Landlords and tenants have a protected relationship here in Washington thanks to the Landlord-Tenant laws.  However, COVID-19 further changed the landscape and procedures for landlords wanting to evict their non-compliant tenants, and five proposed bills in the legislature may create even more limits and procedures for landlords when increasing rent.

A recent case before the Washington Court of Appeals, Sherwood Auburn, LLC v. Pinzon and Mendez, changed the notice period applicable to pay or vacate notices—and perhaps other types of eviction notices—for residential landlords that operate “covered properties” under federal law.

A “covered property” under the CARES Act is either a property with a federally backed mortgage, or a property receiving CARES Act dollars through federal programs.  According to the Sherwood Case, if a tenant occupies a rental property with a federally backed mortgage, the landlord must provide the tenant with a Thirty (30)-Day Pay or Vacate Notice—and no other conflicting notice—before commencing an unlawful detainer (eviction) action. Similarly, landlords must provide tenants with a Thirty (30)-Day Pay or Vacate Notice if landlords accept rental assistance that use CARES Act dollars.  It may be difficult for landlords to determine whether rental assistance programs receive CARES Act funds prior to accepting the rental assistance because these programs are administered locally through a non-profit who receive funds from multiple sources, including state and federal aid.  The Sherwood case also raised the question of whether landlords need to provide Thirty (30)-Day Comply or Vacate notices to tenants for other issues besides non-payment of rent, but as it is now, the case provides no definite answer to such question.

As it may not be obvious, there are some steps landlords can take to determine whether the rental unit is a “covered property” subject to the thirty (30)-day notice period.

  • First, Landlords should determine whether your property has a federally backed mortgage by contacting your loan office or lender.
  • Second, if Landlords are considering taking rental assistance, you should contact the provider of assistance to determine the source of funding, if possible, so you can provide the appropriate notices in the future.
  • Third, if Landlords have taken, or are considering taking, rental assistance, you should keep track of rental assistance payments from non-profits on your tenant’s behalf.  This information is helpful if the landlord must issue a notice to pay or vacate later in the tenancy.

A note of caution – Landlords cannot discriminate based on a tenant’s source of income.  Such refusal to accept rental assistance could be considered discrimination based on source of income.  Landlords considering refusing rental assistance from existing tenants should contact our office before refusing to understand what risks may be associated with that refusal.

In addition to case law changes, the Washington State Legislature is considering six bills that may impose a wide range of limitations on landlords:

  • HB 1388 – Applies Washington Consumer Protection Act to rent practices and prevents increases in rent greater than CPI or 3% whichever is greater, up to a maximum of 7%
  • HB 1389 – Prohibits rent increase during the first year of tenancy.
  • HB 1124 – Require landlords provide 180 days’ notice for any rent increase over 5% and would allot a tenant to terminate a tenancy without penalty for any rent increases above 5%.
  • HB 1074 – Require landlords provide copies of estimates received or invoices paid to reasonably substantiate damage charges when withholding any amount of the security deposit.
  • SB 5435 – Subject to certain exceptions, a landlord may not increase rent for a month-to-month tenancy during the first 12 months after the tenancy begins
  • SB 5197 – Proposes the removal of the requirement that landlords send pay or vacate notices to the local dispute resolution center after the Eviction Resolution Pilot Program established under RCW 59.18.660 expires.

Lastly, some of the COVID-19 measures put in place to protect tenants are set to expire – the payment plan requirement (set to expire as of May 1, 2023) and the Eviction Resolution Pilot Program (“ERPP” – set to expire as of July 1, 2023).  The current legislation does not include an extension for either the payment plan requirement or the ERPP.   However, the ERPP includes a provision requiring assessment of the program after July 1, 2023, so it may be extended in a later session following the legislature’s review of the ERPP’s effectiveness.  Should you wish to comment on the ERPP or any of the pending legislation impacting landlords, you can find your state legislature to contact on the State’s District Finder website.

Please contact Timothy D. Schermetzler or Conner A. Sapp at CSD Attorneys at Law if you have question about residential landlord tenant laws or otherwise need assistance with managing your tenancies.