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Los Angeles Passes Ordinance to Suspend Self-Storage Rent and Late Fees Due to COVID-19

The Los Angeles City Council passed an ordinance last week that requires self-storage operators to suspend rent and late fees for tenants who are unable to pay due to circumstances stemming from the coronavirus pandemic. The measure must still be signed by Mayor Eric Garcetti before it goes into effect. Per the decree, tenants who wish to seek deferment must provide supporting documentation no more than seven days after their storage rent is due. Any postponement would remain valid for three months after the local emergency period is lifted by the mayor, and facility operators would be prohibited from charging late fees or interest on outstanding balances.

Once the legislation is enacted, storage companies have 15 days to notify their tenants in English and Spanish of their right to request a deferral. The ordinance outlines the following acceptable reasons for requesting a stay:

  • Loss of income due to a crisis-related workplace closure
  • Childcare expenditures due to school closures
  • Healthcare expenses related to being ill with COVID-19, or caring for a family member who has the virus
  • Reasonable expenditures that stem from government-ordered emergency measures

Storage operators who fail to comply could be subject to citation. However, the order expressly allows facility owners to terminate rental agreements for lawful reasons not connected to the health crisis.

“Some people financially impacted by the COVID-19 pandemic are struggling to pay the storage rent. They are having to make difficult decisions about whether to use their limited funds to pay the storage rent or pay for food, medicine and housing,” the ordinance states. “Also, forcing people struggling to pay the storage rent during the crisis to travel to the storage facility to move their possessions out of storage, including hiring movers, is a public health risk, as it runs counter to the goals of the city’s stay-at-home orders.”

The ordinance is strongly opposed by the California Self Storage Association (CSSA) and national Self Storage Association (SSA). In recent e-mail newsletters to members, both associations urged operators to seek legal counsel before overlocking units or pursuing lien proceedings in Los Angeles.

If Garcetti signs the measure as expected, Los Angeles would join fellow California cities Livermore and Pasadena in tightening regulations on self-storage operators during the pandemic. Livermore has banned self-storage lien sales, according to the CSSA, while Pasadena added self-storage to its eviction moratorium.

“New ordinances are being drafted each week. We strongly encourage you to check with both your city and county to see if any such ordinance or moratorium has been passed that would restrict you from lien process, late fees or [imposing] repayment timelines,” CSSA officials wrote to members. “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 regard to the Self Storage Act. Current sentiment still remains in favor of those tenants who have been financially affected by the COVID-19 restrictions.”

Los Angeles and the state of California have been under a state of emergency from COVID-19 since March 4.

Sources:
City of Los Angeles, Temporary Protection of Occupants of Self-Service Storage Facilities During COVID-19 Pandemic
CSSA, LA City Council Passes Ordinance to Defer Self Storage Rents and Late Fees Due to COVID-19
SSA Magazine Weekly 6/1/20, Los Angeles Ordinance May Require Rent Deferral for Operators

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