On Monday Seattle joined other major U.S. cities (and Stranger writer Charles Mudede) in calling for governors and federal leaders to cancel rent payments and to issue mortgage moratoriums for tenants and homeowners struggling to pay bills.
So far, Washington's governor and its federal leaders have stopped short of answering that call, symbolically or otherwise.
In a press release Tuesday evening, Gov. Jay Inslee announced a new resource guide created by the Washington State Department of Financial Institutions (DFI) for homeowners who can't pay their mortgages. That resource basically tells homeowners to call their lenders and ask if they qualify for the COVID relief services, and provides a state-run hotline if they run into any trouble in the process: 1-877-RING-DFI (746-4334). The department has also complied a more general list of housing tips and federal financial resources for tenants and homeowners.
Suffice it to say, that's not a rent cancellation plan, nor a 90-day mortgage payment "suspension" of the kind California Gov. Gavin Newsom announced last week.
In an email, Inslee's spokesperson said the DFI hotline and resource guide is "an important step," and added that the Governor's office is "looking into what authority he has" to cancel rent or mortgages. I would also be remiss if I didn't say that Inslee's statewide eviction moratorium offers some space for tenants and landlords to work out payment plans, though the money is of course still owed and any nonpayment of rent could eventually lead to eviction proceedings down the line.
Rep. Pramila Jayapal said she "applauds state and local leaders for taking steps to help renters and homeowners" and thinks the federal government needs to "step up." She supports a nationwide moratorium on "rent-based" evictions and foreclosures, but she's putting the onus on big business—not the government—to "pause" rent and mortgage payments. "Large real estate companies and financial institutions, large-scale landlords and investors who can afford to pause on rent collection must do so," she said.
Inslee and federal leaders are likely running into constitutional issues, according to Edmund Witter, senior managing attorney with the King County Bar Association's Housing Justice Project.
Though a temporary "suspension" of rent or mortgage payments might be constitutional, temporarily canceling them would probably run afoul of the U.S. Constitution's Contract Clause (which basically prevents the state from breaking private contracts) and the Takings Clause (which prevents from the state from depriving a property owner of "all economically beneficial or productive use of the land"). Washington's own constitution has "essentially the same" clauses, Witter said.
Witter notes a "long history" of these kinds of enactments not doing well in case law. In the middle of the Great Depression, for instance, the Supreme Court struck down a Congressional foreclosure statute that relieved farmers of their mortgage obligations because they determined the law was a "taking."
Witter argues a temporary suspension of rent/mortgage payments, which is already "basically" achieved by the current statewide eviction moratorium, probably wouldn't constitute a taking since it doesn't ultimately deprive property owners of "all" beneficial use of their land, nor would it present "a substantial impairment" under the Contract Clause. "A complete cancellation of debt, though, may not pass under either of these," he said.
Emergency powers do not allow the Governor or the President to flout these constitutional clauses, so I wouldn't hold my breath waiting for Inslee to cancel March rent.
As many have noted, state and federal governments could just use public money to pay everybody's landlords and lenders for a while. Politicians are having those conversations as we speak, but tenant advocates want to make sure strong protections coincide with any agreement to line the pockets of landlords with taxpayer dollars.
In the meantime, the Seattle Times has a good explainer from Witter on how to approach your landlord if you can't pay rent. And if you can't pay your mortgage, browse DFI's new resource guide to find out how to get assistance.