As the decimated New York hospitality industry awaits overdue federal relief, new state regulations will largely prevent landlords from kicking out bars, restaurants, and individual tenants over failure to pay rent.
State Chief Administrative Judge Lawrence K. Marks published a memorandum last week indefinitely halting both commercial and residential eviction proceedings filed after March 17, a day after the bar and restaurant shutdown began.
In addition, residential proceedings that commenced before the pandemic can’t result in an eviction before October, per the memo.
The development should act as a temporary lifeline to scores of struggling small businesses and workers. The court memo was timely as it came a week before Gov. Cuomo’s latest eviction moratorium was set to expire, on August 19th. The memo also came as bars and restaurants see their federal paycheck protection loan funds dry up, and as jobless waiters, cooks, and bakers struggle without the enhanced $600 unemployment checks that expired in late July — a reality that Marian Bull documented over at Grubstreet.
The lack of aid is no small matter; about 83 percent of New York restaurants were unable to make their full rent in July, while over 37 percent weren’t able to afford any rent at all, according to a New York City Hospitality Alliance survey of 471 venues.
By the end of June, over 193,000 local food and drink workers were still out of a job. The poor restaurant employment situation — combined with a devastation of the tourist industry, a continued prohibition on mall openings, and an indefinite indoor dining ban —suggests that any recovery will be slow and fraught.
The continued suspension of eviction proceedings should help avert a full fledged commercial and humanitarian disaster, especially as the prospect for federal assistance now seems like less of a reality. House Democrats passed a bill months ago extending comprehensive aid, but Congress deadlocked after both parties failed to agree on the size and scope of the package.
Indeed, without further stimulus, it’s still unlikely that many restaurants or residents will be able to afford the months of back rent they’ll end up owing when any prohibition on evictions is eventually lifted. Landlords can seek monetary judgements to recover those back payments; those judgements can be used to place liens against the personal property of tenants, or garnish their wages, according to to Curbed NY.
For residential eviction proceedings that began before March 17 — before the pandemic started to seriously ravage the city’s hospitality industry — courts will continue to extend protections, though for a shorter period of time. Proceedings can continue to move forward in those cases, but the court must hold settlement conferences to determine whether the parties were harmed by COVID-19, and, if necessary, ascertain what relief options might be available. The actual evictions themselves will remain on hold until October 1, at the earliest.
Commercial institutions that had eviction proceedings levied against them from before March could find themselves in a tougher spot, with the commercial eviction moratorium lifted as of today.
Individuals who might be at risk for eviction can refer to this Curbed NY explainer for a further breakdown of current residential protections.