Legislative Changes Coming on January 1, 2020
The 2019 Oregon Legislative Session was one of the oddest and trickiest in recent memory. The Democratic supermajority in both the House and Senate in Salem, along with Gov. Kate Brown created the political opportunity for sweeping legislation. Still, the industry was dismayed by the unyielding and record-setting swift adoption of SB 608 ushering in the first-in-the-nation statewide Rent Control. The drama didn’t stop there as Oregon gained international headlines with the GOP minority in the State Senate walking out of the Capitol Building to prevent a vote on the majority’s signature environmental Cap & Trade bill.
While SB 608 captured the media’s bandwidth on housing policy, there were still a few other bills that have big impacts on the operations of rental housing in Oregon. Most notably, the following three bills will become effective on January 1, 2020.
- SB 484 will require housing providers to pay greater attention to individuals who may apply for vacancies at properties more than once during a 60-day period, as charging a second application fee to the same applicant within 60 days will be prohibited.
- SB 970 will not allow denying an applicant solely for minor marijuana offences or from a status as a medical marijuana patient.
- HB 2530 will require disclosures for veteran’s services contacts with any termination notice. Multifamily NW has created the Oregon Veterans Resource Disclosure (Form M172 OR) for members’ compliance. This form will be available before the end of the year.
After the game-changer SB 608, the 2019 Session did pass several bills to address the lack of housing. Speaker Kotek’s HB 2001 and HB 2002 are notable achievements ensuring higher density zoning and notice protocols for properties leaving a public funding model. The Multi-Unit Tax Exemption was extended through 2032 in SB 262, and lastly HB 2006 established grants and support programs aimed to educate Oregon’s most vulnerable citizens on landlord/tenant law, fair housing and various support services.
SB 484 – Prohibiting Multiple Rental Application Fees
Effective Date: January 1, 2020
Background and Current Law: It is common practice for landlords to ask potential renters to pay the cost of processing and screening their applications. For those who complete multiple applications, these fees add up quickly.
Bill Summary: Senate Bill 484 requires one fee per applicant, when applications are made to rent one of multiple units owned or managed by the same landlord, within a 60-day period.
SB 970 – Excluding Marijuana Offenses from Rental Applications
Effective Date: January 1, 2020
Background, Current Law and Bill Summary: Senate Bill 970 touches on a number of landlord/tenant issues, however its broadest language effects all residential landlords. Currently landlords are allowed to consider whether a potential renter has committed certain crimes when evaluating their application. Senate Bill 970 excludes prior convictions solely for minor recreational use or possession of marijuana and also prohibits landlords from considering an applicant's status as a medical marijuana patient.
HB 2530 – Tenant Termination Notices for Veterans
Effective Date: January 1, 2020
Background and Current Law: According to data presented by the U.S. Department of Housing and Urban Development (HUD), the State of Oregon had an estimated 1,251 veterans experiencing homelessness in January 2017. Since that time, homelessness among military veterans has increased by nine percent, to 1,363, according to HUD statistics from November 2018. Whenever tenancies terminate in eviction or foreclosure, certain notice and documents must be provided to renters or homeowners, to inform them about the process, what to do, and any corresponding deadlines.
Bill Summary: House Bill 2530 requires certain notices to renters and homeowners regarding termination of tenancy to include information about assistance that may be available for eligible veterans, as well as contact information for the county veterans' service officer, community action agency, or 2-1-1 referral service. Multifamily NW has created form M172 OR Veteran's Resource Disclosure for compliance with HB 2530.
SB 608 – Rent Control and Prohibiting No-Cause Evictions after One Year of Occupancy
Effective Date: February 28, 2019
Background and Current Law: Landlords may evict tenants for a variety of reasons, including for nonpayment of rent and other violations of rental agreements. Both landlords and tenants are generally allowed to terminate month-to-month tenancies without cause, with 30 days’ notice (although some localities, like Portland, have different notice requirements). Fixed-term tenancies can also be terminated without cause by either landlords or tenants at any time during the tenancy with 30 days’ notice prior to the end of the term, or with 60 days’ notice after the end of the term. Rent increases are prohibited in the first year of a month-to-month tenancy and 90 days’ notice of same is required. There are currently no other restrictions on the number or amount of rent increases that may be imposed on a month-to-month tenancy.
Bill Summary: Senate Bill 608 prohibits evictions without cause after the first year of occupancy and adds the following circumstances to the existing list of reasons that a landlord may evict a tenant for-cause: when the premises are sold to a buyer as a primary residence; when the premises will be occupied by the landlord or an immediate family member; or when the premises are being renovated, or demolished, or removed from residential use. If a landlord uses one of the new reasons to evict, they must provide 90 days’ notice and one month's rent to assist the tenant with relocation (except two-unit or less, owner-occupied properties, and landlords with four or fewer dwelling units). Senate Bill 608 also provides for fixed-term tenancies to convert to month-to-month unless the parties agree to a new term or a tenant has received at least three written, contemporaneous warnings about violations in the preceding 12 months. Finally, Senate Bill 608 limits rent increases to no more than seven percent plus the average change in the consumer price index, no more than once in any 12-month period, unless: the premises are considered new construction, or the landlord is resetting rent for a new tenant after a compliant tenant vacated voluntarily, or the rent is subsidized.
SB 262 – Extended the Multi-Unit Housing Property Tax Exemption
Effective Date: September 29, 2019
Background and Current Law: Local jurisdictions are authorized to design programs that attract development of multiple-unit housing by means of property tax exemptions. Programs are required to preserve, construct, add, or convert existing units, at rental or purchase prices that are within reach of a broad range of the general public. The multi-unit housing property tax exemption is utilized by many communities and considered integral to the development of affordable housing but is scheduled to sunset in 2022.
Bill Summary: Senate Bill 262 maintains the property tax exemption used to encourage development of multi-unit housing by extending the sunset to 2032.
HB 2001 – Requiring Higher Density Residential Development
Background and Current Law: Local jurisdictions in Oregon are required to prepare comprehensive land use plans that are consistent with implementation of a set of statewide planning goals, overseen by the Land Conservation and Development Commission (LCDC) which governs the Department of Land Conservation Development (DLCD). The goals establish state policies on urban and rural land uses, resource conservation, economic development, affordable housing, urban growth, coastal protection, natural hazards, and citizen involvement. Zoning and regulation at the local level must be consistent with the relevant comprehensive plan and is used to encourage and discourage types of development. Typical local zoning can create discrete industrial, business, and residential areas, and exclusive residential zones that allow only detached, single-family homes are common.
The current lack of available, affordable housing inspired a number of approaches to increase the supply of housing of all kinds, particularly for households of modest means, including “middle housing.” Middle housing refers to housing that can accommodate more occupants than a single-family home, but less than a large multifamily complex, such as duplexes, row houses, cottage clusters, stacked flats, and accessory dwelling units.
Bill Summary: House Bill 2001 requires certain local jurisdictions to allow the development of middle housing, as defined by the measure, in areas currently zoned for single-family dwellings within their urban growth boundaries. The measure also addresses the conversion of existing single-family dwellings into middle housing.
Cities with populations of 10,000 or more are required to allow duplexes on lots or parcels zoned for single-family homes. Cities and counties within a metropolitan service district and cities with populations of 25,000 or more, must allow middle housing in areas zoned for single-family dwellings, and must allow duplexes on individual lots or parcels zoned for single-family homes. Cities within a metropolitan service district that have populations less than 1,000 are excluded, as are unincorporated lands and lands that lack sufficient access to urban services. Local jurisdictions are required to conform their comprehensive plans and land use regulations within a certain timeframe or adopt model ordinances prepared by DLCD in consultation with the Department of Consumer and Business Services (DCBS). The measure also makes a number of adjustments related to how local jurisdictions currently calculate and report on housing development and future housing needs. DLCD is required to provide technical assistance and is appropriated $3,500,000.
To address the division of existing single-family homes, the measure requires DCBS to establish uniform standards for cities that provide for such division, into no more than four dwelling units each. Cities are required to approve or deny applications for such conversions within 15 business days and must provide an administrative process for applicants to appeal denials within 30 days.
Finally, the measure voids provisions in any recorded instruments affecting real property that are executed after its effective date, that allow the development of a single-family dwelling while prohibiting middle housing or an accessory dwelling unit.
HB 2002 – Withdrawal Notice for Publicly Supported Housing
Effective Date: January 1, 2010
Background and Current Law: In Oregon, property owners who participate in federal housing programs designed to keep rents affordable for tenants are required to provide notice to each local government that has requested it, each affected tenant, and the Oregon Housing and Community Services Department (OHCS) when their contracts with the U.S. Department of Housing and Urban Development are going to expire. In 2017, the Legislative Assembly passed House Bill 2002 requiring such notice to be provided two years before contract expiration or any other event causing the property to be withdrawn from the pool of publicly supported housing and allowing local governments to impose penalties for failure to provide such notice.
Bill Summary: Requires the owner of participating properties to provide notice to the Oregon Housing and Community Services Department (OHCS) and each local government that is entitled to such as a qualifying potential purchaser in a manner prescribed by OHCS, between 30 and 36 months prior to the date the contract term will expire, permitting an owner to withdraw the property from publicly supported housing or to limit affordability restrictions. Provides for penalties for failure to comply. Allows property owners to withdraw from publicly supported housing requirements or terminate affordability restrictions under certain circumstances.
Requires a property owner, when the purchased property is being withdrawn from publicly supported housing, to give notice to OHCS. Specifies that local governments and OHCS are not required to purchase or condemn any property or to maintain affordability restrictions. Prohibits property owners from acting during contract term that would materially interfere with qualified purchaser’s ability to maintain participating property as publicly supported housing.
HB 2006 – Access to Housing and Tenant Legal Services
Effective Date: August 8, 2019
Background and Current Law: The 2018 Oregon Alliance to End Violence Against Women statewide survey identified housing stability as the greatest issue facing survivors of domestic violence in both rural and urban communities across the state. According to a study undertaken by the Oregon Law Foundation, housing continues to rank among the top legal problems experienced by Oregon’s population. Over half of Oregon renters pay more than a third of their income for housing, and many pay more than 50 percent.
Bill Summary: House Bill 2006 establishes grants to support programs related to tenant and landlord education services, fair housing training, and assistance for low-income Oregonians and survivors of domestic violence or sexual assault to find and access rental housing, and tenant legal services.