• Tuesday, February 04, 2020 3:08 PM | Maria Menguita (Administrator)

    By Tia Politi, Oregon Rental Housing Association Secretary
    February 4, 2020

    The passage of Senate Bill 608 has thrown many long-time landlords into a bit of a tizzy. Many are thinking of getting out of the business entirely, but others are considering hiring a professional property manager because the rules have just gotten so complicated. I believe with the help of ROA and our sister organizations, you can continue to self-manage, but if you’re just done, let’s go over some criteria for evaluating management services and selecting a property manager.

    Property Management Licensing & Training
    The first thing to know is that (almost) everyone in Oregon who manages property for compensation must be licensed. There are a few exceptions outlined in ORS 696.020 that you can read about, but they are very limited. Property management licensing in Oregon is regulated by the Oregon Real Estate Agency (OREA). Their rules dictate the ethics, responsibilities and requirements of taking on the fiduciary duties of managing rental properties.

    To obtain a license, an individual must complete 60 hours of classroom education with a certified instructor, obtain instructor approval to take the state licensing exam, pass the exam with a minimum score, be fingerprinted and pass a background check, and pay the required fees. Upon renewal of a property management license every two years, licensees must prove that they have completed a minimum of 30 hours of Continuing Education provided by certified instructors in topics related to the field, as well as a required OREA Rule and Law Course. A property manager operating under a license granted by the OREA must prominently display their license in their place of business.

    I still hold a management license, but it’s inactive. What surprised me about the education I received and the exam that I passed was that it didn’t teach me anything about boots-on-the-ground property management. That takes more education, mentoring and experience. Property managers have a lot to keep track of and in order to be successful they need to cultivate a broad base of specialized knowledge, including management processes and procedures, maintenance for the types of properties they manage, trust accounting, Fair Housing, landlord-tenant law, and even contract law. They must also abide by OREA regulations, which specify the affirmative duties a property manager owes to their clients:

    Duties of real estate property managers - ORS 696.890

    (4) A real estate property manager owes the property owner the following affirmative duties:

    (a) To deal honestly and in good faith;

    (b) To disclose material facts known by the property manager and not apparent or readily ascertainable to the owner;

    (c) To exercise reasonable care and diligence;

    (d) To account in a timely manner for all funds received from or on behalf of the owner;

    (e) To act in a fiduciary manner in all matters relating to trust funds;

    (f) To be loyal to the owner by not taking action that is adverse or detrimental to the owner’s interest;

    (g) To disclose in a timely manner to the owner any existing or contemplated conflict of interest;

    (h) To advise the owner to seek expert advice on matters that are beyond the property manager’s expertise; and

    (i) To maintain as confidential all information from or about the owner, except under subpoena or court order, even after the agency relationship ends.

    (5) The affirmative duties listed in subsection (4) of this section may not be waived.

    (6) Nothing in this section implies a duty beyond or in addition to those activities that are reasonably within the scope of the management of rental real estate. [2011 c.158 §1; 2013 c.145 §2]

    Evaluating management companies 
    So how do you evaluate a property management company? What kinds of questions should you be asking? What should you consider?

    ✓ Step one is to look up the business on the OREA website. You’ll want to check and see if any complaints have been filed against them. That can be a bad sign or could just indicate a one-time problem that has been resolved through education and better practices.

    ✓ How long have they been in business? If only a short time, that company poses a higher risk than a longtime management company with a proven record of success.

    ✓ You should be concerned about the reputation of the company and its principal broker, including the broker's track record, base of knowledge and industry involvement. Reputable managers generally seek to better their industry through membership in local, regional, state and national groups that promote excellence in their respective fields. What is your prospective manager doing to better their own industry?

    ✓ How big is the company? A smaller company may operate with only one or two people, and may offer you a more customized experience, but is that sufficient to ensure timely advertising, showing, screening, placement, management of existing tenancies, and maintenance? In a larger company, you and your property can get lost in the competing needs of thousands of owner-clients, communication can be more challenging, and they may have their way of doing things and require that you fit in their box, so to speak.

    ✓ What is the company structure? Who is in charge and what is the delegated authority to those under them? Who in the company is licensed and has direct oversight of management duties? Who will be your point of contact and that of your tenants? What are the qualifications of the staff in regards to their duties?

    ✓ What is their financial oversight process? Money issues are the source of most complaints to the OREA about licensed managers. Companies with strict financial controls are less likely to have funds go missing, so you should ask about how funds of tenants and clients are handled. What are their procedures for reducing the risk of misappropriation of client funds? The OREA requires that management companies perform a triple-check reconciliation of company funds once per month, noting any irregularities. Is your prospective manager meeting regulation?

    ✓ What does the company do to safeguard your personal information, and who has access? Clients and residents provide very sensitive information to their managers and the information can be an ID thief’s dream hit. So, how will your information be protected? Do they have a security system to guard against break-ins? Do they limit access to employees on a need-to-know basis? If so, how do they do that?

    ✓ Are they willing to provide references from other clients? While you will be referred to happy clients, you can always dig deeper with them and ask about specific things you have concerns about like frequency of inspections, how they have dealt with tenants who are violating the rules, how maintenance is handled, etc.

    ✓ What management software does the company use? Renters’ demographics indicate that the two largest groups of renters are Boomers and Millennials. Each group wants to be served differently. Boomers tend to be more comfortable with pen and paper, but Millennials demand a tech-friendly experience with the ability to apply, request maintenance and pay online or with their phones. Is your company prepared to meet that demand? Do you want your prospective manager to use high tech software that can accommodate Millennials, while also providing a more traditional experience to older residents? I would. Cloud-based software can also relieve concerns about real-life tragedies that can strike at any time like the management office burning down. With cloud-based systems, the information remains intact and the company can still operate from a computer anywhere. Antiquated paper-only systems can result in a total loss of information. Technology and cloud-based software can make a big difference for an owner’s experience too. The ability to log in to an owner portal where you can make contributions, view statements and invoices and retrieve tax documents at your convenience is fantastic.

    ✓ What is the office climate like when you visit? Property management is a customer-oriented business and tenants are your customers. You should be concerned about the experience your tenants will have with the company you hire. Will they be greeted with a smile and offers to assist, or ignored and treated like an annoyance?

    ✓ Does your company know how to effectively deal with tenant non-compliance? And, will they? It takes time to address issues with residents, and many companies turn a blind eye because it requires time and effort, or because they really don’t know how to do it correctly and follow through to eviction when needed.

    ✓ Does the company solely manage real estate, or are they also realtors? This isn’t necessarily a bad thing, but you want to make sure that just because their real estate license allows them to perform property management in addition to property sales, that they are proficient in both areas, and have staff dedicated to the management side of the business.

    What should you expect to pay for management services?
    Most management companies charge a percentage of monthly rents, varying from 4-10%, and some charge a flat monthly fee. Some will collect fees only when the property is rented, others will collect whether the property is rented or not. Some companies charge set-up fees and unit turn fees, and most charge some sort of early termination fee should you not keep your property with them for a minimum length of time, but some don’t. Usually, you will get some sort of break on the per-unit cost if you bring multiple properties to the company. It’s important to keep in mind that management fees are tax deductible as allowed by law.

    With property maintenance, some companies charge a flat fee for each maintenance call, others mark-up repair bills by a percentage, and still others consider it part of the base management fee. Most companies retain late fees, noncompliance fees and NSF fees collected from the tenants, but what about lease-break fees? It seems reasonable to expect that you should receive at least part of that for the lost rent. Clarify these things before you sign, and know what you’re agreeing to.

    The property management contract
    There are standard parts of a property management contract – the term, the fees, the reporting dates, authority for costs, insurance requirements, owner reserve requirements, etc. Ask to see the contract in advance and review it carefully, and have your attorney review it as well. Perhaps the most impactful part of the contract is termination. It should specify when and how the contract may be terminated, the termination fee, if any, when services are no longer wanted or needed, and ideally should provide a speedy escape for either party in the event that either one undertakes an action that puts the other at risk. Property managers and their clients can pose liability to each other. Bringing reputations into disrepute, imposing liability for improper acts or behavior, even illegal actions can occur and put the other party in jeopardy of government fines or legal action.

    I’ve seen it happen both ways. Property managers or their employees who without their client’s knowledge rented substandard or unsafe dwelling units, failed to install the required smoke and CO alarms, failed to provide lead based paint warning information and get a signed agreement, failed to require the tenant to transfer utilities out of the owner’s name and then failed to take corrective action, sexually harassed tenants, or stole their personal property, including once, an expensive purebred puppy. And owners who entered unlawfully, performed substandard repairs, used their right of entry to harass or threaten the tenants, made agreements with tenants and didn’t consult with or even inform their manager. Because of that experience, whichever side of the relationship I was on, I would want an escape clause in the event the other party does something that puts me at risk of damage to my reputation, a lawsuit, or an enforcement action by governmental authorities.

    Risks of hiring a property manager
    Many readers may recall the devastating impact of what I call the “Shockley Debacle.” Several years ago, Eugene property manager, Terry Shockley, owned a company called Property Management Concepts (PMC), which many believed was a highly reputable, successful company. When the company was audited by the OREA, it was discovered that he had misappropriated owner and tenant funds for his own benefit. We’ll probably never know why, but not only did he destroy his career and end up in prison, the theft had devastating impacts on many owners’ finances. He was estimated to have stolen in excess of three million dollars.

    How did this happen? Clients were lured by low percentages - they were penny-wise and pound-foolish; based their selection of a manager on charisma instead of research; trusted too easily, sometimes because they went to the same church; didn’t ask tough questions; failed to verifying things like tax payments, maintenance and contracts; completely abdicated the responsibilities of rental ownership; and lacked understanding of the services they were entitled to receive.

    The company I worked for at the time took over several properties from panicked owners when PMC was placed into receivership by the state, and I was shocked that these owners hadn’t confirmed that maintenance work had actually been completed or that their property taxes had actually been paid. If they had, their losses would have been far less. And, there were numerous red flags such as calls and emails not returned – ever; late payments; late or nonexistent reports; ridiculously simple reports – just numbers on a page; no copies of paid invoices with reports; monies paid in but not accounted for or paid to the contractor; and vacant properties not advertised – no ads, no yard signs, extended vacancies with no explanation or communication.

    Once the truth came out, some owners were hit twice. I performed eviction services for one victim and not only did he lose three months’ rent and have to replenish the tenants’ security deposit (yes, owners remain liable for tenant deposits even if the management company collected and held them), he had to double-pay his property taxes. Turns out that although Shockley claimed he had been paying the taxes, and had charged him for it, he hadn’t and the owner ended up liable to Lane County for three years’ worth of taxes at a cost of more than $100,000, plus penalties. Another owner paid twice for a very expensive roof.

    So, don’t abdicate responsibility for your property. For the victims of Terry Shockley, their only recourse was to sue him civilly and try to attach his assets. I’m not sure how successful they were. Shockley only ended up in jail because he committed wire fraud during the OREA investigation by sending falsified financial records through an out-of-state internet server. That was a criminal act, but stealing everyone’s money was not – it’s considered a civil matter under the law. Your manager is your business associate, not your friend. Don’t hesitate to ask the tough questions and hold them accountable.

    Red flags
    Humans (fallible all) are managing your property. Be assured at some point a mistake will be made. The most important thing to see when a mistake is made is the manager’s response. They should promptly admit their mistake, apologize and make it right, but there are predictable signs that your management company may be in trouble.

    ✓ Repeated lack of timely reporting.

    ✓ Failure to provide copies of paid invoices with monthly statements.

    ✓ Repeated failure to distribute funds on time. When I worked in private management, our company was transitioning to a new system for owner draws and the first month, some owner distributions did not get made when we promised. We immediately reached out to those owners to let them know about the problem and got the distributions done the next day. That’s what a reputable manager does. They don’t try to hide their mistakes, but inform their clients right away when something goes awry, letting them know that a problem happened and how it will be resolved.

    ✓ Failure to respond to inquiries within a reasonable time.

    ✓ Failure to respond to maintenance requests by tenants.

    ✓ Failure to perform inspections.

    ✓ Failure to promptly advertise vacancies.

    If your manager is exhibiting one or more of these behaviors you should…

    ✓ Put your concerns in writing with specific expectations for improvement

    ✓ Transfer your properties elsewhere for management

    ✓ File a formal complaint with the Oregon Real Estate Agency – 530 Center St. NE, Suite 100, Salem, OR 97301 – 503-378-4170.

    ✓ All of the above, in sequence

    With all the risks, why should you consider professional management?
    Good property managers ease the stress in their clients’ lives by taking direct responsibility for the day-to-day management of their investment real estate. Acting as a fiduciary, your management company is charged with maximizing revenue and minimizing risks and expenses. This means charging market rate rents, screening prospective tenants regarding credit & criminal history, prior rental history, and ability to pay, responding in a timely fashion to maintenance requests, and finding the least expensive solutions to problems within their area of expertise. It also means reducing risks and liabilities associated with the ownership of rental property by reporting any habitability or safety issues with the property, and recommending remediation of any problems. They advertise and show the property, screen applications and fill vacancies. They collect rents, hold and distribute security deposits, pay bills on the owner’s behalf, account for and distribute owner funds, send annual tax statements and monthly financial statements, and they do it all properly, legally and on schedule.

    Professional managers enforce the terms of the rental agreement by serving notice upon the tenant immediately upon breach of contract. They inspect your property on at least an annual basis or on bad reports from neighbors or drive by inspections. They may also handle eviction and small claims cases and usually know a good attorney if you need one. When it works, it’s a great, mutually beneficial relationship.

    Ways to protect yourself

    ✓ When you and your property are set up with the company, you need to make sure that certain things are clear and in writing, and disclose certain things to your manager. Things like: Is your property located in the 100-year floodplain? Are there any services that the tenant will be obligated to pay for that benefits the landlord or other tenants? Do you have preferred vendors? Do you want the manager to require renter’s insurance? (The correct answer is, yes.) How will yard care be handled (be VERY specific)? Make sure everyone is clear on who’s taking care of things like underground sprinklers and backflow testing, fire alarm/extinguisher testing, roof/gutter cleaning. Will you allow tenants to smoke outside only or nowhere on the property? Will you allow pets, and if so, under what restrictions? There’s a lot more, just remember that good, clear documentation helps prevent problems and can ensure that you get off to a good start.

    ✓ Trust but verify - Don’t abdicate ultimate responsibility for your own asset. Confirm that bills have been paid, get copies of all signed tenant docs (but don’t expect copies of applications, credit reporting companies require that those not leave the manager’s office for obvious reasons), pay your own mortgage, taxes and insurance so you know it’s done. If you have no other choice, verify that the payments have been made each month.

    ✓ Review your monthly reports. There were a few times when I caught a company error and informed the client about what had happened and what we were doing to correct the error. It always surprised me when the client hadn’t even noticed; obviously, they were not looking over their reports.

    ✓ Inspect your properties yourself once a year. It shows you care and are paying attention. You’ll build relationships with your representatives and get better service overall.

    ✓ Document contacts and conversations with your manager just as you would with your tenants.

    Behaviors that drive property managers crazy and will eventually get you fired

    ✓ Clients who act like they’re the only customer by taking too much staff time. Property management is a high-speed, high-stress endeavor with a lot of balls in the air at any given time. If you make a pest of yourself, you can expect to be shown the door.

    ✓ Clients who make out-of-line demands such as monthly inspections. Not only is this an unreasonable request time-wise, but also very likely a violation of landlord-tenant law.

    ✓ Clients who won’t pay for needed repairs or argue about every bill. If you want maintenance done your way, then take charge of handling it. Also understand that professional managers can’t hire your cheap unlicensed handyman for $20 an hour. They are required to hire licensed contractors or use in-house employees and that costs more like $35-$65 an hour for general repairs and much more for electricians and plumbers.

    ✓ Clients who violate landlord-tenant law by peeking in windows or undertaking other illegal actions. I once had an owner who lived in one side of a duplex and had us manage the other side. She took care of yard maintenance, so didn’t have to give notice to go into the yard, but on the day the tenants were expected to be out, pressed her nose up against the kitchen window “Just to see if they were out.” They weren’t and they were more than a little angry to find their landlady-neighbor looking in the window. They didn’t insist on assessing the penalty of one months’ periodic rent, but could have. She was immediately released from her contract.

    ✓ Clients who go around the manager and make side agreements with the tenant. I once had an owner, who unbeknownst to me told his tenant that he could install a gate and grow medical marijuana at the property. We were supremely unhappy to discover the risk he had created not only for himself, but for us as well.

    ✓ Clients who refuse to do reasonable things that can help rent the property or keep tenants happy. One of my former clients had a unit where the interior paint was a mess. It hadn’t been painted for many years, and was covered with primed, but not painted patches, and he refused to paint the interior. In his exact words, “It’s good enough, it’s just a rental.” Actually, this will be someone’s home. I would not want to manage for a client with that attitude.

    ✓ Clients who believe their way is the only way. Often, owners who have self-managed for a long time make the worst clients because they think their way is the only way or the best way to do something. So, if you want a good relationship with your manager understand that they have their own experience and way of doing things. At the end of the day does it matter how we arrive at the destination as long as we get there in a cost-effective, efficient way?

    ✓ Clients who expect extra services for free. Many property owners seemed to feel that whatever they asked for, was included in the contract price. While it may seem that some months the manager is getting their percentage for very little effort, even the standard work like collecting rents, taking maintenance requests, hiring vendors, paying invoices, reconciling trust accounts, and delivering payments and reports is a lot of work. They’re also providing emergency maintenance services, collecting and confirming vendor information, managing an office and staff, and providing tax statements. Pile on your request for them to arrange for and oversee your unit remodel for nothing, or handle your insurance claim for restoration after your spectacular roof failure, and you’re out of line. That costs extra, usually a surcharge of around 10% of the total costs for labor and materials to oversee the restoration.

    ✓ Clients who say they can’t afford an essential repair. If you can’t afford to be a landlord then you should sell your asset. Owners need to be in a position to fork over possibly thousands of dollars to replace a drain mainline when it fails, replace a worn-out heat pump or furnace, or replace the roof. Just like in your personal finances, you need an emergency fund. (Read “Minding Your Business, means Minding Your Budget” on the ROA website for more details on planning for maintenance over time. You will also find depreciation schedules that can help you plan for replacement costs down the line.)

    ✓ Clients who want more than the two bids provided. If you are not satisfied with the bids your manager has provided, then you can do your own research and see if you can find acceptable service for less. I did once have an owner with a broken specialty stove who found the replacement part for his stove in an obscure corner of the internet that saved him a considerable amount over the costs of parts our appliance repair company was going to charge. Managers just don’t have time to do that, and it can be unreasonable to expect it.

    ✓ Clients who want sole approval rights over tenant placement. Your manager has a very fine line to walk in regards to Fair Housing and equitable treatment of all applicants and may not be able to deny someone you would rather not rent to for whatever reason. If you want control, then manage your own property. Or, screen and place tenants yourself and then hand it over to the manager (if they’re willing to allow it).

    ✓ Clients who expect that there will never be problems with tenants that their manager has placed in the unit. Screening is a risk assessment, but it’s not perfect at separating out successful tenancies from unsuccessful tenancies. Just like when owners screen, sometimes things blow up in our faces. I once had a lady apply for a unit who seemed perfect. She presented well, had great rental history, no criminal history, decent credit and enough income to qualify. A few months after she rented the unit, she displayed very disturbing behavior to the other residents. Turns out she had an alcohol problem and mental health issues, but when she had applied and leased up, she had been in treatment and off the booze. After she moved in, she stopped her meds and started drinking again. There’s just no way to predict things like that or prevent all problems. People are by nature unpredictable beings. Once they’ve been placed in the unit, they may start gambling, doing drugs, or get divorced and have the “War of the Roses” inside your unit. That same thing could have happened to you if you had screened and placed the tenants.

    ✓ Clients who display angry, abusive or inappropriate behavior to residents or staff - self-explanatory.

    ✓ Clients who insist that a bad tenant be retained. For whatever reason, some owners are so reluctant to ever have a vacancy they want their manager to continue to work with uncompliant, unreasonable, or unstable tenants. It’s the manager’s job to manage and that includes terminating tenancy for cause. They have an obligation to you, but also to the neighbors and the community.

    ✓ Clients who think their manager should know everything about the condition of the unit at all times. One of my management colleagues had a client who was very angry after a leak was discovered that had created a lake under her house. I’m sorry, managers are not professional home inspectors. They’re not going to crawl under your house, or on the roof and they’re not qualified to assess the quality of the fixtures, systems or foundation of your home. That requires a professional home inspector, which they can probably arrange for if you ask and pay for it. Otherwise, they will report and respond to visible issues discovered upon inspection or reported by tenants or vendors.

    Choose in haste, repent in leisure
    Choosing a property manager requires careful consideration. Don’t wait until you’re up against the wall and make a decision in haste, because it could be a decision you will regret. If you have multiple properties, you might consider splitting them up and trying out two or three different managers for a year then transfer them all to the one you like best. Not everyone has the same style, so all other things being equal, some people’s personalities or management styles are best served by one manager over another.

    The takeaway
    Choose wisely, be professional, document well, be accountable, hold your manager accountable, read reports, and follow up and you’re likely to have a great experience with professional property management services. You might even wonder why you waited so long.

    This column offers general suggestions only and is no substitute for professional legal counsel. Please consult an attorney for advice related to your specific situation.

    About the Author: Tia Politi is a licensed property manager, rental owner, and president of the Rental Owners Association of Lane County. She serves as the secretary for the Oregon Rental Housing Association (ORHA) and ORHA Education, Inc., heads up the ORHA Forms Committee, serves as a volunteer instructor for St. Vincent de Paul’s Second Chance Renter’s Rehab Program, and teaches classes in rental management throughout the state, including a class teaching high school seniors the basics of renting a home. Tia owns and operates Rental Housing Support Services, LLC, providing consultation, landlord-tenant training, mediation, notice prep and service, eviction support, and telephone helpline services.

  • Wednesday, December 18, 2019 5:00 PM | Maria Menguita (Administrator)

    By Jim Straub, Oregon Rental Housing Association Legislative Director
    December 18, 2019

    SB 608 was the result of those negotiations between myself and Speaker Kotek.  It was passed by the 2019 legislature and went into effect February 28, 2019. Not all tenant advocates like it.  They think the rent raise limitation is too high.  However, landlords know this is not rent control, and the high rent raise limitation is aimed at rent gouging (mainly going on in Portland).  Smart landlords know they’ll have plenty of room to raise their rents every year to take care of things like maintenance, taxes and protecting their investment.

    Landlords don’t like SB 608.  They know it’s a bill designed to solve problems they didn’t cause.  It places limitations on their small businesses.  As a landlord, I don’t particularly like this bill, and I don’t know any landlord who would.  However, landlords also know this was a reasonable compromise bill that took the needs of both sides into account.  And all our efforts to reach that compromise made this bill into a much better bill that it otherwise would have been.

    And what happens next?  Hopefully, no changes anytime soon.  This law needs time to be put into practice and see if it bears fruit.  There will be pressure by tenant advocates to lower the rent raise cap, but smart legislators know we don’t want to discourage new development.  The last thing Oregon needs is small landlords fleeing the real estate market, leaving big corporations as the last landlords standing in the marketplace.

    The worst thing we could do would be to tweak this law before we give enough time for data to come in about how it’s working, or not working.  In fact, at a recent landlord-tenant roundtable discussion I participated in, Professor for Land-Use Planning (Portland State University) Marisa A. Zapata (who is a strong tenant advocate) said, “Some (tenant) advocates say the rent raise limit is too high, but I think we need a wait-and-see approach.  We’re not yet sure what the bill will do and how things will play out.”  Advocates on both sides recommend this cautious approach, which will give this bill a fair opportunity to work as intended. 

    So the truth is, do I wish SB 608 had never become law?  You bet.  With a supermajority in the legislature, Speaker Kotek could have passed nearly any housing bill she wanted.  The bill we got was a compromise with landlords, but it doesn’t benefit us much.  Of course, this bill turned out so much better than it might have been without landlord input, but Speaker Kotek’s cure may be worse the ailment.  Time will tell, stay tuned.

    About the Author: Jim Straub is a third-generation landlord and real estate investor in Oregon with more than 29 years personal experience investing in, building and managing residential real estate. He is also owner of Acorn Property Management, LLC, with offices in Portland and Springfield. Since 2010, Jim has represented the Oregon Rental Housing Association as their Legislative Director. ORHA consists of 14 chapters across the state with more than 5,500 members. Jim brings a wealth of practical experience with a moderate voice to facilitate innovative ideas for modern/today’s housing dilemmas/solutions.

  • Tuesday, December 03, 2019 1:34 PM | Oregon Rental Housing Association (Administrator)

    U.S. Department of Housing and Urban Development (HUD) Secretary Ben Carson is seeking action against online companies that profit from selling sham assistance animal documentation at the expense of rental housing providers and renters who have legitimate needs. These companies’ documents are intended to justify reasonable accommodation requests for assistance animals (service animals and emotional support animals (ESAs)) in housing but are often used to skirt pet restrictions under false pretenses.

    In a letter sent to Chairman of the U.S. Federal Trade Commission Joseph J. Simons and Director of the Bureau of Consumer Protection Andrew Smith, Secretary Carson expresses several concerns in line with those of the apartment industry and asks the FTC to investigate some websites selling assistance animal verification documents. As HUD General Counsel Paul Compton states, “These websites are using questionable business practices that exploit consumers, prejudice the legal rights of individuals with disabilities, dupe landlords, and generally interfere with good faith efforts to comply with the requirements of the Fair Housing Act.”

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  • Tuesday, December 03, 2019 12:45 PM | Maria Menguita (Administrator)

    By Sage Coleman, Oregon Rental Housing Association President
    December 3, 2019

    To our Valued Members around the state of Oregon, I am excited to be your new ORHA President, and want to get you up to speed on our direction as we head into 2020. Legislatively, we had a major change this year (Senate Bill 608) that was a hard pill to swallow, but with ORHA Legislative Director Jim Straub, and ORHA Lobbyist Shawn Miller, leveraging a reputation of good will and reasonableness in negotiation, our influence resulted in a more balanced outcome than we thought was possible. While many landlords around the state felt we should have dug in our heels, the political reality was that any effort like we expended to defeat HB 2004 in 2017, was doomed to failure given the legislative makeup and so time was better spent building a collaborative work environment. ORHA was the only entity that Speaker of the House Tina Kotek was willing to work with to craft the bill, speaking highly of our reputation in Salem. It was YOUR INVOLVEMENT to defeat HB 2004 which helped earn our seat at the SB 608 planning table. Please read Jim’s article, “SB 608 - What the Heck Happened?: The Inside Story” to get the inside scoop on how the negotiations played out.

    We published our new ORHA 2019 Forms Manual with new and updated forms to great acclaim, and the ORHA 2020 Law Book is in process. Forms Committee Chair, Tia Politi, is accepting suggestions for the next round of new forms and updates to current forms to compile ahead of the 2021 revision. Please email your suggestions to the ORHA office: office@oregonrentalhousing.com.

    The Forms Store/Technology Committee, headed by Cloud Miller, has made incredible progress on updating and modernizing the ORHA Forms Store. The updating and quality control testing consumed hundreds of hours of time, but the results are truly spectacular. That effort did not come without some major bumps in the road and we appreciated your patience when our store was down a couple of times. Fortunately, the interruptions in service were short because of the tireless efforts of Cloud and Brad Clemens at Sunriver Computer Services, and our site is now better than ever and ready to help landlords across the state operate a successful business. Currently, they have added new categories of forms to make your search for the correct form easier, and are working to create packages of forms, making the move-in process easier. Forms store quality-control testing continues with vetting across mobile and stationary platforms to ensure that we reach all of our customers and their favorite technology – stay tuned for more. Check it out now!!! https://store.oregonrentalhousing.com/

    The ORHA Board, led by Dennis Chappa of Lane County, recently completed a SWOT (Strengths-Weaknesses-Opportunities-Threats) analysis to help guide our long-range planning and I am excited about implementing this tool to help direct the future of ORHA. I am honored to serve with such a dedicated board and I look forward to robust collaboration with our dedicated State Board members and the talented associations around the state in achieving our next level of success.

    Keep your eyes peeled for a call to support legislative efforts with your dollar-for-dollar tax credit to ORH KEY PAC. If you are looking for tax deductions as 2019 comes to an end this group may be a good choice. https://oregonrentalhousingpac.org/donate

    Thank you for the opportunity to be of service,
    Sage Coleman
    President, Oregon Rental Housing Association
    Broker, Pacific Properties

    Oregon Rental Housing Association (ORHA) is a volunteer, nonprofit association consisting of 15 local groups throughout the state, comprising of more than 5,000 individual members. We provide landlord/tenant education and legal forms, lobby for fair and equitable laws and regulations, and support ethical property management practices throughout the rental housing industry.

  • Thursday, November 21, 2019 9:31 PM | Maria Menguita (Administrator)

    By Jim Straub, Oregon Rental Housing Association Legislative Director
    November 21, 2019

    The 2019 Oregon State Legislative Session was a historic, landmark session which passed Senate Bill (SB) 608, a first in the nation state-wide rent stabilization bill. SB 608 was a negotiated bill, and neither landlord nor tenant advocates got all they wanted. What we did get, though, is a bill everyone might be able to live with. But in order for you/landlords to recognize this, you need to know some of the back story. Will the bill do everything the legislature hopes it will, including solve the housing crisis? It remains to be seen.

    SB 608 is complicated and lengthy. In fact, many landlord-tenant attorneys are still working out all the details and implications. In fact, you’ve probably seen a lot of coverage on this bill by now. But so that we’re all on the same page, let’s review the major points of the bill.

    #1 : SB 608 limits rent increases. 
    This bill limits the amount rental property owners in Oregon may raise rents to a base amount of 7% plus the amount of the western region’s consumer price index (CPI). In 2018, the CPI was 3.3%. Thus, if this bill had been in effect in 2018, the amount rents could be raised would have been limited to 10.3% (7% base + 3.3% CPI).

    Although SB 608 does limit rent increases, the amount of the increase limited in the bill was a strategic negotiation. Tenant advocates originally proposed a limit of 2-3%. While that amount may have seemed fair to them in terms of owner profit, we know that there is more to consider when raising rents than simply a profit motive. Another consideration when determining the fair amount of a rent raise is the cost rental owners must plan for deferred maintenance over time. Rental property owners must factor in such things as repairs to heating systems, sewers and roof maintenance. So, while 10.3% might seem to be a larger annual rent increase than most rental property owners in Oregon might implement, a savvy rental property owner will increase the rent enough each year to allow for deferred maintenance and other items to be factored in.

    Rental property owners whose buildings received their certificate of occupancy less than 15 years ago will be exempt from rent increase limitations. This exception was negotiated by rental property owner advocates so that new construction was not discouraged by the bill. This means that for these newer buildings, rental property owners will be permitted to raise rents without limits, as much as the market will bear.

    #2:  SB 608 limits notices to vacate.

    Under SB 608, no-cause notices to vacate are limited to the first year of occupancy. After the first year, only with-cause notices are permitted, which the tenant may cure. Of course, an eviction (FED) may be filed if the tenant doesn’t comply with the with-cause notice, and if they do comply but commit the same offense within six months, then a ten-day repeat violation notice may be served.

    Fixed-term leases automatically become month-to-month rental agreement at lease termination, unless the landlord has written the lease to expire before one year is up. So, if your tenant pays their rent and follows the rules, they get to stay, subject to a few exceptions.

    With 90 days notice and the payment of a one month relocation fee to the tenants (payable at the time notice is given and only applicable if the owner has 4 or more rental units in Oregon), landlords may ask their tenants to leave under these four conditions:

    • The rental unit is to be renovated or remodeled to the extent that it will not be habitable during the work;
    • The unit is to be completely demolished, or converted to a non-residential use;
    • A landlord or an immediate family member is going to move in; or
    • The landlord has accepted an offer to purchase the dwelling unit from a person who intends in good faith to occupy the dwelling unit as the person’s primary residence.

    But fear not. SB 608 doesn’t prevent you from getting rid of a bad tenant. If they’re not paying their rent or playing by the rules, serve them with-cause notices. If they don’t comply, evict them as before. And there’s one more opportunity to get rid of bad tenants. SB 608 contains a “three strikes you’re out” rule. If over the course of one year, a landlord has served three written warnings (of any kind, it doesn’t have to be for the same offense), a landlord doesn’t have to renew at the end of the lease and there is no obligation to pay a one month relocation fee.

    So, while at first glance it may seem that SB 608 ties landlords’ hands, we believe this is an eminently workable compromise bill.

    So, what led to SB 608 and did landlords get much say in the bill?

    A lot has changed since the first Oregon landlord-tenant bill in 1973. Oregon landlords have been immersed in the development of new landlord-tenant law in Oregon since the Landlord-Tenant Coalition began meeting during legislative sessions since the mid-1980’s. At the Coalition, landlord and tenant advocates met and negotiated compromise bills, ones that were easy for legislators to pass because they knew such bills were supported by both sides. I’ve been meeting with the Coalition on behalf of landlords for ten years now.

    Things changed over the past few years as the sense of a developing housing crisis in our state gave landlord-tenant law a new sense of urgency. About that time, a large landlord group in Portland joined the Coalition (which is open to any landlord or tenant advocate group). In light of the sense of a housing crisis, the tenant advocates came to the Coalition asking the group to deal with the arising problems in the housing industry. The large Portland group simply refused to go there, identify the advocates’ requests as “industry killers”. By putting their head in the sand, the Coalition died.

    This set the stage for 2017 legislative session, and Oregon Speaker of the House Tina Kotek’s House Bill (HB 2004). This bill included many tenant protections, and you may remember it well – the Oregon Rental Housing Association and other landlord advocates worked tirelessly to defeat it. But we couldn’t rest on our laurels, as there was more to come.

    In November 2018, Oregon Democrats were voted into a supermajority in the legislature, and Tina Kotek remained as Speaker of the House. Defeating a new bill with extensive tenant protections would not be as simple as in 2017. To be frank, Speaker Kotek now had the political muscle to force most any bill thru the legislature. Fortunately for Oregon landlords, Speaker Kotek had a lot on her agenda for the 2019 session. Cap and Trade (climate change), funding of public schools and housing, zoning changes to incentivize housing development, Medicaid stabilization - some really big and time consuming bills to get through. Why is this good for landlords? The tenant groups in her home city of Portland were demanding she try again for another HB 2004. But, the speaker also knew that the majority of her time later in the session would be consumed with her other target items. She didn’t want to get bogged down in another fight over landlord/tenant issues.

    Just days after winning the supermajority, Speaker Kotek called me. She said that she was going to introduce and pass a tenant protection bill, but that she had also heard the testimony of the landlords the previous year and she wanted to work with just one landlord advocate who she felt could help develop a compromise bill that both sides could live with, and she felt that landlord advocate was me. Speaker Kotek said, “Jim, let’s find a way to work together.” And over the next several months, that’s just what we did.

    Within a week after winning the supermajority, Speaker Kotek drove down from Portland, and met with me at my office in Springfield for numerous hours of brainstorming. When she sat down, and went over what she wanted in a bill…frankly I was aghast. It would have been an industry killer. Ideas like rent increases limited to 2%, elimination of all no-cause notices regardless of circumstances, something called vacancy control which means that you could never raise the rent on the property more than the 2%, even if the tenant moved out. You would be forced to offer it to the new tenant at the same price as the old, regardless as to how long the previous tenant had lived there or what increases there were on property taxes or local bond measures. I remember thinking for the first time in my life, that it might be a good time to sell my rentals.

    Once I regained my composure, I gave Speaker Kotek real word examples of the need for no-cause notices to ask tenants to leave. There are so many examples of why asking a tenant to leave might be necessary, even if a landlord doesn’t have the legal, provable point to evict them in a court of law. I reminded the Speaker that there are good reasons for landlords to raise rents and that a bill that permits no rent raises will hurt small business owners and, ultimately, hurt tenants. I explained that I had tenants living in properties that I knew where paying hundreds of dollars less in rent each month than what the market would bear, and that lots of landlords did this because good tenants that take good care of the property and pay their rent on time are worth keeping and I reward them by not raising the rent to the maximum each year. I helped the Speaker understand that no matter how fair our application process, sometimes landlords end up with bad tenants. That it’s scary for landlords to hand over what is often their single largest investment, something worth $200K or $300K, to someone they barely know and just hope and pray that it’s still worth that when they get it back. That, to landlords, renting to tenants can feel like hiring someone without an interview and you can’t fire them if it doesn’t work out. Speaker Kotek listened carefully and thankfully, I was able to get her to negotiate. We had many more conversations, each time playing out the cause and effect of any change.

    About the Author: Jim Straub is the Legislative Director for the Oregon Rental Housing Association, a state-wide trade organization representing more than 5,500 landlords in Oregon. He was President of the Rental Owners Association of Lane County from 2007 to 2015, a local trade organization representing over 1,200 landlords in Lane County. He spent more than a decade as their helpline provider. He is also a past member of the Oregon Youth Conservation Corps where he served as an Advisory Board member for 2 terms. He sits on the Oregon Housing Choice Advisory Committee.
  • Friday, July 26, 2019 12:27 PM | Oregon Rental Housing Association (Administrator)

    By Tia Politi, ROA President

    SB 608 and Property Sales

    With the passage of SB 608, buyers, sellers and realtors are finding that the law’s mandates are dramatically changing the world of property sales when there are tenancies of more than one year in place. The new law restricts a landlord’s ability to terminate a tenancy of more than one year to a for-cause termination, or for one of four Qualifying Landlord Reasons: 1) the property is being demolished or converted to a different use within a reasonable time; 2) the landlord intends to undertake repairs or renovations to the property within a reasonable time and the property will be unsafe or unfit for occupancy during repairs or renovations; 3) the landlord intends for the landlord or a member of the landlord’s immediate family to occupy the dwelling unit as a primary residence and the landlord does not own a comparable unit in the same building available that is available for occupancy; or 4) the landlord is selling the property separately from any other unit to a buyer who intends in good faith to occupy the dwelling unit as their primary residence.

    It’s becoming clear that especially for sellers of single-family homes, planning will need to start well in advance of offering their property for sale.

    Buying or Selling a Single-Family Home

    For an owner selling a single-family home occupied by a tenant for longer than one year to a buyer who wants to occupy the home as their primary residence, the new law requires that the tenant be provided with a 90-day notice of termination, and that at the time the notice is delivered the landlord also provide written evidence of the offer to purchase the unit not more than 120 days after acceptance (names and private information can be blacked out), and state that the buyer intends in good faith to occupy the dwelling unit as a primary residence.

    How is a seller to know if a buyer will want to keep the property as an investment and be willing to take on the existing tenancy, or if they want to purchase the home to live in? They won’t until they get an offer. If a buyer does want to live in the property and makes an offer, most buyers will need to get a mortgage to purchase, have an interest rate lock that expires in 45 days, and be required to occupy the home within 30 days after closing, so what are buyers and sellers to do?

    For a full cash sale, once the offer is accepted, the seller can provide the tenant(s) with ORHA Form #5A - Notice of Termination-Qualifying Landlord Reason, check the correct box, provide the evidence of the accepted offer to purchase, and pay the tenant the relocation expense of one-months’ periodic rent unless exempt. (Owners of four or fewer dwelling units are exempt from the payment of relocation expenses.) The notice must be prepared and served in accordance with ORS 105, and will remain in effect for the next owner. Even with an all-cash sale, however, the buyer could end up purchasing a huge liability if the seller failed to prepare and serve the notice in accordance with the law. The tenant could choose to stay and challenge the notice. If the buyer proceeds to eviction court, and they have inherited a defective or imperfectly served notice of termination, they could lose the case in court, have a judgment against them, possibly have to pay the tenant’s attorney, and start over again.

    In a case where a seller believes that it is likely the property would be sold to a buyer who wants to live in the property, and will need to get a mortgage to purchase, the best option may be to remove the tenant for another Qualifying Landlord Reason, such as the owner intends to undertake repairs or renovations to the unit within a reasonable time and the unit will be unsafe or unfit for occupancy during repairs or renovations.

    The question then becomes, how significant do the repairs or renovations need to be in order to claim the right to terminate? It depends. The owner may be challenged and have to justify their decision to a judge, so need to be prepared to think about this ahead of time. Many repairs or renovations would make a property unsafe or unfit for occupancy, and most contractors will refuse to do substantial work in a unit with tenants in place, but sellers should make sure they can justify the level of work they are doing to prepare to sell.

    Realtors encourage sellers to spruce up the unit prior to marketing, so a full interior repaint would likely qualify as would replacement of flooring throughout, kitchen or bath remodels, etc., but things like new windows may not as new windows can be installed from the outside and would not make the property unfit for occupancy during the install. (As a side note, remember that your insurance company will likely not provide full coverage for your unit if it is vacant for more than 30 days, so sellers should have a plan for that, such as a house sitter.)

    The Duplex Rule

    SB 608, does provide a narrow exception to the new termination rules for owners with two units on the same tax lot where one unit is their primary residence. The new law continues to allow termination of tenancy for no-cause with a 60-day notice, or with a 30-day notice if the property is to be sold and the buyer intends in good faith to occupy the tenant’s unit as their primary residence. If the buyer does not intend to occupy the tenant’s unit as their primary residence, then the tenant comes with the property. There are pitfalls in this scenario as well, and while the exemption exists for this type of property, landlords are still obligated to payment of the relocation expense of one-months’ periodic rent at the time the notice is delivered, unless exempt. (Owners of four or fewer rental dwelling units are exempt from payment of the relocation expense.) Use ORHA Form #5C – Notice of Termination – Two-Unit/Owner-Occupied Property.

    If the duplex is being held as an investment property and the seller does not live in one unit, but the buyer wants to occupy one side as their primary residence after closing, the same rules would apply as if for a single-family home. If the tenancy has been in place for more than one year on the side the buyer wants to live in, the seller would either have to issue the 90-day notice of termination – Qualifying Landlord Reason, for one of the four reasons allowed by law, or sell the property as-is and the buyer can issue the notice for the qualifying reason of wanting to live in the unit as their primary residence. Once the notice expires and the tenant vacates, the buyer can then move in.

    Cash for Keys

    This is a tried and true method for regaining possession of a property and nothing in the new law prohibits both parties from making a mutual termination agreement. Just make sure that the terms are clearly spelled out in writing, and that the agreement states what will happen if the tenant complies and what will happen if they don’t comply (It’s a smart decision to have an attorney draft the agreement). Also, don’t hand over the cash until the resident is ready to hand over the keys.

    Marketing an Investment Property

    SB 608 does not impact property sales where the seller and buyer are both investors and the buyer won’t be living at the property, but there are still issues that can make the property easier or more challenging to market – mostly in regards to the price of rents, the quality of the tenancies, and the completeness of the seller’s documentation.

    Owners who have under-market rents will find that their properties cannot prove sufficient cash flow to meet the demands of sophisticated investors, and they won’t be able to command the same price. If you are planning to sell an investment property in the not-too-distant future, and your rents are below market, plan ahead to increase rents within the limits imposed by SB 608 until your rents are market rate so that your property can command the best sales price.

    The quality of the tenants can help or hurt investment property sales as well. Residents who are keeping to their lease and caring for the property are a fantastic marketing asset for sellers; problem residents are not.

    The completeness of the seller’s tenancy documents can also help or hurt the sale. If there are gaps or flaws in your paperwork, fix them now before you market your property for sale, or be prepared to accept a lower price as a buyer will have to agree to accept the increased liability and correct the deficiencies.

    Paperwork Pitfalls

    What does good paperwork look like? The rental agreement and all addenda are complete, initialed, signed and dated by all adult occupants; the seller has good documentation on the condition of the units on move in; there are accurate tenant ledgers; and good notes and copies of notices regarding lease violations during the tenancy.

    Without good paperwork, a buyer may be purchasing liability. For example, the seller is marketing their property built prior to 1978, but has no signed lead-based paint disclosure. The penalty for this violation if reported to the EPA, is $6000. The buyer could require as part of the sale, that the seller fixes the deficiency in the paperwork so that they are not taking on that kind of liability. Or the buyer could agree to accept responsibility for fixing that problem after the sale, but use that deficiency to negotiate a lower price. To ensure they are fulfilling their fiduciary duty to their clients, Buyer’s Agents should request copies of all leases, addenda, and tenant ledgers and review them for completeness, or have an attorney review them. Also, any existing notices of termination should be reviewed by an attorney or professional consultant to ensure that they will hold up in court if the buyer purchases a property before a notice of termination expires.

    Planning ahead

    Depending on the timeframe required for renovations, if owners are planning to renovate ahead of marketing their property, they should think about providing notice to vacate in November, December or January to hit the sweet spot on the sales season. I can’t stress enough how essential it is that owners ensure their notices of termination are prepared and served perfectly. A defective notice of termination can result in a loss in court. For sellers that can mean a lost sale; for buyers it can mean a long delay in being able to occupy the property; and for both it can mean a court judgment against them, payment of attorney fees to the prevailing tenant, and starting the process all over again.

    Also, sellers need to consider that even with a good notice of termination in place, the tenants may not move out, requiring an owner to initiate an eviction action in court. If uncontested, the court process takes two or three weeks, with more time added if there’s substantial abandoned property to address; if contested, the process can be delayed further, so owners should factor that into the timing of the notice to vacate. And just to complicate matters even more, remember that tenants may still provide just 30 days’ notice to vacate which could throw off the timing as well.

    The takeaway

    A property sale with tenants in place for more than one year now requires better advance planning by sellers, more thorough investigation by buyers, and for realtors, it requires a higher level of due diligence than ever before. Fulfilling their fiduciary duty to their clients means educating themselves on the mandates of SB 608 and all of its intricacies to provide their clients with the best information possible as to the benefits, drawbacks and possible outcomes of selling rental property.

    About the Author: Tia is a licensed property manager with more than seventeen years of management experience. She currently manages four low-income senior & disabled and family housing complexes, as well as her own rental properties. Tia serves as President of the Board of Directors for the Lane County Rental Owners Association, Chair of Programming and Bulletin Committees and Co-Chair of the Education Committee. She is a state delegate and Secretary for the Oregon Rental Housing Association, and the Forms Committee Chair. Tia is a volunteer instructor for St. Vincent de Paul's 'Renters Rehab' program. She also teaches classes to landlords on topics including evictions, the move-in process, tenant issues, and fair housing & advertising. Last year, Tia developed and taught a curriculum for high school seniors on the risks, rights and responsibilities of being a tenant with a goal of providing instruction to all young people throughout the state as part of essential life skills education.

    This column offers general suggestions only and is no substitute for professional legal counsel. Please consult an attorney for advice related to your specific situation.

  • Friday, July 26, 2019 11:59 AM | Oregon Rental Housing Association (Administrator)

    By Tia Politi, ORHA Forms Committee Chair

    Dear Local Associations of the ORHA,

    Usually, when ORHA produces a new Forms Manual or Law Book, we work to create an insert or guide that can be added to the previous manual that allows it to be used longer, saving our members money. With the addition of so many new forms, and so many updates to established forms, the board feels that this is not a good option. We are encouraging you to urge your members to purchase the new ORHA Forms Manual 2019 and dispose of the old one. We are moving toward the idea of creating a system or how-to guide for property management in Oregon, and so have revamped the order of the Forms Manual by putting the educational sections, “Delivery of Notices” and “Delivering Possession,” before the forms themselves.

    We exist to protect and serve the interests of our members, and one of the most valuable things we can teach them is the importance of perfecting service of notice. Failure to select the right form, fill it out properly, calculate time correctly, and serve it perfectly are the most common cause of landlord loss in the courtroom and imposition of money judgments owing to the tenant.

    Cloud Miller of TVRA is encouraging members who are reluctant to get a new manual by requiring them to have one if they want his help on the Helpline related to forms. He then teaches them how to find the answers by taking them through the answer in the manual. It has the added benefit of reducing calls.

    Lane ROA is selling the manuals at a lower price now and plans to increase the price in November, and is letting members know. Use whatever strategy you feel would work to get this important reference book into the hands of your members.

    Violet Wilson of SRHA, created a class for her members on the new Forms Manual, that ORHA has purchased to distribute to all of you for the low, low price of $20. Violet’s presentation is designed for a three-hour class and runs attendees through service of notice, the different types of notices, and how to use the manual. Please contact Virginia at the office if you would like a copy of the PowerPoint presentation. She will email it to you, and all it takes is a class facilitator to run through the material. You can print handouts for classes as needed in whatever layout works. Educate your members, create interest in your association, and make money to further your mission – what’s better than that?

    And finally, just in case you haven’t read the rundown on the new forms, here’s the skinny:

    The 2018 Forms Manual was complete and ready to go to print, when word came that there would be a major change coming to the Landlord-Tenant Act – ORS Chapter 90. The board of directors decided it would be best to delay the release of the manual until new forms could be created and incorporated. The final version of SB 608 instituting rent control and limits on no-cause termination of tenancy, was signed into law on February 28, 2019, with an emergency clause. The Act became effective on the Governor’s signature for rent increases, fixed-term leases entered into or renewed on or after the effective date, and terminations of month-to-month tenancies occurring on or after the 30th day after the Governor’s signature. 

                The Forms Committee introduced several new forms earlier in 2019, including Septic Agreement (Form #61), Well Agreement (Form #62), Fireplace, Wood Stove, Pellet Stove Agreement (Form #63), and Pest Agreement (Form #64). This year we are also rolling out a new Exterior Property Care Addendum (Form #65) that address issues of yard care and other exterior care issues, as well as a new Weatherization Addendum (Form #66) to clarify the responsibilities of Landlords and Tenants in protecting the property in case of severe weather events. We have added a Co-Signer Application (Form #52A), to make screening co-signers easier, and have changed our satellite agreement to include cable hookups and security systems. This form is now called the Cable/Satellite Dish/Security System Agreement (Form #24). We also updated several forms in response to user feedback and attorney review, including both the Application (Form #1), Month-to-Month Rental Agreement (Form #2A), Fixed-Term Rental Agreement (Form #2B), Rules and Regulations (Form #33), Add or Delete Tenant Agreement (Form #59), Deposit Refund Checklist (Form #21), the Pet Agreement (Form #3), the Assistance Animal Agreement (Form #46), 24-Hour Notice to Enter (Form #18), and both the Medical Marijuana Agreement (Form #10) and the Marijuana Agreement (Form #10A).

                With the passage of SB 608, the Forms Committee updated the Notice of Termination – No-Cause (Form #5) to clarify that it only applied to first-year tenancies. The committee kept the options for 30, 60 or 90 days because in certain jurisdictions or in subsidized housing, termination timeframes are different. The committee also created new termination forms:  Notice of Termination – Qualifying Landlord Reason (Form #5A), Notice of Non-Renewal of Lease (Form #5B), and Notice of Termination – Two-Unit/Owner-Occupied Property (Form #5C), to help landlords comply with the new requirements. The Notice of Rent Increase (Form #13) was updated to include language consistent with the requirements of law, and created a form Notice of Lease Renewal (Form #67) that provides a way for landlords to incentivize lease renewals rather than allowing the tenancy to convert to a month-to-month agreement.

    To make it easier for landlords to provide warning notices to tenants under a fixed-term lease and potentially terminate a lease under the Three Strikes rule, the following forms have had new language included that states:  “If you are on a fixed-term lease, be advised your landlord has the option to terminate your tenancy at the end of your lease if you have received three or more notices for noncompliance (including non-payment of rent) within a 12-month period preceding the end of the fixed term. Owner/Agent may terminate the tenancy by issuing a 90-day notice prior to the lease end date, or 90 days prior to the date designated in the notice, whichever is later. Correcting the third or subsequent violation is not a defense to the termination. This is your                   violation in the last 12 months.”

    This language has been added to all non-compliance forms, including:

    ORHA Forms #4 & #44 – 72/144 Hour Notice of Non-Payment of Rent

    ORHA Form #6 – Unauthorized Pet Violation

    ORHA Form #14 – Past-Due Rent Reminder

    ORHA Form #34 – Parking Violation

    ORHA Form #35 – Notice of Non-Compliance

    ORHA Form #38 – Notice of Termination with Cause

    The forms committee also included language on all of our termination notices to comply with a new law requiring landlords to make veterans aware of the community resources that may be available to help them. Even though this law does not take effect until January 1, 2020, we thought it would be prudent to include the language now.

    Two other bills that passed this term, but won’t take effect until January 1, 2020, are necessitating changes as well. After the law takes effect, a landlord may only require an applicant to pay a single applicant screening charge within any 60-day period, regardless of the number of rental units owned or managed by the landlord for which the applicant has applied to rent. This prompted a change to Application Screening Charge Receipt (ORHA Form #42) reminding landlords of the new rule.

    Another change to screening guidelines:

    • 1)      When evaluating an applicant, the landlord may not consider drug-related convictions based solely on the use or possession of marijuana.
    • 2)      When evaluating an applicant, the landlord may not consider the possession of a medical marijuana card or status as a medical marijuana patient when making a determination about the suitability of an applicant. Affordable housing providers subject to federal laws prohibiting the use or possession of marijuana (including medical marijuana) by resident on the premises may continue to enforce those rules with their residents.

    This prompted a change to Application Screening Guidelines (ORHA Form #45) reminding landlords of the new rule.

    As we work at the state level to provide the best updates to forms and our manual to serve your association, we know you share the desire to keep our members’ interest paramount. Please encourage them to only use the most updated forms.

  • Wednesday, September 05, 2018 10:53 AM | Anonymous

     Assistance Animals: Best Practices for Landlords

    Federal Fair Housing laws prohibit discrimination against people who are members of protected classes, in the advertising, sale or leasing of real estate. For rental owners, that means making exceptions to your standard policies or allowing a modification of the premises in order to allow a member of a protected class (in this case a disabled person) the opportunity to enjoy the dwelling unit the way a nondisabled person could by allowing the keeping of an animal that is not a pet. Under the law, an animal that assists a disabled person is seen as an assistive device.

    When it comes to things like wheelchair ramps, visual smoke alarms or shower grab bars, rental owners by and large have no objection to making an exception. Some accommodations such as longer grace periods for rent payments or a dedicated space in a first-come, first-served parking lot, can generate some grumbling. But absolutely nothing causes more upset and opposition than the idea of assistance animals – especially for “no pet” rental owners.

    Much of this attitude is based on hard experience in regard to the damage that animals can inflict on a rental property. In my experience, more than half of all residencies involving animals generate at least some animal-inflicted damage to the house or grounds. With pets, rental owners can charge higher deposits and higher rent to offset the financial risks. They can also restrict the size, breed, or types of pets, as well as the number of pets on the property. With assistance animals, rental owners lose a lot of control over those decisions. This seems unfair as they are the ones faced with the expense of repairs that may go beyond the amount of a traditional security deposit. Even though assistance animal owners are responsible for any damage caused by their animal, it can be frustrating to pursue them to repay damages, and difficult to collect.

    Also tenants seem to have become more aware of their rights in this regard, leading to a noticeable increase in those who report disabilities and are able to obtain a prescription or other care provider authorization. While we can all see the need for a blind resident to be allowed their seeing-eye dog, a diabetic their blood sugar-detection dog, or an epileptic their seizure-detection dog, the surge in “comfort” animals is creating bad feelings among landlords whose perception is that residents are blatantly abusing the system.

    As a rental owner, I completely understand the angst this generates, but guess what? I personally have two dogs and find great comfort in their presence. Numerous studies have shown that the presence of an animal in a residence leads to better mental health for their owners. Dog owners enjoy a markedly reduced risk that their home will be burglarized or that they will become the victim of a violent crime. Now if I were a person seeking a rental, could I make the case that without Stella and Bandit I would suffer? Probably. I certainly would feel more vulnerable to crime and miss their comforting presence. Does that mean I’m disabled and could not get by without them? Maybe. I don’t feel disabled, but I’m thankfully not in a position of having to choose either. I guess the point of telling you that is we often can’t see the invisible anxieties, disorders, fears, conditions, and past traumas of another person that necessitates an assistance animal, and under federal law meets the definition of a disability.

    What is a disability?

    “The term "disability" means, with respect to an individual a physical or mental impairment that substantially limits one or more major life activities of such individual; a record of such an impairment; or being regarded as having such an impairment.

     Major life activities include, but are not limited to, caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working.

    A major life activity also includes the operation of a major bodily function, including but not limited to, functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions.

    An individual meets the requirement of "being regarded as having such an impairment" if the individual establishes that he or she has been subjected to an action prohibited under this chapter because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity.

    The ADA does not apply to impairments that are transitory and minor. A transitory impairment is an impairment with an actual or expected duration of 6 months or less.

    The definition of disability shall be construed in favor of broad coverage of individuals to the maximum extent permitted.

    An impairment that substantially limits one major life activity need not limit other major life activities in order to be considered a disability.

    An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.

    The determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures such as medication, medical supplies, equipment, or appliances, low-vision devices (which do not include ordinary eyeglasses or contact lenses), prosthetics including limbs and devices, hearing assistances and cochlear implants or other implantable hearing devices, mobility devices, or oxygen therapy equipment and supplies; use of assistive technology; reasonable accommodations or auxiliary assistances or services; or learned behavioral or adaptive neurological modifications.”

                                                                                                                      -ADA website

    Additionally, the term physical or mental impairment includes, but is not limited to, such diseases and conditions as orthopedic, visual, speech and hearing impediments, cerebral palsy, autism, epilepsy, muscular dystrophy, multiple sclerosis, cancer, heart disease, diabetes, Human Immunodeficiency Virus infection, mental retardation, emotional illness, drug addiction, and alcoholism.  This definition doesn’t include any individual who is currently using illegal drugs or is a current user of alcohol who poses a direct threat to property or safety (24 CFR 100.201).

    Fair Housing law provides that rental owners shall, without regard to normal rules imposed on tenants, allow for an accommodation to relax those restrictions in order for a disabled individual to enjoy the rental unit the way a non-disabled person could. To the extent that a specific request is “reasonable” a rental owner must allow an exception to accommodate an individual’s disability. That includes allowing animals when they would otherwise be prohibited. Both rental owners and residents have misconceptions about what requirements are lawful to impose upon the owner of an assistance animal. I hope you find the following FAQ helpful in achieving a better understanding of your rights and responsibilities as a landlord:

    Is a resident required to ask for the accommodation for an assistance animal in advance? A reasonable accommodation request may be made at any time, including during the eviction process, and the failure to do so does not mean you have a right to automatically decline the request whenever it’s made.

    Am I obligated to inform residents of their right to an assistance animal if they have a disability? No, the request must be initiated by the resident or by another on the resident’s behalf, but rental owners are obligated to consider all reasonable accommodation requests from their residents.

    Does the request have to be in writing? No, a verbal request is also required to be honored.

    Is there any difference between a service animal, an aid animal, a companion animal, a comfort animal or an assistance animal? Not under the law. Any of the above terms may be used to describe an animal that meets the disability-related need of a resident.

    Can I restrict the size or breed of an assistance animal? No.

    Can residents have both pets and assistance animals? Yes, if your policies allow for pets.

    Does an assistance animal have to be specially trained? While many assistance animals are specially trained to assist their owners with physical disabilities, many assistance animals simply provide comfort and peace-of-mind to their owners, ameliorating the effects of mental, psychological, social, or anxiety disorders in the affected party. Post-Traumatic Stress Disorder (PTSD) is a common diagnosis for combat veterans, rape or assault survivors, or protected classes who have, historically, experienced discrimination. Often children with disabilities find great comfort and stability by relating to and caring for animals. The bottom line is, you are not qualified to determine whether or not someone needs this type of accommodation and should never try to be the final arbiter of whether an individual’s condition requires an assistance animal for purposes of considering a reasonable accommodation request. It is the care provider alone who determines whether or not someone meets the definition of a disabled person.

    Can I ask what the disability is? No. That is private information and you are not entitled to have it. At my company, however, we are seeing many doctors, nurses and social workers telling us what the condition is in direct violation of HIPAA privacy statutes, yikes! But that’s their liability, not ours.

    When I asked an applicant for a care provider authorization, they presented me with a card saying the animal was a service animal and told me it was illegal to require more. Is that true? No, there is often a misunderstanding among disabled people with service or assistance animals that they are allowed to bring an animal onto a rental property with only a service animal ID card they obtained legitimately or one they printed off the internet. While that is often all that is required for access to public stores and buildings under the ADA, it is not true for assistance animals in housing. You can require a care provider authorization in most cases, but remember, if a person’s disability is obvious, it is considered a violation to require that they verify their obvious disability.

    What kind of paperwork or verification can I require of a tenant with an assistance animal? You may require a verification from a qualified care provider who has direct knowledge of the disability (unless the disability is obvious, then you may not require the verification). You may require that the animal be vaccinated and licensed as required by law or ordinance. In most cases you may also request that the animal be spayed or neutered (more on that later), and proof of such provided to you. You may request a photograph of the animal. You may request that the tenant name a responsible party who agrees to take the animal and care for it should the tenant be unable to do so.

    What is the definition of a “care provider”? A care provider can include a medical doctor, a psychiatrist, a counselor or clergy person, a social worker, or a parent or other family member. Basically, any other individual who provides or has provided care to the disabled person, has direct knowledge of the applicant’s or tenant’s disability, and verifies that the animal is needed to allow the disabled resident to enjoy the unit the way a non-disabled resident could. If an applicant or resident provides a recent care provider verification, it is okay to contact the care provider for verification that they issued the verification, as long as you don’t use that as an excuse not to allow the animal to move in in a timely fashion. Also, it can be construed as improper to require them to re-verify their prescription in writing.

    What if the verification says the person would “benefit” from an animal? Well, I would benefit from a million dollars, but that doesn’t mean I’m disabled. It is required that the care provider verify that the person meets the definition of a disability and that they need the animal to meet their disability-related need. You could decline a request when the care provider has determined that the individual does not meet the definition, but be prepared for them to correct the deficiency in their verification, which then obligates you to reconsider the request.

    Can I require that the paperwork be completed prior to the animal taking up residency? That depends. You may not place unreasonable barriers in the way of someone seeking an accommodation, but if an applicant makes a request as opposed to an existing tenant, I usually request that they get their care provider authorization in prior to the animal taking residency. But I also work with people whose records are packed away or need time to get their dog licensed because they just moved to town.

    One of the more irritating things rental owners have been experiencing are last-minute notifications that an approved applicant makes (often at the time of move-in) that they have an assistance animal. But many tenants are rightfully wary to disclose this due to concern that a rental owner will find another way to deny their application, so they wait until the time of move in to disclose, or wait until they move in and you discover the animal. To try to prevent some of this, we have changed the ORHA application (ORHA form #1) to say: “If your service or companion animal requires a reasonable accommodation please inquire with Owner/Agent.” This can help avoid surprise requests, giving both parties enough time to take care of the paperwork prior to the animal taking up residency. If you have older applications you should get new ones.

    Can a rental owner have an assistance animal removed pending a care provider verification of the need for the animal? That is extremely risky and could be seen as placing a barrier in the way of a disabled person. Remember, the disabled individual is asserting that they need that animal to assist them with their disability. You don’t want to be guilty of creating a breakdown for the resident or otherwise causing them to fear discriminatory treatment, which could result in a claim against you even if you eventually approve the accommodation. It’s best to assume, until proven otherwise, that the request is legitimate.

    What if a guest brings an assistance animal onto the property, do I have to allow that? Likely, yes, but the visitor is also required to prove that the assistance animal is legit by completing the same paperwork as a resident.

    Can I charge a deposit or higher rent for an assistance animal?   No.

    Can I require that the assistance animal be spayed or neutered? That is disputed. Even among well-educated people within the Fair Housing agency itself, there is some disagreement on this matter. It is certainly okay to REQUEST that the animal be spayed or neutered, but be open to an explanation of why that may not be possible or advisable. For example, I have a tenant with a balance disorder who has a large specially trained purebred dog that walks beside her to provide stability and keep her from falling. She has a contract with the breeder that prevents her from spaying the dog until it is at least five years old, so I made an exception for that. Also, once an animal is beyond a certain age, it can be physically risky to subject them to that surgery, which could be another good reason to make an exception. Remember, you can’t place unreasonable barriers in the way of the person seeking accommodation.

    Can I require that the assistance animal be licensed and current on vaccinations? Yes, if applicable. Owners of assistance animals must still comply with all codes and laws regarding vaccination, registration and licensing of their assistance animal.

    How many animals can be allowed per person? That is not defined under the law. Each animal must qualify on its own in regard to the service it provides to the disabled person. And, no, assistance animals are not entitled to their own assistance animal!

    What types of animals are allowed to serve as assistance animals? Domestic animals are clearly allowed, but vermin can be excluded. Review each request on its own merits and make exceptions when reasonable to do so. For example, under current law you are not required to allow farm animals as assistance animals, but one of the more popular animals for visual assistance for the blind is a miniature horse. They are no larger than many dogs, can be house-trained, and live up to three times as long as a seeing-eye dog, making them a better long-term investment. Current rules don’t require that you consider allowing vermin species such as most rodents, snakes or even fish, but this area of law is always evolving and if you don’t want to end up as a test case, best to consider ALL requests and grant them when it is reasonable to do so. There was a recent case where a guinea pig was determined to be a valid assistance animal. Could I see a scenario wherein watching fish swim in their tank or have a boa constrictor squeeze your arm have a calming effect related to a resident’s disability? What do you think?

    What if I have a severe allergy to a specific type of animal? All requests must be reasonable. The definition of reasonable is open for debate, hence the opportunity for litigation, resulting in case law that provides clarity as to what is or is not allowed. I had a potential client once who had purchased her dream home and intended to live in it during retirement which was a few years away, but wanted to rent it out in the meantime. She had a life-threatening allergy to cats and asked me if she could exclude cats from residing at the property even if they were assistance animals. I discussed it with staff at the Fair Housing Council of Oregon, who agreed that it could be justification for declining assistance cats, but that the woman should be very sure she could prove it if a complaint were filed against her. I would go further and recommend that you obtain your own verification of disability from your care provider in advance, so that if this issue ever arises you will be prepared.

    What if the assistance animal damages the property or the resident won’t clean up after it? Assistance animals, just like pets, are not allowed to be destructive, dangerous, or disturb the covenant of quiet enjoyment. Residents are required to take proper care of the animal and clean up after it. Non-compliance fees may be charged and tenancies terminated for failure to clean up animal waste outside the dwelling unit. Residents must pay for any damage caused by their assistance animal and their tenancy may be terminated for failure to pay.

    What if an assistance animal disturbs the peaceful enjoyment of neighbors? After a good faith effort to allow the tenant to fix the problem, you would be justified in having the animal removed or ending the tenancy. I got a complaint from a resident in a four-plex that his neighbor had a dog and when she left it would bark continuously, interfering with his right to quiet enjoyment. She was also failing to clean up its waste. I served her a Pet Violation notice and she contacted me to let me know her daughter had brought her the dog and it was an assistance animal. I sent her our assistance animal paperwork, but told her that since this animal had already proven itself to be disturbing the peaceful enjoyment, she would either need to find a way to stop the incessant barking or find a different assistance animal. I also reminded her of the obligation to clean up after the dog and that any further instances would result in the possible assessment of non-compliance fees, leading to either the removal of the dog or a termination of her tenancy. She removed the dog, but of course we remained open to her obtaining another assistance animal. If she had kept the dog, but continued to allow it to disturb the neighbor’s right to quiet enjoyment or failed to clean up after it, I would have served a Notice of Termination with Cause (ORHA form #38) for the violation(s), resulting in either a cure of the notice or termination of the tenancy.

    What steps should I take if I see an unauthorized animal in my unit? I start by serving a 10-day Pet Violation Notice (ORHA form #6), requiring the tenant to remove the animal or their tenancy will terminate after 10 days. I also send along a Warning Notice (ORHA form #35) letting them know that if the animal is not removed within 48 hours, they will be assessed a $250 noncompliance fee, with additional fees being charged for every 48 hours the unauthorized pet remains on the property. That usually gets a response. About half the time the resident asserts that the animal is an assistance for a disability.

    When that happens, take at face value that it really is an assistance animal until proven otherwise, then provide the necessary paperwork (Reasonable Accommodation Request and Verification – ORHA form #53). Follow up with the resident to make sure that their verification is valid and the animal is spayed or neutered (unless you have made an exception), current on vaccinations, and licensed if required by law. Once the verification is complete, the tenant fills out and signs the Assistance Animal Agreement (ORHA form #46), recording the pertinent information about the animal as well as a Responsible Party Certification. The form also reminds the resident about the rules for their assistance animal and the consequences of violating those rules. Get a photograph of the animal for your records and keep it with the tenant’s file.


    Sometimes providing verification of things like spay/neuter records, vaccinations or licensing can take time to accomplish, especially if all the requirements haven’t been met and the resident doesn’t have the funds. There’s no set timeframe within which the resident must fully comply, and there are conflicting thoughts on what is reasonable in regards to compliance, so err on the side of caution. If you terminate a tenancy based on a resident’s failure to provide assistance animal documentation, make sure you are not placing barriers in their way. For example, requiring that everything be completed in two weeks may not be a problem for one resident, but could be a burden to another on a fixed income with no transportation. Sometimes it can take time to get a vet appointment, or come up with the money for licensing.

    What is the risk to me for denying an assistance animal? The potential consequences are expensive. The Bureau of Labor and Industries (BOLI) is the enforcement arm of Fair Housing in our state. The system is complaint-driven. What happens after a complaint is filed depends on the nature of the complaint, but testing is often the first step in determining whether or not discrimination has occurred. In one prominent local case a few years back, a rental owner who was advertising their “no-pet” rental was contacted by a prospective applicant who told the owner he had an assistance animal. The owner responded by saying, “We don’t take pets.” The individual filed a complaint with the Fair Housing Council of Oregon, who tested the rental owner several more times. He failed and was fined $16,000 by BOLI for discriminating against the disabled. Discrimination penalties are often much, much higher, going into the tens of thousands or hundreds of thousands of dollars for large cases where a pattern of continuing discrimination is identified.

    So, what have we learned?

    This is how things are. You may not like it, but you have to follow the law or risk very painful consequences. Can’t bear it? Then go into a different business. Never try to dissuade someone from making a request for an assistance animal. If you get a call on your no-pet rental and are asked whether it’s okay to have an assistance animal, just repeat the following: “I do not discriminate based on any protected class, and I will consider a reasonable accommodation request for an assistance animal at any of my properties. Would you like an application?” Evaluate each request in relation to the reasonableness of the request and the verification provided, and do not make any decision before you have all of the information.

    Despite the risks, rental owners are obligated to follow fair housing law, so my best (non-legal) advice to you: Deal fairly. Inspect regularly. Enforce consistently.

    This column offers general suggestions only and is no substitute for professional legal assistance. Please consult an attorney for advice related to your specific situation.

    About the writers of this article:

    Tia Politi, Lane ROA President, with assistance from

    Victoria Smithweiland, Operations Director for Womenspace

  • Tuesday, September 04, 2018 10:46 AM | Anonymous

    September 1st, 2018

    Dear Colleagues,

    This Primary Election, our industry experienced a tremendous defeat with the loss of Senator Rod Monroe (D-Portland).  During the 2017 legislative session, he stood up to Speaker Kotek and the House of Representatives bill to end no-cause termination notices and impose rent control.  Unfortunately, that resulted in the advocates taking him out in the Primary election.

    We can’t let this happen again.  This coming November election is critical.  Either, we elect legislators who will help us manage our properties or we may face future set backs with rent control and/or the loss of no-cause evictions.

    The Speaker sees the defeat of Senator Rod Monroe as one step closer.  You remember the Oregonian headline...

    Kotek pushes for statewide cap on rent hikes, end to 'no-cause' evictions

    Never before has our industry been this aggressively attacked with our ability to control our properties in jeopardy.

    This is a special appeal because we need to raise $50,000 for our PAC in the next few weeks to defend ourselves or face the consequencesSo it’s time once again to please contribute to the Oregon Rental Housing KEY-PAC.

    Your contribution of $5,000, $1,000, $500, $250 or $100 will go a long way this election cycle to help stop these attacks!  A lot is at stake next legislative session.

    ORHA’s legislative successes are built upon getting the right legislators elected!  Regardless of a candidate’s political affiliation, ORH KEY-PAC helps elect candidates who will help protect your ability to own, operate and manage rental property.

    Over the years, ORH KEY-PAC has made a huge impact in elections that have ultimately helped the rental industry. 

    This election, we need two to three times the amount you usually contribute to defend ourselves next legislative session.

    So please, support the ORH KEY-PAC and support legislators who will understand and protect our industry. We simply can’t afford not to.


    Jim Straub
    Oregon Rental Housing Association
    Legislative Director

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PO Box 20862, Keizer, OR 97307
Email: office@OregonRentalHousing.com 

The Oregon Rental Housing Association (ORHA) is a non-profit educational landlord association -- ORHA Board Members, Mentors, Staff, and/or other related ORHA affiliates do not give legal advice. Please be advised that any information provided  is no substitute for professional legal counsel and any advice or guidance given does not constitute legal advice.  Please consult an attorney for legal advice related to your specific situation.

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