PHILADELPHIA EMERGENCY HOUSING PROTECTION ACT
The Philadelphia City Counsel has passed the Emergency Housing Protection Act (“EHPA”). The city law imposes strict compliance requirements on landlords to evict tenants following the COVID-19 pandemic. The EHPA has already been challenged by the Homeowners Association of Philadelphia (HAPCO) as unconstitutional in federal court.
The EHPA was passed in response to the coronavirus pandemic. According City Council 1.9 million Pennsylvanians have applied for unemployment assistance; 120,000 Philadelphians have applied for unemployment; there is a backlog of 5,000 eviction cases; and the city must cut approximately $649 million dollars from its budget since COVID-19. These numbers have likely increased since they were reported. According to the Council 24.5% of Philadelphians live in poverty, almost half the city population is renters, and more than half of renters pay more than 30% of their income to rent. Therefore, the EHPA is necessary to forestall a massive, unprecedented eviction crisis.
On the other hand, organizations like HAPCO have argued the EHPA unfairly and unlawfully passes the burden of the COVID crisis onto landlords. Many smaller landlords are facing mortgage foreclosure and financial crisis because their tenants have defaulted on rent. Therefore, the EHPA may eventually be struck down as an unconstitutional tax or taking on the landlord class in Philadelphia, PA.
CITY COUNCIL PASSES EHPA
There is a package of bills under the EHPA collectively called the Emergency Housing Protection Act. The city laws have a significant impact on processing evictions in Philadelphia and generally delay the process. The bills make evictions long and more time consuming for landlords, especially for nonpayment of rent. The EHPA has been challenged as unconstitutional by several landlord organizations including HAPCO and a lawsuit is pending in federal court aiming to strike down the EHPA.
Under the EHPA landlords are legally obligated to enter into Hardship Agreements (repayment agreements) with tenants who have defaulted on rent during the pandemic. Under the law landlords are not required to provide hardship notices to tenants before taking them to eviction court. The notice must be served on the tenant thirty days prior to the eviction. The orders the Philadelphia Landlord Tenant Court closed through August 31, 2020. Following the designated period of protection residential tenants who comply with their hardship repayment agreement cannot be evicted until May 2021. If Tenants default on their repayment plan they may be evicted. The law lengthens the time frame for evictions by at least one (1) month as landlords are obligated to provide a thirty (30) day notice before taking action.
HEIGHTENED PENALTIES FOR SELF-HELP EVICTION
The EHPA heightens penalties for landlords engaging in self-help eviction. Under the law, a landlord may face ninety (90) days in prison for changing the locks without using landlord-tenant court. The law also provides $2,000.00 punitive damages where landlords change the locks without due process. Under the law attorneys may collect fees for bringing self-help lawsuits under the EHPA>
WAIVER OF ALL LATE FEES
The EHPA waives all late fees on commercial and residential leases until May 2021. The EHPA also waives interest on back-rent during the emergency period. The law voids lease terms that collect late fees during this period.
The EHPA closes the eviction court until September 2020. Under the law landlords will not be able to obtain a court date to evict tenants who have defaulted during the emergency period until November 2020.
MANDATORY DIVERSION PROGRAM
The EHPA legally mandates all landlords to engage in government imposed mediation before proceeding with an eviction in Philadelphia, PA. Pursuant to the ordinance landlords must sit-down with a mediator to discuss a resolution to their landlord/tenant issues. The landlord cannot proceed with eviction until he has participated in this mediation, unless there are no mediators available within at least thirty days. The ordinance lengthens the time to evict a tenant in Philadelphia, PA.
Right now there is a moratorium on all evictions in Philadelphia, PA until September 2, 2020. Therefore if you are a landlord with a tenant who has defaulted on rent there is no avenue for relief. Even after September landlords may be legally required to give tenants up to nine months to repay rent owed. Much of the rent will likely be forgiven during mandatory diversions and mediations. Finally, if a landlord decides to take actions into their own hands through self-help eviction they may be criminally prosecuted or subject to punitive damages in civil court.
UNWAVERING LANDLORD/TENANT LAWYERS
Our firm has a steadfast commitment to Philadelphia landlord/tenants in all eviction matters. Whether you are a tenant seeking to enforce your rights, or a landlord seeking possession our firm is available to provide zealous and diligent representation. With the proposed changes in Philadelphia eviction law, now more than ever it is critical you have an experienced and aggressive advocate on your side. Contact the Law Office of Mark D. Copoulos for a free no-obligation consultation on your Philadelphia real estate matter. Our firm stays current on the latest changes in the law and will ensure that your legal objectives are achieved in a reasonable time frame. For more information on the proposed ordinances and their passage into law continue to monitor our website. We will keep you posted as developments arise.