Wednesday, June 30, 2021

Oregon SB 278 and 282 Summary for Landlords - Oregon's Eviction Extension and Grace Period for Repayment of Rents

 

The article below covers newly enacted Oregon Senate Bill 278, which requires landlords and courts to delay termination of residential tenancies for nonpayment for 60 days if the tenant provides documentation of application for rental assistance.

It also covers Oregon Senate Bill 282, which extends the grace period for repayment of residential rent accrued during the emergency period of April 1, 2020, to June 30, 2021, until February 28, 2022.

Courtesy of Kevin Eike, Eike Law PC

SB 278 and 282 Summary for Landlords 

Executive Summary: Extends grace period for repayment of residential rent accrued during the emergency period of April 1, 2020, to June 30, 2021, until February 28, 2022. Prohibits residential landlords from reporting nonpayment of rent accrued during the emergency period to credit bureaus. Prohibits residential landlords from screening prospective tenants based on nonpayment of rent accrued during the grace period. Allows certain defendants to set aside and seal judgments of evictions based on claims arising during the grace period. Limits certain restrictions on residential tenant's guests. SB 282 sunsets on March 1, 2022.  

SB 278 and 282 replacing and amending HB 4401 

We begin by reviewing our terms. “Emergency period” is the period during which tenants do not have to pay rent. The EP began on April 1, 2020 and ends on June 30, 2021. The “nonpayment balance” is the amount of unpaid rent, charges, or fees accrued during the EP. “Grace period” is the period during which tenants must eventually pay the nonpayment balance. The GP now ends on February 28, 2022. (SB 282 drops entirely the requirement of the “notice of eviction protection” and the “declaration of financial hardship,” for the sake of terminating a tenancy, but SB 278 still requires the declaration if a landlord applies for rental assistance.) 

What happens on July 1, 2021, with respect to rent? SB 278 § 2 (sunsets on February 28, 2022) 

1.Tenants must pay July's rent or be at risk for a 10-day nonpayment notice, subject to certainnotice requirements:

a. Additional language is required on the notice and any FED summons and complaint:“Eviction for nonpayment of rent, charges and fees that accrued on and after April 1,2020, and before June 30, 2021, is not allowed before February 28, 2022. Informationregarding tenant resources is available at www.211info.org.”

b. A revised notice of eviction protection must be enclosed with the 10-day notice, as wellas attaching that notice of eviction protection to any FED summons or complaint. (Whilethe declaration of financial hardship has been eliminated for the sake of the notice, it is still required for the landlord to apply for rent assistance.)

2. If a tenant has provided documentation to the landlord from a rent assistance provider verifying the submission of an application for rental assistance, the landlord may not give a nonpayment notice and may not file or continue an FED. A tenant may supply this documentation (in any written form) up to and including the first appearance in an FED. In that case, the court will postpone the first appearance for 60 days. A tenant may invoke this 60-day mini-EP only once!

a. If 60 days now pass after the tenant gave such documentation, the landlord may give anonpayment notice without having to include the notice of eviction protection (becausethe tenant already knows). If a court has postponed first appearance because the tenantsupplied documentation at first appearance, the court will now set the matter for trial.

b. A court will dismiss an eviction complaint if it finds that:

i.a landlord did not include a notice of eviction protection with the nonpayment notice

ii.the landlord failed to reasonably participate in a rental assistance program

iii.the landlord receives the rent specified on the nonpayment notice (of course)

iv. a tenant supplied the required documentation before the landlord filed the complaint

3. A nonpayment-balance reminder notice must change the “can’t evict for that balance until” language to “can’t evict for that balance until” February 28, 2022.

4. Landlords can now serve any termination notice without cause under ORS 90.427. (HB 4401allowed only no-cause terminations with a landlord-qualifying reason under ORS 90.427(5).)However, for the sake of the first year of occupancy rule, if the first year would have expired between April 1, 2020, and August 31, 2021, the first year ends on August 31. This is the only substantive restraint on terminating for no cause under ORS 90.427. Thus, in order to terminate under ORS 90.427(3) or (4), the effective date of the notice must fall no later than August 31,2021, most landlords will have to resort to a 90-day notice.

5. Landlords can apply to the Housing and Community Services Department for 100 percent (not merely 80 percent) of tenants’ nonpayment balances. Landlords still need tenants to sign a declaration in order for landlords to apply. Tenants who have incomes at or below 80 percent of AMI can apply to the Oregon Emergency Rental Assistance Program and payments go directly to landlords in almost all cases. This sunsets on March 1, 2023.

What is extended until March 1, 2022, with respect to rent? 

  1. The GP: Tenants have until March 1, 2022, to pay their nonpayment balance. If they do not payby then, they are at risk for a nonpayment notice, being sued for EP rent, and being referred to collections or reporting to a credit agency for unpaid EP rent.

  2. Enhanced statutory damages of three times rent if a landlord retaliates (ORS 90.385). If a tenant has a nonpayment balance, a landlord cannot consider a tenant to be in default of rent under ORS 90.385 or ORS 90.390 (discrimination).

  3. The changed order of payments under ORS 90.220(9) (first dollar landlord receives goes to current month’s rent).

  4. If a landlord accepts partial rent for either a tenant or a guest (see below, “Non-Tenant Guests”), the landlord does not waive their right to terminate under ORS 90.412(2) (accepting rent with knowledge of violation) or ORS 90.417(4) (requirement of a separate agreement for accepting partial rent).

  5. Revised notice of eviction protection must be enclosed with the 10-day notice, as well as the FED summons and complaint.

  6. Ability of landlord to take EP accrued rent out of the deposit, but only after the tenancy terminates.
  7. Finally, the statute of limitation of ORS 12.125, with respect to claims by a landlord based on a tenant's nonpayment or nonpayment balance, is tolled until March 1, 2022.

What happens on March 1, 2022? 

The tenant protection provisions of SB 278 and 282 are repealed, except for certain sections below. Nonpayment notices revert to 72 hours. A landlord may send a nonpayment notice on March 1, 2022, if the tenant does not pay the nonpayment balance by February 28, 2022. 

Tenant Reporting and Screening Amending ORS 90.303 (§ 8) 

A landlord may not report to any consumer credit reporting agency a tenant’s nonpayment balance. 

Landlords considering a prospective tenant may not consider an FED general judgment entered against that prospective tenant for any claims that arose during the EP and the GP. Nor may landlords consider an applicant’s unpaid rent during the EP and the GP.  

These amendments sunset on January 2, 2028. You heard that right—2028. 

Eviction Judgment Expungement Statute (ORS 105.163) Amended (§ 9) 

ORS 105.163 generally allows a tenant to have an eviction judgment set aside after five years and have the record sealed. SB 282 echoes the language of amended ORS 90.303: If the judgment was based on any claims for possession during the EP or GP, the tenant can have the judgment expunged.  

These amendments sunset on January 2, 2028. 

Non-Tenant Guests (§ 14) 

During COVID-19, landlords terminated tenancies for guests overstaying a limit on the number of days tenants had agreed to in the rental agreement. SB 282 reduces that likelihood by generally opening up occupancy, subject to certain limits. A landlord can still write into the rental agreement a max occupancy, but there are limits to enforcing that max: (1) If there is a federal, state, or local max occupancy, the rental agreement cannot go below that max for tenants or guests. (2) Setting (1) to one side, a rental agreement cannot set a maximum-duration limit for a guest.  

However, if the guest stays longer than 15 days in any 12-month period, a landlord may require the guest to satisfy the landlord’s screening criteria for tenants, except for financial criteria (because guests do not pay rent). A landlord may also require the tenant and guests to make a temporary occupancy agreement under ORS 90.275. But a landlord cannot require the end date of that agreement to be earlier than February 28, 2022.  

A tenant is not entirely off the hook, however. A landlord may assess a fee or terminate the tenancy if the guest misbehaves or violates the temporary occupancy agreement. This is consistent with termination for nonpayment now being available for landlords post-July 1. A guest may also pay “rent,” without making the guest a tenant.  

These amendments sunset on March 1, 2022. 

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Kevin Eike and the Eike Law team may be reached at info@eikelawpc.com or (503) 372-6755.

This article presents general information about various aspects of Oregon landlord-tenant law, is not intended as legal advice, and you should not consider it as legal advice. You should not act upon this information without seeking professional legal counsel. Please do not send Meyers Law, LLC, any information or documents until a formal attorney-client relationship has been established through an interview with a lawyer and you get authorization in the form of a fee agreement from Meyers Law, LLC. Any information or documents you send before your receipt of a fee agreement cannot be treated as confidences, secrets, or protected information of any nature. 

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