Treasury Secretary Steven Mnuchin announced the move to lawmakers during a congressional hearing Tuesday. The order states that it does not prevent collection of late fees, penalties or interest due to failure to pay rent.
“I think you’ll be quite pleased with the impact that it will have,” Mnuchin told Rep. Maxine Waters (D-Calif.) during the hearing.
Up to 40 million renters are at risk of eviction across the United States, according to the order, which warns of an unprecedented “wave of evictions.” According to estimates from Stout, a Chicago-based consulting firm, roughly 274,000 households in Maryland have lost income due to the COVID-19 pandemic and are at risk of eviction.
Under the nationwide order, to avoid eviction, tenants must prove that they:
Used “best efforts” to obtain any available government assistance for rent or housing. Various local governments in Maryland have set up rental assistance programs, although local officials say they’ll need additional funding from the state to prevent a wave of evictions.
Won’t earn more than $99,000 in annual income in 2020, or no more than $198,000 if filing a joint tax return. Individuals are also eligible if they weren’t required to report any income in 2019 to the U.S. Internal Revenue Service, or if they received a CARES Act stimulus check.
Can’t pay the full rent due to “substantial loss of household income, loss of compensable hours of work or wages, a lay-off, or extraordinary out-of-pocket medical expenses.”
Are using best efforts to make “timely partial payments that are as close to the full payment as the individual’s circumstances may permit, taking into account other nondiscretionary expenses”
Would be made homeless if evicted, or forced to live into a new “congregate or shared-living setting” because they don’t have other options.
The order came just a day after failure-to-pay rent court cases resumed in Maryland. Advocates expected a flood of cases, since courts hadn’t heard new cases since they closed in March.
Earlier Tuesday a slew of Maryland lawmakers, including House Speaker Adrienne A. Jones (D-Baltimore County) and Attorney General Brian E. Frosh (D) asked Gov. Lawrence J. Hogan Jr. (R) to provide additional rental assistance to Marylanders.
Hogan designated $30 million in CARES Act funding toward rent relief in March, but a request for additional rent relief was shot down by FEMA, Hogan spokesman Michael Ricci said.
Adam Skolnik, the executive director of the Maryland Multi-Housing Association, warned this week that another moratorium without additional rent assistance would be “kicking the can down the road.”