Bill introduced to shield unpaid federal workers from Landlords!

181 Replies

Sen. Brian Schatz (D-HI) and Rep. Derek Kilmer (D-WA) have introduced this legislation if you live in these districts you should know what your elected leaders are doing.  But if its a bill doesn't the President have to sign it ... not likely from the landlord and chief.

Originally posted by @Mike M. :
Originally posted by @Meghan McCallum:

You guys. I apologize of someone else posted this earlier but...THIS IS A PROBLEM. I look at it this way. Everyday the gov't is shutdown it adds 1% greater chance that will create a drastic shift in our economy! The US government is our largest employer. This is going to effect us all. It will be the memberships people canx or default on. 

I'm very uncomfortable in our position as an American let alone an investor. This may be a great wealth grab.  I'm very spooked.

 If the "US government is our largest employer" as you say, then the Republic is lost already. You SHOULD be "spooked" you've been swayed to think this is natural. It isn't natural. 

I was thinking the same thing. It amazes me people with this thinking are in the real estate business.

To those landlords wondering if they can be late on their mortgage or other expenses due to the government shutdown, the website for my bank account and at least one of my credit cards has an alert on top, along the lines of, "Are you affected by the federal government shutdown? We can help." 

I haven't seen what they are actually willing to do, but I see similar alerts when there is a natural disaster, or other event that might impact your ability to pay.

Wow. I came to BP just to see what people were saying about this topic. 

I think its funny that all the bleeding hearts are people who are either not landlord at all, or they do not have Federal Employees as tenants. It's pretty easy to sit there and say a landlord should do this or that when it doesn't personally effect you. 

I am lucky enough to not have any tenants on Section 8 and no tenants who are Federal Employees so I don't really have a dog in this fight.

I like to think that I would be compassionate and work with my tenant (if possible) but I would def kick them out if I had to choose between them and hurting my business. We had a similar situation where teachers in my state went on strike. I had a teacher as a tenant. As the strike continued I reached out to her and told her not to stress/worry because I would NOT be kicking her out over this. Everything worked out great as I have reserves and the she only missed a couple pay checks. I worked it out and let her make payments on the missed rent as they did not get a lump sum back pay. They just made the days up at end of the year. 

I think we could be in for a long shut down and I could not care less. I honestly don't care if it ever opens back up. Send me back to to horse and buggy times and I'll still be ok. 

If I had property in a major city I would be worried though. When those Food Stamps and other things are not available next month I think those people are going to start looting/rioting. I've already been stocking up on some items just in case. Then again, I'm a prepper who lives in the deep hollers of West Virginia lol. 

I came here with an opinion on the matter but better yet, say you go to evict the tenant, will you even be able to? Are courts going to stay open? Assuming the shut down lasts long enough to get through an eviction (who knows at this point) will eviction even be possible during the shutdown? I know courts are often associated with the state or county so I assume paid by the state or county, but does the federal government also fund the state courts? Idk the answers. Genuinely curious.

I see mostly emotional response on this thread. I try to keep emotions out of my business and instead predict the future using logic - then plan business actions to best align. So here is my take on where this is headed.

No shut down has ever lasted even a month, so it is illogical to believe this would last months longer. Usually the shut downs end after a paycheck is missed, because people start feeling the pain. This translates to outrage and pressure on politicians. The pressure increases exponentially every day, so politicians feel the pressure and come to an agreement due to self-preservation. I know you hear politicians say they are ready to "go months", but that is rhetoric - happens all the time that we see politicians reverse position quickly.

This bill (the topic of this thread) will never become law. It is completely illogical to believe that could be possible. Hundreds of bills are introduced and most never even reach the voting process. For this bill to pass, it would require the House of Representatives and Senate majority votes. It would then require the President to sign the bill. There 0% chance that all those things would happen. Why would they agree on this and not a funding bill?

For landlords who are talking about evicting government employees, it is not be the best business decision. In previous shut downs, employees have received back pay, which makes it most likely that will happen in this case. It means your tenant will get an influx of cash to catch up on rent. Evictions are costly and knowing the money is coming soon, the best financial decision is to ride it out. Eviction will cost three months rent or even much more in some markets. Odds are low it would even last three months and lower that you won't get paid. (If you don't have money to pay your mortgage, that is a different problem with your business).

I can already hear people saying, "but. but. but. Joe, It COULD last for months". Of course it could, but I don't make decisions on what COULD happen, I make decisions on what is LIKELY to happen. 

If you can afford no rent for two or three months fine but why should a landlord go out of business or have to file for bankruptcy because a tenant isn't getting paid, PG&E is going to file for bankruptcy, are you gonna evict PGE workers if they cant find another job quickly if there are massive layoffs? what if that landlord is a federal worker? Landlords should not all be stereotyped. 

I would take it easy, forgo the late fee, etc. This nonsense over a wall cannot last forever, and you know the person will be back to work sooner than later. Just my two cents.

When I worked in the defense industry in the 1970s, the end market for the products we made was decided by 535 members of Congress. When I switched to the commercial semiconductor industry in the 1980s, the end market was decided by thousands of engineers who decided if the products we made were going to be used on their circuit boards. I've never worked in the automobile industry, but millions of consumers decide the market for those products. The common element for all of these different industries is they experience boom and bust cycles every few years. A Plan B (savings, side hustles, alternate career plans) are in my opinion a key element of financial survival.

Last night, I listened to a Townhall Meeting hosted by Dave Ramsey and Chris Hogan (author of Everyday Millionaires). One question was from a government worker who wasn't getting paid right now (and had two weeks of cash left in the bank, but would get paid once the shutdown ended). The recommendation from these two personal finance gurus was to keep food on the table and the utilities on, but stop paying everyone else. The gurus said there would be a ding on the credit report, but historically, the shutdown would end soon. The gurus said this timetable was too short for landlords to evict tenants or banks to foreclose on mortgages. To the extent your tenants listen to these gurus, they might stop paying rent until they start getting paid again.

Quite frankly, in my younger days, I would have taken the action suggested by these gurus if my financial back was against the wall. I came close a few times, which scared me straight financially, but the contingency planning did go through my mind whenever I was facing a cashflow crisis.

@Cam Jimmy

After all questions and answers we all know that government is the biggest liability for people. Let’s just cut the bills, stop going vacation or expensive restaurants save that money on savings account for security. Oh Mom doesn’t have that money for expensive toys anymore. Well Daddy need to do Uber for their need...

@Derrick E. what happens to the federal worker is the near term damage. If the shutdown were to stretch on, as you hope, the long term damage will begin to affect the welfare states that have a heavy reliance on federal dollars (the other states/ major cities tax dollars) like West Virginia, Kentucky, etc. It will also affect the private sector, and is beginning to.

I think the important thing is to not see this in terms of ideology- but big picture.

@Jeffrey Jardine by the way I'm sorry to tell you but a vast majority in private sector esp. mid/low level jobs don't do a whole lot either all day (I teach/research at a business school, so I know)...that's just the nature of work today unfortunately...nothing special about that across the board but when you commit to pay, IMO YOU SHOULD PAY (especially if this is someone protecting and patrolling my community/shores like Coast Guard (we have a lot of Coast Guard here protecting us from the "smuggling Canadians" on Lake Huron)...isn't that what we try to teach our tenants and our kids?? ;) Just saying!

Originally posted by @Joe Splitrock :

I see mostly emotional response on this thread. I try to keep emotions out of my business and instead predict the future using logic - then plan business actions to best align. So here is my take on where this is headed.

No shut down has ever lasted even a month, so it is illogical to believe this would last months longer. Usually the shut downs end after a paycheck is missed, because people start feeling the pain. This translates to outrage and pressure on politicians. The pressure increases exponentially every day, so politicians feel the pressure and come to an agreement due to self-preservation. I know you hear politicians say they are ready to "go months", but that is rhetoric - happens all the time that we see politicians reverse position quickly.

This bill (the topic of this thread) will never become law. It is completely illogical to believe that could be possible. Hundreds of bills are introduced and most never even reach the voting process. For this bill to pass, it would require the House of Representatives and Senate majority votes. It would then require the President to sign the bill. There 0% chance that all those things would happen. Why would they agree on this and not a funding bill?

For landlords who are talking about evicting government employees, it is not be the best business decision. In previous shut downs, employees have received back pay, which makes it most likely that will happen in this case. It means your tenant will get an influx of cash to catch up on rent. Evictions are costly and knowing the money is coming soon, the best financial decision is to ride it out. Eviction will cost three months rent or even much more in some markets. Odds are low it would even last three months and lower that you won't get paid. (If you don't have money to pay your mortgage, that is a different problem with your business).

I can already hear people saying, "but. but. but. Joe, It COULD last for months". Of course it could, but I don't make decisions on what COULD happen, I make decisions on what is LIKELY to happen. 

 Your Comment: "Odds are low it would even last three months and lower that you won't get paid."

You assume too much. With a $21 Trillion dollar national debt, this is likely a method the white house will use to "thin the herd". 

A lot of those employees are unnecessary and the strategy may be to keep a partial shutdown until enough people leave their jobs to reduce government bloat a bit. He can't fire them, but if they aren't getting paid they may get a clue and leave.

Remember, the President is first a businessman, not a professional government employee and keep in mind that 90% of those employees voted for Hilary in the last election. There is no incentive to make them happy or to keep them or to see that they get paid for work they didn't do. 

It's better to plan your finances as if they won't get paid if you have any for tenants. These are not normal times.

Take a breath. We gave folks forbearance because of the last two hurricanes. This is just another disaster. Part of the business. NONE of the forbearances ever caught up. Just resumed payments or collapsed because they lost it all in Houston. 

I don't believe, as @Mike M. does, that President Trump and republicans are being deceptive in their reasons for this shut down. But I do believe that in this world of weekly precedents, this could be a very long shut down,

@Wayne Brooks

Obliviously they’ll be paid for work that was already done but many contractors had the work stop while their particular agency is shut down.

Those folks won’t be getting paid.

IE - and admin assistant that supports a furloughed executive isn’t coming in and won’t be getting paid.

Originally posted by @Joe Splitrock :

I see mostly emotional response on this thread. I try to keep emotions out of my business and instead predict the future using logic - then plan business actions to best align. So here is my take on where this is headed.

...

This bill (the topic of this thread) will never become law. It is completely illogical to believe that could be possible. Hundreds of bills are introduced and most never even reach the voting process. For this bill to pass, it would require the House of Representatives and Senate majority votes. It would then require the President to sign the bill. There 0% chance that all those things would happen. Why would they agree on this and not a funding bill?

...

Nicely put, Joe. A red rag was waved in front of me, and up I went on my soapbox to preach financial independence to the unwashed masses...

Originally posted by @Joe Splitrock :

I see mostly emotional response on this thread. I try to keep emotions out of my business and instead predict the future using logic - then plan business actions to best align. So here is my take on where this is headed.

No shut down has ever lasted even a month, so it is illogical to believe this would last months longer. Usually the shut downs end after a paycheck is missed, because people start feeling the pain. This translates to outrage and pressure on politicians. The pressure increases exponentially every day, so politicians feel the pressure and come to an agreement due to self-preservation. I know you hear politicians say they are ready to "go months", but that is rhetoric - happens all the time that we see politicians reverse position quickly.

This bill (the topic of this thread) will never become law. It is completely illogical to believe that could be possible. Hundreds of bills are introduced and most never even reach the voting process. For this bill to pass, it would require the House of Representatives and Senate majority votes. It would then require the President to sign the bill. There 0% chance that all those things would happen. Why would they agree on this and not a funding bill?

For landlords who are talking about evicting government employees, it is not be the best business decision. In previous shut downs, employees have received back pay, which makes it most likely that will happen in this case. It means your tenant will get an influx of cash to catch up on rent. Evictions are costly and knowing the money is coming soon, the best financial decision is to ride it out. Eviction will cost three months rent or even much more in some markets. Odds are low it would even last three months and lower that you won't get paid. (If you don't have money to pay your mortgage, that is a different problem with your business).

I can already hear people saying, "but. but. but. Joe, It COULD last for months". Of course it could, but I don't make decisions on what COULD happen, I make decisions on what is LIKELY to happen. 

Exactly turn over kills landlords  to make this situation into a forced turnover would in my mind be a very poor business decision based on panic and some bull headed idea's some landlords have about its my way for the highway.  :)

I checked with my bank, they did cash my January estimated tax check

interesting that section of the government is still operating

:/

In my small little corner of America, I will choose to help my community where and how I can. I don't need a law to force me to do the right thing where possible. Thriving communities are built upon leaders, not bleeders. Compassion, not coercion. And investments, not economic rents.

I'm sure this law is intended to mitigate the myopic throat slashing practices of the big banks that care little for people and communities. I believe the majority of my fellow independent landlords and investors have a soul and wish to walk tall in their community.

Originally posted by @Steve K. :

I checked with my bank, they did cash my January estimated tax check

interesting that section of the government is still operating

:/

I am withholding mine until I hear they are back in business  LOL 

Originally posted by @John Collins :

In my small little corner of America, I will choose to help my community where and how I can. I don't need a law to force me to do the right thing where possible. Thriving communities are built upon leaders, not bleeders. Compassion, not coercion. And investments, not economic rents.

I'm sure this law is intended to mitigate the myopic throat slashing practices of the big banks that care little for people and communities. I believe the majority of my fellow independent landlords and investors have a soul and wish to walk tall in their community.

Maybe the big banks but I can tell U America is built on Community banks serving the communities they operate in.. without them we would be dead in the water..  as it related to the mortgage meltdown that was the secondary market dictated what products to buy that was wall street.. Not your local banks.    

I received comments questioning my claim that federal employees will receive back pay. Please be aware that the house and senate have already passed a bill that states working and furloughed employees will receive back pay. The president is expected to sign this bill:

S. 24 Government Employee Fair Treatment Act of 2019

"Each employee of the United States Government or of a District of Columbia public employer furloughed as a result of a covered lapse in appropriations shall be paid for the period of the lapse in appropriations, and each excepted employee who is required to perform work during a covered lapse in appropriations shall be paid for such work, at the employee's standard rate of pay, at the earliest date possible after the lapse in appropriations ends, regardless of scheduled pay dates."

https://www.govtrack.us/congress/bills/116/s24

Again, just to be clear this is not a proposed bill like the subject of this thread. It is a bill that has passed the house and senate and is waiting on the president to sign, with commitment he will sign it. I am confident you will all get your money.

@Joe Splitrock - if signed, than yes... eventually, but again- I think a landlord would be wise to have their tenant execute a separate contractual document acknowledging the amount owed as it accumulates. This way if someone skips out with their lumpsum pay-out the landlord can walk right into small claims or collections - bi-passing the landlord tenant court. (depending on state)

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