Industry News

RHA Legislative Update - Week of April 13th

Fri, 17 Apr 2015 13:18:00 -0900

Rental Housing the Association of Washington Legislative Report for the week of  April 13th, 2015.

Opposite House Cutoff

 

Policy Bill Cutoff

Wednesday the 15th of April marked the final day of policy bills for consideration on the floors of the house and senate chamber. After 94 days of committee hearings, floor debate, and stakeholder negotiations the legislature is done with it’s major policy work, and will now turn its sole focus towards the difficult task of producing agreed upon budgets for the state’s operation and capital expenditures.  The only bills that are allowed past the floor cutoff deadline are those which are designated Necessary to Implement the Budget (NTIB) and must contain policy which affects budget appropriations.

HB 2156 – Increasing Taxing Authority for Cities

There is one important NTIB bill remaining that could significantly effect property owners. HB 2156 Relating to promoting the fiscal sustainability of cities and counties is an omnibus bill containing many policy ideas that did not make it through the legislative process in their own separate bills. The current language of HB 2156 would give cities, among other things, an increased share of liquor revenues, a new property taxing authority for funding cultural access programs, and allow certain classifications of cities to obtain a priority lien (above mortgages) on nuisance abatement assessments up to $2,000.  The bill would also allow counties to impose a new public utility tax. 

Many varied business interests and utilities oppose portions or all of the current language of HB 2156. RHA’s government affairs team will work alongside those interests and our property ownership coalitions to amend and defeat the provisions of the bill that adversely affect property, if not stop the bill entirely. HB 2156 will be heard Friday morning the 17th in the House Finance Committee. The bill will have to move through both the House and Senate in the upcoming days in order to be considered for signature. There are many hurdles and opportunities for amendment in front of the bill, as budget negotiations move along.

Deceased Tenant Bill Passes House and Concurred with in Senate

This week House passed the deceased tenant bill and the Senate concurred with the legislation as it came out of the House. The final language was agreed upon by all stakeholders and passed the House unanimously, which is a remarkable occurrence for a bill lobbied by rental property owner interests in the current political climate.  The bill will allow tenants to designate a person to be notified by the landlord in the event of a tenant death who can pay additional rent to hold the property at the unit. The legislation works in coordination with probate laws, and will give the landlord an option to not use the current abandonment provisions in the Residential Landlord-Tenant Act and still have protection from further liability down the road. We expect the Governor to sign the bill unchanged into law in the near future.

Non-passed Policy Bills Dead

All other policy bills regulating rental property owners, including 90 day notice for rent increases, tenant screening, sealing of civil eviction records,  housing discrimination based on source of income are now finally beyond consideration. RHA government affairs team worked hard alongside other landlord associations to prevent these bills from becoming law, and will continue to engage stakeholders over the interim and into any special sessions to ensure that property owner’s rights are protected. 

Budget Wranglings

Three budgets need to be passed by the legislature before their work is done for the year. Transportation, Capital, and Operating budget drafts from both the House and the Senate continue to be rewritten and negotiated.  While session is slated to end on Sunday, April 26, 2015, the legislature must pass budgets and have them signed by the Governor before session can end.  Washington State requires a balanced budget to be passed and if a budget is not in place before July 1, 2015, there could be considerable government shutdowns.  In 2013 (the previous budget session) it took 3 special sessions and the end of June before a budget was reached

At odds is the question of new revenue. Considering state budget projections show an increase of approximately $3 billion over the previous biennium, the Senate, run by the Majority Coalition Caucus, seeks no new monies, instead proposing cuts, and fund shifts, along with counting new revenue from marijuana.  The House proposed revenue increases of almost $1.5 Billion in order to fund the Democratic priorities while the Senate budget included no new taxes or revenue.  The negotiations are now about which version of the budget is viable and what compromises may have to be made in order to get a budget passed and legislative session closed.  The big-ticket items in the House budget were a 5% Capital Gains Tax ($570 M) and an Increase in B&O Tax from 1.5% to 1.8% ($532 M). 

Additionally, we know that the Governor wants to make WA the leader in Carbon policy and yet there was not a carbon tax included in either budget.  While a “revenue neutral” carbon approach is believed to have some support, most believe that the potential revenue that would be generated under a carbon tax would be in addition to the proposed tax increases above.

Governor Meets with Party Leaders regarding Budget

This week, the Governor met with the leaders of the Republicans and Democrats in the House and Senate and dictated what we would accept in the upcoming budget negotiations and what measures could lead to a Gubernatorial veto.  The Governor then promptly left the meeting.  Included in the Governor’s demands are:

1.      $1.3B or more this biennium for K-12 and funding for HB 2776.

2.      Fully fund the collective bargaining agreements for State employees and teachers.

3.      Additional monies for early learning and mental health.

4.      Full funding of medical education in Spokane. That means both the new WSU medical school and the UW WAMI program.

5.      Money for teacher mentoring program in the budget.

6.      I want the Senate to add money to Parks.

7.      Funding for Droughts.

The Governor also indicated that he will NOT accept the following:

1.      “Lean” cuts, back of the budget, or so called efficiency savings in order to balance the budget.

2.      No bond money use in the operating budget in order to fill in the need for additional revenue for the State.

3.      Refusal to sign any tax cut until these other requirements are met.

Additionally, the Governor made clear that he believed that the only way to pass a potential budget is with a substantial increase in revenue.  The Governor said, “I think we all understand this will require additional revenue. You all know that my preference is for a Carbon solution or a Capital Gains tax.”

Bill Tracking Details: 

RHA Supported Bills:

HB 1553 – Opportunity restoration:

Creates a process by which a person with a criminal record can be granted a certificate of restoration of opportunity, which removes any professional bar imposed solely as a result of the conviction.

Prohibits certain state, county, and municipal departments, boards, officers, and agencies authorized to assess the qualifications of an applicant for a license, certificate of authority, qualification to engage in the practice of a profession or business, or for admission to an examination to qualify for the license or certificate from disqualifying a qualified applicant, solely based on the applicant's criminal history, if the qualified applicant has obtained a certificate of restoration of opportunity and the applicant meets all other statutory and regulatory requirements.

 (Representatives Walkinshaw, MacEwen, Ryu, Appleton, Moscoso, Holy, Gregerson, Zeiger, Peterson, Farrell, Walsh, Reykdal, Orwall, Pettigrew, Tharinger, Fitzgibbon, Kagi)

HB STATUS:            DEAD (Senate Law & Justice )

HB 1573/SB 5221 – Tenant property, disposition (WROA BILL):

If a landlord places an evicted tenant's property on the nearest public property because the tenant has objected to the landlord storing his or her property, or the landlord elects to place the tenant's property on the public property, the landlord may dispose of the tenants property, at the expense of the tenant, if the tenant's property has remained on the public property for a period of not less than five days.

(Representatives Johnson, Muri, Stanford & Senators Benton, Roach)

HB STATUS:            Dead   (House Judiciary Committee)

SB STATUS: Dead   (House Judiciary Committee)

HB 1574/SB 5538 – Deceased tenant property (WROA BILL):

Establishes procedures for the disposition of the personal property of a residential tenant upon the death of the tenant. Requires a tenant, upon written request of a landlord, to:

(1) Provide the landlord with the name, address, e-mail address, and telephone number of a designated person to contact in the event of the tenant's death; and

(2) Sign a statement authorizing the landlord, in the event of the tenant's death, to settle certain matters relating to the decedent's rental of the property.

(Representatives Rodne, Wylie, Shea, Johnson, Muri, Stanford, Jinkins& Senators Angel, Sheldon)

HB STATUS:            Dead (House Rules Committee)

SB STATUS:             (Passed)

SB 5218 – At-will tenancy/unlawful detainer:

An at-will tenant may be sued for an unlawful detainer. A person who occupies real property with the consent of the owner but without a specific rental amount or designated period of tenancy on an at-will basis may be evicted if they fail to leave the premises after 20-days' notice, in writing, served as provided for in statute. An at-will tenant is entitled to a show-cause hearing as provided in the Residential Landlord Tenant Act.This does not apply to housing for agricultural employees when provided in conjunction with employment.
 (Senators Hobbs, Benton)

SB STATUS: Dead   (Senate Rules Committee)

SB 5219 – Unlawful detainer:

A tenant who fails to pay other fees due to the landlord, aside from rent, is guilty of unlawful detainer if the landlord gave the tenant three days' notice in writing requiring the tenant to pay the other fees or surrender the premises.
 (Senators Benton, Roach)

SB STATUS: Dead   (Senate Rules Committee)

SB 5220 – Landlord-tenant acts/judgment:

Consent, the entering of a general appearance, or the filing of a responsive document by the defendant establishes personal jurisdiction and a money judgment may then be entered against the defendant.
 (Senators Benton, Roach)

SB STATUS: Dead   (Senate Rules Committee)

SB 5894 – Unlawful activity/properties:

A person is guilty of criminal trespass in the first degree if the person is a tenant by sufferance or resides at a rental property and is not listed as a tenant on the rental agreement or as a guest in an affidavit signed by the owner or an agent of the owner of the property, and the person refuses to immediately upon demand surrender possession of the premises to the owner, or vacate the property, including other rental areas or common areas held by the owner. The existing defenses to criminal trespass also do not apply to a person trespassing in a dwelling in which a foreclosure action is pending or where the dwelling has been foreclosed upon and is being prepared for sale.
 (Senators Sheldon, Warnick, King, Padden)

SB STATUS: DEAD (Senate Rules Committee)

ROOpposed Bills:

HB 1106 – Operating Budget 2015-2017:

Proposed Tax Increases and Tax Exemption Removals (Totaling $1.49 Billion):

* 5% Capital Gains Tax ($570 M)

* Increase B&O Tax to 1.8% ($532 M)

* State Marketplace Fairness Act ($85.2 M)

* Limit REET on Foreclosure Sales ($81.9 M)

* Sales Tax on Non-Residents ($51.5 M)

* Sales Tax on Bottle Water ($44.4 M)

* Royalty Income ($42.5 M)

* Resellers of Prescription Drugs ($34.6 M)

* Extracted Fuel ($30.3 M)

* Travel Agents ($14.3 M)

(Representatives Hunter, Ormsby, Sullivan, Gregerson, Reykdal)

(By Request: Governor Inslee)

HB STATUS: (Senate Ways and Means Committee)

HB 1115 – Capital Budget 2015-2017:

It authorizes new capital projects for 2015-17 totaling $3.77 billion, of which $2.16 billion is financed from state general obligation bonds and $1.6 billion is financed from other funds. Included are authorizations for state agencies to enter into alternative financing contracts totaling $313 million. It also reappropriates $2.87 billion for uncompleted projects approved in prior biennia.

In addition, the striking amendment makes adjustments to the 2013-2015 Capital Budget, including appropriation increases of $16.7 million and appropriation decreases of $130.3 million, for a net decrease of $113.6 million. It also decreases reappropriations by a net of $3.5 million.

 (Representatives Dunshee, DeBolt, Gregerson, Morris, Reykdal_

(By Request: Governor Inslee)

HB STATUS: (Passed)

HB 1257/SB 5123 – Tenant screening reports:

A landlord may not charge a prospective tenant for costs incurred in obtaining a tenant screening report if a comprehensive screening report regarding the prospective tenant was: (1) prepared within 30 days of the rental application; and (2) made available to the prospective landlord by a consumer reporting agency. A prospective landlord is not prevented from getting an independent tenant screening report if a comprehensive screening report is made available to him or her. However, a prospective landlord may not charge the prospective tenant for any subsequent report. The landlord also may not treat a prospective tenant any less favorably solely because a comprehensive screening report regarding the prospective tenant has been provided.

(Representatives Walkinshaw, Senn, Robinson, Stanford, Farrell, Ormsby, Riccelli, Gregerson, Jinkins, Fitzgibbon, Peterson, Bergquist, Santos, Pollet & Senators Frockt, Kohl-Welles, Mullet, Pedersen, Jayapal, Darneille, McCoy, Conway, Keiser)

HB STATUS:            Dead  (Senate Financial Institutions & Insurance Committee))

SB STATUS: Dead   (Senate Financial Institutions & Insurance Committee)

HB 1460/SB 5376 – Eviction records reporting:

The Fair Credit Reporting Act is amended to prohibit consumer reporting agencies from including eviction records in any consumer report, if: the eviction suit did not result in a judgment finding the prospective tenant liable for unlawful detainer or otherwise in unlawful possession of the premises; the tenant was restored to his or her tenancy; or the judgment reflects a residual amount of rent left owed after the defendant substantially prevailed in an affirmative defense, counterclaim, or set-off.

(Representatives Robinson, Walkinshaw, Walsh, Stanford, Bergquist, Appleton, Sells, Ortiz-Self, Gregerson, Tarleton, Peterson, Pettigrew, Fitzgibbon, Riccelli, Jinkins, Kilduff, McBride, Pollet & Senators Habib, Miloscia, Darneille, Jayapal, Hobbs, Kohl-Welles, Keiser, Frockt, Chase)

HB STATUS:            Dead   (House Judiciary Committee)

SB STATUS: Dead   (Senate Rules Committee)

HB 1484/SB 5699 – Capital gains excise tax:

Provides funding for the education legacy trust account.

Imposes a tax on individuals for the privilege of:

(1) Selling or exchanging long-term capital assets; or

(2) Receiving Washington capital gains.

(Representatives Jinkins, S. Hunt, Tharinger, Robinson, Fitzgibbon, Wylie, Pollet, Reykdal, Farrell, Ryu, Van De Wege, Kagi, Ormsby, Clibborn, Appleton, Bergquist, Walkinshaw, McBride, Tarleton)

(By Request: Office of Financial Management)

HB STATUS:                        (House Finance Committee)

SB STATUS:            (Senate Ways and Means Committee)

HB 1565/SB 5378 – Housing options/govt progrms:

A person is prohibited from taking certain acts based on the source of income of an otherwise eligible applicant or tenant. Prohibited acts include, but are not limited to: refusing to lease or rent any real property to an applicant; expelling a tenant from any real property; making any distinction, discrimination, or restriction against an applicant or tenant in the price, terms, conditions, or privileges relating to the rental; attempting to discourage the rental or lease of any real property; publishing, circulating, issuing, or displaying any communication of any kind relating to the rental or lease of real property that indicates any source of income; and assisting another to commit a prohibited act.

(Representatives Ormsby, Walsh, Pettigrew, Kirby, Jinkins, Robinson, Riccelli, Wylie, Santos & Senators Kohl-Welles, Miloscia, Frockt, Darneille, Pedersen, Jayapal, Hobbs, McAuliffe, Keiser, Chase)

HB STATUS:  Dead   (House Judiciary Committee)

SB STATUS:   Dead   (Senate Human Services, Mental Health & Housing Committee)

HB 1593/SB 5813 –   Local transportation options:

 

Eliminates street utilities.
Allows cities and towns to establish transportation utilities to pay for transportation infrastructure maintenance and operation.
Allows cities and counties with transportation benefit districts to eliminate the separate entity status of the transportation benefit districts.
Allows the transportation benefit districts to impose a vehicle fee of up to $50 and a sales and use tax of up to 0.2 percent with a vote of the governing board.

 (Representatives McBride, Fey, Clibborn, Moscoso, Reykdal, Takko, Tarleton, Farrell, Sells, Kagi & Senators Cleveland, Miloscia, Liias, Darneille, Hobbs, McAuliffe, Habib)

HB STATUS:            (House Transportation Committee)

SB STATUS:             (Senate Transportation Committee)

HB 1866/SB 5259 –   Voter reg. info/res. tenants:

 

A landlord must provide each new residential tenant with a voter registration form or a link to the electronic voter registration form on the Secretary of State's website at the time the tenant signs a lease with the landlord.
The failure to comply with this section may not be construed to affect the validity of the lease or enforcement of any of the lease provisions.

 (Representatives McBride, Fey, Clibborn, Moscoso, Reykdal, Takko, Tarleton, Farrell, Sells, Kagi & Senators Cleveland, Miloscia, Liias, Darneille, Hobbs, McAuliffe, Habib)

HB STATUS:  Dead (House Rules Committee)

SB STATUS:  Dead  (Senate Financial Institutions & Insurance Committee)

HB 2051/SB 5377 – Tenant relocation:

 

Authorizes certain cities, towns, counties, and municipal corporations to require, after reasonable notice to the public and a public hearing, up to ninety days' written notice for a change in rent exceeding ten percent of a tenant's current rent. thirty day notice to raise rent. local government rental assistance eligibility increased from fifty to eighty percent of median income.

 (Representatives Farrell, Tarleton, Pollet, Robinson, Gregerson, Ryu, Orwall, Walkinshaw, Appleton, Kagi & Senators Kohl-Welles, Miloscia, Frockt, Jayapal, Darneille, Pedersen, McAuliffe, Keiser, Chase)

HB STATUS:  Dead (House Rules Committee)

SB STATUS:  Dead  (Senate Financial Institutions & Insurance Committee)

HB 2224 – Excise tax system:

Brief Summary of Bill:

* Imposes a 5 percent tax on capital gains.

* Reinstates the 0.3 percent business and occupation (B&O) surtax on service businesses.

* Increases the small business credit for service businesses.

* Eliminates the preferential B&O tax rate of 0.275 percent for travel agents and tour operators.

* Eliminates the preferential B&O tax rate of 0.138 percent for resellers of prescription drugs.

* Repeals the sales and use tax exemption for bottled water.

* Changes the nonresident sales and use tax exemption for tangible personal property into a remittance program.

* Narrows the use tax exemption for extracted fuel.

* Eliminates the preferential B&O tax rate of 0.484 percent for royalty income.

* Authorizes additional methods of establishing nexus for purposes of business and occupation and sales taxes.

* Limits the availability of a real estate foreclosure exemption.

 (Representatives Carlyle, Hunter, S. Hunt, Kagi, Walkinshaw)

HB STATUS:                        (House Finance Committee)

SB 5077 – Operating Budget 2015-2017:

Biennial appropriations for the 2015-17 fiscal biennium for the various agencies and programs of the state are enacted, including appropriations for general government agencies, human services programs, natural resources agencies, and education institutions.

(Representatives Hill, Hargrove)

(By Request: Governor Inslee)

HB STATUS:                        (House Appropriations Committee) 

NeNeutral Bills:

HB 1481/SB 5564 – Juvenile records and fines:

Allows courts to seal juvenile records when restitution remains if the individual made a good faith effort to pay the full amount of restitution. Eliminates various legal financial obligations and other fees for juveniles, including the juvenile penalty assessment and interest on legal financial obligations. Allows courts to order community service in lieu of restitution for juveniles if the juvenile has insufficient funds to pay the restitution.

(Representatives Kagi, Zeiger, Senn, Walsh, Peterson, Stambaugh, Walkinshaw, Goodman, Muri, Pettigrew, Jinkins, Hudgins, Appleton, Robinson, Gregerson, Fitzgibbon, Ormsby, Clibborn, S. Hunt, Ryu, McBride, Sawyer, Stokesbary, Rodne, Young, Farrell, Kilduff & Senators O'Ban, Darneille, Miloscia, Hargrove, Kohl-Welles, Fain, Jayapal, Brown, Habib, Dammeier, Frockt, Litzow, Warnick, Hasegawa, McAuliffe)

HB STATUS:            Dead  (House Rules Committee)

SB STATUS:             (Passed)

 

Concerns Bills:

HB 5139 – Buidings, 4 or more stores:

The exemption in the Act for any building that is four or more stories high with a B occupancy, as defined by the 1982 Uniform Building Code, and a city fire insurance rating of 1, 2, or 3, is eliminated. As a result, the provisions of the State Building Code apply to such buildings.

 (Senators Roach, Liias, Conway, Benton, McCoy, Dansel, Ericksen)

HB STATUS:                        (Passed)