Legislative Update – What Passed

The 2019 Legislative Season is closed and we have new laws in place that affect real estate investors.  As an industry, it’s important that we pay attention and educate our legislators on how these changes impact what we do. A simple call or email to your legislator goes a long way. Your voice gets multiplied when they hear many people saying the same thing.
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**You can find your Senator and Representative HERE **
PASSED: HB19-1118 Time to cure a lease violation extended to 10 days
 
HB19-1118 changes the time for a lease violation that is not a substantial violation from 3 to 10 days.  ICOR worked with other trade organizations and requested that owners of five or less single family homes be exempt from this requirement and these landlords can serve a 5 day day notice.  It’s a small victory for many ICOR members; however, the 10 day rule will apply to all your rentals as soon as you acquire your 6th rental.
(b) “EXEMPT RESIDENTIAL AGREEMENT” MEANS A RESIDENTIAL AGREEMENT LEASING A SINGLE FAMILY HOME BY A LANDLORD WHO OWNS FIVE OR FEWER SINGLE FAMILY RENTAL HOMES AND WHO PROVIDES NOTICE IN THE AGREEMENT THAT A TEN-DAY NOTICE PERIOD REQUIRED PURSUANT TO THIS SECTION DOES NOT APPLY TO THE TENANCY ENTERED INTO PURSUANT TO THE AGREEMENT.
PASSED: HB19-1328 Landlord and Tenant Duties Regarding Bed Bugs
Canine Scent Detection of bed bugs is now law in Colorado.  HB19-1328 requires a landlord to, within 96 hours of notification, have the home inspected for bed bugs by a “Qualified Inspector” (a.k.a. the guy with a bed bug sniffing dog) and mitigate the home within another 5 days – all at the landlord’s expense, of course. 
PASSED:  HB19-1170 Residential Tenants Health and Safety Act
This bill changes the definition of uninhabitable to include non-functioning appliances and a suspicion of mold. For anything dangerous or hazardous, the landlord must within 24 hours provide comparable alternative housing for tenants and immediately begin fixing the problem. (72 hours action is required for just uninhabitable, but not hazardous.)  The tenant no longer has to file anything with the court and written notice can be delivered electronically.  This bill started out very broad, but a few improvements were made (this is why legislators need to hear from us). For example, landlords can set up a maintenance plan for appliances that the tenant agrees to perform with the lease. However, the bill is 20 pages long and very tedious. The bottom line is to act quickly when a repair is needed and, if necessary, consult an attorney who can explain your obligations under this law.
PASSED: HB19-1106 Rental Application Fees
Rental applications were completely unregulated in Colorado until now. This bill requires landlords to charge the same application fee for all applicants, and requires the Landlord to provide a receipt of the application fee.  It prohibits a landlord from looking at arrests to disqualify an applicant or looking at criminal convictions older than 5 years (except for murder, assault, stalking, sex offender status, or manufacture, distribution of meth or possession of items to make meth.)  The bill also requires a landlord to provide information on grounds for denial in writing as well. The bill takes effect 8/2/19.  
PASSED: HB19-1309 Mobile Home Park Oversight
This bill allows local municipalities to regulate mobile home parks as well as extends the time periods for evictions and moving a mobile home. It also attempts to lessen the cost of disputes so that more owners can fight park owners in court. Like most regulations, there will be some good come out of it and some unintended ill effects. Time will tell.
TABLED FOR NEXT YEAR: SB19-225 Rent “Stabilization” 
  
The Denver Post reports that SB19-225 that would have repealed the ban on local governments enacting rent control is effectively dead for this session.  The bill was laid over by Senate Majority Leader Steve Fenberg (D-Boulder). This bill made it through the State House and a Senate Committee before being “killed.” But only for this year, because the bill’s sponsor, Senator Julie Gonzalez (D-Denver), has promised to bring the rent control bill back next year.  You can read the Denver Post story here
The text and overview of the bill is here.  If passed, this will allow cities and counties to enact rent control on private residential property.  We encourage everyone to contact their legislators on this bill.   It has been proven that rent control does NOT increase the supply of affordable housing.  Read more here about a Stanford University study on rent control in San Francisco.
Kudos to ICOR and the Apartment Association for educating and testifying on this bill. Most importantly, remember that savvy investors will adapt to change.
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To learn more about how rent control distorts the market see this video: 
Why Rent Control Hurts Renters
From the Denver Post Editorial Board, April 26, 2019
“Colorado lawmakers should pitch [this bill] out the closest window. Senate Bill 225 would do away with a long-standing prohibition on rent control policies across the state. In other words, it’d open up the flood-gates for more progressive cities to place caps on rent. For decades, economists have decried rent-control as a failed economic policy that has left housing conditions worse off in the places it has been implemented. There are better ways to address the high cost of housing in certain Colorado communities. We suggest lawmakers instead focus on passing House Bill 1228 which would make an extra $150 million available to developers over the next four years who build affordable housing.”
 Continue to support ICOR with a membership as they advocate on our behalf.

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