Statewide “Bridge” Program in the State of Washington
As the COVID related eviction moratoriums are evolving to an eventual conclusion, Washington State is facing an overall change in rental laws, as well as the recovery from delayed or unpaid rental payments during this public health emergency.
Pending the final end to the moratoriums, Governor Inslee has issued Proclamation 21-09 in order to “bridge” the time gap between the end of the moratoriums and the effectiveness of transitioning through this recovery.
Below is an overview of the Statewide Bridge Program and the changes in the over state of Washington rental laws as well as how these commingle with the COVID recovery aspects for Landlords and Tenants.
Because the new long-term laws, as well as the COVID recovery Bridge programs have very stiff penalties for Landlords not in compliance, the attorneys at Holmquist + Gardiner strongly advise you to seek counsel on issues you may come across related to these legal changes.
Statewide “Bridge” Program
On June 29, 2021, Governor Inslee announced the Bridge program under Proclamation 21-09, intended to bridge the operational gap between the eviction moratorium, which expired June 30, 2021 and the protections and programs subsequently enacted by the Legislature. With the changes in Washington State Law, the bridge is meant to create more certainty as the post-COVID long-term housing recovery strategies contained in legislative enactments such as SB 5160 are implemented.
In order for both Landlords and Tenants to get back on track from the fallout of COVID, the bridge program was created and is effective July 1, 2021 and remains in effect until 11:59 PM on September 30, 2021.
Proclamation 21-09 has various protections, including that eviction for non-payment of past due rent is not permitted until the resources and programs created to address this are in place and operational. This means, if you do not try to take advantage of these programs once they are implemented, that eviction is possible. Eviction for non-payment of future rent, meaning during the time of August 1, 2021 to September 30, 2021 is not permitted if the tenant has taken demonstrative action to pay rent.
In addition, the order requires, among other aspects, that:
Landlords and tenants avail themselves of rental assistance and eviction resolution pilot programs pursuant to SB 5160 to resolve any COVID-related past due rent (February 29, 2020 through July 31, 2021);
Tenants take steps to pay rent or avail themselves of rental assistance in order to pay future rent (beginning August 1, 2021 throughout the effective dates of this order);
For any tenant who is or becomes in arrears, landlords offer a reasonable repayment plan to tenants per SB 5160; and
Tenants respond to notice of funding and other available programs within the timeframes established by SB 5160.
Late fees / Rent Increases
During the Bridge period, late fees are prohibited, but rent increases are permitted as provided under state law (RCW 59.18.140).
Non-traditional Housing
Non-traditional and other transient housing previously covered by the eviction moratorium are not included in this order, including hotels/motels, Airbnbs, and camping areas.
Utilities “inextricably linked”
Linked to the housing issue, Governor Inslee also issued guidance on utilities. While potentially viewed as a separate issue by some, some landlords may include utilities in rent, and therefore should be aware of the potential impact.
Under the Proclamation, utilities are encouraged:
Continue to make good faith efforts to reach customers with past-due accounts, including partnering with community organizations, and provide information about their various assistance options.
Help customers identify utility, local, state and federal financial assistance programs they may be eligible for.
Offer extended payment plans of 12 months or longer.
Waive disconnection, reconnection, site visit and late fees accrued during the disconnection moratorium, if customers sign up for payment assistance.
Refrain from reporting overdue accounts to credit bureaus or placing liens on customers with overdue accounts for at least 180 days.
Tenants are encouraged to reach out to their utilities company in order to work with them on any past due balances. In addition, if the Landlord includes utilities in the rent or in addition to rent, reach out to them to discuss repayment options to avoid issues there.
State Changes Summary
SB 5160 made very broad changes to residential landlord-tenant law in Washington. An overview of these changes are as follows:
COVID-related changes:
Expands tenant screening protections related to medical history and COVID debt.
Extends prohibition on late fees six months after the end of the State moratorium.
Requires mandatory payment plans for rental debt accrued during the public health emergency.
Legal Counsel and Procedural Guidance for Landlords and Tenants:
Establishes a statewide right to legal counsel for low-income tenants in eviction hearings.
Under AG Ferguson’s Opinion on July 9, 2021, this covers that as of April 22, 2021, no unlawful detainer proceedings of indigent clients can proceed if that client has not been offered appointed counsel by Superior Court.
During the time frame of Proclamation 21-09 and after September 30, 2021, the same rule will apply – indigent tenants must be offered court-appointed counsel.
Adds language to termination notices informing tenants where they can seek legal help.
Adds language to eviction summons informing tenants of right to counsel.
Requires dispute resolution prior to the service of an eviction summons and complaint.
Adds dispute resolution language required for 14-day non-payment of rent notices.
Lease Language:
Expands definition of tenant and new notice requirements to include some transient and transitional situations.
Allows co-tenants to apply for tenancy after death or abandonment of primary tenant.
HB 1236 Section 2 (3)
If tenant vacates and leaves other occupants behind, landlord must serve notice to apply to become a party within 30 days of serving notice.
The landlord has provided the tenant before the end of the specified period at least 60 days advance written notice that the tenancy will be deemed expired at the end of the specified period, served in a manner consistent with RCW 59.12.040
Prohibits agreement terms that waive tenant rights, require a tenant to apply for government benefits, include charges other than rent, or provide for an automatic eviction in the event of a missed payment.
Rent Payments:
Requires payment plans be reasonable and that installments not exceed 1/3 of monthly rent.
Screening:
SB 5160 prohibits reporting to prospective landlords, requesting from previous landlord or using negative information about negative rent payment history between 3/1/2020 and 3/31/2022 (or six months after end of emergency order) or any related unlawful detainers.
Immigration and / or Citizenship status are not protected in Washington State.
Allow alternative financial history documentation for housing decisions if credit report cannot be obtained.
Statewide Just Cause Eviction
While Seattle has had Just Cause Eviction for decades, the state just enacted ESHB 1236 to create statewide just cause protection.
Under this law, the JUST CAUSE EVICTION reasons include:
Failure to comply with a termination notice.
Habitual non-compliance with material lease terms
Waste, nuisance, or repeated substantial interference with owner or other tenants’ quiet enjoyment.
Sexual harassment by tenant against owner or if the tenant is required to register as a sex offender.
Owner intends to sell, occupy as a primary residence, redevelop the property or convert to a condo.
Owner no longer wishes to share a property which they also occupy and share common areas.
Owner is required to close the property due to health and safety violations.
Owner has a legitimate business or economic reason to end the tenancy.
Understanding when Just Cause applies to the non-renewal of the lease under the new laws: Section 2(1)(c)
If the initial agreement is a term SIX months or more and NOT converting to month-to month
Agreement was continuously renewed for a fixed term of 6 months or more.
May end tenancy without cause with 60 days’ notice prior to any unspecified term.
Agreement allowed to continue month-to-month or term less than six months at any point.
Just Cause applies
If initial agreement is for term 12 months or more, that does not convert to month-to-month.
Agreement was continuously renewed for any length of fixed term.
May end tenancy without cause with 60 days’ notice prior to any specified term.
Agreement allowed to continue month-to-month at any point.
Just cause applies.
Many ordinances do not allow this exemption: Auburn, Burien, Federal Way, Seattle, Unincorporated King County
Section 2(1)(c)(iii) – Safe Harbor Window
For any tenancy that was month-to-month on May 10, 2021, If the landlord and tenant enter into an initial agreement between May 10, 2021 and September 30, 2021:
a six month lease or more that does not convert to month-to-month; or
a twelve month term or more that does not convert to month-to-month
The new agreement will be treated as it is the initial agreement and will be maintained as an exempt tenancy.
Lease Terms
RCW 59.18.140: 60-day notice to increase rent
Other changes to terms still require 30-days notice
Various municipalities have other rent increase provisions
HB 1236: Section 2(1)(b)(ii) and (c)(ii): 60-day notice to end “for cause” exempt term agreement
HB 1236: Section 2(2)(k): Just cause to terminate if tenant does not accept offered renewal at least 30 days prior to end of current term.
Fixed-term leases (including successive fixed terms) can be terminated if the owner gives the tenant 60 days’ written notice before the end of the rental period. Additionally, mutual terminations must provide a minimum of 60 days for the tenant to vacate.
Serve notice regarding end of term more than 60 days prior to end of term.
Option A: No renewal is offered, vacate premises per current rental agreement.
Option B: Offer renewal with attached extension form or new rental agreement.
Tenant must return signed new agreement at least 30 days before end of term or vacate the premises per current rental agreement.
Failing to comply with strict notice requirements under RCW 59.12.040 can lead to loss of exemption from “for cause” termination.
More guidance is available on lease terms if you have expiring leases that need to comply with the new laws; or if you have previous month-to-month clauses that you would like to evaluate for renewals of leases.