New York Extends Eviction Moratorium Through August 2021

May 20, 2021

On Tuesday, May 4, 2021, Governor Andrew Cuomo signed an extension[1] of the COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020 (the “2020 Act”) and the COVID-19 Emergency Protect Our Small Businesses Act, extending New York’s foreclosure moratorium through August 31, 2021 (“Small Business Act”). New York’s extension contrasts with the decision by U.S. District Judge Dabney L. Friedrich of the United States District Court for the District of Columbia, the very next day, finding that the Center for Disease Control and Prevention’s nationwide moratorium on evictions exceeded its statutory authority.[2] The ruling was quickly appealed by the U.S. Department of Justice and is stayed pending appeal. No matter the outcome on appeal, New York’s various statewide tenant protections remain in force, including the May 4 legislation.

New Yorkers have been precluded from pursuing evictions and foreclosures during the pandemic since March 20, 2020. By Executive Order 202.8, Governor Cuomo implemented a 90-day moratorium on residential and commercial evictions, which was extended through June 5, 2021.[3] On December 28, 2020 Governor Cuomo signed the 2020 Act into law, staying residential evictions and foreclosures for 60 days. The 2020 Act also allowed certain tenants and landlords to file a hardship declaration that would halt any proceedings through May 1, 2021. On March 9, 2021, Governor Cuomo signed the Small Business Act, offering similar protections against eviction and foreclosures for small businesses. The May 4 legislation extends these moratoriums through August 31, 2021. Presently, tenants who do not submit declarations of pandemic-related hardship, or who create safety or health hazards for other tenants, can still be evicted.

New York landlords are also enjoined from evicting residential tenants who failed to pay rent during the pandemic due to financial hardship under the New York Tenant Safe Harbor Act, enacted in June 2020. The Tenant Safe Harbor Act does not prevent evictions of tenants who willfully withhold rent or are subject to eviction for other reasons, nor does it prevent courts from issuing money judgments to landlords for rent deficiencies.

Suspending residential and commercial foreclosures for over a year appeared to merely delay an inevitable rash of evictions in New York City. But a separate initiative to distribute federal relief funds to help pay affected tenants’ back-rent may fill in the gaps, saving the city from a foreclosure deluge. Through the COVID-19 Emergency Rental Assistance Program, New York allocated $2.35 billion of federal relief funds for affected tenants. Eligible applicants may seek up to 12 months of rental and utility arrears assistance, as well as three prospective months of rent. The program is expected to open to applicants by the end of May. It is too soon to tell if the $2.35 billion will cover all real estate losses from the pandemic, obviating the need for evictions or foreclosures. Regardless, owners of residential and commercial real estate in New York City will surely have August 31, 2021 circled on their calendar.

For more information on this issue or other real estate matters, please contact:

Belinda G. Schwartz at +1 212 592 1544 or [email protected]
Scott T. Tross at +1 973 274 2030 or [email protected]
Avery S. Mehlman at +1 212 592 5985 or [email protected]
Sean E. O'Donnell at +1 212 592 1545 or [email protected]
Silvia Stockman at +1 212 592 1583 or [email protected]

© 2021 Herrick, Feinstein LLP. This alert is provided by Herrick, Feinstein LLP to keep its clients and other interested parties informed of current legal developments that may affect or otherwise be of interest to them. The information is not intended as legal advice or legal opinion and should not be construed as such.

[1] S.6362-A/A.7175-A.

[2] Alabama Ass’n of Realtors et al. v. U.S. Dep’t of Health and Human Svcs. et al., 1:20-cv-03377 (D. D.C. May 5, 2021).

[3] Executive Order No. 202.106