After more than a year of operating under the Governor’s Evictions and Related Housing Practices Proclamation 20—19 et seq. (the “Governor’s Proclamation”), which significantly restricted residential landlords’ ability to raise rent, enforce rules, remove tenants, and collect delinquent rent and fees, there is some light at the end of the tunnel for landlords. On April 22nd, Governor Inslee signed new legislation (Engrossed Second Substitute Senate Bill 5160), which will end the Eviction Moratorium as of July 1, 2021. But this legislation added new protections for residential tenants and extended and incorporated into the legislation many of the other protections from the Governor’s Proclamation.
Some of the significant changes in the new law include:
1. A permanent ban on late fees through January 1, 2022. Landlords will not be able to collect late fees that accrued between March 1, 2020 and six months following the expiration of the Governor’s Proclamation.
2. Limits on Information Shared with Prospective Landlords. When landlords are used for reference checks on past tenants, the landlords cannot report any eviction action that occurred, or delinquent rent that accrued, between March 1, 2020 and six months following the expiration of the Governor’s Proclamation (i.e., January 1, 2022).
3. Limits on Information Landlords can Inquire of Prospective Tenants.
Landlords cannot inquire, consider, or require the disclosure of a tenant’s or prospective tenant’s medical history, except as allowed to evaluate a tenant’s request for reasonable accommodation or modification.
4. Repayment Plans for Delinquent Rent Accrued Since March 1, 2020.
Landlords must offer tenants repayment plans for delinquent rent accruing between March 1, 2020 and the later of i) six months following the expiration of the Governor’s Proclamation (i.e., January 1, 2022) or ii) the end of the Governor’s Public Health Emergency declaration. The monthly repayment installments cannot exceed one-third (1/3) of the regularly monthly rental charges. Landlords must offer this repayment plan prior to commencing an unlawful detainer action for delinquent rent accrued between March 1, 2020 and the later of i) six months following the expiration of the Governor’s Proclamation (i.e., January 1, 2022) or ii) the end of the Governor’s Public Health Emergency declaration.
5. Eviction Resolution Pilot Program and Tenant Right To Counsel.
In select counties, the County Dispute Resolution Centers will pilot a program to use alternative dispute resolution methods, such as mediation, seeking to resolve non-payment of rent and other issues prior to filing an unlawful detainer. This pilot program will run through July 1, 2023. The legislature is funding legal service providers to represent indigent tenants in unlawful detainer actions. Subject to available funds, tenants qualify for this program if the tenant has income, after taxes, below 200% of the federal poverty guidelines or already receives other types of public assistance.
6. New Notice and Summons Requirements.
The legislation requires landlords include new language in the 14-day pay or vacate notices and summons for unlawful detainer. This language can be found in E2SSB 5160 Section 10 starting on Page 15.
Landlords who violate these rules could face civil penalties and be liable for tenants’ court costs and attorneys’ fees.
The End of No Cause Evictions on Month-to-Month Leases
Effective on May 10, 2021, the Governor signed separate legislation impacting residential landlords’ ability to terminate tenancies at the end of a lease term or terminate indefinite period tenancies (i.e. month to month) without cause (Engrossed Substitute House Bill 1236). This legislation prevents a landlord from ending a periodic tenancy (month-to-month lease) unless the landlord can demonstrate just-cause based on one of 16 reasons listed in the statute, some of which require the landlord give 90-day advanced notice to the tenants. For Example:
1. If a landlord wants to personally occupy the property, or has family that will personally occupy the property, the landlord must give 90 days’ advanced written notice prior to terminating the month-to-month lease.
2. If a landlord wants to sell the property, the landlord must give 90 days’ advanced written notice prior to terminating the month-to-month lease.
3. If a landlord has other legitimate economic or business reasons to terminate, the landlord must give 60 days’ advanced written notice, which a court could extend by another 60 days if the tenant shows good cause.
These restrictions on no-cause termination of tenancy also apply to landlords who initially offer a lease for a specific term and then allow the tenants to continue after the expiration of the original term on a month-to-month basis, unless the initial lease term is at least 6 months and the landlord provides 60 days’ advance notice of non-renewal before the end of the initial lease term. Landlords that only offer leases for specific terms or durations are also subject to the no-cause termination restrictions, unless the lease term is at least 12 months and the landlord provided 60 days’ advanced notice of non-renewal before the end of the initial lease period. Violations of this proposed legislation could be significant for landlords, as tenants have a statutory right to seek the greater amount of either the tenants’ actual damages or three times the monthly rent, plus attorneys’ fees and costs.
It is recommended that landlords review and update their leases and develop forms and procedures to provide tenants with notice prior to the expiration of their lease terms. Also, check your local regulations for additional landlord tenant laws, as many cities and counties are adopting additional residential leasing regulations.
Impact of new state legislation on CDC Order:
In September 2020, the Center for Disease Control (“CDC”) issued an order halting residential evictions in response to the COVID-19 Public Health Emergency [for a summary of the CDC Order, see Article: CDC Eviction Order]. It is still the case that the CDC Order overrides less restrictive state law protections for tenants. However, unlike the state laws, the CDC Order requires the tenant seeking the Order’s protection to provide a declaration under penalty of perjury addressing five criteria in the CDC Order. As a result, the CDC only applies where a tenant completes the required declaration.
The CDC Order remains in place through June 30, 2021. However, the future of the CDC Order may be in question: On May 5, 2021, the United States District Court for the District of Columbia vacated the CDC Order because it exceeded the authority of the CDC in Alabama Association of Realtors, et al., v. United States Department of Health and Human Services, et al. This order was immediately appealed by the U.S. Justice Department, and on May 14, 2021, the U.S. District Court granted the Justice Department’s Emergency Motion to Stay the Order overturning the CDC Order pending an appeal of the Court’s decision. So, the CDC Order remains in place, for now.
Please contact Tim Schermetzler at Chmelik Sitkin & Davis P.S. if you have questions about your residential leases or need assistance.