Realtors slam bill to protect renters as “a slap in the face”

By: - May 7, 2019 5:59 am
we've let housing economics get so weird

Kent Weakley, Getty Images

Nearly 44 percent of Nevadans are renters. But legislation designed to beef up renters’ rights is facing stiff opposition not only from Republicans and landlords, but from some Democrats and low-income housing officials, too, who contend the measure threatens to reduce an already insufficient supply of affordable housing.  

Real estate and property management executives testified Thursday that Senate Bill 256 is unworkable and would force landlords out of the business, with their properties likely sold and off the rental market.

The measure passed out of the Senate by an 11-10 vote, with two Democrats, Marilyn Dondero Loop and Majority Leader Nicole Cannizzaro, joining their Republican colleagues in the minority.  

But supporters say the tight housing market enables some landlords to gouge tenants, stick them with unreasonable late fees, and perpetuate a cycle that too often ends in homelessness.  

“There’s a shortage of over 200,000 affordable housing units in the state,” state Democratic state Sen. Yvanna Cancela testified at the hearing on SB 256.  “Home ownership is out of reach for more than half of Nevadans and renters are being priced out of the market constantly.”

“Today, renters are dependent on any housing they can secure and afford, regardless of problems.  They’re less likely to complain about repairs or excessive late fees for example because they’re afraid they may be evicted or their rent will be increased,” said Cancela, who sponsored the bill.  “Landlords, as a result, have less reason to keep tenants in place because they can charge higher rents or sell property to developers. Bad actors in this space have more incentive to harass tenants to try and get them to move and to use security deposits to do repairs and charge more rent.”

The portion of the bill that would have prohibited landlords from considering rental payment history when evaluating applicants for subsidized housing was stripped from the legislation through an amendment.

“As our own landlord in our public housing, the loss of the ability to screen our residents based on payment history would create such chaos and turnover that it would make public housing unworkable,” Brent Boynton of the Reno Housing Authority wrote in testimony submitted to the Senate Commerce and Labor Committee.  “We would lose the ability to maintain our properties and provide our services to the people who need them.”

Keith Lynam, president of the Nevada Realtors, called the bill “a slap in the face,” because it doesn’t include issues addressed by an interim study committee, he told the Current.   

“We’re representing both sides of this issue,” Lynam said. “We are finding the hard-working families places to rent.  More than anyone else, we understand the pressures both sides are under.”

“We get it.  We understand,” said Lynam.  “But I don’t think they understand.  They think anyone who has a rental home is sitting on piles and piles of money.”

Realtors are proposing an amendment that would exempt any building that has less than four units from the provisions of the legislation.

“It’s an apartment complex issue,” said Lynam, who admitted he has nothing but anecdotal evidence to back up his claim. “We come at this time and time again, yet it’s really not the single family landlord that’s the problem.”

Exempting single family homes “would be a huge step backwards,” said Bailey Bortolin, a lobbyist who represents the Legal Aid Center of Southern Nevada (LACSN). She said the proposal “lacks logic.”

“With such a large percentage of Nevadans being renters, it only makes sense that tenants understand what is actually expected of them,” testified Lauren Pena, an LACSN attorney who works with tenants. “Existing law makes it difficult, if not sometimes impossible for tenants, sometimes landlords and admittedly me, to figure out how much money is actually owed.”  

“Rent should not be a moving target. Late fees should not be hard to calculate,” Pena told lawmakers.   

The bill would require that landlords apply rent payment to rent first and then to fees.

“Unfortunately, it’s necessary because some landlords will take payment, apply it to outstanding fees, and continue to seek eviction for non-payment of rent,” Cancela told the Current via email.

“It also prevents landlords from continuing to accrue late fees on rent by arguing that the payment is going to fees, not rent, making late rent,” Cancela said.  “Tenants can argue that they intended the money to go to rent, but are on rough footing legally because they likely signed a lease (that they did not have a chance to negotiate, particularly in this market) providing that payment goes to outstanding fees first.”

“Nothing in this bill prohibits landlords from going after late fees or collection costs,” Pena testified. “They will still have their ways.”

“Last year there were 32,000 summary evictions in Las Vegas Justice Courts. That’s one of only eleven justice courts in Clark County,” Pena said.    

An amended version of the bill would require landlords to return security deposits within 21 days, instead of 14 days as originally presented, or within five days of a final walk through.

“A tenant can be evicted in seven days, but a landlord has 30 days to return a security deposit,” Cancela testified, adding tenants need their deposits in order to secure new housing. “According to the Federal Reserve, 40 percent of Americans don’t have $400 for an emergency.”

Republican state Sen. James Settlemeyer, a member of the Commerce and Labor Committee, said that in bustling Northern Nevada, contractors are too busy to provide repair bids on short order.  

Lyman says Realtors are sometimes able to negotiate with landlords to allow tenants to break up their security deposit into several payments.    

SB 256 would allow renters who are evicted to gain access to their previous home to retrieve emergency items such as medication and documents.  

It would also provide an expedited means for tenants claiming harassment at the hand of their landlords to get help in court.  

“I’m sorry. If you add this all together, if I was a landlord I’d say ‘you know what, I’m done. I’m selling the home. And I’m out of it.’  And then what we’ve created is no ability for people to rent homes,” Settlemeyer told members of the Senate Committee on Labor and Commerce.  

Nancy Brune of The Kenny Guinn Center for Policy Priorities testified that neglectful landlords contribute to student transience. She said evicted students are unable to retrieve school books and backpacks from their former homes.

“We understand the financial hardships they are under,” Lyman said of renters. “We understand the stress this puts on their children, having to move from neighborhood to neighborhood and school to school.”

But Lyman said landlords have financial obligations of their own.  

“These are not hedge funds. They are moms and pops and they have obligations themselves,” he said.  

“I’ve had an open door from the time the bill was introduced and have done my best to incorporate feedback from all parties,” Cancela told the Current. ”It’s disappointing to have opposition that is not rooted in problem-solving. This is a modest bill that could make a big difference for tenants across Nevada.”

SB 256 is one of several bills this session seeking to address the dearth of affordable housing in Nevada. Another measure, Senate Bill 151, extends the time landlords must wait to evict tenants from five to seven days after serving a notice of default.

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Dana Gentry
Dana Gentry

Dana Gentry is a native Las Vegan and award-winning investigative journalist. She is a graduate of Bishop Gorman High School and holds a Bachelor's degree in Communications from the University of Nevada, Las Vegas.