February 2019 – Oregon Floating Home Owner News

What Happened at the February 22, 2019, MH Coalition Meeting?

This meeting was held in Salem and John DiLorenzo facilitated.

The MH Coalition came to an agreement on all fronts at what was, we can now say, the final MH Coalition meeting for this set of issues for proposed legislation during the 2019 session.

I can’t begin to tell you how high the stakes were. In January, our proposed marina issues became a Senate bill – SB 586 to be exact!! But since the MH Coalition was still debating some key parts and because the person who was assigned to us to draft the actual legal language was new to the process – everything was delayed and our bill was at risk of not progressing further if we didn’t come to a place of agreement at this February 22nd meeting.

It was critical that the MH Coalition find resolution on the final issue – how to deter tenants from committing minor marina/park rule violations.

Keep in mid that, currently, the law states that tenants can be evicted for a minor rule violation such as parking in the wrong parking space.

We seek to change that. No one should lose their home because they parked in the wrong space once.

So we created solutions to address this in our bill by restricting noncompliance evictions only for “Material Violations” of the lease – for example: nonpayment of rent, being a danger to the community, etc. MAJOR lease noncompliance issues.

Which left minor rule violations unaddressed and without any “teeth” to hold a tenant liable for following the marina rules. Landlords needed something to deter tenants from committing minor rule infractions if they were going to allow us to change the law to allow evictions for major lease infractions.

The three options on the table to deter tenants from committing minor rule violations were:

3 Strikes and You’re Out rule – if a tenant commits a minor rule violation such as parking in the wrong parking space on three separate occasions and was served notice on each occasion (but also corrected it after the first 2 notices) within a 12-month period, then the 3rd notice would trigger the eviction process and the tenant would not have a chance to correct the 3rd violation. Floating home tenancies in California operate under a similar law.
Fees for Minor Violations – if a tenant commits a minor rule violation such as parking in the wrong parking space, then a landlord can charge a fee as long as that fee is listed in the rental agreement AND allowed by ORS 90.302. The problem is that, by law, a landlord cannot change a rental agreement to add the ability to charge fees. So this option would allow landlords to unilaterally amend rental agreements already in place only for the purpose of being able to legally capture fees for minor violations. There are limits: minor rule violation fees can only be charged for about 7 limited things already listed in ORS 90.302 (more on those below).
Do nothing. Keep the law as is and if a tenant commits a minor rule violation such as parking in the wrong parking space, the landlord can serve them an eviction notice. YIKES!!

The tenants debated a TON about this one off-line in multiple conversations in preparation for the February 22nd meeting. We took this last bit of negotiations very seriously. This has serious consequences for changing the law and there are serious consequences if we do not change the law.

We had earlier in the month decided that option 1 was likely to be abused the most since eviction was at stake. And we knew we need to do something to protect tenants from living in fear of being evicted for silly infractions, so we could not choose option 3, doing nothing.

So we negotiated and debated every aspect of option 2 – fees – until we were comfortable enough that it was as good as it could be and a definite improvement on what we have.

Our primary areas of concern centered around the potential abuse of fees and that a landlord did not have to prove anything, just send a fee notice. However, currently, the landlord does not have to prove you committed the minor rule violation to place you in an eviction hearing anyway. So, while the fees do not solve every possible abuse scenario, we did have a lot of discussion about ways to mitigate that risk of abuse.

The other area of concern was the hierarchy or order of the application of payments – we wanted the same protections as apartment tenants listed in 90.220(9). If you’ll recall from the last post, ORS restricts the order of the application of an apartment tenant’s payment and makes sure that landlords cannot apply a tenant payment to a fee before they apply it to rent owed. But this law does not apply to marina tenancies. However, we found comfort in realizing that ORS 90.302(3)(a)(E), which does apply to marina tenancies, prohibits landlords from deducting a noncompliance fee from a rental payment.

This left us to wrestle with only the potential for abuse of landlords charging fees. Many good ideas were generated from these outside tenant sessions to help reduce the risk of abuse.

However, in order to fully vet those ideas, we needed more time, which we did not have if we wanted our bill to be voted on in this legislative session. So, with the entire bill at risk – every issue we had already greed upon over the previous 2 years of work. So we came to agreement that this item is better than what we have, but we will propose improvements to it in the next legislative session.

Our bill proposes to allow park and marina landlords to unilaterally amend leases ONLY to be able to charge tenants fees for these things listed in ORS 90.302:

The non-compliance fees allowable by ORS 90.302, IF IF IF they are also described in your lease fall into 3 main areas:

(1) Fees authorized by other statutes.

(a) Late rent payments, ORS 90.260

(b) NSF checks, ORS 30.701

(d) Facility pet rule violation, ORS 90.530

(e) Lease-break fee (contract law)

(2) Noncompliance with the rental agreement, as specified:

(a) The late payment of a utility or service charge that the tenant owes the landlord as described in ORS 90.315 (Utility or service payments).

(2) Failure to clean up pet waste from a part of the premises other than the dwelling unit.

(3) Failure to clean up the waste of a service animal or a companion animal from a part of the premises other than the dwelling unit.

(4) Failure to clean up garbage, rubbish and other waste from a part of the premises other than the dwelling unit.

(5) Parking violations.

(6) The improper use of vehicles within the premises.

(7) Smoking in a clearly designated nonsmoking unit or area of the premises. The fee for a second or any subsequent noncompliance under this subparagraph may not exceed $250. A landlord may not assess this fee before 24 hours after the required warning notice to the tenant.

(8) Keeping on the premises an unauthorized pet capable of causing damage to persons or property, as described in ORS 90.405 (Effect of tenant keeping unpermitted pet). The fee for a second or any subsequent noncompliance under this subparagraph may not exceed $250. A landlord may not assess this fee before 48 hours after the required warning notice to the tenant.

(3) Other:

(a) Attorney fees authorized by 90.255

(b) Applicant screening charges per ORS 90.295

(d) Credit card processing fees

However, I was able to successfully make an argument to the MH Coaltion landlords and tenants such that fees cannot be charged to marina tenants for item #5: Parking Violations.

My argument is that, unlike park tenants who have driveways and carports which can fit multiple vehicles, marina tenants are at risk of parking violation every time they enter the marina in a vehicle because we only have common areas to park in. Subjecting marina tenants to fees for parking violations would risk them owing money when a service vehicle (house keeping, contractor, friend, guest, etc.) parks in a common area in violation of marina rules, as well as, every time we park. There is no safe-haven for parking because we have no private driveway or parking available to us. ALL marina parking is located in a common area subject to potential parking violations.

So, the MH Coalition agreed that marina landlords cannot charge fees for minor parking violations. The ability of a landlord to charge parking violation fees listed in ORS 90.302 (3)(b)(A) will only apply to park tenants.

And this ability for marina landlords to charge fees for minor noncompliances (with the exception of parking) will be in exchange for our ability to remove the language from the law which allows landlords to evict tenants for minor rule infractions.

And with that, the MH Coalition came to full agreement on our issues and wrapped up our meetings for this legislative session.

The bill will now be amended to reflect our new decisions and then work its way through the Oregon Legislature.

The next steps are to get the Legislative Counsel to draft our issues into bill language to amend our bill from January. Have our bill heard in a Senate work group, then voted and passed in the full Senate. Then onto the House for the same. Then back to the Senate for final voting to approve any amendments that the legislative counsel did not finish in time for the previous Senate vote!

It is important to note that Move-in, Move-out, facility use, and membership fees are not listed as an allowable fee by ORS and are therefore not legal to charge a tenant.

What Happened at the February 6, 2019, MH Coalition Meeting?

This meeting was held in Salem and John VanLandingham facilitated.

INFORMATION SHARING:

We discussed SB 608 in detail. This is not our bill. It is the bill sponsored by Rep. Kotek and covers rent caps among other items.
- Part 1 pertains to “double tenancies” – in other words, for floating home owners who rent their floating homes to tenants. You can only evict your tenant with good cause after the 1st year of occupancy. There are a few exceptions to this such a homes newer than 15 years among other reasons.
- Part 2 is a rent cap. No more than once a year, a marina landlord can raise the rent but no more than 7%, plus the Consumer Price Index (which is around 3% right now).
- This bill will pass. It may pass with an emergency clause which simply means that, instead of going into effect as law on January 1 of the following year, it will go into effect in 90 days from the signing.
- We spent quite some time discussing this because the Landlords don’t like being limited by how often and by how much they can raise rents on their park tenants and floating home owners.
- But we cannot weigh in on their bill.
Our Bill SB 586 Schedule:
- Jan 14: The bill was introduced
- Jan 17: It was Scheduled for review by various groups – tax, finance and revenue, environmental
- February 22: We will meet one last time to come to final agreement.
- Early March: It will likely have a hearing – Senator Fahey is pressing for a hearing of it. We need to have final agreement on all concepts by then.
- April 9: The deadline to schedule a required Senate Work Session to review it.

TERMINATIONS:

There are three parts to this issue:

Part 1: We agree to make a distinction between separate and ongoing minor violations.

Part 2: We agree to add “Materially” to describe the types of violations for which a tenant can be terminated. (But, given that we are adding in language to describe “material” (major) violations, it only seems reasonable to add language around what constitutes a minor violation.

Part 3: We have not come to agreement on who to treat minor violations.

The Tenants largely agreed to eliminate the 3 strikes and you are out option because Tenants do not think it’s right (for a numbers of reasons – too many to explain here) to evict someone because their dog was off leash 3 times or any other minor violation. We OWN our homes.

Which leaves us with the option to allow Landlords the ability to charge us fees. But not all Tenants agreed on this. Approximately half of the tenants (including one voting member) wanted to adopt the fees for minor violations and move on. The other half of the Tenants (full disclosure – I am in this latter group) want to allow Landlords the ability to charge fees, BUT also want to further discuss adding a few reasonable additional protections from abuse.

My experience with my marina landlord when she billed us for a $7 fee we didn’t legally owe is that we contested it and she told us we had to pay it. Our only other recourse, under current law, is to not pay it and take our chances in eviction court where the judge would likely side for us since we truly legally didn’t owe it…but let’s say the Landlord was able to convince the judge that we did owe the $7, either by falsifying documents, or perjuring herself to say that we had verbally agreed to it (stranger things have happened). IF the Judge decides that we owe the $7, then we are EVICTED. We are not given the chance to pay the $7…nope. We are forced to leave the marina. We lose our home. Over $7. Current law. No joke.

Therefore, we simply paid the $7 because we have better things to do than fight a legal battle over $7.

Now imagine the fee your landlord is charging you for a minor violation is $50 and you live on a fixed income AND you don’t owe it.

The following outlines the latter argument for why we need additional protections. Although, at this time, this late in the process, we may not get them this year.

We are about to give Landlords more power and are not adequately protecting Tenants from potential abuses of that additional power.

If we change ORS to allow fees for minor violations, then we are now going to allow ALL Landlords to (1) unilaterally amend rental agreements, (2) charge tenants fees for minor violations (and add a few more violations to ORS such as inoperable vehicles, etc.), and (3) terminate if Tenants don’t pay the noncompliance fees. Most Landlords do not currently have this power.

Adopting ORS 90.220(9) is just one step towards protecting Tenants from potential abuses that could follow if we allow all Landlords to terminate for the nonpayment a $50 minor violation fee.

ORS 90.220(9) is the statute that lays out what hierarchical order a Landlord can apply the payments they receive from a tenants. It basically says that a Tenants rent check can only be applied to rent first. In other words, a landlord cannot charge you a fee, then take the fee out of your rent check, thereby making your rent late which can get you evicted.

ORS 90.220(9) does not apply to marina tenancies. Only to apartment tenancies. Our group advocated for adopting this apartment law to apply to marina and park tenancies.

Without ORS 90.220(9), if a Landlord were to charge a noncompliance fee for a minor violation and the tenant didn’t pay it (perhaps they didn’t commit the violation and don’t believe the noncompliance fee is valid), the Landlord could use the Tenant’s rent payment to pay the contested noncompliance fee first. In this situation, the Landlord’s action causes the Tenant’s full rent payment to be considered “short”, which means, by definition, the Tenant’s rent is not paid.

When rent is late, it is a Material Violation of the lease. The Landlord can then issue a 30-day termination for nonpayment of RENT. So, without 90.220(9), the Landlords have the power to change a situation from being a Termination due to nonpayment of a noncompliance fee for a minor violation into a Material Violation of the rental agreement. The two cases for Termination are viewed very differently by a judge in an FED case. The case is then heard before a judge on the grounds of Termination Due to Nonpayment of Rent, when really the causing factor for the termination is not paying the $50 fee for a minor violation.

And keep in mind that minor violation notices do not require proof or evidence of any kind that a violation actually occurred. The notices just have to state facts sufficient to communicate the reason for the notice. So, a minor violation notice could state that “a tenant saw you fail to clean up after your dog.” So, if you don’t agree that you committed the violation and disagree that the fee is owed, then you could get terminated on the basis of Nonpayment of Rent. I witnessed a newer tenant get a warning because a “long-time resident saw (his) daughter throw a soda can into the river.” The accused tenant checked his grocery receipt – he had just moved in that day and just gone to the grocery for the first time and bought the kids one 6-pack of soda, and he had all 6 cans accounted for either in the fridge or the recycling. He offered to bring the cans and the receipt to the landlord as proof to refute the claim by the “long-time resident” who remained anonymous. The landlord said that wouldn’t be necessary because she believed her long-term resident over him. There is no proof or evidence required for notices.

Adopting ORS 90.220(9) creates a much-needed separation between terminations for reasons of nonpayment of noncompliance fees (the cause being a minor behavioral violation) and terminations for nonpayment of rent which is a material violation of rental agreements.

Giving Landlords these additional powers along with keeping the causes for these two types of termination separate – these two changes to the law complement each other and provide for a system of checks and balances that I know will benefit both Landlords and Tenants.

(Landlords said they would be ok adopting ORS 90.220(9) IF they could move fees to the top of the hierarchy, thereby causing tenants who didn’t pay the fees to be evicted.)

I reject the Landlords proposal to change ORS 90.220(9). We would like ORS 90.220(9) to be made applicable to park and marina tenancies as it is written in the statute.

Here are 4 reasons I think Tenants and Landlords need ORS 90.220(9) – Order of application of payment.
1. It seems that park and marina tenants should have, at the very least, the same protections as apartment tenants, although the second half of Chapter 90 exists because there is a legislative need to provide MORE protections for park/,marina tenancies than apartment tenancies. Apartment tenants already enjoy the benefits from ORS 90.220(9). The exemption of park and marina tenancies from ORS 90.220(9) seems to be just an understandable “oversight” as JVL explained (the General Coalition who passed ORS 90.220(9) didn’t want to speak for us). So currently, park/marina tenancies have less protections than apartment tenancies regrading the order of the application of fees. We should correct that.
2. Given that Tenants are on the precipice of allowing Landlords additional ways to exercise control over tenant behavior (spelled out in ORS with clear penalties for minor violations – a power which most Landlords do not currently have), as well as another way to extract fees by the unilateral amendment of leases (another power which they do not currently have), and that Tenants are placing themselves at additional risk for Terminations (for non-payment of noncompliance fees – MOST Tenants are not currently at risk for this category of terminations because noncompliance fees aren’t allowed in their leases), it only seems humane, fair and right that the Tenants should have some sort of understanding and trust about the hierarchy of where their rent checks will go.
3. ORS 90.630(1)(e) already authorizes a Landlord to terminate for nonpayment of a noncompliance fee under 90.302(3). Landlords already have this right. What the Landlords are now asking for is the right to Terminate on the basis of rent (a Material violation) where the underlying cause is simply a contested minor behavior violation either by (1) not adopting ORS 90.220(9) or (2) by adopting ORS 90.220(9), but altering it such that its protections from Landlord abuses are eliminated.
4. What do we think an FED Judge will do when hearing a case where a tenancy is being terminated because the Tenant is short $50 on their rent payment and the Tenant makes the case that he is “short” because he paid rent in full but that the Landlord is applying it to a fee that should never have been charged? I don’t think the ability to pull noncompliance fees from rent helps the Landlord in front of Judge. And I don’t think it helps the Tenant either. Re-writing this application order strips this statue of its intended purpose and further muddies the waters of already-complicated FED cases.

Adopting ORS 90.220(9) does not affect a Landlord’s right and ability to Terminate a bad actor Tenant for bad behavior and nonpayment of noncompliance fees. That ability remains the same regardless of adopting ORS 90.220(9).

In summary, most landlords did not amend rental agreements to allow noncompliance fees (and subsequent terminations for minor violations) when they had the chance. We are about to give ALL Landlords the ability to Terminate when a Tenant doesn’t agree with (and doesn’t pay) a noncompliance fee for a minor violation – of which no proof or evidence that the violation actually occurred is required. I think it is reasonable to ask that we have at least one safeguard measure [ORS 90.220(9)] put into place to help protect Tenants against possible abuses of this newly-acquired power.

Unfortunately, the Landlords would not agree to this. Given that we are running out of time to continue to debate this issue, we had to table it for our next meeting. If we cannot come to agreement, we will have to scrap this issue. If we begin scrapping issues, then the Landlords could stop the entire bill.

There are some other things we prosed to improve the issue concept as well. But it is unclear if those will even be heard due to time restraints.

So, cross your fingers for a productive next and FINAL meeting. This portion of the meeting did NOT go well for how late it is in the process. Clearly, there are still issues that require more through debate.

DISPUTE RESOLUTION AND ENFORCEMENT:

It is looking like we have agreement on Dispute Resolution and Enforcement. We agree to mandatory mediation and funding a special counsel to assist tenants with cases that will do the most good to eradicate “bad actor” Landlords.