The Sacramento Report

CAA Considers Legislative Priorities for 2006

by Monica Williamson

The California Apartment Association is currently developing its 2006 legislative and legal priorities. A variety of issues are under consideration by CAA’s Government Affairs Committee to determine if legislative or legal action is necessary and feasible.

Megan’s Law
CAA will continue its efforts in 2006 to solve the challenges created by the Megan’s Law database. Currently, state law effectively prohibits housing providers from using the Megan’s Law web site to make housing decisions. Rental property owners or managers cannot use information contained on the web site as a factor to grant or deny tenancy, evict a current tenant or provide a warning to other tenants if a sex offender lives on the property. At the same time, rental property owners may be liable if they fail to protect residents against a known risk—in this case, someone with a documented criminal history of sexual assault against children, women and other potential residents and guests.

In 2005, CAA sponsored Assembly Bill 438 (Parra). This bill would give rental property owners and managers the flexibility to protect their residents from dangerous sex offenders. Specifically, the bill amends state law to clarify that owners and managers can use the database to act decisively in the interests and safety of their tenants and would allow the database to be used by property owners in deciding whether or not to rent to registered sex offenders, regain possession of rental units from dangerous sex offenders or warn other tenants about registered sex offenders.

AB 438 remains stalled in the Assembly Public Safety Committee, where it failed initial passage in April 2005. CAA has until January 2006 to move this bill out of the committee. The grassroots campaign that has been underway throughout 2005 has kept this issue extremely visible around the state. The campaign demonstrates to state elected officials that their constituents support AB 438, and they want their legislators to weigh in favor of families and children rather than convicted sex offenders.

Eviction Delay
CAA has conducted research and collected background on the tactics utilized by unscrupulous individuals and law firms to delay eviction. One such tactic includes requesting a jury trial in an unlawful detainer action at the very last moment. An unscrupulous tenant who waits to request a jury trial forces a delay in the case by several weeks; this often results in additional delays in getting an appropriate court date and scheduling a settlement conference. One way to remedy these tactics is to include a provision in a lease agreement that would waive the party’s right to a jury trial in the event that a dispute arises under the agreement.

In August 2005, the California Supreme Court heard a case on this subject and ruled that parties may not contractually agree to waive the right to a jury trial before a lawsuit has arisen. The court ruled that the California Constitution provides that the right to a civil jury trial may be waived only if the waiver is expressly authorized by the Legislature—thereby inviting the Legislature to clearly specify whether such provisions are permissible. Although the dispute in this case arose under a business contract, other states have allowed jury waivers in all types of contracts, including consumer agreements.

CAA is working with others in the business community to craft legislation to allow contractual jury waivers. This issue is quite controversial and it remains to be seen if a legislative solution will be successful.

Rental Inspections
Local rental-inspection ordinances are proliferating throughout the state. The resulting inconsistent patchwork of requirements is confusing and makes operating rental housing in multiple jurisdictions challenging. CAA’s Local Government Committee has been closely monitoring this issue over the past year, and some committee members have recommended that CAA seek state legislation to completely or partially alter inspection programs at the local level.

CAA is considering whether to introduce legislation that would bring some uniform statewide guidelines to these programs in order to make them more predictable and workable. Such guidelines might include a uniform inspection checklist or a requirement that local governments only target problem properties. CAA is also working with the National Apartment Association to find appropriate ways to ensure that these ordinances truly achieve their goal of mitigating substandard property without unduly burdening tenants and responsible property owners.

Credit Reporting
Litigation is currently pending over the provision of unlawful detainer reports. Eviction reports are based on public court records and are used to determine whether an applicant has been evicted from a prior residence. The fact that the litigation is still pending has made the issue of whether unlawful detainer reports must be treated as “regular” consumer credit reports or “investigative” consumer reports unsettled under California law.

In the case of a regular consumer credit report, the user (the property owner or manager) of the report is required by law to provide a copy of the report to prospective tenants upon request if the prospective tenant has paid a fee. By contrast, the process for an investigative consumer report requires that within three days after ordering the report, the owner must disclose to the applicant that the report has been ordered. The disclosure must include the agency’s information and a summary of specific legal provisions. Owners must also provide applicants with a means to indicate their desire to obtain a copy of the report (a checkbox). If applicants request a copy, the owner must send the copy within three business days of receipt. Owners must also certify to the investigative consumer agency that they have complied with the legal requirements. CAA has created two new forms to comply with this law. See the “Products and Services” section of CAA’s web site at www.caanet.org for copies of the new forms.

CAA is currently investigating whether a consistent reporting process can be developed under state law, a process that works for both rental property owners and prospective tenants. We will keep you posted as CAA’s Government Affairs Committee continues its work on these important issues.

The opinions expressed in this article are those of the author and do not necessarily reflect the viewpoint of SFAA or the San Francisco Apartment Magazine. Monica Williamson is CAA’s Vice President of Public Affairs. She is responsible for state legislation and oversight of local government activities conducted by CAA staff, chapters and divisions. Copyright � 2006 by the San Francisco Apartment Magazine. All rights reserved.