Colorado HB 19-1106 - Concerning the Rental Application Process for Prospective Tenants.

First Regular Session

Seventy-second General Assembly

STATE OF COLORADO

INTRODUCED


LLS NO. 19-0582.01 Richard Sweetman x4333                                          HOUSE BILL 19-1106

HOUSE SPONSORSHIP

Titone and Gonzales-Gutierrez, Benavidez, Buckner, Coleman, Duran, Galindo, Herod, Jackson, Jaquez Lewis, Kennedy, Lontine, McLachlan, Singer, Sirota, Valdez A., Weissman

SENATE SPONSORSHIP

Pettersen,













House Committees                                                  Senate Committees

Business Affairs and Labor




A BILL FOR AN ACT

101                 CONCERNING THE RENTAL APPLICATION PROCESS FOR PROSPECTIVE

102                                         TENANTS.

Bill Summary

(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)

The bill states that a landlord may not charge a prospective tenant a rental application fee unless the landlord uses the entire amount of the fee to cover the landlord's costs in processing the rental application. A landlord also may not charge a prospective tenant a rental application fee that is in a different amount than a rental application fee charged to another prospective tenant who applies to rent:


Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.

Capital letters or bold & italic numbers indicate new material to be added to existing statute.

Dashes through the words indicate deletions from existing statute.
!               The same dwelling unit; or

!               If the landlord offers more than one dwelling unit for rent at the same time, any other dwelling unit offered by the landlord.

The bill requires a landlord to provide to any prospective tenant who has paid a rental application fee either a disclosure of the landlord's anticipated expenses for which the fee will be used or a receipt that itemizes the landlord's actual expenses incurred.

The bill requires that, before accepting a rental application or collecting a rental application fee from a prospective tenant, a landlord shall give the prospective tenant written notice of the landlord's tenant selection criteria and the grounds upon which a rental application may be denied. If a landlord uses rental history or credit history as criteria in consideration of an application, the landlord shall neither inquire into nor consider any rental history or credit history beyond 7 years immediately preceding the date of the application.

If a landlord denies a rental application based on any of certain described grounds, the landlord shall provide the prospective tenant a written notice of the denial that states the reasons for the denial.

A landlord who violates any of the requirements created in the bill is liable to the person who is charged a rental application fee for twice the amount of the rental application fee, plus court costs and reasonable attorney fees.



1                 Be it enacted by the General Assembly of the State of Colorado:

2                                         SECTION 1. In Colorado Revised Statutes, add part 9 to article

3        12 of title 38 as follows:

4
PART 9
5
RENTAL APPLICATION FAIRNESS ACT

6                                         38-12-901. Short title. THE SHORT TITLE OF THIS PART 9 IS THE

7                 "RENTAL APPLICATION FAIRNESS ACT".

8                                         38-12-902.  Definitions. AS USED IN THIS PART 9, UNLESS THE

9                 CONTEXT OTHERWISE REQUIRES:

10                                         (1)  "DWELLING UNIT" MEANS A STRUCTURE OR THE PART OF A

11                 STRUCTURE THAT IS USED AS A HOME, RESIDENCE, OR SLEEPING PLACE.

12                                         (2)  "LANDLORD" MEANS THE OWNER, MANAGER, LESSOR, OR


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1                 SUBLESSOR OF A DWELLING UNIT.

2                                         (3) "RENTAL AGREEMENT" MEANS ANY AGREEMENT, WRITTEN OR

3                 ORAL, BETWEEN A LANDLORD AND A TENANT EMBODYING THE TERMS AND

4                 CONDITIONS CONCERNING THE USE AND OCCUPANCY OF A DWELLING UNIT.

5                                         (4) "RENTAL APPLICATION" MEANS ANY INFORMATION, WRITTEN

6                 OR ORAL, SUBMITTED TO A LANDLORD BY A PROSPECTIVE TENANT FOR THE

7                 PURPOSE OF ENTERING INTO A RENTAL AGREEMENT.

8                                         (5) "RENTAL APPLICATION FEE" MEANS ANY SUM OF MONEY,
9        HOWEVER DENOMINATED, THAT IS CHARGED OR ACCEPTED BY A

10                 LANDLORD FROM A PROSPECTIVE TENANT IN CONNECTION WITH THE

11                 PROSPECTIVE TENANT'S SUBMISSION OF A RENTAL APPLICATION.

12                                         (6)  "TENANT" MEANS A PERSON ENTITLED UNDER A RENTAL

13                 AGREEMENT TO OCCUPY A DWELLING UNIT TO THE EXCLUSION OF OTHERS.

14                           38-12-903.     Rental application fee - limitations. (1)             A

15                 LANDLORD SHALL NOT CHARGE A PROSPECTIVE TENANT A RENTAL

16                 APPLICATION FEE UNLESS THE LANDLORD USES THE ENTIRE AMOUNT OF

17                 THE FEE TO COVER THE LANDLORD'S COSTS IN PROCESSING THE RENTAL

18                 APPLICATION. THE LANDLORD'S COSTS MAY BE BASED ON:

19                                         (a) THE ACTUAL EXPENSE THE LANDLORD INCURS IN PROCESSING

20                 THE RENTAL APPLICATION; OR

21                                         (b)   THE  AVERAGE  EXPENSE  THE  LANDLORD  INCURS  PER

22                 PROSPECTIVE TENANT IN THE COURSE OF PROCESSING MULTIPLE RENTAL

23                 APPLICATIONS.

24                                         (2) A LANDLORD SHALL NOT CHARGE A PROSPECTIVE TENANT A

25                 RENTAL APPLICATION FEE THAT IS IN A DIFFERENT AMOUNT THAN A

26                 RENTAL APPLICATION FEE CHARGED TO ANOTHER PROSPECTIVE TENANT

27                 WHO APPLIES TO RENT:



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1                                         (a) THE SAME DWELLING UNIT; OR

2                                         (b) IF THE LANDLORD OFFERS MORE THAN ONE DWELLING UNIT FOR

3                 RENT AT THE SAME TIME, ANY OTHER DWELLING UNIT OFFERED BY THE

4                 LANDLORD.

5                                         (3) (a) A LANDLORD SHALL PROVIDE TO ANY PROSPECTIVE TENANT

6                 WHO HAS PAID A RENTAL APPLICATION FEE EITHER A DISCLOSURE OF THE

7                 LANDLORD'S ANTICIPATED EXPENSES FOR WHICH THE FEE WILL BE USED OR

8                 A RECEIPT THAT ITEMIZES THE LANDLORD'S ACTUAL EXPENSES INCURRED.

9         IF A LANDLORD CHARGES AN AMOUNT BASED ON THE AVERAGE COST OF

10                 PROCESSING THE RENTAL APPLICATION, THE LANDLORD SHALL INCLUDE

11                 INFORMATION REGARDING HOW THAT AVERAGE RENTAL APPLICATION FEE

12                 IS DETERMINED.

13                                         (b)  A LANDLORD SHALL PROVIDE EVERY PROSPECTIVE TENANT

14                 WITH A RECEIPT FOR ANY APPLICATION FEE RECEIVED. THE LANDLORD

15                 MAY PROVIDE A PROSPECTIVE TENANT AN ELECTRONIC RECEIPT UNLESS

16                 THE PROSPECTIVE TENANT REQUESTS A PAPER RECEIPT, IN WHICH CASE

17                 THE LANDLORD SHALL PROVIDE THE PROSPECTIVE TENANT A PAPER

18                 RECEIPT.

19                                         38-12-904.  Rental applications - required disclosures to

20                 prospective tenants - eligibility requirements - denial notice -

21                 acknowledgment of receipt. (1)   BEFORE  ACCEPTING  A  RENTAL

22                 APPLICATION  OR  COLLECTING  A  RENTAL APPLICATION  FEE  FROM  A

23                  PROSPECTIVE TENANT, A LANDLORD SHALL GIVE THE PROSPECTIVE TENANT

24                 WRITTEN NOTICE OF THE LANDLORD'S TENANT SELECTION CRITERIA AND

25                 THE GROUNDS UPON WHICH A RENTAL APPLICATION MAY BE DENIED. IF

26                 ANY OF THE FOLLOWING ARE GROUNDS FOR DENIAL, THEY MUST BE

27                 CLEARLY STATED IN THE NOTICE:



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1                                         (a) THE PROSPECTIVE TENANT'S:

2                                         (I) CRIMINAL HISTORY;

3                                         (II) ADDRESS HISTORY;

4                                         (III) RENTAL HISTORY;

5                                         (IV) CREDIT HISTORY; OR

6                                         (V) CURRENT INCOME;

7                                         (b) THE PROSPECTIVE TENANT'S FAILURE TO PROVIDE ACCURATE

8                 OR COMPLETE INFORMATION IN THE RENTAL APPLICATION; OR

9                                         (c)  THE PROSPECTIVE TENANT'S FAILURE TO PAY THE RENTAL

10                 APPLICATION FEE IN THE AMOUNT SPECIFIED IN THE NOTICE.

11                                         (2) IF A LANDLORD USES RENTAL HISTORY OR CREDIT HISTORY AS

12                 CRITERIA IN CONSIDERATION OF AN APPLICATION, THE LANDLORD SHALL

13                 NEITHER INQUIRE INTO NOR CONSIDER ANY RENTAL HISTORY OR CREDIT

14                 HISTORY BEYOND SEVEN YEARS IMMEDIATELY PRECEDING THE DATE OF

15                 THE APPLICATION.

16                                         (3)  IF A LANDLORD DENIES A RENTAL APPLICATION BASED ON

17                 GROUNDS DESCRIBED IN SUBSECTION (1) OF THIS SECTION, THE LANDLORD

18                 SHALL PROVIDE THE PROSPECTIVE TENANT A WRITTEN NOTICE OF THE

19                 DENIAL THAT STATES THE REASONS FOR THE DENIAL. IF THE SPECIFIC

20                 SCREENING CRITERIA CANNOT BE DIRECTLY CITED BECAUSE OF THE USE OF

21                 A PROPRIETARY SCREENING SYSTEM, THE LANDLORD SHALL INSTEAD

22                 PROVIDE THE PROSPECTIVE TENANT WITH A COPY OF THE REPORT FROM

23                 THE SCREENING COMPANY THAT USES THE PROPRIETARY SCREENING

24                 SYSTEM. A LANDLORD  MAY  PROVIDE  A  PROSPECTIVE  TENANT  AN

25                 ELECTRONIC  VERSION  OF  THE  DENIAL  NOTICE  REQUIRED  IN  THIS

26                 SUBSECTION (3) UNLESS THE PROSPECTIVE TENANT REQUESTS A PAPER

27                 DENIAL NOTICE, IN WHICH CASE THE LANDLORD SHALL PROVIDE THE



-5-                                                                      HB19-1106
1                 PROSPECTIVE TENANT A PAPER DENIAL NOTICE.

2                                         38-12-905. Violations - penalties. A LANDLORD WHO VIOLATES

3                 ANY PROVISION OF THIS PART 9 IS LIABLE TO THE PERSON WHO IS CHARGED

4                 A RENTAL APPLICATION FEE FOR TWICE THE AMOUNT OF THE RENTAL

5                 APPLICATION FEE, PLUS COURT COSTS AND REASONABLE ATTORNEY FEES.

6                           SECTION 2.       Act subject to petition - effective date -

7                 applicability. (1) This act takes effect at 12:01 a.m. on the day following

8         the expiration of the ninety-day period after final adjournment of the
9       general assembly (August 2, 2019, if adjournment sine die is on May 3,

10                 2019); except that, if a referendum petition is filed pursuant to section 1

11                 (3) of article V of the state constitution against this act or an item, section,

12                 or part of this act within such period, then the act, item, section, or part

13                 will not take effect unless approved by the people at the general election

14                 to be held in November 2020 and, in such case, will take effect on the

15                 date of the official declaration of the vote thereon by the governor.

16                                         (2) This act applies to rental applications submitted on or after the

17                 applicable effective date of this act.




























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