April Showers the Rental Housing Industry with New Legislation

With April showers comes new rental housing legislation. Amongst bills ranging from ‘ban the box’ employment screening procedures to rent control, legislators across the nation are anxious to reform old rental housing regulations and create new requirements. Although some multifamily bills have passed, the majority of this month’s legislative update is still on the chopping block (for better or worse). Take a look at passed, pending, and future rental housing bills nationwide and in your property’s state.

Nationwide | Arizona | California | Georgia | Hawaii | Illinois | Indiana | Maryland | Missouri | Pennsylvania | Oregon | South Dakota | Washington

 

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NATIONWIDE

PENDING: Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155)

This gigantic, 193-page bill aims to do multiple things. Among them, S. 2155 will amend the United States Housing Act of 1937 to reduce inspection and environmental-review requirements for some public-housing agencies, and change the eligibility requirements of the Family Self-Sufficiency Program (FSS). This bill will also revise credit reporting requirements to require credit reporting agencies to provide credit-freeze alerts and consumer-credit provisions to minors and veterans.

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PENDING: Tenant Protection Act (S. 1758)

The Tenant Protection Act will amend the Fair Credit Reporting Act (FCRA) with further requirements for landlords and consumer reporting agencies (your tenant screening provider). The use of eviction records, or “housing court records”, will become more limited under this bill. Tenant screening providers will be prohibited from using eviction records (or any other court records pertaining to housing) in their resident screening report unless 1) the record resulted in a judgment of possession; 2) the decision of the court in the record’s case is not being appealed; and 3) the record is no more than 3 years old. Since being introduced on August 3, 2017, this bill has not made any progress. You can expect to hear more about this bill this year.

Presently, eviction records are allowed to date back up to 7 years in most states, and may include both judgments and filings so as to inform properties about applicants who demonstrate a trend of poor residency.

PENDING: FCRA Liability Harmonization Act (H.R. 2359)

Introduced in the House on May 4, 2017, this bill aims to amend the civil liability requirements under the FCRA, specifically the requirements with class actions. As currently proposed, this act would prohibit courts from applying a minimum amount of damages for each member of the class, with fees (excluding attorney’s fees) not exceeding $500,000. Since its introduction to congress this bill has had hearings held by the Subcommittee on Financial Institutions and Consumer Credit on September 7, 2017. You can expect to hear more about this bill this year.

PENDING: Certainty in Enforcement Act of 2017 (H.R. 1646)

This bill would amend the equal employment opportunity requirements under the Civil Rights Act of 1964 to deem an employer’s use of credit or criminal records (as mandated by federal, state, or local law) to be job related and consistent with business necessity. H.R. 1646 would make it so that the use of criminal or credit reports for lawful employment purposes would not be the basis of liability under any theory of disparate impact.

FUTURE: Liberian Deportation Protections Removed

The Trump administration has announced that they will be ending the Deferred Enforcement Departure program which allows citizens of Liberia living in the U.S. to avoid deportation. There will be a one year “wind-down” period. This is similar to the Temporary Protected Status rollbacks that were announced late last year.

 

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ARIZONA

PASSED: Property Tax Appeals (HB 2385)

Signed by the Governor on March 23, 2018, HB 2385 revises the property tax values appeal process. If the court finds that the county assessor’s valuation is insufficient, the full cash value required will not be greater than the full value initially determined by the county assessor and appealed by the taxpayer. This applies to appeals filed in court dating back to January 1, 2017.

PENDING: Security Deposits (HB 2263)

HB 2263 would change the regulations on security deposits – making it so that if a tenant does not dispute the deductions from a security deposit (or the amount due and payable) within 45 days after the tenancy termination, the amount due is final. If this bill passes all further claims will be waived.

PENDING: Landlord Tenant Act (SB 1376)

This bill revises the procedures Arizona property owners must do when handling a tenant’s abandoned private property. Landlords will not be responsible for storing a tenant’s perishable items, plants and animals on behalf of the tenant. Personal property that is contaminated (poses a health and safety risk) may be disposed of at the property owner’s discretion. Additional changes may apply.

PENDING: Alterations Exemption Eliminated (SB 1409)

This bill eliminates “alterations” from the Maintenance, Repair, Replace, Alterations (MRRA) exemptions for the purposes of prime contracting.

 

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CALIFORNIA

IN EFFECT: Water Saving Fixtures (SB 407)

Be aware that the deadline to switch your plumbing fixtures to meet California’s water-saving standards is January 1, 2019. This applies to pre-1994 multifamily housing and is a part of SB 407, which was passed October of 2009.

PENDING: Accessory Dwelling Units (SB 831)

SB 831 eliminates some of the regulations and fees regarding accessory dwelling units (also known as granny flats or in-law units). These include eliminating all local agency, school district, special district and water corporation fees, requiring an accessory dwelling unit application to be automatically approved if a local agency does not act within 120 days, and allow for the creation of an accessory dwelling unit on lots with existing or proposed homes. If this bill passes setbacks will be no greater than 5 feet and create an amnesty program that would ease the permitting process (active until 2026).

PENDING: Withholding Transportation Funds until Housing Quota Met (AB 1759)

This bill would require each city or county to meet the minimum housing production goal (as is written in their general development plan) in order to be eligible to receive a portion of the Road Maintenance and Rehabilitation Program’s remaining funds. This bill is co-sponsored by the California Apartment Association and the California Association of Realtors.

PENDING: Price Gouging During a State of Emergency (AB 1919)

AB 1919 would make it a misdemeanor for a person, business, or other entity to increase the monthly rental price to an existing or prospective tenant by more than 10% within 30 days of a declaration of emergency. It would also be a misdemeanor to evict a tenant after the proclamation of a state of an emergency for the purpose of renting the property out. AB 1919 would also create a state-mandated local program to monitor and manage this new crime.

PENDING: Homeless Youth Act of 2018 (SB 918)

This bill would establish $60 million in grants from the cannabis tax and other funds to California’s growing homelessness crisis, particularly among minors, and create an Office of Homelessness Youth within the Department of Housing and Community Development (HCD). No more than 40% of the total funds granted in a given year would be used for shelter programs.

PENDING: CalWORKS Housing Assistance (AB 1921)

AB 1921 would allow family recipients of CalWORKS to 16 total days of temporary housing assistance regardless of interruptions. It would also allow recipients to use their payments towards shared housing.

PENDING: Homeless Persons Services Block Grant (AB 3171)

Introduced by Assemblymen Phil Ting (D – San Francisco) and Ricardo Lara (D – Los Angeles), this bill would establish a Local Homelessness Solutions Program and create the Local Homelessness Solutions Account, which would provide funding to aid impacted cities. Funds drawn from the general fund to homelessness solutions account would go towards shelter diversion, rapid rehousing, and permanent supportive housing.

PENDING: Just Cause Evictions (AB 2925)

Promised by Assemblyman Rob Bonta (D - Alameda) AB 2925, would impose ‘just cause’ eviction controls. The full details of the bill have yet to be created (subscribe to receive updates).

PENDING: Eviction Process Changes (AB 2343)

This bill would require landlords to wait longer before starting the eviction process. Supported by Assemblyman David Chiu (D – San Francisco), the eviction wait time would be extended to 10 days when a tenant has failed to pay the rent and 5 days when a tenant violates the lease under this bill. Tenants would also have 14 days (rather than 5) to respond to the eviction suit.

PENDING: Evictions due to Unlawful Weapons (AB 2930)

Existing law allows rental properties in the City of Los Angeles, Long Beach, Oakland and Sacramento to file for an action on an unlawful detainer to abate the nuisance caused by illegal conduct involving unlawful weapons or ammunition. This law will sunset on January 1, 2019. AB 2930 would eliminate the sunset date and impose a state-mandated local program.

PENDING: Ellis Act Revisions (AB 2364)

AB 2364 would weaken the Ellis Act (which protects property owner’s rights to leave the rental housing industry) and place greater requirements on it. If this law passes the 5-year withdrawal period (in which accommodations, plus annual adjustments, must be offered to tenancies within the withdrawal period) will be extended to 10 years. If the property is vacant when the property owner files for withdrawal, applicable owners will have to extend the accommodations to displaced tenants. Currently, the Ellis Act places provisions on owners who decide to lease the property within 2 years after leaving the industry. AB 2364 would extend that to 5 years. Additional restrictions apply to properties within rent controlled cities and counties.

FUTURE: California Rent Control Initiatives

A ballot initiative to repeal the Costa-Hawkins Act (an act that prohibits local governments from regulating the price of rent) has been filed. The measure has not yet qualified to be put on the ballot on November 2018. Activists will have until June 28th, 2018 to collect valid voter signatures.

You should also be aware that tenant’s rights activists are preparing to launch separate rent control initiatives in the following cities: Glendale, Inglewood, Long Beach, Pasadena, Sacramento, and Santa Cruz. The majority of these groups in the above cities are still collecting signatures. None have officially made it to the ballot yet.

FAILED: Repeal the Costa-Hawkins Act (AB 1506)

This bill would have repealed the Costa-Hawkins Act, which currently prevents cities and counties throughout California from adopting restrictive rent control policies. It failed in committee earlier this year.

 

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GEORGIA

PENDING: Lease Termination under Family Violence Circumstances (HB 834)

HB 834 would allow tenants to terminate a rental lease agreement in order to escape family violence. The tenant will be responsible for any unpaid rent, prorated to the effective date of the termination. This will apply to lease agreements entered into, on, or after July 1, 2018. This includes renewals, modifications, or extensions of the agreement on or after such date. HB 834 is on its way to the governor’s desk and will likely pass.

 

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HAWAII

PENDING: Residential Landlord-Tenant Code Amendment (HB 223)

This bill allows property managers and owners to charge a tenant screening fee to cover the costs of the tenant screening. This fee shall not exceed $25.

 

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ILLINOIS

PENDING: Recreational Marijuana Ballot Initiative

Be aware that a measure that would place a ballot question on whether recreational marijuana should be legalized and taxed in Illinois cleared the Senate and will now move onto the House. This ballot question would only be advisory, so even if citizens do vote in favor of legalizing marijuana, lawmakers would still need to pass an official bill. Considering that the state has already legalized medical marijuana, and this measure cleared the senate in a 37-13 vote, it is highly likely that a bill supporting recreational marijuana will pop up in the next few years.

PENDING: Statewide Rent Control (HB 2430 and SB 2310)

Both of these bills aim to repeal the Rent Control Preemption Act, which currently prohibits local governments from enacting rent control. Additionally up to 10 wards in the city of Chicago will see a proposal on the topic on the March 20th primary ballot. The Gazette Chicago reports that this includes the 1st, 3rd, 4th, 12th, and 25th wards.

Learn More About Rent Control!

 

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INDIANA

PASSED: Emotional Support Animal Restrictions (SB 240)

SB 240 places limitations on who may use and who can prescribe an emotional support animal. Verification must come from “health service providers” who are licensed within Indiana, including psychiatrists, physicians, psychologists, advanced practice nurses or those licensed by the Behavioral Health and Human Services Licensing Board. There are some additional requirements in place for residents who move from out of state as well. This was signed into law on March 21, 2018.

 

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MARYLAND

PENDING: Statewide ‘Ban the Box’ (HB 541)

This bill would prohibit applicable employers from requiring an applicant to disclose information about their criminal record or conducting a criminal history check before a conditional offer of employment is extended.

Learn More about ‘Ban the Box’!

 

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MISSOURI

PASSED: Kansas City, MO’s ‘Ban the Box’ Ordinance

Effective on June 9, 2018, employers with 6 or more employees within the city are prohibited from basing their hiring (or promotional) decision on an applicant’s criminal history, unless the employer can prove that the decision was based on available information. Employers may inquire into an applicant’s criminal history only after determining they are otherwise qualified for the position and have been interviewed.

 

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PENNSYLVANIA

PENDING: Philadelphia, PA ‘Just Cause’ Eviction Ordinance

A ‘just cause’ eviction bill passed the committee on February 13th will go before the full Philadelphia City Council soon. According to the Philadelphia Business Journal, the bill defines a ‘just cause’ (or “good cause”) as non-payment of rent, property destruction, or non-conformation to the terms of the lease. Property owners would be required to provide 20 to 60 days’ notice before an eviction or substantial lease change (like a rent increase).

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OREGON

PENDING: Portland, OR Relocation Fee Extension

Portland’s current eviction policies are unique in that it does allow no-cause lease terminations, but requires property owners to pay the tenant’s relocation fees if they choose to cut their tenants loose without cause, or raise the rent by at least 10%. While the Mandatory Rental Relocation Assistance law is scheduled to sunset in April, commissioners are planning on passing a permanent version that will extend to single-family homes and condos.

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SOUTH DAKOTA

PASSED: Assistance Animals Housing Documentation (SB 119)

This new law requires that support animal verification “originate from a licensed health care professional who does not operate in this state solely to provide certification for service or assistance animals.” If a property owner discovers a tenant has made a false claim to a disability which requires the use of a service or assistance animal (or provides fake supporting documentation), SB 119 provides new procedures to enable the owner to evict the tenant.

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WASHINGTON

PASSED: Washington State’s Fair Chance Act (HB 1298)

Signed into law on March 13, 2018, the state’s new Fair Chance Act prohibits employers from inquiring about a job applicant’s arrests or convictions before they have received a conditional offer of employment. This law goes into effect on June 6, 2018 and will have no impact on existing local laws with additional ‘ban the box’ protections (like the City of Seattle).

For more information on this ‘ban the box’ law, click here

PASSED: Spokane, Washington Employment Regulations

Spokane, Washington has also enacted their own ‘ban the box’ ordinance. This law goes into effect on June 14, 2018 and affects all private employers.

FAILED: Statewide Rent Control (HB 2583)

The state’s rent control bill died in committee after failing to meet the legislative cutoff date.

 

Which Rental Housing Legislation Sticks Out the Most to You?

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About the Author

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Becky Bower is the Communications Executive here at the Resident Screening Blog. She holds a degree in English, with a focus in creative writing, from CSU Channel Islands. Her biggest weakness is cake and favorite superhero is Batman.