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California Self Storage Association

State of Emergency, Moratoriums, Price Gouging

With the daunting amount of news and information coming at you constantly it is impossible for any one person to keep up. Our team curates and alerts you to the "must have” information to ensure you are in the know. Having relevant, current information helps you to make the best decisions possible.

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  • Friday, September 11, 2020 11:41 AM | Ross Hutchings (Administrator)

    State of California Department of Justice, Office of the Attorney General Xavier Becerra

    News Release

    September 11, 2020

    For Immediate Release
    (916) 210-6000
    agpressoffice@doj.ca.gov

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    Print Version

    Attorney General Becerra Issues Consumer Alert on Price Gouging Following State of Emergency Declaration in Siskiyou County

    SACRAMENTO – California Attorney General Xavier Becerra issued a consumer alert following the Governor’s declaration of a state of emergency for the County of Siskiyou due to fires. The fires have burned over 120,000 acres, destroyed homes and other structures, and forced the evacuation of thousands of residents. Attorney General Becerra reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396.

    “Families in Siskiyou County are in the midst of dealing with multiple devastating wildfires, forcing thousands to evacuate their homes. They shouldn’t have to worry about whether they’re being illegally cheated out of fair prices,” said Attorney General Becerra. “Our state’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies. I encourage anyone who has been the victim of price gouging, or who has information regarding potential price gouging, to immediately file a complaint with our office online at oag.ca.gov/report, or to contact their local police department or sheriff’s office.”

    California law generally prohibits charging a price that exceeds, by more than 10 percent, the price of an item before a state or local declaration of emergency. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.

    Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.


  • Thursday, August 27, 2020 9:37 AM | Ross Hutchings (Administrator)

    Can I Conduct Lien Sales and Charge Late Fees During the Coronavirus Pandemic?

    Joe Doherty posted on 8/25/2020 4:44:00 PM

    Lien Sales & Late Fees During the Coronavirus Pandemic

    As the coronavirus (Covid 19) has spread throughout the United States, several states and localities have enacted restrictions on foreclosures and evictions. Many of these orders that have been issued to date exclusively cover residential evictions and foreclosures. However, some states have expanded those restrictions to cover commercial or non-residential evictions and foreclosures as well. Some of the commercial / non-residential eviction or foreclosure moratoriums may prevent operators from conducting self storage liens sales, performing overlocks, or imposing late fees.

    Although self storage lien sales are not evictions in the usual sense of that word, SSA urges all operators to exercise great caution if they operate in an area covered by a moratorium on commercial or non-residential evictions or foreclosures.

    First, self storage lien sales are a form of non-judicial foreclosure. Therefore, an order that imposes a foreclosure moratorium may apply to self storage lien sales. Second, the overall intent of many government restrictions at this time is to keep people at home as much as possible. It arguably frustrates the intent of the orders if a landlord creates a situation that forces a tenant to leave home for a non-essential purpose. Third, the orders are often hastily drafted and vague and do not define the term “eviction”, “foreclosure”, or other key terms in the orders. The overall intent, coupled with the vague wording, indicates that the term “eviction” or “foreclosure” is meant to cover any unilateral action by an operator that terminates a rental agreement. This certainly covers lien sales, even if the primary purpose of a lien sale is to recover unpaid rents.

    The sheer volume or orders, especially from local governments, makes it difficult to provide a comprehensive list of jurisdictions that have enacted eviction or foreclosure moratoriums. Additionally, in the interest of space, we did not include local orders that affect only residential evictions or lawsuits filed to evict a tenant.

    We intend to update this document frequently to include new orders and previous orders we missed. Please email Daniel Bryant and Joe Doherty if you believe any orders are missing.

    California 

    • Governor issued an order, issuing a statewide moratorium on residential evictions. 
    • Governor also issued an executive order and a subsequent extension that authorizes local governments to pause evictions for residential and commercial tenants. The protection is in effect through September 30, 2020.
    • Pursuant to the Governor’s order, tenants are still obligated to pay rent, and landlords can still recover rent that is due. The order only applies to the imposition of limitations on evictions when the basis for the eviction is nonpayment of rent, or a foreclosure, arising out of a substantial decrease in household or business income (including, but not limited to, a substantial decrease in household income caused by layoffs or a reduction in the number of compensable hours of work, or a substantial decrease in business income caused by a reduction in opening hours or consumer  demand), or substantial out-of-pocket medical expenses; and the decrease in household or business income or the out-of-pocket medical expenses was caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19, and is documented.
    • In other words, the statewide order limits local governments to protecting tenants that provide a COVID-19 related reason for non-payment. If the tenant does not provide such a reason, a California operator can likely proceed with the lien process against that tenant. However, operators should carefully review the local orders linked to below to determine the exact protections available to tenants in the jurisdictions where the operator does business.
    • Commercial evictions and commercial and residential foreclosures are suspended only as set forth by local governments. Some of the local orders provide protections past the statewide date of September 30, 2020. A complete list of California orders can be found here.

    Livermore, CA 

    • The Director of Emergency Services issued an order stating that “no landlord or lessor shall endeavor to evict a commercial tenant for nonpayment of rent, limit their physical access to personal property or conduct lien sales, including but not limited to any such provisions under.... Business and Professions Code section 21700 et seq., if the tenant or lessee demonstrates that the inability to pay rent is due to, or arising out of, a substantial decrease in business income or substantial out of pocket medical expense, or extraordinary child care needs, any of which was caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19, and is documented in writing.”
    • A landlord who knows that a tenant cannot pay some or all of the rent temporarily for the reasons set forth above shall not serve a notice pursuant to . . . Business and Professions Code section 21703 as applicable, . . . conduct a lien sale, or otherwise seek to evict or terminate a rental agreement for nonpayment of rent during the period of the local emergency and while this Order is in place.
    • A landlord is presumed to know of a tenant’s inability to pay rent within the meaning of this Order if the tenant or mobile homeowner, within 30 days after the date that rent is due, notifies the landlord in writing of tenant’s inability to pay full rent because of a substantial decrease in business income, or out of pocket medical expenses caused by the COVID-19 pandemic, or extraordinary child care needs, or by any local, state, or federal government response to COVID-19, and provides documentation to support the claim. Any medical or financial information provided to the landlord shall be held in confidence and only used for evaluating the tenant’s claim.
    • A landlord is also prohibited from retaliating against a tenant that qualifies for the protections set forth in this order during the term of the moratorium. For example, a landlord, and any of the landlord’s employees or agents, is prohibited from terminating utilities or blocking physical access to personal property to a qualified tenant protected by this moratorium.
    • The order remains in effect until September 30.

    City of Los Angeles, CA 

    • The Los Angeles City Council passed an ordinance requiring self storage owners to defer rent if a tenant is unable to pay for a COVID-related reason and provides documentation to the owner no later than seven days after the rent is due.
    • The deferral lasts until three months after the local emergency period.
    • The ordinance prohibits late fees on deferred rent.
    • The ordinance also requires that owners provide notice of the ordinance to their tenants.
    • Owners in Los Angeles are strongly encouraged to consult with legal counsel before proceeding with lockouts or lien sales. 

    Los Angeles County, CA 

    • The Board of Supervisors ratified an Executive Order stating that no residential or commercial property owner shall evict a residential or commercial tenant for: (1) nonpayment of rent, late charges, or any other fees accrued if the Tenant demonstrates an inability to pay rent and/or related charges due to financial impacts related to COVID-19, the state of emergency regarding COVID-19, or following government-recommended COVID-19 precautions, and the Tenant has provided notice to the Landlord within seven (7) days after the date that rent was due, unless extenuating circumstances exist, that the Tenant is unable to pay; or (2) reasons amounting to a no-fault eviction under the County Code, unless necessary for health and safety reasons.
    • The order defines “no-fault  eviction” as  any eviction for which the notice to terminate  tenancy  is not based on alleged fault  by  the  Tenant,  including but not  limited  to,  eviction  notices  served pursuant to Code of Civil Procedure section 1161 et seq. or County Code.
    • The Board later amended the Executive Order to cover the unincorporated areas of L.A. County and the incorporated cities without a local eviction moratorium.
    • The amended order prohibits a landlord from charging late fees on unpaid rent.
    • The amended order also states that “a commercial tenant includes, but is not limited to, a tenant using a property as a storage facility for commercial purposes.”
    • The order provides tenants with 12 months after the expiration of the order to repay their unpaid rent.
    • The L.A. Count order, as amended, may affect lien sales and late fees, particularly as applied to business tenants. Consultation with your legal counsel is strongly advised before proceeding with any lien activity.

    Ontario, CA

    §  The City Council ordered that no landlord shall endeavor to evict a storage unit patron (including a lien sale), in accordance with the ordinance, if the storage unit patron demonstrates that the inability to pay rent or fees is due to COVID-19, the state of emergency regarding COVID-19, or following government recommended COVID-19 precautions. To take advantage of these protections, the patron must satisfy all of the following requirements: 

    1.       Prior to April 7, the patron paid rent due to the storage unit operator pursuant to an agreement. 

    2.       The patron notifies the storage unit operator in writing before the rent is due, or within a reasonable period of time afterwards not to exceed 7 days, that the patron needs to delay all or some payment of rent because of an inability to pay the full amount due to reasons related to COVID-19, including but not limited to the following: 

    • ·         The patron was unavailable to work because the patron was sick with a suspected or confirmed case of COVID-19 or caring for a household or family member who was sick with a suspected or confirmed case of COVID-19;
    • ·         The patron experienced a lay-off, loss of hours, or other income reduction resulting from COVID-19, the state of emergency, or related government response; orThe patron needed to miss work to care for a child whose school was closed in response to COVID-19. 

    3.       The patron retains verifiable documentation, such as termination notices, payroll checks, pay stubs, bank statements, medical bills, or signed letters or statements from an employer or supervisor explaining the patron’s changed financial circumstances, to support the patron’s assertion of an inability to pay. This documentation may be provided to the storage unit operator no later than the time of payment of back-due rent. 

    §  If a storage unit patron complies with the requirements above, a storage unit operator shall not do any of the following: 

    1.       Prevent a storage unit patron from accessing their stored items during the normal hours of operation of the storage unit facility; or 

    2.       Send to the storage unit patron a Notice of Lien Sale pursuant to Business and Professions Code, Division 8, Chapter 10, or any other applicable statute regulating storage unit operators. 

    3.     Conduct a Lien Sale pursuant to Business and Professions Code, Division 8, Chapter 10, or any other applicable statute regulating storage unit operators. 

    §  For purposes of this ordinance, “in writing” includes email or text communications to a landlord or the landlord’s representative with whom the tenant has previously corresponded by email or text. Any medical or financial information provided to the landlord shall be held in confidence, and only used for evaluating the tenant's claim. 

    §  The patron is not relieved of liability for unpaid storage fees, which the operator may seek after expiration of the local emergency and the patron must pay within six months of the expiration of the local emergency. Six months after the end of the emergency if the rent or storage fees are unpaid, an operator may charge or collect a late fee for rent/fees that is delayed for the reasons stated in the ordinance; or an operator may seek rent or storage fees that is delayed for the reasons stated in the ordinance through the eviction or other appropriate legal process.

    §  The order remains in effect until further notice.

    Pasadena, CA

    • City Council passed an ordinance stating that “no landlord shall endeavor to evict a commercial tenant for non-payment of rent if a commercial tenant is unable to pay rent due to financial impacts related to COVID-19.”
    • “Tenant” means a person, partnership, corporation, family trust or other business entity entitled by a written or oral agreement to occupy a rental unit to the exclusion of others, and actually occupy said rental unit for residential or commercial purposes (including, but not limited to, a self-storage facility, as defined by Pasadena Municipal Code Section 17.80.020).
    • The Pasadena Municipal Code defines self-storage as “a structure containing separate storage space that is designed to be leased or rented individually in an enclosed building. This use does not include outdoor storage or recreational vehicles, boats, personal watercraft, motorcycles, or trailers.”
    • A landlord shall give written notice of the protections afforded by this ordinance to each tenant no later than 30 days after its effective date. In lieu of providing written notice to each tenant's rental unit, a landlord may conspicuously post and prominently display such notice in the common areas of the property during the pendency of this local emergency.
    • A landlord knows of a tenant’s inability to pay rent if the tenant, within 30 days after the date that rent is due, notifies the landlord in writing of lost income and inability to pay full rent due to financial impacts related to COVID-19, and provides documentation to support the claim. Any medical or financial information provided to the landlord shall be held in confidence, and only used for evaluating the tenant's claim.
    • The tenant must pay any unpaid rent within six months after the local state of emergency ends.
    • The landlord cannot charge late fees, deny a tenant access to the premises, or move or convert the tenant’s possessions.


  • Thursday, August 27, 2020 9:34 AM | Ross Hutchings (Administrator)

      

    What are a Landlord's Obligations to its Tenants During the COVID-19 Pandemic?

    By Scott I. Zucker

    As we move into the fifth month of the pandemic there remain conflicting signs of our future. Infections are rising, deaths are mounting while research institutes and pharmaceutical companies race to find a cure through a vaccine. In the interim, we seek to find normalcy with working from home, creating virtual classrooms for our children, wearing masks while shopping, and enjoying outside-only dining at restaurants.

    For those invested and working in the self-storage sector of the industry, while we may have learned that our business was "essential" (at least under some definitions), the pandemic has left us with anxious tenants, un-visited facilities, increasing rent defaults and a new list of maintenance and safety protocols. COVID-19 has also left us with certain new and unique questions about the obligations of being a landlord.

    One of the first issues is how to handle late fees and the enforcement of the owner's lien due to a rent default. Significantly, with the imposition of multiple ambiguous and inconsistent statewide and municipal orders, the pandemic has led to either no late fees and no lien sales being imposed by operators for the last five months or the sporadic and cautious return of the owner's enforcement of its contractual and statutory rights in response to defaulting tenants.  Guidance on this issue has been difficult, since none of the laws that seek to protect struggling residential tenants or even small businesses truly intend to forgive a tenant's obligation to pay its rent or forestall a landlord from its right to be paid. But many hastily drafted executive orders, court orders and even state laws have resulted in confusing and incomplete directives as to the right that a self-storage operator may have when it comes to enforcing its contractual entitlement to late fees and, more importantly, its statutory self-help remedy of foreclosing on its lien over its tenant's stored goods. At this juncture, the only appropriate answer to the question of "Can I sell?" would be to thoroughly review and consider any statewide orders or laws that have been legislated as well as any orders or laws that may have been issued by local municipalities where the facility is located. As an interim measure, it is widely recommended that all lien notices be updated to include certain COVID-19 language to allow tenants to respond to a facility's default notice. The language might read something like: "If you are unable to pay your account in full because you were financially impacted by the COVID-19 Pandemic, please contact us to discuss your situation. Please note that in order to assist you, it will be necessary for you to provide us with medical confirmation if you or a family member had the virus or employment records if you became unemployed."

    The other issue that a self-storage landlord needs to consider is the risk of virus contact at the facility. Although the potential liability for asserting that a virus contact arose at a facility (as compared to a grocery store or even at home though another family member) is truly small, there is still a burden imposed on a self-storage operator, like all business owners, to ensure their property is, through ordinary care, as safe as possible. This is why operators are encouraged to develop cleaning protocols at their facilities where doors, handles, pin-pads and other surfaces are regularly cleaned and the operator creates an ongoing maintenance log to document these good faith, regular efforts at sanitation. Included in this ongoing documentation is the tracking and notice to employees and tenants of any recent visitors to the property that have tested as positive for the virus. Although there appears to be no law to require it, if that is the case and the facility is notified, it would be recommended that the facility post a notice acknowledging that the facility received notice that an infected person was on the premises and, since notification, the facility (and the areas where the person traveled on the property) have been sanitized for cleanliness. The decision to notify as compared to not notify may seem burdensome, but the benefit of making that disclosure (thereby permitting the tenant to make its own decision to enter) may ultimately create the difference between a successful or unsuccessful tenant injury claim. 

    Stay Safe and Happy Storing!

    Scott 


  • Thursday, August 13, 2020 10:04 AM | Ross Hutchings (Administrator)

    Price Restrictions Remain Despite Lifting of Stay-at-Home Orders

    Joe Doherty posted on 7/15/2020 3:22:00 PM

    Price Restrictions Remain Despite Lifting of Stay-at-Home Orders  

    As many states’ stay-at-home orders are lifted and states are “reopened,” many storage operators ask whether it is permissible to return to business as usual as it relates to normal rent increases for both current and prospective tenants. The answer to that question is: it depends. 

    The first inquiry is whether your state has a price gouging restriction in effect. Most states do. Although these laws differ, they generally put a cap on raising prices for certain goods and services above a certain percentage from the amount charged immediately preceding an emergency declaration, subject to certain narrow exceptions. Some of these laws are clearly applicable to self storage, some clearly are not, and others are uncertain in scope. 

    These price gouging statutes are “activated” by a declaration of a state of emergency by either the Governor or the President. Many Governors’ powers are limited to only declare a state of emergency in 30-day intervals. As such, while an operator may see that their applicable emergency order is set to expire on a certain date, it is likely that it will be extended given the uncertainty surrounding the COVID-19 pandemic. The current “expiration” date is likely more a reflection on the limitation of the Governor’s power, not that the state envisions that the disaster will conclude then. 

    Further, operators must remember that many states’ price gouging laws are activated by Presidential action too. President Trump declared a national emergency on March 13. That declaration remains in effect indefinitely. As such, before any rent increase is considered, an operator must look to see if the President has lifted the national emergency declaration as well as whether the Governor(s) of the states within which you operate has lifted the state emergency declaration – and not just the shelter-in-place or similar order, as discussed below. 

    State of Emergency Declarations vs. Stay-at-Home Orders 

    Importantly, a declaration of a state of emergency is different from a stay-at-home order that required individuals to limit movement outside of their residence except for essential activities during the early stages of the COVID-19 pandemic. While lifting of stay-at-home orders ensures that storage operators may continue to remain open for business, they are not the controlling orders for purposes of potential rent increases. 

    The President and Governors traditionally declare a state of emergency when they believe a disaster has occurred that is severe enough that it will require the government to deploy resources to states, cities, and counties on a more expedited timeline. Oftentimes, these orders will permit the President and Governor to bypass certain laws and regulations that would otherwise be applicable, recognizing that time is of the essence. A state of emergency could be declared for hurricanes, wildfires, blizzards, numerous other natural or man-made disasters, or as is currently the case across the country, the COVID-19 pandemic. 

    These orders generally do not require a citizen to take particular action. However, as outlined above and among other things, many states of emergency declarations trigger the state’s price gouging laws. Unlike a state of emergency, the stay-at-home orders required citizens to refrain from activities. Again, for purposes of any potential rent increases operators must look to relevant state of emergency declarations. Do not assume that because your state has lifted its stay-at-home order that price restrictions do not remain operative. Most states of emergency, and by extension the price going laws, are still in effect and will likely continue to be for some time. 

    How Do the Statutes Practically Work? 

    While the price gouging laws are intended to prevent nefarious actors from excessively profiting from disaster (e.g., selling hand sanitizer for $200 a bottle), their impact and practical effect extends beyond those examples. 

    Although no SSA member would intentionally raise their rental rates dramatically during a declared state of emergency, the laws may affect an operator’s ability to implement even standard rate increases. Operators must pay close attention to the language of the relevant statute. Some statutes are what we refer to as “hard cap” statutes. Those state statutes limit price increases on a firm percentage basis. 

    For example, in California, an operator may not charge a rental price greater than 10 percent more than the amount charged immediately preceding the declaration, subject to certain narrow exceptions. If a California operator charged $100 for a unit immediately preceding the declaration and raised the rent to more than $110 during the state of emergency, the operator may be in violation of the law. 

    Other states take a different approach. For example, in Tennessee, upon the declaration of a state emergency, it is unlawful to charge “grossly excessive” prices for food, construction services, emergency supplies, storage services or other vital goods or services. “Grossly excessive” is not a defined term. Therefore, it is more ambiguous as to what constitutes such as increase and by extension what the permissible parameters are for certain rent increases. Operators should be reasonable. 

    Importantly, many of these laws create so-called strict liability offenses. In other words, it only must be proven that the unlawful rate increase occurred, without a valid exemption provided by the law, not that an operator had a specific intent to violate the law or “gouge” the tenant. 

    Beyond specific price gouging laws, many states’ Attorneys General have announced that they will pursue action against gougers under various consumer protection laws. For example, the Illinois Attorney General announced that the state will pursue price gouging claims under the Illinois Consumer Fraud and Deceptive Business Practices Act. The Attorneys General from Washington, Vermont, Indiana, and Colorado have made similar statements. As such, even if an operator is in a state without a specific price gouging statute, they must be cognizant of other statutes that may be applicable and may limit price increases during and after the pandemic. In these states, again, operators should be reasonable. 

    Conclusion 

    During the COVID-19 pandemic, members should consult with their legal counsel regarding the application of their state’s pricing laws before changing rental rates for both current and prospective tenants. Given how dynamic the current situation is, members should also frequently monitor announcements and statements from federal, state, and local officials that could extend, modify, or revise their state of emergency as the COVID-19 situation changes. 

    For a general overview of all 50 states price gouging laws, click here. 

    For an overview of the current “expiration” dates of applicable price gouging laws, click here. 

    For additional restrictions operators must comply with related to lien sales, lock outs, and late fees, click here.


  • Friday, July 17, 2020 11:18 AM | Ross Hutchings (Administrator)

    The California Office of Emergency Services has a chart of various "state of emergencies" to avoid price gouging:

    https://www.caloes.ca.gov/cal-oes-divisions/legal-affairs/price-gouging

  • Wednesday, July 08, 2020 11:19 AM | Ross Hutchings (Administrator)

    CEA Logo

    SPECIAL ALERT

    As with all things COVID-19 related, we once again see an unprecedented move with the passing of a temporary "right to reemployment" ordinance that did not require the mayor's signature. On June 23, 2020, the San Francisco Board of Supervisors voted in favor of legislature requiring San Francisco employers with 100 or more employees to "offer a right to reemployment" to certain workers who were laid off due to the ongoing COVID-19 pandemic.

     

    The ordinance was enacted on July 3, 2020 and obligates covered businesses to comply within 30 days (by August 2, 2020). It will remain in effect through September 1, 2020 unless the Board votes to extend it.

    Employers in San Francisco should be aware of the following criteria:

    • Who is covered? Applies to any for-profit or non-profit business operating in San Francisco on or after February 25, 2020 with 100 or more employees. Many healthcare businesses are exempt.
    • How is layoff defined? For purposes of this ordinance, a layoff is considered a separation of employment affecting 10 or more employees within a 30 day period, including business closures. The layoff must have occurred because of the San Francisco's emergency health declaration and/or due to orders to shelter in place during the COVID-19 pandemic.
    • Who is an eligible worker? An "eligible worker" is an individual who had been employed for at least 90 days at or before the time of layoff.
    • What notice(s) are required? While the ordinance is in effect, employers must provide notice to all "eligible workers" in a language the individual understands which includes the effective date, rehire rights, and the Economic and Workforce Development (OEWD) hotline number. Employers must inform the OEWD within 30 days of the layoff the total number of employees affected with job classifications, original hire dates, and separation dates.
    • Are there record retention requirements? Employers must keep records of each layoff for 2 years including the worker's legal name, job classification, hire date, last known address, email, phone number, and copy of the layoff notice.

    READ MORE DETAILS >>

    Please continue to check our Additional Resources page for updated information.

    CEA is here to support you during the COVID-19 Crisis.

     

    Call 800.399.5331 or email us at CEAinfo@employers.org

    California Employers Association
    1451 River Park Drive, #116
    Sacramento, California 95815
    (800) 399-5331   employers.org

    CEA Logo


  • Tuesday, June 16, 2020 12:05 PM | Ross Hutchings (Administrator)

    REMINDER - LA CITY NOTICE TO TENANTS DUE NO LATER THAN THIS THURSDAY - JUNE 18, 2020

    Self Storage Owners and Operators in the City of Los Angeles, 

    The Los Angeles self storage ordinance requires that operators provide notice of the ordinance to their tenants by June 18. The notice must be provided in English and Spanish.

    Click HERE for the mandatory notice in English and Spanish.

    Thank you, 

    Ross Hutchings, CAE
    Executive Director – California Self Storage Association
    5325 Elkhorn Blvd., # 283, Sacramento, CA 95842
    ross@californiaselfstorage.org
    888.CSSA.207 (888.277.2207) – toll-free office, 949.554.3292 – mobile


  • Tuesday, June 02, 2020 8:27 AM | Ross Hutchings (Administrator)

    Despite significant opposition from the self storage industry, the Los Angeles City Council passed an ordinance requiring self storage owners to defer rent if a tenant is unable to pay for a COVID-related reason and provides documentation to the owner no later than seven days after the rent is due. The deferral lasts until three months after the local emergency period. The ordinance also prohibits late fees on deferred rent and requires that owners provide notice of the ordinance to their tenants.

    We expect the Mayor to sign this ordinance soon. 

    CSSA strongly encourage you to consult with legal counsel before proceeding with lockouts or lien sales in the City of Los Angeles. 

    Additional Moratoriums & Restrictions

    In addition to the new Los Angeles Ordinance, we know of three other cities that have moratoriums or restrictions:

    • Ontario - Moratorium - specially mentions self storage 
    • Livermore - Moratorium (banned) self storage lien sales
    • Pasadena - Eviction Moratorium - "tenant" definition includes self storage 

    New ordinances are being drafted each week. We strongly encourage you to check with both your city and county HERE to see if any such ordinance or moratorium has been passed that would restrict you from lien process, late fees, or imposes repayment timelines.

    CSSA is working closely with SSA to track these ordinances as they arise and attempt to make our case for exempting self storage or challenging the validity with regards to the Self Storage Act. Current sentiment still remains in favor of those tenants who have been financially affected by the Covid-19 restrictions. 

    For more information and updates on Covid-19 restrictions and various articles for help in managing your business during these challenging times, please follow the information on the CSSA website CORONAVIRUS INFORMATION.


  • Tuesday, June 02, 2020 8:13 AM | Ross Hutchings (Administrator)

    California Cities and Counties Eviction Moratoriums

    Governor Gavin Newsom issued an EXECUTIVE ORDER that authorizes local governments to pause evictions for tenants – both residential and commercial – when the basis for the eviction is non-payment of rent arising out of a substantial decrease in household or business income or substantial out-of-pocket medical expenses caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19.

    It is the opinion of CSSA and SSA that neither California law nor the Governor’s order allows local governments to affect the lien rights of self storage operators. California’s self storage lien law is in a different part of the state code and is separate from the state’s eviction laws.

    Nevertheless, we strongly recommend that California operators review each LOCAL ORDER or ORDINANCE carefully – looking for all applicable city and county orders / ordinances – and determine the effect that each has on issues such as self storage lien sales, late fees, and unlawful detainer actions. Although some orders / ordinances have overlapping language, they often have significant, and occasionally subtle, differences such as definitions, repayment periods, and requirements for the tenant to claim the protection of the order / ordinance. We also strongly recommend consultation with experienced legal counsel when dealing with tenants who fail to pay in full. 

    CLICK HERE for California Cities and Counties Eviction Moratoriums

      


  • Tuesday, June 02, 2020 8:07 AM | Ross Hutchings (Administrator)

    Moratoriums on Commercial Late Fees, Liens, and Evictions

    As the coronavirus (Covid 19) spreads throughout the United States, several states and localities have enacted restrictions on foreclosures and evictions. Many of these orders that have been issued to date exclusively cover residential evictions and foreclosures. However, as the situation evolves, more states are expanding those restrictions to cover commercial evictions as well. Some of the commercial eviction or foreclosure moratoriums may prevent operators from conducting self storage liens sales, performing overlocks, or imposing late fees.

    Although self storage lien sales are not evictions in the usual sense of that word, the SSA urges all operators to exercise great caution if they operate in an area covered by a moratorium on commercial or non-residential evictions or foreclosures.

    First, self storage lien sales are a form of non-judicial foreclosure. Therefore, an order that imposes a foreclosure moratorium may apply to self storage lien sales. Second, the overall intent of many government restrictions at this time is to keep people at home as much as possible. It arguably frustrates the intent of the orders if a landlord creates a situation that forces a tenant to leave home for a non-essential purpose. Third, the orders are often hastily drafted and vague and do not define the term “eviction”, “foreclosure”, or other key terms in the orders. The overall intent, coupled with the vague wording, indicates that the term “eviction” or “foreclosure” is meant to cover any unilateral action by an operator that terminates a rental agreement. This certainly covers lien sales, even if the primary purpose of a lien sale is to recover unpaid rents.

    The volume of new orders issued daily makes it difficult to provide a comprehensive list of jurisdictions, especially local governments, that have enacted eviction or foreclosure moratoriums. Additionally, in the interest of space, we did not include local orders that affect only residential evictions or lawsuits filed to evict a tenant.

    California

    • Governor issued an order, issuing a statewide moratorium on residential evictions. 
    • Governor also issued an executive order that authorizes local governments to pause evictions for renters. The protection is in effect through May 31, 2020. Tenants are still obligated to pay rent, and landlords can still recover rent that is due. The order only applies to the imposition of limitations on evictions when the basis for the eviction is nonpayment of rent, or a foreclosure, arising out of a substantial decrease in household or business income (including, but not limited to, a substantial decrease in household income caused by layoffs or a reduction in the number of compensated hours of work, or a substantial decrease in business income caused by a reduction in opening hours or consumer  demand), or substantial out-of-pocket medical expenses; and the decrease in household or business income or the out-of-pocket medical expenses was caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19, and is documented.
    • Evictions and foreclosures are suspended only as set forth by local governments. Many localities in California have imposed such restrictions on commercial leases. Additionally, many have restricted the ability to impose any late fees. A complete list of California orders is forthcoming.

    Late fees - If it does not violate your local order (see below) late fees may continue to be assessed as part of your normal business practice. However several operators have reported that they are assessing the late fee but giving their tenants a grace period before it is due.

    Lockouts, liens, auctions - We have heard form several operators that have put a halt on lockouts and/or lien notices/auctions for the month of April, yet others are still pressing forward. If you decide to move forward with auctions, you will need to hold them online as in-person auctions violate the non-gather order for the state of California. 

    Check your local order in place - Whether or not an operator is permitted to assess late fees, liens, lockouts or auctions depends on the orders in place in the city/county where your facility is located within the state of California. You must review your local orders in place, and then make a business decision depending on what is allowed. We also suggest you consult your attorney before making a decision. 

    Here is one link that might help you find your local order: https://www.covid19.ca.gov/state-local-resources/#top  

    Consider the optics - Before making a final determination, you might also want to consider the optics or how this looks to your community. You may want to consider some leniency if other businesses in your area are delaying payments to give those negatively affected by these restrictions, including being furloughed or loosing their job.

    Additional advice is given by Joe Doherty and Daniel Bryant from SSA:

    "Although self storage lien sales are not evictions in the usual sense of that word, the SSA urges all operators to exercise great caution if they operate in an area covered by a moratorium on commercial or non-residential evictions or foreclosures.

    First, self storage lien sales are a form of non-judicial foreclosure. Therefore, an order that imposes a foreclosure moratorium may apply to self storage lien sales. Second, the overall intent of many government restrictions at this time is to keep people at home as much as possible. It arguably frustrates the intent of the orders if a landlord creates a situation that forces a tenant to leave home for a non-essential purpose. Third, the orders are often hastily drafted and vague and do not define the term “eviction”, “foreclosure”, or other key terms in the orders. The overall intent, coupled with the vague wording, indicates that the term “eviction” or “foreclosure” is meant to cover any unilateral action by an operator that terminates a rental agreement. This certainly covers lien sales, even if the primary purpose of a lien sale is to recover unpaid rents."


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