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Justice Department Appeals Ban on CDC Evictions Moratorium

[Updated: Mar 03, 2021 ] Mar 03, 2021 by Marc Rapport
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The U.S. Justice Department has appealed a Texas federal judge’s order that blocks the moratorium on evictions put in place last year by the U.S. Centers for Disease Control and Prevention (CDC).

That was in response to a lawsuit filed by a group of Texas landlords and property owners. President Donald Trump first approved the ban in September, and it since has been extended twice, most recently by President Joe Biden on his first day in office.

U.S. District Judge J. Campbell Barker of the Eastern District of Texas did not issue an injunction against enforcement but, according to CNN, said he expected the CDC to respect his ruling and withdraw the moratorium.

The judge, an appointee of former President Donald Trump, ruled on Thursday that the ban oversteps federal authority’s limits in trying to prevent communicable diseases -- like COVID-19 -- from crossing state lines.

"The federal government cannot say that it has ever before invoked its power over interstate commerce to impose a residential eviction moratorium," including during the 1918 Spanish Flu pandemic, Barker wrote in his decision.

Justice says the ban, even if kosher, would be limited -- and it’s not the only one

In a statement announcing its appeal Saturday, the Justice Department said the moratorium does not exceed congressional authority and that the impact of the judge’s ruling is greatly limited anyway.

"The decision … does not extend beyond the particular plaintiffs in that case, and it does not prohibit the application of the CDC’s eviction moratorium to other parties. For other landlords who rent to covered persons, the CDC’s eviction moratorium remains in effect," said Brian Boynton, acting assistant attorney general for the Justice Department's Civil Division.

There also are other such bans in effect, both federal and state, and the decision did not address those. Those include the ban on evictions and foreclosures for mortgages backed by government-sponsored entities like Fannie Mae (OTCMKTS: FNMA) and Freddie Mac (OTCMKTS), which have also been extended to March 31.

Click here to see the CDC rule itself. It lays out in the first two pages who is covered by the rule. Click here to see the Justice Department’s notice of appeal.

The Millionacres bottom line

The federal government argues that evicting delinquent renters can result in more homelessness and more crowded housing, both of which can add to the spread of the coronavirus.

But then there are the owners and managers of those properties where the rent’s not being paid, and they have their own bills to pay. They’re not all big corporations with deep pockets. Far from it. The Urban Institute estimates that nearly 60% of single-family units in this country are owned by people with but one or two units to their name.

There’s no immediate word on when an appellate court will take up the case. In the meantime, the $1.9 trillion stimulus bill making its way through Congress contains billions of dollars in rental assistance that could help ease the pain on both sides of the transaction

How much that ends up being, and how much that can help this pushmi-pullyu between two sides with very legitimate concerns, remains to be seen.

Then there’s the other state and federal bans, plus millions of mortgages coming out of forbearance in coming months, too, ensuring that the pressure and hopes for pandemic and economic relief from the vaccine rollout can only keep rising.

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