of being hauled into court, but also to reduce the spread” of the coronavirus.

Advocates for tenants and landlords say that getting help from the $2 billion Emergency Rental Assistance Program, which has struggled to administer relief because of technical glitches, is vital to preventing an eviction crisis.

“The owners and tenants need each other,” said Joanna Wong, a member of Small Property Owners of New York, a nonprofit. “The owners want tenants to stay in and pay rent, and tenants want to stay in and have a home,” she said. “It stabilizes the whole ecosystem.”

“I wish that all this energy and effort used on the eviction moratorium would be redirected toward addressing implementation issues so that funds can get out faster and to more people,” she added.

Mr. Kavanagh said that one of his constituents, a landlord, tried dozens of times to apply for assistance from the program but couldn’t. The assistance covers up to 12 months of late rent or utility bills, and up to three months of future rent if rent makes up more than a third of an applicant’s monthly income.

“A situation where a pending application becomes the key protection against eviction obviously depends on that process being smooth enough that people can get on the system and get their application,” he said.

“But it’s been very problematic so far, the way it’s rolled out. This ruling at the Supreme Court makes it all the more important that we get that program,” Mr. Kavanagh said.

Ms. Shi said that the Supreme Court ruling didn’t mean that her problems with her tenant were going to be resolved smoothly. She will need to go to court, which may end up being a lengthy process, as the courts are facing massive backlogs in cases.

She is also worried that her proceedings may be derailed by potential new moratoriums under the new governor, and that she will no longer be able to afford her own rent and take care of seven other family members.

“This is just the beginning,” she said. “It’s not the ending.”