City Makes More Businesses Eligible for Rent Relief

The Glendale City Council on Tuesday was quick to amend its decision regarding back-rent protection for commercial tenants after initially approving a plan last week, but any consideration of further changes may become politically fraught.
The city’s six-month payment plan for certain commercial tenants — originally, privately held firms, non-multinational companies or businesses that did not have 100 or more employees per location before the COVID-19 pandemic — now includes businesses with up to 10 locations; when the City Council first green-lighted the plan last week, it included businesses with up to four locations, though Councilman Dan Brotman had initially proposed the 10-store threshold.
The amendment went through on an odd 3-1-1 vote, with Councilwoman Paula Devine disagreeing because of what seemed to be a handful of complaints — “I just think it’s uncalled for; five businesses is a lot,” she said — and Councilman Ara Najarian simply abstaining from voting based on his frustration with how frequently his peers have debated the issue.
“My problem is, we have set so many different rules,” Najarian said, adding he did not disagree with the substance of the amendment. “I think it’s very confusing to the public, landlords in particular and to these small business people. This is maybe our third iteration on some sort of relief for commercial tenants.”
Commercial renters not covered by the six-month plan criteria have, instead, three months to make up for rent not paid during the course of the pandemic, which for nearly three months shut down virtually all retail business that didn’t have a grocery element and restricted restaurants to takeout or delivery service. Even now, as most businesses have been able to resume service in recent weeks, stores and restaurants will be limited on capacity and will likely be hamstrung by the customer base’s reluctance to resume normal business activity.
The council implemented an eviction moratorium to protect residential and commercial tenants from being booted for failing to pay rent, provided they can show evidence that the pandemic had exacerbated their financial situations. Current policy has those moratoriums sunset at the end of the month, meaning that on July 1, tenants are expected to pay that rent and will have the clock started on paying back rent. (Residential tenants will have a 12-month window to make up past-due rent, staggered quarterly.)
Adding crossfire to the debate this week, public comment on the item included one caller accusing the council of being more responsive to business interests than the plight of residential renters, and another echoing Najarian’s critique than the city has just added confusion with every decision.
“I’m not saying we’re doing the wrong thing, but the way we got there has been confusing,” Najarian added. “I’m hearing from more property owners than I’ve heard from business owners who are affected by this. It’s kind of a mess.”
Philip Lanzafame, director of community development, explained that the recommendation for the amendment was less a response to direct complaints than an acknowledgment of modest bottom lines even at larger enterprises.
“I think it’s more the nature of the business being a very low-margin business, and they don’t have the resources,” Lanzafame said, almost certainly referring to restaurants. “They’ll bring on another location to help spread those costs even further, because it is such a low margin — not because they have cash on hand, but because they’re trying to spread that cost among more locations.”