3.3 M Unemployed + $600/week

What a complete, unmitigated mess this pandemic is creating. Putting aside the health and lives that may be at risk for just a moment, the economic carnage is SWIFT, REAL, and IMMEDIATE. It feels like a bunch of clowns playing whack-a-mole with this, and you’re unemployed. I’m sorry for that.

Prior estimates warned, leading up to Thursday, that claims for last week AND this week, combined, may be as high as 2.25 million. Well they were wrong. By A LOT. In a single week, unemployment claims smashed estimates and obliterated the last highest record (I think set in the Great Recession) by FIVE TIMES. And that was just one week — not two.

Unemployment isn’t a “curve”; it’s real, and it’s here

Of course there’s a serious health crisis going on, but what gets lost in the headlines is that millions of you are paying a very high price, right now. It’s not some curve to be flattened for you. It’s not a mathematical model. You lost your job and you’re unemployed right now. How will you make rent? How will you feed your kids?

It’s not just the money that you lose. About six weeks ago, before all this happened, I was talking to a 50 year old guy who does (did) some of the light duty work around my cowering space (which is now closed).

He was so proud that they had recently let him run the closing shift. Not only was the traffic better on the LA freeways at night, but, more importantly, he knew meant management trusted him to take care of the facility (a multimillion dollar one) and to close everything up. That sense of pride and purpose is probably gone now, I guess, I don’t know. He got laid off so I can’t ask him.

But I do know there’s nothing to close at night because the coworking space didn’t open in the morning. It hasn’t in a couple of weeks.

What does he say to his family this weekend?

$600 extra per week

The massive bill that’s been working through Congress passed and Trump signed it today. There’s a lot to it. Stuff to make some bankruptcies easier, forgivable loans for small businesses, help for some big businesses, especially airlines.

But, aside from one time cash payments that I’ll try to explore soon, maybe the more important aspect is that you can get an extra $600/week ON TOP OF whatever your current unemployment is.

So if you were getting, say, $275/week, now you get $875 per week, which is a big increase!

As I understand it, it should last through late July. But I’m still trying to understand.

It literally just became law today, so it will probably take California EDD at least a few weeks to process it, at which I would guess, they may make catch up payments since I think you might be eligible starting next week.

Here’s the key part of Section 2104 of the “CARES Act”:

And here are some other places to read some more details:

More to come this weekend, rebooters!

By the way, here’s the full text of the CARES Act:

Attorney advertising. Now and then I help people file for bankruptcy under the Bankruptcy Code, but I do a lot more than that for my clients. As such I qualify as a debt relief agency, which I’m proud to say. Michael Rice is responsible for the content. 840 Apollo Street, No. 100, El Segundo, CA 90254


Hermosa Beach Eviction Moratorium

In tonight’s post, we’re taking a look at Hermosa Beach, CA’s eviction moratorium. I know HB is a teeny, tiny city in the South Bay bubble and I just featured it in my last post about beach closures, but I’m guessing it’s a common order that’s getting passed around by city attorneys.

Finally, since I live here, I have easy access to the order. Remind me and I’ll dig around to the other Los Angeles area cities to see what their orders say. Our city attorney also represents West Hollywood, so my guess is that theirs looks similar.

Remember that normally, during normal times, the cities and counties aren’t allowed to stop evictions or foreclosures. That’s something that only the State can do. But recently, the Governor issued an order clearing the way for local cities to temporarily make their own choices about evictions and foreclosures.

Landlord restrictions and duties:

The order has a list of things that your landlord cannot do.

  1. Landlords cannot “endeavor to evict” you for not paying rent if you demonstrate you are “unable to pay rent due to financial impacts related to COVID-19.” See below for more about what “financial impact” means.
  2. The landlord cannot serve notice, take you to court for unlawful detainer, or “otherwise” take actions if the landlord “knows that [you] cannot pay some or all of the rent” due to the coronavirus. (E.g., you need to let them know!)
  3. When you provide documentation about your inability to pay (see below), the landlord must hold your information “in confidence” and can only use the information for “evaluating the tenant’s claim.”

Your/tenant’s duties:

You can’t simply stop paying rent without contacting the landlord.

In fact, you have 30 days from the date that the rent was due to provide “documentation or explanation” as to why you can’t make rent. For many, April rent is due in just a few days, on April 1, so you only have until April 30 to contact your landlord and provide proof.

If you’re going to miss your rent payment, you should to contact your landlord before thirty days!

What does “financially impacted” mean?

In case you missed the news, over three million people lost their jobs JUST LAST WEEK over this pandemic. That’s clearly a financial impact, but the Hermosa Beach order has some detail.

The eviction moratorium applies to you as a renter if you were financially impacted in any of the following ways:

  1. You were sick from the virus
  2. You were caring for a family member
  3. You were laid off, lost hours, or otherwise lost income, such as, because your employer closed
  4. You had extraordinary out of pocket expenses
  5. You had additional child care needs because of school closures
  6. You lost income because you were complying with recommendation from a health authority to self-quarantine

Number 6 is something I’d recommend you document carefully because it’s the one with the “fuzziest” parameters around it.

Do I have to make up the unpaid rent?

YES. And this is the unfortunate and unstated part of the mess and the “bailout” that people don’t talk about: sure, you’re getting some temporary relief, but it’s really more of a loan.

Once things get back to normal, you have to make it up. There’s no free rent.

That said, here are the conditions:

  1. You have six months from the time that the city council declares the emergency is over to catch up on the rent you couldn’t pay due to the pandemic.
  2. Landlords can’t charge fees.
  3. They can’t, after six months (assuming you caught up), claim you didn’t pay rent during the moratorium to evict you.
  4. But there are no other restrictions, so the landlord can still report to a credit agency or other source that you missed rent.

Homeowner “protections”

Those who own homes get some protections too, but not as many.

The Hermosa Beach order says the mortgage service can’t start a foreclosure action, that the property owner has six months to catch up on payments and that late fees can’t be collected, but otherwise all bets are off when the local emergency ends. The lender and borrower and are left to sort it out in court at that time.

For the record, I’m writing all this with the assumption that the cities, counties, and the State have the power to do what they’re doing. My hunch is that they are overstepping their legal authority in some cases, but that will take many months or years to shake out.

Attorney advertising. Now and then I help people file for bankruptcy under the Bankruptcy Code, but I do a lot more than that for my clients. As such I qualify as a debt relief agency, which I’m proud to say. Michael Rice is responsible for the content. 840 Apollo Street, No. 100, El Segundo, CA 90254


What Is Congress Debating?

As I write this, the United States Congress is currently debating how to address the financial effects of the coronavirus pandemic. The bill that the Congress is working through is over 600 pages long.

I thought you’d be interested in some of the highlights that apply to you:

  • If you work for a small business, there would be $300 billion in new loans available for payroll and money they would need to keep the lights on.
  • The California unemployment program is backed by the federal government, and Congress is debating how to increase the number of people who can get it and how much or how long, which is particularly important right now.
  • They may issue cash checks of $1,200 per adult and $500 per child for most people who make less than $200k/year.
  • Student loans might get six months of interest free deferment. In other words, you wouldn’t have to pay for six months. However, there are some wrinkles around Perkins Loans or private loans (of course 👎).

In case you’re curious, big businesses would get some big benefits too. $50 billion for airlines, and $435 billion for some other big businesses.

Under the current bill, there is not an increase in SNAP or other Social Security programs.

These are just some hot take notes. Nothing is final yet, but I thought you’d be curious to know what Congress is debating right now.


City Council Freakout

I thought this was fantastic from Lake Worth Beach, Florida.

I don’t know the details of how this came up, but it certainly does seem like a bad time to be shutting off people’s utilities!


Los Angeles County Locks Down

It almost seemed like a race to issue lock down orders today for those of us in Los Angeles County! In just a few hours, we had both LA County and the State of California issue orders. This is a quick post talking about some similarities, differences, and problems with the two.

Los Angeles County’s Order

The LA County order came out this afternoon (uploaded in this post). It’s pretty similar to the orders we saw up in Northern California. They basically say: “it’s better to stay at home, if you go to confined places with more than 10 people, there are a bunch of restrictions.”

The California Order

The Governor’s office also issued an order this afternoon, which I wrote about briefly tonight. Unfortunately, the Governor’s doesn’t have much detail in the order, even though the order covers a lot more people than just LA County. It covers the entire state.

Terrible rollout compared to the counties and cities if you ask me.

Which One Matters?

I like the LA County order better because it’s got more detail and clarity in terms of what you can, should, and can’t do. I really dislike the Governor’s order because it’s super confusing and feels like it was written without a lot of thought.

Unfortunately, the order issued by the State should override the LA County order, but give me a second to look into the details of each and what’s really going on.

What a mess!

But don’t panic. Stay home as much as you can right now until this blows over. Be safe! Stay tuned and I’ll try to help you figure this out!

I’m planning a conference call on this mess in the next couple of days to try to sort it out. To get on the email list and get an invite, click here.

Attorney advertising. Now and then I help people file for bankruptcy under the Bankruptcy Code, but I do a lot more than that for my clients. As such I qualify as a debt relief agency, which I’m proud to say. Michael Rice is responsible for the content. 840 Apollo Street, No. 100, El Segundo, CA 90254


California Locks Down

California’s Governor just announced a statewide order (uploaded below) to keep people in their homes. By the time you read this post, you’ll probably hear a lot more about it in the news. Let me give you the hot takes just a few hours after the order hit the internet.

Before I start, I hope you can rely on what I tell you as a trusted source because I seriously have no vested interest in drawing you to the site. I don’t make any money from this other than, possibly, building my reputation. And my reputation relies on telling you the truth!

What the Governor Said and Didn’t Say

The Governor issued an order from his office (No. N-33-20) saying that everyone in California has to “stay at home.” Not to concern you, but the order doesn’t have much detail at all.

What he didn’t do is explain who can do what and how. This is going to be messy over the next couple of days!

Don’t worry though. In a state of almost 40 million people, people are going to have to sort this out.

What We Know So Far

The order says that we should stay home unless

  • you’re providing critical infrastructure functions (there are 16 of them, which I’ll explore soon)
  • that the supply of food and needed supplies should continue, which seems to imply that grocery stores and restaurants can continue to operate with take out
  • there are other “authorized activities,” which weren’t explained in the order

Open Questions (Lots!)

But what’s interesting is that the Governor didn’t actually say any of these things. It looks like he copied and pasted from the Public Health Office.

As such, it seems like they put the order together without a lot of thought, which might create a lot of chaos and confusion in the short term.

  • The order is effective immediately, does that mean people on the road RIGHT NOW need to get home?
  • What does an essential function mean? Uber drivers? Textile workers? There are “16 critical” sectors that get an exception, so I’ll dive into it soon.
  • What are you going to do?

Get on my mailing list for the latest updates and free conference calls updating you on this fast moving situation!

For those who want to read it, here is the full California Executive Order N-33-20

Attorney advertising. Now and then I help people file for bankruptcy under the Bankruptcy Code, but I do a lot more than that for my clients. As such I qualify as a debt relief agency, which I’m proud to say. Michael Rice is responsible for the content. 840 Apollo Street, No. 100, El Segundo, CA 90254