Bill Summary – FastDemocracy

H-1120.2
                           SUBSTITUTE HOUSE BILL 1388
     State of Washington         68th Legislature       2023 Regular Session
     By House Housing (originally sponsored by Representatives Macri,
     Ramel, Peterson, Thai, Gregerson, Hackney, Ormsby, Alvarado, Doglio,
     Cortes, Riccelli, Mena, Kloba, Bateman, Fitzgibbon, Street, Taylor,
     Lekanoff, Simmons, Farivar, Pollet, Stonier, Berry, Reed, Bergquist,
     Morgan, Davis, Santos, Chopp, Stearns, and Fosse)
     READ FIRST TIME 02/14/23.
      AN ACT Relating to protecting tenants by prohibiting predatory
  residential rent practices and by applying the consumer protection
  act to the residential landlord-tenant act and the manufactured/
  mobile home landlord-tenant act; adding new sections to chapter 59.18
  RCW; adding new sections to chapter 59.20 RCW; prescribing penalties;
  and declaring an emergency.
 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
     NEW SECTION.   Sec. 1.   A new section is added to chapter 59.18
 RCW to read as follows:
     (1) Except as provided in subsection (2) of this section, a
 landlord is prohibited from engaging in any of the following
 practices:
     (a) A landlord may not rent or seek to rent a dwelling unit at an
 excessive rent, if such rent increase is beyond the amount reasonably
 necessary to maintain or improve the dwelling unit, and is:
     (i) Substantially likely to cause the tenant or household to move
 or involuntarily relocate from the home; or
     (ii) Used as a means to avoid other protections afforded to
 tenants under this chapter or any other applicable law;
     (b) A landlord may not charge a higher rent or include terms of
 payment or other material conditions in a rental agreement that are
                                       p. 1                         SHB 1388
 more burdensome to a tenant for a month-to-month rental agreement
 than for a rental agreement where the term is greater than month-to-
 month, or vice versa; and
     (c) A landlord may not charge a tenant move-in fees or security
 deposits that exceed one month's rent.
     (2) This section does not apply to:
     (a) A tenancy in a federally funded property owned or operated by
 a public housing authority under chapter 35.82 RCW, or a tenancy in a
 property that is funded through a housing assistance program under
 chapter 43.185 RCW; and
     (b) A tenancy in a dwelling unit for which the first certificate
 of occupancy for the dwelling unit was issued 12 or less years before
 the date of the notice of the rent increase.
     (3) The attorney general may investigate practices that are
 violations of this section. The attorney general may issue civil
 investigative    demands    for  documents,     answers   to    written
 interrogatories, or testimony to any person that the attorney general
 has reason to believe has violated this section or has information or
 knowledge   pertaining   to   a violation    of   this  section.   When
 investigating, the attorney general may consider, in addition to any
 other relevant information:
     (a) The condition of the dwelling unit. For example, outstanding
 repair issues, maintenance costs other than for cosmetic upgrades,
 property taxes, or other information pertaining to the care and
 maintenance of the dwelling unit and premises;
     (b) Whether a rent increase, move-in fee, security deposit, term
 of payment, or other material condition in the lease was used to
 evade protections afforded to tenants under this chapter or any other
 source of legal rights. For example, whether the tenant made any
 complaints regarding repair issues prior to the issuance of the rent
 increase notice; and
     (c) Whether a rent increase will cause the tenant or household to
 move or involuntarily relocate from the home. For example, the
 economic and financial position of the tenant's household.
     (4) The attorney general may issue a cease and desist letter to
 any person to restrain and prevent violations of this section. If the
 recipient of a cease and desist letter does not comply within five
 calendar days of receipt of the letter, the attorney general may file
 an action in superior court to enforce this section. If the court
 finds that the person violated this section and failed to comply with
                                      p. 2                         SHB 1388
 a cease and desist letter, the court shall enjoin the person from
 engaging in conduct that violates this section and impose a civil
 penalty of no more than $10,000 in addition to other remedies per
 violation of the cease and desist letter. In any successful action to
 enforce a cease and desist letter under this section, the court shall
 award the attorney general the costs of bringing the action,
 including reasonable investigative costs and reasonable attorneys'
 fees, plus damages and restitution for any persons harmed by the
 violation.
     (5) The attorney general may enforce this section in superior
 court. In any successful action under this section, the court shall
 impose a civil penalty of no more than $25,000 per violation, and
 shall award the attorney general the costs of bringing the action,
 including reasonable investigative costs and reasonable attorneys'
 fees, plus damages and restitution for any persons harmed by the
 violation. The remedies under this subsection are in addition to, and
 are not prerequisites for, any other remedies a court may order under
 subsection (6) of this section. Additional civil penalties may not be
 assessed for the same violation under the consumer protection act
 pursuant to RCW 19.86.140.
     (6) A tenant whose landlord engages in practices in violation of
 this section and pays rent or other charges in excess of amounts
 permitted by this section has a cause of action against the landlord
 to recover actual damages in the amount of the excess rent or other
 charges paid, mandatory punitive damages equal to three months of the
 unlawful higher rent or charges that the tenant paid, and reasonable
 attorneys' fees and costs incurred in bringing the action.
     (7) The remedies provided by this section are in addition to any
 other remedies provided by law.
     (8) It is a defense to an unlawful detainer action under chapter
 59.12 RCW that the action to remove the tenant and recover possession
 of the premises was for nonpayment of rent that was unlawfully
 increased in violation of this section.
     (9) A landlord may not report the tenant to a tenant screening
 service provider for failure to pay rent that was unlawfully
 increased in violation of this section.
     (10) By January 1, 2024, the office of the attorney general shall
 produce and maintain on its website translated versions of this
 section in the 10 languages most frequently spoken in Washington
 state and, at the discretion of the office of the attorney general,
                                     p. 3                         SHB 1388
 other languages as requested by individuals who have limited English
 language proficiency. A translation must be made available upon
 request in printed form on letter size paper, eight and one-half by
 11 inches, and in an easily readable font size.
     (11) For the purposes of this section:
     (a) "Excessive rent" means a rent increase during any 12-month
 period that is greater than the rate of inflation as measured by the
 consumer price index or three percent, whichever is greater, up to a
 maximum of seven percent above the existing rent. The maximum annual
 rent increase percentage allowed for each calendar year is calculated
 and published by the department of commerce as required in section 2
 of this act.
     (b) "Rate of inflation as measured by the consumer price index"
 means the September 12-month percent change in the consumer price
 index for all urban consumers (CPI-U), west region, all items, not
 seasonally adjusted, or a successor index, as published by the bureau
 of labor statistics of the United States department of labor in
 September of the current calendar year.
     NEW SECTION.   Sec. 2.   A new section is added to chapter 59.18
 RCW to read as follows:
     (1) On September 30, 2023, and on each following September 30th,
 the department of commerce shall calculate the maximum annual rent
 increase percentage allowed by sections 1 and 4 of this act for the
 following calendar year. The maximum annual rent increase percentage
 allowed for the following calendar year is the rate of inflation as
 measured by the consumer price index or three percent, whichever is
 greater, up to a maximum of seven percent. For the purposes of this
 section, "rate of inflation as measured by the consumer price index"
 means the September 12-month percent change in the consumer price
 index for all urban consumers (CPI-U), west region, all items, not
 seasonally adjusted, or a successor index, as published by the bureau
 of labor statistics of the United States department of labor in
 September of the current calendar year.
     (2) On September 30, 2023, and on each following September 30th,
 the department of commerce shall publish the maximum annual rent
 increase percentage calculated under subsection (1) of this section,
 along with the relevant excessive rent protection provisions in
 sections 1 and 4 of this act, in a press release.
                                     p. 4                         SHB 1388
      (3) The department of commerce shall maintain publicly available
  information on its website about the maximum annual rent increase
  percentage for the previous calendar year and for the current
  calendar year, and on or after September 30th of each year, for the
  following calendar year.
     NEW SECTION.   Sec. 3.   A new section is added to chapter 59.18
 RCW to read as follows:
     (1) The legislature finds that the practices covered by this
 chapter are matters vitally affecting the public interest for the
 purpose of applying the consumer protection act, chapter 19.86 RCW.
     (2) A violation of this chapter by a landlord including, but not
 limited to, a violation of a cease and desist letter issued pursuant
 to section 1 of this act, is not reasonable in relation to the
 development and preservation of business and is an unfair or
 deceptive act in trade or commerce and an unfair method of
 competition for the purpose of applying the consumer protection act,
 chapter 19.86 RCW.
     (3) Any violation of this chapter by a landlord is        also   a
 violation of RCW 19.86.020 of the consumer protection act.
     NEW SECTION.   Sec. 4.   A new section is added to chapter 59.20
 RCW to read as follows:
     (1) Except as provided in subsection (2) of this section and in
 RCW 59.20.060(2)(c), a landlord is prohibited from engaging in any of
 the following practices:
     (a) A landlord may not rent or seek to rent a mobile home lot at
 an excessive rent, if such rent increase is beyond the amount
 reasonably necessary to maintain or improve the mobile home lot, and
 is:
     (i) Substantially likely to cause the tenant or household to move
 or involuntarily relocate from the mobile home lot; or
     (ii) Used as a means to avoid other protections afforded to
 tenants under this chapter or any other applicable law;
     (b) A landlord may not charge a higher rent or include terms of
 payment or other material conditions in a rental agreement that are
 more burdensome to a tenant for a month-to-month rental agreement
 than for a rental agreement where the term is greater than month-to-
 month, or vice versa; and
                                     p. 5                         SHB 1388
     (c) A landlord may not charge a tenant move-in fees or security
 deposits that exceed one month's rent.
     (2) This section does not apply to a tenancy in a federally
 funded property owned or operated by a public housing authority under
 chapter 35.82 RCW, or a tenancy in a property that is funded through
 a housing assistance program under chapter 43.185 RCW.
     (3) The attorney general may investigate practices that are
 violations of this section. The attorney general may issue civil
 investigative    demands    for  documents,    answers   to    written
 interrogatories, or testimony to any person that the attorney general
 has reason to believe has violated this section or has information or
 knowledge   pertaining   to   a violation   of   this  section.   When
 investigating, the attorney general may consider, in addition to any
 other relevant information:
     (a) The condition of the mobile home lot. For example,
 outstanding repair issues, maintenance costs other than for cosmetic
 upgrades, property taxes, or other information pertaining to the care
 and maintenance of the mobile home lot and premises;
     (b) Whether a rent increase, move-in fee, security deposit, term
 of payment, or other material condition in the lease was used to
 evade protections afforded to tenants under this chapter or any other
 source of legal rights. For example, whether the tenant made any
 complaints regarding repair issues prior to the issuance of the rent
 increase notice; and
     (c) Whether a rent increase will cause the tenant or household to
 move or involuntarily relocate from the mobile home lot. For example,
 the economic and financial position of the tenant's household.
     (4) The attorney general may issue a cease and desist letter to
 any person to restrain and prevent violations of this section. If the
 recipient of a cease and desist letter does not comply within five
 calendar days of receipt of the letter, the attorney general may file
 an action in superior court to enforce this section. If the court
 finds that the person violated this section and failed to comply with
 a cease and desist letter, the court shall enjoin the person from
 engaging in conduct that violates this section and impose a civil
 penalty of no more than $10,000 in addition to other remedies per
 violation of the cease and desist letter. In any successful action to
 enforce a cease and desist letter under this section, the court shall
 award the attorney general the costs of bringing the action,
 including reasonable investigative costs and reasonable attorneys'
                                     p. 6                         SHB 1388
 fees, plus damages and restitution for any persons harmed by the
 violation.
     (5) The attorney general may enforce this section in superior
 court. In any successful action under this section, the court shall
 impose a civil penalty of no more than $25,000 per violation, and
 shall award the attorney general the costs of bringing the action,
 including reasonable investigative costs and reasonable attorneys'
 fees, plus damages and restitution for any persons harmed by the
 violation. The remedies under this subsection are in addition to, and
 are not prerequisites for, any other remedies a court may order under
 subsection (6) of this section. Additional civil penalties may not be
 assessed for the same violation under the consumer protection act
 pursuant to RCW 19.86.140.
     (6) A tenant whose landlord engages in practices in violation of
 this section and pays rent or other charges in excess of amounts
 permitted by this section has a cause of action against the landlord
 to recover actual damages in the amount of the excess rent or other
 charges paid, mandatory punitive damages equal to three months of the
 unlawful higher rent or charges that the tenant paid, and reasonable
 attorneys' fees and costs incurred in bringing the action.
     (7) The remedies provided by this section are in addition to any
 other remedies provided by law.
     (8) It is a defense to an unlawful detainer action under chapter
 59.12 RCW that the action to remove the tenant and recover possession
 of the premises was for nonpayment of rent that was unlawfully
 increased in violation of this section.
     (9) A landlord may not report the tenant to a tenant screening
 service provider for failure to pay rent that was unlawfully
 increased in violation of this section.
     (10) By January 1, 2024, the office of the attorney general shall
 produce and maintain on its website translated versions of this
 section in the 10 languages most frequently spoken in Washington
 state and, at the discretion of the office of the attorney general,
 other languages as requested by individuals who have limited English
 language proficiency. A translation must be made available upon
 request in printed form on letter size paper, eight and one-half by
 11 inches, and in an easily readable font size.
     (11) For the purposes of this section:
     (a) "Excessive rent" means a rent increase during any 12-month
 period that is greater than the rate of inflation as measured by the
                                     p. 7                         SHB 1388
 consumer price index or three percent, whichever is greater, up to a
 maximum of seven percent above the existing rent. The maximum annual
 rent increase percentage allowed for each calendar year is calculated
 and published by the department of commerce as required in section 2
 of this act.
     (b) "Rate of inflation