Legislative Session Weekly Update 2 - Jan 30, 23

Several new bills were numbered this week and/or we have received draft language:

HB 316 RESIDENTIAL RENTAL AMENDMENTS GayLynn Bennion (D), Cottonwood Heights

This bill does two things:

1. It requires 90 days’ notice of rent increase if the increase is greater than 10% or $100
2. It requires all expenses in the contract be listed in the first page of the lease, or on consecutive pages

We are meeting with the sponsor on Tuesday to seek compromise. Most states allow a contract to be modified, including an increase of rent, with 30 days notice.

Un-numbered House Bill on Garnishments Marsha Judkins (R), Provo

This bill would add protections for bad tenants and other debtors who owe money and reduce the effectiveness of garnishments. Not only would it make it harder to garnish a debtors wages, but it would incentivize renters to make sure their income stayed below a certain level of income so they could never be held accountable for any debt.

While it sounds consumer friendly (it is definitely anti-business), this bill would be devastating for low-income renters because if it was harder to hold renters accountable for the money they owed, landlords would simply increase their deposits and/or rental criteria, making it more difficult for renters who make less than a certain income and would be difficult to garnish to find a place to rent.

The way garnishment currently works, if a renter owes you money, you can get a judgement and garnish 25% of a person’s disposable income above $217 a week. So, if a person brings home 80% of AMI, or about $49,000 a year, once taxes of 15% are deducted they would bring home about $800 a week. Deducting the safe harbor of $217, you can garnish 25% of the remaining $583 or $145 a week. This language would reduce the percentage you could garnish the lower the income amount. It would also require reporting, which would increase the cost of garnishments or make it infeasible.

The sponsor has good intentions with this bill, to protect tenants who get themselves in a situation where they owe money. But make no mistake, to protect tenants that owe money, this bill would hurt renters who pay their bills by leading rental owners to mitigate risk by raising rental criteria and charging higher deposits. We hope to meet with the sponsor this week and that we can help her see that not only does this hurt small business owners by making it harder to collect debt, but it will make it harder for all low income renters, even those who have never owed a landlord money, by increasing the barriers to entry for people who make less than certain amount of income.

For information on other bills we are tracking, see our previous legislative reports.