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Md. landlord groups say rent abatement would cause ‘chaos’

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Groups representing property owners and those advocating for tenants are at odds over the best way to ameliorate the economic fallout from the COVID-19 pandemic on the market. (The Daily Record/File Photo)

A trio of groups representing property owners’ interests argue that granting a request from unions and activists to suspend rent collections in Maryland due to the COVID-19 pandemic will further damage the economy and create “chaos” in the court system.

Those organizations, in a letter to state leaders, objected to a request from groups including CASA, 32BJ SEIU, and Progressive Maryland, to enact laws deferring rent collection during a special session of the Maryland General Assembly. Maryland Realtors, Maryland Multi-Housing Association Inc., and Apartment and Office Building Association of Metropolitan Washington signed the letter addressed to Gov. Larry Hogan, House Speaker Adrienne Jones, and Senate President Bill Ferguson.

“Any proposal that prevents rental housing providers from collecting rent for a prolonged length of time like one or three years would interrupt the rental housing system and potentially harm the renters that the proposals seek to assist,” according to the letter from the organizations.

Deferring rent payments, the organizations contend, prevents property owners from investing and maintaining properties. Without the revenue from rent, property management firms will have to lay off employees who work directly on maintenance of those properties, the letter said.

“Further, this abeyance will cause economic losses for industry suppliers, contractors, utility providers, and for Maryland jurisdictions who now rely on receiving property taxes,” according to the letter.

In a letter to the state’s elected leaders sent on April 13, several unions and liberal activist groups requested Maryland suspend rent transactions for 90 days. That request also asked Maryland lawmakers to simultaneously provide financial relief to property owners who demonstrate financial hardship.

Activists in the same letter also requested Maryland prohibit late fees and debt collections on rental and mortgage payments for a year once the COVID-19 crisis concludes. They also want the state to require banks and rental property owners to offer interest-free payment plans lasting up to three years for tenants and homeowners to pay down debt.

“As you know, workers across the state have risked their health and safety to care for patients in hospitals, nursing homes and other settings, watch over our children, stock our grocery stores, clean critical businesses, and keep our communities functioning. If the State’s most vulnerable residents face economic ruin stemming from a public health crisis beyond their control, it will bring dramatic long-term negative effects on the State,” activists wrote in the letter. “Drastic intervention is necessary immediately to prevent this from happening.

Members of organizations speaking for property owners said they have already acted to help tenants by waiving late fees, creating payment plans, and continuing working with renters to prevent evictions.

In their letter, associations speaking on behalf of landlords praised eviction prevention programs created in Montgomery and Anne Arundel counties. Those groups also urged Baltimore to use funds from its Affordable Housing Trust Fund to secure its own eviction prevention program.

Housing providers, however, are urging the creation of a rental assistance program for families hurt by the COVID-19 outbreak instead of instituting rent abatement as an alternative to postponing rent payments.

“A rental assistance program would further incentivize housing providers to assist residents by assuring housing providers that they will receive some income to meet their expenses through a program tailored specifically to addressing COVID-related rent shortfalls,” according to the letter.

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