June Amendments to DC Coronavirus Law effective July 17

In Legislation, Real Estate by Richard Bianco

On June 8, 2020, the DC Council adopted the latest amendments to the emergency Coronavirus law. However, the amendments did not actually go into effect until July 17, 2020. The changes impact landlord obligations to tenants as outlined below.

The earlier versions of the law included a sweeping moratorium on all evictions and eviction filings (regardless of the reason), prohibited rent increases, and required landlords to enter into payment plans. Notably, the Council drafted the original legislation without meaningful input from stakeholders. Since the law is so unclear the Council has repeatedly made changes and issued “clarifications.” The most recent amendment is couched as clarifying, in reality, it impacts landlords’ substantive rights.

Which payments require a payment plan?

Initially, landlords were obligated to offer tenants a payment plan for any “gross rent” coming due after March 11, 2020, until one (1) year after the declared end of the public health emergency, if the tenant suffered economic hardship related to the Coronavirus.

Now, that language has been broadened to encompass gross rent “and other amounts that come due.” Presumably this is intended to cover pass through expenses to tenants such as utilities, insurance and taxes. What remains unclear is how the law impacts leases requiring direct payment by the tenant to the taxing authority, insurance company, or utility service provider.

Are tenants with a previous balance entitled to a payment plan?

The amendment makes it clear that tenants who had a balance for rent due prior to March 11, 2020 are still entitled to a payment plan. However, the payment plan only applies to rent and other charges accruing from March 11, 2020 forward. The previous balance need not be part of the plan.

Can commercial landlords increase rent?

For the most part, even in commercial cases, landlords cannot increase rent until the end of the public health emergency. Specifically, all commercial retail tenants and non-retail tenants renting less than 6,500 square feet, are protected from rent increases. In the event that a landlord implemented an increase since March 11, 2020, it is now void and the landlord must return any increase actually collected.

At this point there is no relief in sight for landlords. Although the law continues to evolve, each new amendment creates additional burdens. If you are confused (understandable) about what hoops you need to jump through, I encourage you to contact us or book an appointment using our online scheduling tool. We’d be glad to assist.