2019 is shaping up to be the year for eviction reform

There are concerted efforts underway in both the Washington state legislature and the Seattle City Council to reform the tenant eviction process this year.

The impetus for much of this work is a September 2018 report entitled Losing Home, authored by the Seattle Women’s Commission and the Housing Justice Project arm of the King County Bar Association.

The report begins by analyzing the 1,218 eviction cases filed in Seattle in 2017, to understand what the causes and impacts are of evictions. Their analysis is lengthy and worth reading in full, but the most salient points include:

• Eviction disproportionately impacts households headed by women and under-represented minorities.
• The vast majority of evictions are for nonpayment of rent.
  
  But it’s often for small amounts of rent — 1 month or less. The Seattle Times recently reported on a woman facing eviction for a rent underpayment of only $2.  In other words, many landlords seemingly are rushing to evict people at the earliest opportunity.  To be fair, though, the study just analyzes evictions, and provides no data on instances that stayed out of eviction proceedings because landlords provided flexibility on payment of rent — one can assume there are plenty of those that go unreported. But of the cases where eviction did happen, the landlord didn’t wait long.In 2017, there were 21 eviction cases filed where the amount sought was $100 or less.
• Additional costs such as attorneys’ fees and court costs, which landlords are allowed to seek from tenants being evicted, can be substantial. In some cases, they can be considerably more than the underpaid rent. Here are the average costs:And here are a few examples from the report of outlier cases. In one case, a $600 rent underpayment led to over $4,500 of additional fees.
  
• Legal representation for tenants makes a large difference in the outcome, suggesting that the eviction process is not well understood by tenants and is difficult to successfully navigate.
  

This is no surprise: from the report, here is a flowchart of the typical eviction process for non-payment of rent. A lot happens in three short weeks.

The report calls out one organization in particular for what appears to be a harsh approach to eviction: the Low Income Housing Institute (LIHI). It evicted dozens of tenants from its properties for relatively small amounts of money.

And in many cases it tacked on substantial additional charges, the most egregious case being $1,450 in attorneys’ fees and court costs for a $49 underpayment.

The report highlights several problems with the current eviction process from the perspective of tenants, and recommends solutions — many of which require legislative action to reform current laws. Near the top of the list is that from the time a tenant receives an official notice that he or she is behind on rent, there is only a three-day window in which the landlord is required to accept payment, after which the landlord may choose to evict the tenant even if he or is able to pay. That’s not enough time to wait for the next paycheck, and despite the fact that programs assist to help tenants financially who are in danger of eviction due to nonpayment of rent, three days is often not enough time for tenants to discover and contact those programs and get the assistance in-hand to pay their rent in full.

The report offers eighteen recommendations for specific actions to be taken to reform the eviction laws, process, and tenant assistance programs:

State representative Nicole Macri (with a number of co-sponsors) has introduced two bills during the current session to address some of these issues. House Bill 1656 attempts to repeal “no-cause eviction.” It does the following:

• It extends the definition of “tenant” beyond the persons who signed the lease to any other occupants of the units who have co-resided with the tenants for at least six months. This is to address the case where the signed tenant moves out and the other co-occupants have no legal rights to remain in the unit.
• It prohibits a landlord from attempting to evict a tenant or terminate a tenancy without a court order, which may only be obtained after the landlord “pleads cause with specificity.” It goes on to list the specific types of “cause” that are allowed.
• It changes the rules for fixed-duration rental agreements so that they no longer terminate at the end of the specified period; instead, they automatically become month-to-month rental agreements with no end-date. Except for a few limited cases, this means that the power to end a lease would live almost entirely in the hands of tenants.
• Currently if a tenant files a complaint about a rental unit and in the following 90 days the landlords starts eviction proceedings for nonpayment of rent or breach of the rental agreement, there is a presumption that the eviction action was not retaliatory. That presumption is removed.
• Currently in an eviction proceeding, neither party may recover legal fees if those legal services were provided to them at no charge. That rule is deleted.
• The rules around landlords handling of the tenant’s damage deposit post-eviction are tightened, including a firm requirement for written third-party receipts or estimates for all damage charges.

House Bill 1453 more directly addresses reforms to the eviction process itself. It does the following:

• It extends the period for a tenant to pay rent in arrears from 3 days to 21 days after receiving a formal notice.
• It rewrites the required text in eviction notices to include new language that clarifies the requirements placed on tenants to participate in the process and lists where a tenant can go to get help.
• It specifies that continued tenancy or relief from eviction can only be conditioned on payment of rent itself, not other charges, utilities, late payment charges, legal costs, attorneys’ fees, or anything else. It also says that any payments the landlord receives must be used to pay for rent first, before being credited toward any other fees or charges due.
• It grants judges overseeing eviction proceedings more discretion, allowing them to provide relief from eviction if it is “appropriate in the interest of justice.” Currently judges have little discretion, which is one reason why so many evictions move forward and with such speed. Judges may also stay an eviction if it deems such an action “fair and just.”
• After a judge enters a judgment in an eviction case, the eviction will not be executed for five days; and in that period, the tenant has the opportunity to pay the rent in full and have his or her tenancy restored. Again, that is just the rent and not any other fees or charges owed.
• When the eviction is for the breach of a condition in the rental agreement that is “a condition capable of cure,” the court is required to stay the eviction order “to afford a reasonable time for the tenant to properly cure and redeem the tenancy.”

For its part, the City Council seems to hope that Macri’s bills make it through the state legislature. But Council members Lisa Herbold and Mike O’Brien have brought forward their own resolution to establish an agenda for local reforms to the eviction process. That resolution passed through Herbold’s committee two weeks ago, and is up for final approval by the full Council tomorrow (Monday) afternoon. Rather than identify specific solutions, the resolution lays out several problems for the Council to tackle this year, and a couple more that form a longer-term agenda.

The issues on the resolution’s list for this year:

• the financial hardship for tenants experiencing domestic violence who are held liable for damages caused by a perpetrator of domestic violence against them;
• the difficulty of avoiding eviction when faced with life emergencies such as temporary unemployment, medical emergencies, deaths in the family, domestic violence, and “large rent increases;”
• difficulties that tenants have understanding the eviction process, or the effect of “mutual termination agreements;”
•  lack of awareness by tenants of their legal rights in the eviction process as well as the free legal resources available to them;
• the substantial financial burden placed upon tenants by non-rent charges such as late fees, court costs and attorneys’ fees;
• leases that prohibit or limit the number of roommates, when many tenants need to share a unit with a roommate in order to make it affordable. Also, the power of landlords to exercise wide discretion in rejecting potential roommates, or to impose extra fees for roommates;
• fees for early termination of a lease, even when the unit can be rapidly re-rented;
• courts generally don’t (or can’t) exercise judicial discretion, even when a tenant has good cause to be late in paying rent and can pay in full at the time of the hearing.

On the longer-term list:

• providing additional support for eviction proceedings for tenants with physical or mental health disorders or who are hospitalized;
• tenants living in a unit when the tenant of record dies who don’t have legal rights to remain in the units;
• the reporting of landlord-tenant debt in credit reports, which might make it more difficult for tenants to obtain housing.

While there are many important issues to be addressed on the list and many landlord abuses to be curbed (such as excessive charges tacked on to evictions), these are also very one-sided lists that paint all landlords with the same broad brush — and assume to some extent that landlords don’t have cash-flow issues as severe as some tenants. It also continues a local trend in denying landlords the right to choose tenants (by denying them the ability to end a tenancy with a problematic tenant who might violate the spirit but not the letter of a lease agreement or who is chronically late in paying rent but never quite meets the threshold for eviction). But landlords’ rights to choose their tenants is a matter being litigated in Washington courts at the moment — and at least for the moment, the landlords are winning. That might pose a problem down the road for Macri’s bill prohibiting no-cause evictions if worded too broadly.

As expected, the Rental Housing Association of Washington, a trade-association and advocacy group for landlords, has come out strongly against the City Council’s resolution setting out its eviction reform legislation. In a statement emailed to me,  Heather Pierce, the RHA’s Deputy Director of Government Affairs, wrote:

The simple, effective solution to reducing evictions for non-payment of rent is to provide short-term, emergency rent assistance for those in need and with limited resources. RHAWA advocated that Council greatly increase this funding during its budget discussions and was roundly ignored.

Short-term rental assistance works. Seattle’s own Housing Levy Report from March 2018 notes a 97% success rate at preventing eviction and homelessness. RHAWA publically supported passage of the Seattle Housing Levy in 2016 and the renewal of Bellingham’s Housing Levy in 2018 for this very reason.

SCC has chosen to put zero additional dollars toward short-term rental assistance in 2019, with Councilmember Herbold instead wanting to study its efficacy – in the face of the City’s own Housing Levy Report demonstrating that short-term assistance works and preempts the eviction process all together.

Interestingly, Greystone Company analyzed rental subsidies given out by cities around the country and Seattle ranked among the lowest when it comes to providing residents relief for financial emergencies that would otherwise keep them housed.

Landlords are not the cause of eviction. Income inequality, and systemic economic and institutional social barriers are the drivers of the collective action problem before us. Council can best serve the City by engaging with stakeholders on all sides. Developing the best available data as a basis for policy discussions would create cogent economic outcomes for tenants while preserving Seattle’s indispensable rental housing stock.

In a followup, I asked Pierce whether they would support the City Council investigating any of the individual issues it raises in the resolution. Her reply: “We presented a solution that has a proven track record in cities around the country. The resolution is not legislation and the concepts presented are not legislation, so we really have nothing specific to comment on regarding the resolution. ”

Clearly both sides are staking out positions on the ends of the spectrum. 2019 looks to be the year for eviction reform (or at least attempts), but don’t be surprised if it drags out in the courts into 2020 and beyond. In the meantime, House Bill 1453 is scheduled for a hearing in Olympia Tuesday morning, and House Bill 1656 is scheduled for its first hearing Wednesday morning.