Washington Multifamily End of Session Report #2 - SB 5160

Summary of Senate Bill 5160 - Partially vetoed by Governor Inslee and signed into law effective immediately on April 22, 2021. 

This summary was provided by the Washington Multifamily Housing Association.

From the start of the pandemic, it was clear some sort of legislative action would be necessary to address the return to normality. WMFHA worked throughout the past year with the Governor’s office and key lawmakers to express ongoing concerns our members had in making sure they could provide opportunities for quality and safe housing in Washington.

The ongoing payment of rent is the paramount issue affecting both housing providers and residents over the past year. Residents, for the most part, continued to make rental payments. For most of those that could not,  they reached out to seek assistance from the state and from numerous nonprofits. Still, rental delinquency averaged more than 7% in 2021. We anticipate that more than $750 million of rent is owing in our state as of March 2021.

Repeatedly, we asked to work with lawmakers to address issues present before and during the pandemic. We’re grateful to those lawmakers who worked collaboratively with WMFHA to reach a resolution on many issues during the legislative session and find a path forward to return to normality. These negotiations were not always easy, and we had to make decisions to obtain the best result for the industry as a whole. 

Senate Bill 5160 represents the pathway out of the moratorium. This bill ended up in a much different position than where it started and provides a clear return to normality. This is due to the work of the WMFHA Government Affairs team and our consistent interactions with the legislature to identify concerns and provide opportunities for compromise.

The bill provides a continuation of some temporary measures to assist residents struggling to recover while providing additional opportunities to obtain financial assistance to make housing providers whole for bearing the entirety of the burden for more than a year. We encourage you to sign up for and attend one of our upcoming webinars covering SB 5160 and the just cause eviction laws passed in this legislative session. 

Summary of key provisions of SB 5160:

• The bill, except for the requirement to offer payment plans upon nonpayment of rent, extends temporary protections through December 31, 2021.  
• WMFHA defeated efforts to extend protections through the public health emergency and to ANY future broadly defined public health emergency.
• Late fees are prohibited through December 31, 2021.
• Use of nonpayment of rent or an eviction related to nonpayment of rent through December 31, 2021, is prohibited in future housing decisions.
• Requires a payment plan of three months for every one month behind, and permits eviction where default or failure to engage in a payment plan communication occurs. The requirement to offer a payment plan extends through the duration of the public health emergency.
• Requires mediation-type services prior to the filing of an unlawful detainer action.
• Permits indigent tenants (less than $16,000 income annually) the right to counsel.
• Provides access to the Landlord Mitigation Fund and reimbursement of up to $15,000, where the tenant (1) voluntarily vacates the tenancy with a balance owing, or (2) defaults on a payment plan.
• Provides an opportunity for the tenant to obtain rental assistance for past due rent and up to three months future rent at an eviction hearing to reinstate the tenancy.

Despite these temporary opportunities and restrictions, WMFHA defeated efforts to enact numerous proposals that would have added unnecessary costs to the operation of rental housing, including: 

• Attempts to effectively extend the moratorium for two years after the expiration of the public health emergency, and to permit residents to terminate their tenancy at any time without penalty if they asserted a COVID nexus without any requirement of proof and limit any termination to sale or occupancy of the property only.
• Efforts to eliminate the show cause hearing, increasing the cost of every eviction by more than 500% and extending the time frame to obtain a writ and judgment by multiple months.
• Implementation of excessive penalties including the application of the consumer protection act for all violations and 4.5x times the rent penalties for violations of the law.
• Automatic sealing of all eviction proceedings, prohibiting a future housing provider from considering a past eviction record of any kind.
• Requirements to notify the local counsel for tenants of every notice provided to residents.
• Efforts to separate possession of the rental property from a debt owing.
• Efforts to repeal a law that prohibits the use of judicial discretion where resident received three or more 14-day notices in a 12-month period.

We appreciate all of our members who participated in calls to action, and provided testimony to the legislature this session in support of policies that provide real relief to both housing providers and residents. It is your voice that fuels our ability to obtain results on your behalf.

If you have questions about Senate bill 5160 or other legislative actions, please contact Brett Waller at brett@wmfha.org.  Washington Multifamily Housing Association.