Monday, March 8, 2021

Attorneys say some small landlords are being hit hard by non-payment

By SARAH MANSUR
Capitol News Illinois
smansur@capitolnewsillinois.com

SPRINGFIELD — Gov. JB Pritzker’s latest executive order extending the eviction moratorium for residential tenants adds a new legal protection for tenants who are unable to pay rent due to the pandemic.

Executive order 2021-05, issued on Friday, prevents landlords from pursuing legal action in court against a tenant as long as the tenant gives notice of their inability to pay, and the tenant is not “a direct threat to the health and safety of other tenants or an immediate and severe risk to property.”

Pritzker’s moratorium on residential evictions, first issued in late March 2020, applies to renters who submit a declaration saying they are unable to pay rent as a result of the pandemic and would be rendered homeless if they were evicted. Eligible renters must earn less than $99,000 annually if filing taxes as a single person, or $198,000 if filing tax returns jointly.

The most recent order clarifies that renters can be protected from eviction as long as they submit their declaration form, even if they submit the form after their landlord began legal action to evict them.

Previous executive orders on the eviction moratorium established that law enforcement could not enforce a court order to evict tenants if brought by a landlord, said Michael Steadman, a Chicago attorney who represents landlords.

Steadman, a sole practitioner, said the new executive order effectively extends the period of time in which renters can make the written declaration, which is a form provided by the Illinois Housing Development Authority.

“Whereas before, if (renters) didn’t make the written declaration before a landlord filed their eviction case, the case could move forward, although the eviction couldn’t. Now, they can freeze the eviction case, even after the case is filed,” Steadman said in a phone interview Monday. “It’s a small change. But it is an additional impediment, as far as landlords moving eviction cases through the system and dealing with non-paying tenants.”

Pritzker has renewed his eviction moratorium through several executive orders since March order expired.

His executive order in November, which created the declaration form, established that renters could be evicted if they were a threat to the safety of other tenants or a risk to property.

Steadman, who works on Chicago’s southwest side, said some of his clients who only own one or two buildings are struggling.

“I can assure you that there are tenants out there, and it’s a small minority of them and I don’t know how small, who are taking advantage of the situation, and are very much aware of my clients’ limited ability to remedy the situation and get their property back,” he said.

Phil Vacco, a sole practitioner and chairman of the Illinois State Bar Association’s real estate law section, said the eviction moratorium is a regular topic of discussion during the organization’s meetings.

“An argument can be made that when it comes to protecting the rights of tenants during the COVID crisis that the pendulum has swung too far to one side, without providing any real assistance for the property owner,” Vacco said in an interview. “While the governor has stressed that the moratorium is not intended to act as rent forgiveness… Even when the eviction moratorium is lifted it may be difficult, if not impossible, for landlords to collect what is due.”

In the meantime, Vacco said landlords are still obligated to pay real estate taxes, insurance, maintenance fees and mortgages on their property.

“Mom-and-pop landlords, who don’t have the financial ability to weather this storm, may find themselves forced out of business, leaving more and more rental properties in the hands of a larger corporations.  In the long run this can make it more difficult for tenants to negotiate lease terms.”

Capitol News Illinois is a nonprofit, nonpartisan news service covering state government and distributed to more than 400 newspapers statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.