A few news items affecting housing…

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Last week, the CDC extended the residential eviction moratorium to July 31. The constitutionality and validity of the moratorium has been litigated many times. The issues are: (1) the existence of constitutional power for the government to hand down such a moratorium under the Commerce Clause; and (2) whether the delegation of authority to the CDC by Congress is broad enough to encompass an eviction moratorium.

The latest decision was issued June 2 by the D.C. Circuit in Alabama Association of Realtors v. United States Department of Health and Human Services*. There, the Court upheld the stay of the lower court’s decision striking down the moratorium and made it clear that the panel believes the CDC would win on the merits. 

On Tuesday, the Supreme Court left the moratorium extension in place.

The Treasury Department issued new guidance encouraging states and local governments to streamline the distribution of the nearly $47 million in available emergency rental assistance funding.  Associate Attorney General Vanita Gupta released a letter to state courts encouraging them to pursue alternatives to protect tenants and landlords.

South Carolina Housing authority is working with landlords and tenants to administer the federal pandemic relief funding. The application must come from the tenant, but the landlord may refer the tenant to the agency for action.

In other news, President Biden fired Mark Calabria, the head of the Federal Housing Finance Agency (FHFA) last week, just hours after the Supreme Court held the structure of FHFA was unconstitutional under the separation of powers doctrine. The offending provision states the president can only remove the director for cause, not at will. FHFA regulates Fannie Mae and Freddie Mac, both of which have been the subject of extensive restructuring debate dating back to the housing crisis of 2008. The case is Collins v. Yellen**

Real estate practitioners will recall that the Court issued a similar decision last year concerning the structure of the Consumer Financial Protection Bureau (CFPB) in Seila Law v. CFPB***.

* 2021 WL 2221646 (D.C. Circuit, June 2, 2021).

** U.S. Supreme Court case 19-422, WL2557067, June 23, 2021.

*** 140 S. Ct. 2183 (2020).

D.C. Federal Court vacates CDC’s eviction moratorium

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…. then temporarily stays its ruling

This blog reported in early April that the Centers for Disease Control and Prevention (CDC) had extended the national moratorium on residential evictions through June 30. The U.S. District Court for the District of Columbia issued an order on May 5 vacating the moratorium, but later in the day temporarily stayed its own ruling to give the Court time to consider the merits of the arguments on both sides. The result of the stay is that the eviction moratorium remains in place for the time being.

The suit* resulting in these remarkable rulings was brought on November 30 by two trade associations, the Alabama and Georgia Associations of Realtors, and by individuals who manage rental properties. The complaint raised several statutory and constitutional challenges to the CDC order. Both parties filed motions for summary judgment. The plaintiffs’ motion was granted on the grounds that the CDC had exceeded its authority by issuing the broad moratorium. The Department of Justice filed an emergency appeal within hours.

The Court asked for a defense response this week and a reply from the government by May 16, so it is likely that a new order will be issued soon. But with the moratorium’s expiration date of June 30, a new ruling will have little, if any, effect. 

In addition to the national moratorium, some state and local laws restricting evictions remain in place.

The Court’s order vacating the moratorium pointed to the unprecedented challenges for public health officials and the nation caused by the COVID-19 pandemic. The difficult policy decisions, like the decision to impose the moratorium, have real-world consequences, according to the Court. The Court stated that it is the role of the political branches, not the courts, to assess the merits of such policy decisions. The Court perceived the question before it to be very narrow:  does the Public Health Service Act grant the CDC the legal authority to impost a nationwide eviction moratorium? The Court held that it does not.

*Alabama Association of Realtors v. United States Department of Health and Human Services, United States District Court for the District of Columbia, No. 20-cv-3377 (DLF).