Legal/Legislation

NEW NEW TENANT SCREENING RULES TAKE EFFECT JUNE 7, 2012 We want to remind our members that new tenant screening rules take effect June 7, 2012. The new rules were adopted by the legislature during the 2012 session and supported by a variety of landlord organizations. The new rules will probably not change the way you have been conducting screenings but a short review is a good thing. The law requires landlords to advise applicants about all rental criteria that may result in denial of tenancy. This list can be given to the applicant or posted at the property. In order to reduce or eliminate the possibility that a rejected applicant might claim that the list was not provided, we suggest both posting and giving all applicants a copy. The list could be printed on the back of your application. You should also think about how you will provide the information to people who apply on-line. Landlords are also required to tell applicants what types of information will be accessed to conduct the screening; provide the name and address of the consumer reporting agency; and tell the applicant of his/her rights to obtain a free copy of the consumer report in the event of denial or other adverse action and to dispute the accuracy of information in the consumer report. The second part of the new law requires landlords to give written “adverse action" notices to affected applicants. As most of you may know, the term adverse action includes but is broader than an outright denial or rejection of the applicant. The law provides a form that landlords must follow to provide the notification. It is important that landlords follow the form as closely as possible because the law requires that the “adverse action notice must contain the following information in a substantially similar format….” One basis for denial that is not clearly covered by the new law is a denial based on “misinformation” on the application. For example, the applicant may have given a name and social security number that don’t match. This would usually be reported by the screening service in the consumer report and we suggest that you check this box if the denial is based on “misinformation.” You might also check the next box indicating that the report did not contain sufficient information. If there is more than one reason for denial you should check all boxes that apply. The form consists of two sections. In the first section, the landlord advises the applicant that the application has either been rejected or approved with conditions and describes the conditions. In the second section, the landlord advises the applicant of the basis for the rejection or conditional approval. As usual, we urge you to consult and work with your chosen screening company to make sure that you are in compliance with the new law when it takes effect. CLICK HERE TO DOWNLOAD THE REQUIRED ADVERSE ACTION FORM.   We are pleased to present this legislative update from PSA's affiliated partner, WMFHA   GOVERNMENT AFFAIRS UPDATE - July, 2011 For questions about Washington Multi-family Housing Association’s legislative efforts or to get involved in Government Affairs, please contact WMFHA’s Director of Government Affairs, Joseph Puckett at gac@wmfha.org. IMPORTANT ALERT NEW CREDIT REPORT RULES TAKE EFFECT JULY 21, 2011 As a part of the massive piece of legislation Congress passed last year to regulate Wall Street and financial institutions is a provision that amends the Fair Credit Reporting Act (FCRA). This change to FCRA potentially affects landlords and their tenant screening processes. The amendment to FCRA requires disclosure of the credit score to a consumer when person or business takes an adverse action against a consumer based in whole or in part on a numerical credit score. This is a new disclosure requirement and is scheduled to go into effect on July 21, 2011. The terms “credit score” and “adverse action” are defined in FCRA. The definitions are included in the guidance prepared by NAA and NMHC that is a part of this alert. We urge all owners and property managers to review the guidance carefully and consult with counsel to determine the best course of action to take in light of these new requirements. As pointed out in the guidance, “if you or your screening company use a credit score as defined in FCRA Section 609(f)(2)(A), i.e., one used by lenders to arrange loans, in order to determine renter eligibility, AND, you take an adverse action …then you must provide the new credit score disclosure along with the adverse action notice already required under FCRA." CLICK HERE to print the NAA/NMHC guidelines. Best Regards, Joe Puckett Director of Government Affairs Washington Multi-Family Housing Association   May 9, ~ STATE LEGISLATURE This has been a relatively quiet legislative session for landlord-tenant matters. This is primarily due to the extensive negotiations that took place last fall between landlord and tenant advocates regarding changes to the Residential Landlord Tenant Act. The only bills that are still under active consideration in Olympia are ones that affect the budget. If you want more information about any particular bill, you can go to the legislative website http://www.leg.wa.gov click on "bill information" in the left hand column, and type the number of the bill that you want to review in the box entitled "search by bill number." HB 1416/5289: B&O TAXESThese bills are attempts to slightly modify the legislation passed last year that imposed B&O tax obligations on property management companies for the wages paid to onsite employees. They provide that if a limited partnership or a limited liability company owns the property and a housing authority is the sole general partner or sole managing member then the onsite wages are exempt from B&O taxes. The House version appears dead but the Senate version is still alive and is in the Senate Ways and Means committee. HB 1793: JUVENILE CRIMINAL RECORDS This bill has several sections and one that could affect landlords. Section 2 would prevent a screening company from disclosing the juvenile criminal history of an applicant if the applicant is 21 or over when the application is made. The bill has passed the legislature and been delivered to the governor for signature. Landlords and screening companies have asked the governor to veto Section 2 of the bill because it is bad policy and because it conflicts with the federal fair credit reporting act. We expect a decision by the governor in the next two weeks. CARBON MONOXIDE ALARMS At present, there are temporary regulations in place that require the installation of CO alarms in existing rental units by January 1, 2013 if the units have fuel fired appliances. These regulations are likely to change. In January, the State Building Code Council appointed a Technical Advisory Group (TAG) to investigate and make recommendations for new regulations. Joe Puckett was invited to serve on the TAG which met for 2 months and approved recommendations that have been forwarded to the SBCC. The Council will consider the recommendations and then propose new regulations sometime this summer. Public hearings on the proposed regulations will be held in the early fall and the revised regulations should be adopted by November 2011. Further information on CO alarms is available on the SBCC website https://fortress.wa.gov/ga/apps/sbcc/default.aspx. SEATTLE INSPECTIONS In January, a taskforce was appointed to work with the Department of Planning and Development to develop a report to the city council regarding licensing and inspections of rental properties in the city. Joe Puckett was asked to serve on that taskforce. The group began meetings in February and its last meeting is set for May 12. After the final meeting, DPD will draft the report and it will be reviewed by the taskforce. The report and perhaps a minority report will then be delivered to the council sometime this summer. Information about the taskforce and the inspection issue is available on the DPD website www.seattle.gov/dpd/compliance/rentalhousing/overview/default.asp. EX-OFFENDERS AS A PROTECTED CLASS Late last year, the Seattle Office of Civil Rights (SOCR) put forth a proposal that would make ex-offenders a protected class in Seattle in both housing and employment. The proposal would allow a convicted felon to file a complaint of unlawful discrimination with SOCR if he/ she felt that he/she had been rejected for housing or employment because of his/her criminal history. SOCR stated that this proposal was similar to law in Madison, Wisconsin and would help to reduce recidivism. Landlords and employers strongly objected to the proposal and met with both SOCR staff and members of the city council. Although landlords make recommendations to SOCR for changing the proposal to make it more palatable, no changes have been made. Landlords also met with members of the council and it currently appears that the proposal has lost momentum but may reappear in a different form that is perhaps limited only to employment. Further information can be found on the website of the Seattle Human Rights Commission www.seattle.gov/humanrights