Polis issues rental late fee ban through 2020; statewide eviction moratorium still pending

Task force releases policy recommendations, some of which will require legislation

A rental unit in Denver's Capitol Hill neighborhood on Aug. 7, 2020. (Moe Clark/Colorado Newsline)

Gov. Jared Polis on Thursday announced an executive order banning forthcoming and accumulated late fees for Colorado renters through the end of the year in light of recommendations put forth by a state eviction prevention task force.

The 10-person Special Eviction Prevention Task Force convened four times in September and October to establish short-term and long-term policy recommendations to address increasing housing instability due to the coronavirus pandemic. Some of the recommendations put forth in the 17-page report will require legislative action.

THE MORNING NEWSLETTER
Subscribe now.

“My top priority is protecting the health and safety of Coloradans, which includes secure housing. Implementing these thoughtful recommendations is another important step toward creating housing stability for more Coloradans during this pandemic,” said Polis, in a statement.

In the task force report, members recommended that the “assessment and accumulation of late fees and interest” be banned through the pandemic, not just through the end of the year.

“I’m really glad the governor has taken these actions. They are not insignificant and they are good first steps,” said Jennifer Rodgers, a task force member and vice president and market lead for Enterprise Community Partners Inc. in Denver. “But I do wish the executive order extended till the end of the pandemic,” she said, regarding the ban on late fees.

Rodgers said short-term executive orders add more uncertainty for tenants and landlords because they need to be continuously updated overtime. 

“I don’t believe that households will have the resources they need and make up rent due because of loss of income or being sick by the end of the year,” she added. “It would be a great next step for the governor to issue a statewide moratorium that goes throughout the pandemic, not just the end of the year,” Rogers said.

The CDC’s federal eviction moratorium went into effect on Sept. 4 and is set to expire on Dec. 31. A spokesman for the governor’s office said more information around the potential of a statewide eviction moratorium will be available in the coming days. A previous statewide eviction moratorium expired in mid-June.

In his announcement, Polis encouraged — but did not mandate — municipalities to remove limits on the number of unrelated people who can live in a single household and on the number of days that hotel rooms may be occupied. Last week, the governor issued another executive order that allocated more CARES Act funds to the Department of Local Affairs to be used for housing assistance.

On Sept. 22, Polis issued an executive order that requires landlords provide information on the Centers for Disease Control Temporary Halt in Evictions tenant declaration form before initiating eviction proceedings.

Report outlines level of need, long-term policy recommendations

Though the COVID-19 pandemic has undisputedly put a strain on both tenants and landlords, a previously predicted flood of evictions has been temporarily staved off in part due to federal, state and local financial assistance and eviction moratoriums. 

As of September, 95% of renters paid their rent on time, according to the task force’s report. But to do so, severely cost-burdened renters — households that spend more than 50% of their income on housing costs — have had to cut back on other expenses, rely on friends or family for financial assistance or taken on additional personal debt to make ends meet.

A report released on Sept. 25 by the National Council of State Housing Agencies estimates that by January, Colorado could see 140,000 evictions and tenants could cumulatively owe between $469 million and $666 million in back rent. The task force report estimated that possible evictions in January could be closer to 150,000.

“At the very least, as many as 25,000 households are likely to be moving through the eviction process beginning in January 2021, based on eviction filings that have already occurred in March through September of 2020 and 2019 October through December trends,” it said in the report.

Black households in Colorado are 5 times more likely than white households to be behind on rent, according to the U.S. Census Pulse Survey. Asian households are 3 times more likely, and Hispanic households are 3 times more likely.

Other medium-term recommendations put forth by the task force with majority support included imposing a statutory limit on late fees/interest and issuing grace periods; creating a landlord tax credit for rent and late fee/interest forgiveness; strengthening statewide eviction response tools for renters and landlords; and lengthening the write or restitution (the time a tenant has to vacate a home after an eviction is issued) beyond 48 hours.

Long-term policy recommendations include developing a program to repurpose hotels/motels into transitional housing and creating a tailored counseling and “good tenant program.”