Delaware Multi-Housing Legislation
LEGISLATIVE UPDATE
“FINAL GAVEL”
1st SESSION OF THE
152nd GENERAL ASSEMBLY
AS OF: 13 July 2023
EXECUTIVE SUMMARY
“This will do exactly the opposite of what you think you are doing.”
Rep. Rich Collins
Information provided by Scott Kidner
LAND USE /REAL ESTATE/HOUSING
The following bills and positions noted represent the overall commercial and residential real estate, multi-family, and manufactured housing industry, along with the business community as it relates to their private property rights, how they conduct their business, and their ability to use/transfer real property within the state of Delaware.
SENATE
SS#1 to SB1w/HA#1 – Sen Townsend and Rep Minor Brown – Right to Counsel/Diversion Program/CLASI
NEUTRAL
As most in housing know, the bill is a significant rewrite of SB101 from last session that for virtually every eviction case, an attorney must be provided for the defense of that tenant. A Coordinator would be hired through the AG’s office to contract with CLASI or other legal services who would provide the defense counsel. The bill saw numerous changes after lengthy and detailed conversations with the sponsor and CLASI, which resulted in: Defining a “tenant”, how full-time students are calculated, how income is calculated, requiring that mediation must occur no later than 48 hours before trial date, and tenant’s failure to complete mediation may not delay commencement of trial (HA1), creates a list of actions that are covered for representation, among many other changes.
Based upon these changes and other items removed from the bill, the DAA eventually took a position of neutral, and it easily passed both Chambers by 16 June 2023
Awaiting Governor’s Signature
SB9– Sen McBride and Rep Lambert – Relating to Lead Paint
NEUTRAL
The bill creates a much more robust lead testing and abatement program in Delaware by inspection of properties where a child is found to have elevated BLL’s screened for lead paint, and if found, abated. Also says for those property owners/landlords that receive state money to mitigate, they are barred from raising rents for three years, and creating a dedicated fund for abatement, and finally expanding the duties of the Childhood Lead Poisoning Advisory Committee that includes inspections and remediation in pre-1978 properties. The DAA and DAR offered some slight modifications included in both SA#1 and HA#1. With positions of neutral from the housing community, the bill eventually passed the Senate with the amendments on 30 June.
Awaiting Governor’s Signature
SB99 – Sen Pinkey and Rep Wilson-Anton – Municipalities
NEUTRAL
The bill prevents the use of municipal ordinances that require removal by eviction a tenant or the tenant’s household for criminal activity. Essentially, this bars the local government from enforcing eviction by landlords, such that if they do not remove the tenant – they will have their rental license cancelled. Both DAA and DAR took the position of neutral, passing int eh Senate with 4 No votes, and then released from House Housing on 15 June, without making it to the House floor for a vote before 30 June.
No Further Action Taken.
HOUSE
HB37 (HB191) – Rep Dorsey-Walker and Sen Brown – Tenant Remedies/Escrow
OPPOSED
Like HB477 from the last year, the bill seeks to address issues in Wilmington relating to a specific landlord and condemnation of his rental units in 2022, by giving tenants ability to withhold and/or escrow rent into an account within the JP Court system. DAA maintained throughout the debate from last year and into this year, creating an escrow account does nothing to help tenants that are facing life and safety issues and their unit is condemned. After several weeks of meetings and two separate hearings, the bill was changed again and filed as HB191 and then a week later, HS#1 to HB191 was introduced.
Each version made changes to the current code around escrow, and while some changes were positive for the landlord community, the final version needed significant redress to eliminate conflicts and confusion in the bill. Opposed by DAA in committee again, the bill was released – then assigned to House Appropriations (Fiscal Note) – whereby it was released late on the 21st . It passed the House on 22 Yes, 1 N, 1 NV and 16 Absent (this was the night the R’s walked out) and assigned to Senate Housing with no hearing held before 30 June.
No Further Action Taken.
HS#1 to HB55 – Rep Lynn and Sen Hoffner – Homeless Bill of Rights
OPPOSED
Amending Title 6 and Tile 31, the bill – and like many versions before it, seeks to establish a new protected class for those that are defined as homeless in the bill. And like the previous version, this one is also opposed by DAA and DAR because of the negative impact it will have the ability of the property owner to determine if the potential tenant can meet the requirements of tenancy. Additional issues remain in this version as the broad definition of homelessness, the rights afforded to these people that include their ability to “stay” in cars or in public spaces without intervention from police, and what happens to the landlord if they are accused of violating the provisions of this new fair housing claim charged against them by a tenant.
Introduced on 14 Mar 2023 and assigned to the House Judiciary Committee, no hearings were held before the close of the Session.
No Further Action Taken.
HB168 – Rep Williams and Sen Mantzavinos – Short Term Rental Tax
OPPOSED
Amending Titles 9 and Title 30 – the bill creates a new tax for short-term rentals (VRBO/ARBNB) of a 150 days or less and adds a new rental license fee of $25 a year for short-term listing services. Strongly opposed by DAR and supported by the Hotel Lodging and Tourism Associations – the bill was introduced on 18 May and assigned to House Revenue and Finance Committee. It was released from Committee in June and remains on the House Ready List. The expectation is the parties will try and seek some common ground before the return of the Assembly in January 2024.
No Further Action Taken.
Delaware lawmakers seek to revise the fair housing act and landlord-tenant code to force property owners to accept ANY rental payment received from government-sponsored programs including section eight and other housing subsidy programs
LEGISLATIVE UPDATE
“FINAL GAVEL”
1st SESSION OF THE
152nd GENERAL ASSEMBLY
AS OF: 13 July 2023
EXECUTIVE SUMMARY
“This will do exactly the opposite of what you think you are doing.”
Rep. Rich Collins
Information provided by Scott Kidner
LAND USE /REAL ESTATE/HOUSING
The following bills and positions noted represent the overall commercial and residential real estate, multi-family, and manufactured housing industry, along with the business community as it relates to their private property rights, how they conduct their business, and their ability to use/transfer real property within the state of Delaware.
SENATE
SS#1 to SB1w/HA#1 – Sen Townsend and Rep Minor Brown – Right to Counsel/Diversion Program/CLASI
NEUTRAL
As most in housing know, the bill is a significant rewrite of SB101 from last session that for virtually every eviction case, an attorney must be provided for the defense of that tenant. A Coordinator would be hired through the AG’s office to contract with CLASI or other legal services who would provide the defense counsel. The bill saw numerous changes after lengthy and detailed conversations with the sponsor and CLASI, which resulted in: Defining a “tenant”, how full-time students are calculated, how income is calculated, requiring that mediation must occur no later than 48 hours before trial date, and tenant’s failure to complete mediation may not delay commencement of trial (HA1), creates a list of actions that are covered for representation, among many other changes.
Based upon these changes and other items removed from the bill, the DAA eventually took a position of neutral, and it easily passed both Chambers by 16 June 2023
Awaiting Governor’s Signature
SB9– Sen McBride and Rep Lambert – Relating to Lead Paint
NEUTRAL
The bill creates a much more robust lead testing and abatement program in Delaware by inspection of properties where a child is found to have elevated BLL’s screened for lead paint, and if found, abated. Also says for those property owners/landlords that receive state money to mitigate, they are barred from raising rents for three years, and creating a dedicated fund for abatement, and finally expanding the duties of the Childhood Lead Poisoning Advisory Committee that includes inspections and remediation in pre-1978 properties. The DAA and DAR offered some slight modifications included in both SA#1 and HA#1. With positions of neutral from the housing community, the bill eventually passed the Senate with the amendments on 30 June.
Awaiting Governor’s Signature
SB99 – Sen Pinkey and Rep Wilson-Anton – Municipalities
NEUTRAL
The bill prevents the use of municipal ordinances that require removal by eviction a tenant or the tenant’s household for criminal activity. Essentially, this bars the local government from enforcing eviction by landlords, such that if they do not remove the tenant – they will have their rental license cancelled. Both DAA and DAR took the position of neutral, passing int eh Senate with 4 No votes, and then released from House Housing on 15 June, without making it to the House floor for a vote before 30 June.
No Further Action Taken.
HOUSE
HB37 (HB191) – Rep Dorsey-Walker and Sen Brown – Tenant Remedies/Escrow
OPPOSED
Like HB477 from the last year, the bill seeks to address issues in Wilmington relating to a specific landlord and condemnation of his rental units in 2022, by giving tenants ability to withhold and/or escrow rent into an account within the JP Court system. DAA maintained throughout the debate from last year and into this year, creating an escrow account does nothing to help tenants that are facing life and safety issues and their unit is condemned. After several weeks of meetings and two separate hearings, the bill was changed again and filed as HB191 and then a week later, HS#1 to HB191 was introduced.
Each version made changes to the current code around escrow, and while some changes were positive for the landlord community, the final version needed significant redress to eliminate conflicts and confusion in the bill. Opposed by DAA in committee again, the bill was released – then assigned to House Appropriations (Fiscal Note) – whereby it was released late on the 21st . It passed the House on 22 Yes, 1 N, 1 NV and 16 Absent (this was the night the R’s walked out) and assigned to Senate Housing with no hearing held before 30 June.
No Further Action Taken.
HS#1 to HB55 – Rep Lynn and Sen Hoffner – Homeless Bill of Rights
OPPOSED
Amending Title 6 and Tile 31, the bill – and like many versions before it, seeks to establish a new protected class for those that are defined as homeless in the bill. And like the previous version, this one is also opposed by DAA and DAR because of the negative impact it will have the ability of the property owner to determine if the potential tenant can meet the requirements of tenancy. Additional issues remain in this version as the broad definition of homelessness, the rights afforded to these people that include their ability to “stay” in cars or in public spaces without intervention from police, and what happens to the landlord if they are accused of violating the provisions of this new fair housing claim charged against them by a tenant.
Introduced on 14 Mar 2023 and assigned to the House Judiciary Committee, no hearings were held before the close of the Session.
No Further Action Taken.
HB168 – Rep Williams and Sen Mantzavinos – Short Term Rental Tax
OPPOSED
Amending Titles 9 and Title 30 – the bill creates a new tax for short-term rentals (VRBO/ARBNB) of a 150 days or less and adds a new rental license fee of $25 a year for short-term listing services. Strongly opposed by DAR and supported by the Hotel Lodging and Tourism Associations – the bill was introduced on 18 May and assigned to House Revenue and Finance Committee. It was released from Committee in June and remains on the House Ready List. The expectation is the parties will try and seek some common ground before the return of the Assembly in January 2024.
No Further Action Taken.
Delaware lawmakers seek to revise the fair housing act and landlord-tenant code to force property owners to accept ANY rental payment received from government-sponsored programs including section eight and other housing subsidy programs
Urge Lawmakers to Oppose SB 90!
Property Owners should not be forced to participate in government sponsored subsidies
June 24, 2022
Reach out to your House Representative NOW HERE
SB 90, aims to help Section 8 Housing Choice Voucher (HCV) holders find housing by mandating that property owners particiapte in these program regardless of if they are willing or able to meet the burdensome requirements of such programs. The bill will revise both the Delaware Fair Housing Act and Residential Landlord-Tenant Code to repeal the exception to discrimination based on source of income that allows a landlord to decide if they wish to accept residents who participate in government-sponsored rental assistance programs.
Lawmakers and housing advocates mistakenly believe that property owners and landlords refuse to accept section 8 (and similar programs) because there is a bias against those who are on these programs. This belief could not be further from the truth. Property owners choose not to accept section 8 applicants because they do not want to work with the program that require property owners and operators to adhere to additional regulatory requirements, which are otherwise not imposed in a standard apartment leasing transaction that can significantly increase the cost of doing business.
The requirements imposed by Section 8 may include, but are not limited to, the following:
- Prescribed tenancy approval process, including additional paperwork and mandatory approval timeline;
- Use of the local Public Housing Authority's (PHA) model lease or review and approval of the owner's preferred lease by the PHA;
- Execution of a "tenancy addendum" to be attached to every voucher holder's lease;
- In addition to the owner and resident's agreement, owners must agree to enter into a Housing Assistance Payments (HAP) contract with the PHA and to comply with added lease terms and administrative responsibilities contained therein;
- Potential change in the amount of housing assistance without warning and at any point during the term of the lease;
- Rents subject to "reasonableness" requirements and limits on rent increases which are subject to approval by the PHA;
- Inspections of the housing prior to move in and annually to determine whether the housing meets HUD's Housing Quality Standards (HQS) and/or equivalent state or local standards approved by HUD;
- Possible delay in rental payments at any point during the lease term without recourse due to federal budget appropriations delays,rlengthy administrative processes and even arbitrary withholding of payment by PHAs;
- Mandated termination policies and procedures including strict limits on when an owner may evict a resident and for what reason; and
- Additional time to coordinate with the PHA and ensure compliance with the program's stringent requirements.
There are better options for improving the availability of rental housing for voucher holders than mandating participation in the Section 8 Program such as increasing funding for the Program and reducing the bureaucratic requirements associated with it.
The bill will ultimately put additional pressure on housing providers with very little benefit to the renters who the legislation is supposed to be helping.
