City Council passes proposed moratorium now under review by the mayor.
4/30/2020 14:00
The Los Angeles City Council unanimously passed a proposal April 30 for Mayor Eric Garcetti to impose a moratorium on debt collection while the city’s Safer at Home Order is in place through May 15.
The proposal is non-binding and currently does not change collection policies in Los Angeles. The mayor is reviewing the authority to implement a moratorium, enforce it, or may consider a modified version. Under the proposal, Councilwoman Monica Rodriguez also seeks to classify debt collection agencies as non-essential businesses while the city’s order in in place.
Industry representatives from the California Association of Collectors (CAC) spoke at the council’s April 30 meeting and identified concerns that "unintended consequences" in the moratorium could negatively impact consumers, The Los Angeles Times reports.
"Professional debt collectors are a resource for the community, and an all-out moratorium on collections would take that important resource away," CAC president, Shawn Suhr, told the council, according to the article.
During the meeting, members also said collections agencies should be able to remain in operation for payments and working on "legally required functions," it reports.
ACA International member Patricia Lopez, vice president of operations for USCB America in Los Angeles, called into the city council’s meeting on behalf of her company and its work with clients, including hospitals.
"One of our largest partners is the Los Angeles County health care system — basically the front lines on diagnosing and treating the COVID-19 virus, as well as other local government agencies who we partner with closely," Lopez said, according to The Los Angeles Times article. "Shutting down collection agencies will actually hurt many of Los Angeles’ residents and businesses."
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