Landlords Are Struggling to Make Ends Meet as CDC Extends Eviction Ban

With so many Americans out of work and unable to pay their rent, the Centers for Disease Control and Prevention instituted a nationwide eviction ban on residential rental properties.

With the moratorium originally set to expire on January 31, newly elected President Joe Biden, on his first day in office, signed an executive order prolonging the eviction ban until at least the end of March.

Under this eviction moratorium, tenants who fail to pay their rent or mortgage are shielded from removal, so long as they submit a formal declaration to their landlords, proving their financial hardship is COVID-related.

Any landlord who fails to comply with the CDC’s policy can be slapped with fines up to $200,000, face criminal prosecution, and even be forced to serve time behind bars.

No one wants to see the homeless population rise, but what of the landlords who also have bills to pay and mouths to feed? These individuals seem to be forgotten when we look at the casualties of the nationwide financial crisis.

In Northeast Washington D.C., Archie Djabatey owns a four-unit building where he also resides. According to The Washington Post, the 35-year-old bought the building with dreams of building a legacy he could pass on to his future children—an aspiration that has since been placed on pause by the eviction moratorium.

The eviction crisis has been a unique situation for Djabatey, because his neighbors are also his tenants. “You want to help, but it’s also a business,” he said, “That’s the way it is.”

These moratoriums place the burden of housing solely on landlords, perpetuating the financial hardships the country is already facing.

In February of last year, just one month before the pandemic changed nearly every aspect of our lives, Djabatey had to file an eviction suit against one of his tenants after he had failed to pay rent. Not only was the tenant delinquent, but he had also been using drugs on the property and had strangers funneling in and out of his unit at all hours, becoming a nuisance to the other residents.

The court rightly sided with Djabatey. But the eviction process came to a screeching halt as COVID began spreading across the country. Ten months later, and the tenant in question is still living in the apartment without paying rent while violating the terms of his lease and protected against eviction. This moratorium is not only a problem to other residents, it’s also robbing the building’s owner of $1,002 a month. “It’s coming out of my pocket. I’m in a very tight situation.”

Djabatey’s story is just one of many. Pacific Legal Foundation attorneys spoke to a landlord in Louisiana who explained that she had trouble paying her mortgage due to lost income. As a result, she could no longer afford essentials, like prescription medications, all because of the eviction moratorium.

But Louisiana and Washington, D.C. are not the only regions with a strict eviction moratorium.

The term “landlord” might conjure up images of slumlords taking advantage of their tenants and leaving them with dilapidated and unlivable dwellings. Yet, in Southern California, where eviction is prohibited for any tenant who is able to pay at least 25 percent of their rent or mortgage, 70 percent of rental building owners own fewer than 50 units. These small landlords are worried about how they will stay financially afloat with the eviction moratoriums being continually expanded.

New York landlords are dealing with the same concerns, as the state recently passed what The New York Times called “the most comprehensive anti-eviction laws in the nation.”

Many constitutional attorneys have questioned why the CDC is making policy decisions in the residential real estate market, given that the Constitution does not authorize it to do so.

The ordinance puts a pause on any eviction proceedings already filed in court and prohibits landlords from beginning any new proceedings until at least May 1.

In Oregon, the newly passed House Bill 4401 extends eviction bans until June 30, 2021. Several landlords have since filed suit against Governor Kate Brown, Portland, and Multnomah County in response to the new law.

Many constitutional attorneys have questioned why the CDC is making policy decisions in the residential real estate market, given that the Constitution does not authorize it to do so. Only Congress has the power to create and pass laws.

The Public Health Service Act does give the CDC the authority to take steps to curb the spread of the virus, but it only authorizes the agency to “provide for such inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles found to be so infected or contaminated…and other measures.”

The CDC has extended that authority by claiming that allowing landlords to evict delinquent or destructive tenants will exacerbate the spread of the virus.

Well-intentioned as the eviction moratoriums may be, these policies often cause more unintended consequences than solving actual problems. It’s unclear how many people would actually have been evicted in 2020 without the bans. During the 2008 financial crisis, for example, despite fears of mass evictions and homelessness, eviction rates stayed relatively the same as before the crash.

These moratoriums place the burden of housing solely on landlords, perpetuating the financial hardships the country is already facing. There are more effective and reasonable policies that would protect those truly struggling from pandemic-related hardships, while also making sure landlords aren’t losing their income.

There are more effective and reasonable policies that would protect those truly struggling from pandemic-related hardships, while also making sure landlords aren’t losing their income.

Many people are struggling right now, but not everyone is being asked to bear such a heavy weight on their shoulders. “No one is asking restaurants and grocery stores to give food out for free, so why are government agencies, with no authority to legislate, asking landlords to provide a service without compensation?” said PLF attorney Ethan Blevins.

As is the case with many national crises, the government is making a power grab wherever it can feasibly justify doing so, ignoring the separation of powers guaranteed in the Constitution.

PLF has filed suits on behalf of struggling landlords in Ohio and Louisiana, but landlords all over the country continue to suffer the consequences of the CDC’s actions.

This Pacific Legal Foundation article was republished with permission.

Brittany Hunter

Brittany is a writer for the Pacific Legal Foundation. She is a co-host of “The Way The World Works,” a Tuttle Twins podcast for families.

This article was originally published on FEE.org. Read the original article.

Landlords Are Struggling to Make Ends Meet as CDC Extends Eviction Ban

Property Rights Help Environmentalists Protect Wildlife

Property Rights Help Environmentalists Protect Wildlife

Earlier this year, President Donald Trump announced that his administration would seek to open oil and gas drilling in the Arctic National Wildlife Refuge. The plan, outlined in Trump’s 2018 budget resolution, has reignited a long-standing debate over the oil-rich Alaskan wildlife refuge.

“Some places are so special that they should simply be off-limits,” Nicole Whittington-Evans of the Wilderness Society said at the time, arguing that the refuge is “too wild to drill” and “has values far beyond whatever oil might lie beneath it.” David Yarnold, president of the Audubon Society, said that drilling in ANWR “would cause irreversible damage to birds and one of the wildest places we have left on Earth.”

Drilling proponents cite the area’s immense energy potential. More than 10 billion barrels of oil could be tapped by developing just a small portion of the 19-million-acre refuge, according to the U.S. Geological Survey – enough to produce 1.45 million barrels per day, more than the United States imports daily from Saudi Arabia. The Trump administration claims that opening ANWR for leasing would reduce the federal deficit by $1.8 billion over the next decade.

How are these conflicting environmental and natural-resource values to be resolved? In the case of ANWR, the answer is politics. The refuge is federal land, so decisions about its management are political by their nature. Debates are often characterized as all-or-nothing decisions – either “save the Arctic” or “drill baby drill” – and when one side “wins,” another side loses.

But what would happen if ANWR were privately owned, perhaps by an environmental group?

Privately-Owned Protection

Take, for example, the Audubon Society, one of many environmental groups opposed to drilling in ANWR. “Oil and birds don’t mix,” says the group on its website. “Drilling is a dirty and dangerous business that has historically always resulted in spills and harmed the environment.”

Yet consider how the Audubon Society manages some of its own privately owned wildlife refuges. For nearly 50 years, starting in the 1950s, the group allowed oil and gas companies to drill dozens of wells on its 26,000-acre Paul J. Rainey Sanctuary, a bird sanctuary in southwestern Louisiana.

Why would Audubon allow drilling on its own sanctuaries but oppose it elsewhere? The answer, in short, is property rights. Private ownership creates incentives that often lead to more reasonable outcomes than in the political arena. Property rights motivated Audubon to consider the trade-offs associated with its management and the opportunity costs of leaving the oil and gas in the ground. Because the group owned the sanctuary, it sensibly weighed the potential benefits of drilling against its environmental costs.

Audubon earned more than $25 million in royalties from energy development on the Rainey Sanctuary, and it used those funds to protect more land and invest in habitat improvements on the preserve. “The gas-development activities, closely controlled and monitored by Audubon, offer opportunities to diversify and improve habitat which Audubon otherwise couldn’t afford to create,” said one of the group’s senior vice presidents in 1984.

The Audubon Society had every incentive to ensure the drilling was done responsibly. For instance, energy companies had to comply with strict limits on drilling during bird-nesting season. One journalist wrote that “when the cranes punched in, the hardhats would have to punch out.” The group was especially careful to do so because, as one sanctuary manager put it, Audubon's members “would be very irate if we polluted our own environment, our own land, our own sanctuary.”

Assessing Trade-Offs

The Rainey Sanctuary isn’t the only example of Audubon calling for different actions on its private property than on public lands. The group authorized drilling on its Bernard Baker Sanctuary in Michigan as well. For years, an oil well located outside that sanctuary tapped oil and gas beneath its surface through slant drilling, earning the group mineral royalties while also protecting habitat.

On public lands such as ANWR, the story is much different. Audubon opposes virtually all oil and gas development on federal lands. The group would receive none of the benefits of saying “yes” to drilling there, so it has no reason to weigh its costs and benefits, even if those benefits could be substantial.

One recent study estimated the value of the oil beneath ANWR at $374 billion. With that kind of potential, if the refuge were under private ownership, even the most anti-development environmental group would be forced to consider what additional conservation benefits could be gained by allowing at least some drilling.

After all, it’s possible that a small amount of energy development in one area could help provide even more important environmental benefits elsewhere.

As one Alaskan outdoor writer said in response to debates over ANWR, “It would seem of far more environmental concern that Alaska's ducks and geese have a place to winter in overcrowded, overdeveloped California than that California's ducks and geese have a place to breed each summer in uncrowded and undeveloped Alaska.” With private ownership, environmental groups would more sensibly assess that trade-off, just as Audubon has, to achieve the most environmental value.

Greater Potential for Win-Win Arrangements

Oil and gas production ended on the Rainey Sanctuary in 1999, but Audubon has since considered reopening it to drilling. Other groups such as the Nature Conservancy have also allowed drilling on some of their private lands in Texas, raising millions of dollars to conserve endangered prairie chicken habitat. The conservancy’s efforts, however, have drawn criticism from some environmental activists who pressured the organization to recently declare that they want to get out of the oil and gas business entirely.

Nonetheless, with new horizontal-drilling techniques that allow oil and gas to be extracted from afar and with fewer surface impacts, there is now even greater potential for such win-win arrangements on private lands.

Property rights give owners strong incentives to balance conservation with resource development and resolve competing demands in a cooperative, mutually beneficial way. When environmental groups bear the costs of managing their own lands, their behavior is often very different from what they advocate on public lands. The experience of the Audubon Society’s Rainey Sanctuary demonstrates a more sensible approach than can be found in most public land debates today.

As Richard Stroup of PERC once put it: “Audubon is smart to maintain wildlife habitat while capitalizing on revenue potential – now if only our federal land management agencies could figure this out.”

Reprinted from the Property and Environment Research Center.

Shawn Regan


Shawn Regan is the Director of Publications and a Research Fellow at PERC. He holds a M.S. in Applied Economics from Montana State University and degrees in economics and environmental science from Berry College. His work has appeared in the Wall Street Journal, Quartz, High Country News,Reason, Regulation, Grist, and Distinctly Montana. Shawn is also a former backcountry ranger for the National Park Service.

 

This article was originally published on FEE.org. Read the original article.