Senate Bill 101(S) passed the Senate 13-7-1 earlier this month, but it ran into some difficulty last week in the House Housing & Community Affairs Committee. First, the bill would provide tenants facing the greatest financial hardship with access to legal counsel, create a diversion program to resolve most landlord-tenant disputes before they result in legal action, set a floor on the arrears that can result in eviction proceedings and allow tenants to stay in their homes if all back rent, fees, and costs are paid prior to an eviction.
Sounds good right? Well, the Landlord Lobby is going apeshit and leaning heavily on some Democratic Representatives in the House. The bill was tabled in the House Housing Hearing last week because the management of the hearing went off the rails after the Chair had to leave for another committee hearing, and so the wavering House Democrats on the committee who needed to hear strong testimony basically got to hear twenty minutes of objections from opponents and about five minutes from actual expert witnesses in favor of the bill. Because of the disparity, the bill will be heard against this Tuesday at 11 am in the House Housing Committee.
I have heard that Representative Kim Williams has not yet committed to supporting the bill in committee or on the floor. She is hearing apocalyptic and inaccurate arguments from landlord groups about how the bill will slow the process and put them out of business. It will not slow the process at all (and in fact may speed up the process if tenants have counsel) and Chief Magistrate Alan Davis has confirmed that. I’d ask Representative Williams and any other wavering Democrat to read the arguments for the bill, and the rebuttal to the arguments you are hearing, below:
| SENATE BILL 101 SPONSORS | YES VOTES | NO VOTES |
| Townsend, Pinkney, Gay, Lockman, S.McBride | Senate Passed 13-7-1. Brown, Ennis, Gay, Hansen, Lockman, Paradee, Pinkney, Poore, S.McBride, Sokola, Sturgeon, Townsend, Walsh | Bonini, Hocker (not voting), Lawson, Lopez, Mantzavinos, Pettyjohn, Richardson, Wilson |
| Minor-Brown, K.Johnson, Lambert, Bentz, Longhurst, Morrison, Wilson-Anton | ||
| CURRENT STATUS — | Sent to House for consideration |
Overview of the Bill
1. Establishes a right to counsel for evictions and certain other landlord/tenant actions for poor tenants (200% of poverty or less).
2. Establishes a Right to Counsel Coordinator in the Attorney General’s office, to implement and oversee the program.
3. Establishes a pre-filing Eviction Diversion program to require mediation, which will resolve many cases before they ever get to court. The diversion program will also connect landlords and tenants with sources of rent payment, including DeHAP (Delaware Housing Assistance Program). The diversion program will be overseen by the Justice of the Peace Court, and will be modeled after the Residential Mortgage Foreclosure Mediation Program.
4. Creates a minimum requirement to file for eviction of one month’s rent or $500, whichever is greater. Currently there is no minimum necessary to file for eviction, so landlords can – and some have – filed to evict a person for owing as little as one dollar.
5. Creates a “right of redemption” in evictions, which will permit a tenant to stay in their home if they pay rent due, plus court costs and fees, prior to the writ of possession being posted.
Why the bill is important
Even before Covid, approximately 18,000 eviction cases per year were being filed in Delaware. This bill is NOT about allowing tenants to stay without paying. It is about helping poor tenants navigate a complex process.
Stable housing is key to maintaining employment, keeping kids in school, and physical and mental health. Tenants who cannot afford to hire an attorney should not have to go through the eviction process alone. Few things are more destabilizing for a family than losing their home.
Currently, in eviction proceedings in JP Court, 86% of landlords are represented by either attorneys or non-attorney agents. Only 2% of tenants have representation, and current rules do not permit tenants to have non-attorney representation.
Delaware spends a tremendous amount of money supporting people who do not have stable housing. Costs include homeless shelters and support, heath care costs (including increased emergency visits,) foster care, and education costs to support children. An independent report done on eviction in Delaware by Stout shows that for every dollar we spend on providing help for tenants at the front end of eviction proceedings, we save $2.75 at the back end. Put into the actual costs of providing these services (which have so much support that they have already been voted in by the JFC) for every 3 million dollars a year that this bill will cost at full implementation, the State of Delaware will save 9 MILLION DOLLARS. We can’t afford not to pass this bill.
What the Bill Doesn’t Do
1. Does not change the underlying duty to pay rent. If a tenant can’t pay the rent, they can’t remain in a unit.
2. Doesn’t require landlords to hire attorneys in all cases. This bill will only provide representation for poor tenants. This bill seeks to help tenants so they don’t have to go it alone when their housing is at stake.
Many landlords are now represented by non-attorney agents in court. These agents become familiar with how the process works. Tenants have no idea how to navigate the complicated process of going to court. An application has been made to the Delaware Supreme Court to permit a similar type of non-attorney representation for tenants, and it appears likely that this will happen.
Many cases will also be resolved in the Eviction Diversion program, meaning that they never get to court. This will also save landlords money in potential attorney fees. It will also help landlords get paid by connecting tenants and landlords to money to help pay rent. At the moment, there is enough federal rental assistance (over 200 million dollars) to pay all the unpaid rent of tenants in Delaware. The Eviction Diversion program will be sure this money gets to landlords.
Changes to the Bill Made in Response to Landlord Groups
SB 101 has been significantly amended since its initial filing, in response to three rounds of input from several landlord associations, including the Delaware Apartment Association and the Delaware Association of Realtors. The DAA and the De Realtors Association also met with proponents of the bill to raise and discuss desired changes, and a number of changes came as a result of that meeting. These meetings and changes have occurred over the course of multiple weeks since early May.
A number of these changes are very significant, and are responsive to landlord concerns relating to potential delay and additional cost. While we do not believe this bill will result in additional delay or costs (and indeed is likely to reduce both) we have made these changes to ease landlord concerns.
We have not agreed to changes that would fundamentally change the bill, such as the elimination of a minimum amount necessary to file for eviction, or changing the eviction diversion program from pre-filing to post-filing.
Major changes made to the bill include:
1. Landlords can bypass the eviction diversion program when tenants cause or THREATEN irreparable harm to the landlord’s or another tenant’s person or property. (lines 199-201)
The morning of the Senate vote (6/8/21), in response to a third round of comments received from DAA, this section was further amended to specifically permit bypass of eviction diversion in:
A. cases where a landlord files for eviction due to allegations that a tenant has harmed ANY person or property, or has been convicted of a class A misdemeanor or felony (via adding reference to § 5513(b) in line 200), and
B. to also permit bypass of eviction diversion in eviction filings in cases filed for breach of contract due to tenant’s “willful or negligent failure to comply with tenant’s responsibilities.” (via adding reference to § 5513(c) in line 200)
2. Tenants are not entitled to a lawyer for meritless appeals. The tenant attorney can deem that an appeal lacks merit and decline to bring it. (line 88)
3. The time that tenants have to engage in the eviction diversion program has been shortened from 45 to 30 days. (lines 205-206)
4. Unlike in the original language of the bill, landlords do not have to file a new case for eviction cases where a final judgment was entered but stayed due to an “interest of justice” finding under Delaware’s current State of Emergency. The bill has been changed to only require that landlords with such cases file a motion requesting a writ of possession. (lines 209-213)
5. The bill has been changed to be effective in 120 days rather than 90 days. (line 217)
6. The tenant’s right of redemption is limited to any time BEFORE the writ of possession is posted, rather than AFTER. (lines 164-165)
7. The eviction diversion program is not mandated to be established until 270 days after the effective date (rather than 180 days) (line 174)
8. To address concerns from landlords who rent to subsidized tenants, the right to counsel no longer attaches when a housing subsidy is reduced. (line 50)
Of course landlords are in a full court press here. They were here in Wilmington against the Neighborhood Stabilization bill, cynically playing up fears of gentrification if the city was to get serious about stopping some of the worst abuses by landlords here.
I wish that all legislators were required to read this book: Evicted: Poverty and Profit in the American City. This is a clear-eyed and data-driven look at how poor people in America are legally being exploited by landlords. Poor tenants are the new venture capital targets — take a giant slice of poor people’s incomes and invest very little in the homes and communities where they live. They can do this because the system is set up to protect capital — not the people who live in these places. And they can do this because of the deep hole that we’ve dug for ourselves for affordable housing.
Being a landlord can be tough. But there’s also good profits in it if you make the right choices which is why venture capital firms and other corporations are buying up rentals at a pretty big clip. It is also true that being a tenant in some of these places is tough too — not being able to get repairs done, being reticent to complain because the landlord might toss you, losing your place at the end of the lease so the landlord can raise the rent. These people need the protection of the courts too, and we continue undermine the very people who most need our protection in a rental landscape that is changing by the day. As long as we continue to ignore the affordable housing problem we have, these opposing legislators offer up our poorest tenants as the easiest targets to extract money from. There’s no justice in leaving our most vulnerable tenants at the mercy of well-represented landlords.
Venture capital will once again fail at single family rentals. It’s a heterogeneous product with so many variables that scaling at that level is impossible in the long-term. That’s why independent landlords have always dominated the market. I look forward to seeing Wall Street and the like fail…again.
On a separate note, idk why anyone would invest in DE then be surprised by things moving in this direction. Like the rest of the NE, it’s a terrible market with unfavorable regs and numbers not as good.
What shocks me about this bill is that most of the provisions are not already law. For instance, the Pennsylvania Landlord-Tenant Act ( of 1951!!) quite clearly provides that if the request for eviction is for non-payment of rent, the eviction cannot take place if all back rent and court costs are paid before the scheduled eviction date.
Providing legal counsel will not result is proper evictions not taking place because the tenant is represented. It will result in evictions being avoided if the landlord does not abide by the procedural requirements in the law.
Good lord, the number of straight up inaccuracies in this article are astounding. The concept that this bill has been changed to take into account landlord concerns is laughable. The changes were extraordinarily minor. How is it even possible to argue that the proposed process will not take longer than the current process? The proposal explicitly calls for a mandatory PREFILLING diversion program that allows tenants 30 days just to sign up and has no time limit cap or even estimate of how long it will take. Do you really think this wont slow things down lol? If you want less evictions the solution is not to make evictions harder and more costly for landlords. The solution is to provide tenants with resources to avoid the circumstances that lead to evictions in the first place. Landlords aren’t going to do this for free.
The Chief Magistrate says the process will not be slowed down — which is a far more authoritative voice than yours, yes? We can get fewer evictions by making sure that landlords are not allowed to run roughshod over their most vulnerable tenants. Apparently you have a business model to protect here.
What do you think about Common Sense’s last comment: “The solution is to provide tenants with resources to avoid the circumstances that lead to evictions in the first place.”?
This makes sense to me…
I agree that tenants should not be forced to live in slum conditions. This is absolutely wrong and tenants need to enforce their rights as landlords enforce theirs. But I also believe that landlords should not be forced to house tenants for free while they wait 30 days for tenants to decide whether or not to sign up for a diversion program and then another 2-4 months to get a court date in non-payment of rent cases if a tenant does not have the ability or willingness to pay. I have sympathy if they do not have the ability to pay, but the reality is that someone must pay the the mortgages, taxes, property insurance, water bills (in Wilmington) and make repairs to properties and most landlords use the rent payments for these expenses. Someone must make these payments and it does not seem right to me either that the financial burden of housing non-paying tenants fall on the landlords. Whose responsibility is this?
Indeed, as you stated this can be tough for both landlords and tenants and the solution does not seem to be quick and easy, as they try to rush this bill through.
I am curious about your statement “Being a landlord can be tough. But there’s also good profits in it if you make the right choices”. What do you mean by this?
From the Original Post:
“The diversion program will also connect landlords and tenants with sources of rent payment, including DeHAP (Delaware Housing Assistance Program). The diversion program will be overseen by the Justice of the Peace Court, and will be modeled after the Residential Mortgage Foreclosure Mediation Program.”
Which says that this diversion program is set up to make sure landlords are not carrying the costs of the mediation period. This is a very fair set of terms.
“Being a landlord can be tough. But there’s also good profits in it if you make the right choices” What on earth is not clear about this? Landlords are clearly not in this for the charity as your post amply demonstrates. Just like every other business, if you know what you are doing and manage your risks, you make money.
I ask the question because “make the right choice” could mean do not rent to people who have bad/no credit, low incomes, past evictions, criminal records, etc.
I imagine if the State passes a bill that will make evictions harder for landlords, smart landlords will indeed be more diligent about “making right choices” and not rent to tenants who meet this profile and many vulnerable tenants will have an even harder time finding housing.
There are landlords who expressly make their money from renting to vulnerable tenants who don’t have many choices. These are the renters who need the legal protections of this bill.
This assumes they don’t bother to do that already. Evidence of that, please.
I am in the real estate business. I represent landlords. I support SB101. That is all.