What Happened? Part 2 – Nevada Legislative Update 2019

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In Part 1 of this series, we discussed the activities of the 2019 Nevada Legislative Session, specifically SB 151, as it relates to property management in Nevada. Today’s post will discuss additional bills passed during the session which will impact our industry.

NEVADA REAL ESTATE LICENSEES

SB 230 affects real estate licensees in a number of ways. First, and perhaps most important,real estate licensees MUST include their real estate license number on any and all advertising materials, including flyers, business cards, websites, social media, and other advertising venues. This portion of the bill became effective on July 1, 2019, so be sure to update all your advertising now! The bill also tasks the Nevada Real Estate Commission with implementing regulation allowing conditions and limitations for licensees to advertise using a nickname.

Also effective July 1, brokers are no longer required to “prominently display” licensees of agents associated with the brokerage; they must now be kept in a secure manner, and made available for inspection by the public or the Nevada Real Estate Division.

The bill brings many changes to the education requirements for real estate licenseesin Nevada. For all new licensees (those submitting applications for licensing on or after January 1, 2020), pre-licensing education will now be a total of 120 hours (instead of 90 hours). At least 15 hours of the pre-licensing instruction must focus on preparing contracts, and another 15 hours must be specific to agency laws and requirements.  

Continuing education requirements are also set to increase, pending mandated new regulation by the Commission. The new regulation “must require a minimum of 36 hours of continuing education.”  In conjunction with new continuing education requirements, the Commission is also required to include regulation authorizing someone aged 65+ years to apply for an exemption from the continuing education requirement.

EVICTION ACTIONS

In addition to the changes discussed in my post on SB 151, the Nevada Legislature also passed SB 74. This bill allows for appeal of an eviction orderby either party within ten (10) days of the date of the order. Additionally, the bill provides that, should a Landlord unlawfully recover possession of the property, a Tenant is entitled to expedited relief (and can recover possession), even if there is an eviction action pending. This bill takes effect October 1, 2019.

AB 266 – This bill became effective on July 1, and provides for automatic sealing of court records on eviction casesthat do not go all the way through to a lockout order. It is largely a cleanup bill, clarifying existing law. In short, if the court does not enter an award for possession of the property to the landlord, the case dies, and the records are sealed. 

ANTI-DISCRIMINATION

As many of you are aware, some of the older governing documents of homeowners associations contain language that is in direct opposition to the provisions of the Federal Fair Housing Act. SB 117 took an important step toward correcting the impacts of such language by allowing property owners to record a separate document with the county that strikes the discriminatory language in their association’s governing documents. The bill takes effect on October 1, 2019. 

MULTIFAMILY PROPERTIES

SB 212 went into effect on July 1st, and allows towing companies to post notices on improperly parked vehicles, provided the towing company has a contract for that purpose with the owner or manager. The bill also allows immediate towing without further notices if the vehicle was previously tagged three or more times in the same multifamily complex during the preceding six months.

For managers of multifamily housing that meets the definition of “Affordable Housing” and is accessible to persons with disabilities, SB 104 is an important read. The bill requires such managers and owners to make quarterly reports to the Housing Division to assist in its mission to maintain accurate records of affordable housing in the state. The bill took effect July 1, 2019. 

SB 367 provides that renters of low-income housing funded in total or in part by the “Account for Low-Income Housing” will be allowed to keep one or more pets, subject to minor restrictions. This bill goes into effect on January 1, 2020. 

CONTRACTORS

As property managers, we’re often responsible for selecting contractors to perform work on the properties we manage.  SB 397 became effective July 1, 2019. The bill authorizes licensed contractors to perform work in specialties outside the scope of his/her contractor’s license provided: (1) the work is not plumbing, electrical or HVAC, and (2) the value of the work does not exceed $1,000. 

AB 175 – Establishes a formal registration process at the state level for “Environmental Health Specialists.”Although many existing specialties are exempted from the registration requirement, the bill takes aim at uneducated and unlicensed vendors who practice in this area of work. 

LASTLY…

If your business involves selling real estate as well as property management, AB 335 will interest you. It tightens up requirements on a homeowners association for furnishing “resale packets” and the fees charged relating to a change in ownership of a home/condominium in a common-interest community. Most importantly, resale packets must be valid for a period of not less than 90 days.

It’s important to note that the 2019 Nevada Legislative Session also took up a number of bills attempting to address the increasing problem of homelessnessin our state. One of those bills, AB 174, establishes the Nevada Interagency Advisory Council on Homelessness to Housing. This is an important step toward bringing together a number of state agencies, as well as experts in the public realm to address the homelessness issue in Nevada. We’ll be watching the Council’s activities closely.

This was a busy session for the Nevada Legislature! Some of the greater impacts of the bills discussed in this space will be determined by the local courts, over the next couple of years. Please share your thoughts and feedback, by commenting on this post. Thanks for reading!

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2019 NV Legislative Updates – Part 1 – Clarification

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Due to a number of inquiries related to my first post on the 2019 Legislative changes, specifically SB 151, I sought legal counsel for clarification of one of the bill’s provisions. My statement (prior to today’s edit) that a Landlord would have to stop an eviction if the tenant paid rent but not late charges was incorrect. The “old” rules still apply for a pending “non-payment” eviction, regarding what constitutes payment. The Landlord MAY refuse to accept payment unless it includes all rent, “reasonable late fees,” utilities, and/or any security deposit owing.

This is a good time to remind you that, whenever you are in doubt about how laws or regulations are interpreted, you should ALWAYS consult legal counsel, just as I did. It will be interesting to see how the impacts of SB 151 are handled in the courts. Watch closely, I think we’re going to see some very crowded court calendars very soon.

Part 2 of my Legislative Update will be posted in a few days. Thanks for reading!

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What Happened? Nevada Legislature 2019 (Part 1 of 2)

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2019 was certainly an eventful legislative session for Nevada! A number of bills were introduced, seeking to have a direct impact on the residential landlord/tenant and property management industries, not the least of which was Senate Bill 256 (SB256).

SB256, in its original form, would have brought sweeping changes to Nevada Landlord/Tenant law. The bill sought to protect ‘source of income’ discrimination in housing – ending the practice by some landlords and property managers to refuse to rent to ‘Section 8’ recipients. It would have prevented landlords of ‘low income’ housing from considering a tenant’s past inability to pay rent as a qualifying factor for tenancy. Further, it would have granted rights to tenants for “initial inspection” of a dwelling unit before vacating, and would have required landlords to provide a written summary of possible charges against the tenant’s security deposit, among other changes. SB256 died on the Assembly side, thanks to the strong lobbying efforts of the Nevada Association of REALTORS.

Although SB256 did not make it to the Governor’s desk, parts of that bill snuck in just under the wire, and became law. This was due to a last-minute amendment to SB151. When I say “last minute,” I’m not kidding. The very last day of the legislative session brought additional landlord/tenant provisions to SB151, which became law when signed by the Governor, and takes effect on July 1, 2019.

SB151 affects our industry in a number of ways. First, it clearly delineates a difference between the procedure for eviction of a commercial tenant vs. eviction of a residential tenant, for nonpayment of rent. Commercial tenants continue to be subject to a 5-day “summary eviction” for nonpayment of rent. Residential tenants, on the other hand, are now subject to a 7-day (7 “judicial” days) “pay or quit” action. Once the court orders the eviction action, the sheriff or constable must remove the residential tenant no earlier than 24 hours after the order is posted, and no later than 36 hours after the court order for removal is posted. 

If a residential tenant leaves personal property in the residence after vacating, under SB151, that tenant has 5 days to retrieve “essential personal effects.” Further, the tenant may file a motion (within 20 days) to contest the reasonableness of the landlord’s actions in storage of the property; both the daily storage costs, and the removal procedure used by the landlord. The court must hold a hearing within 10 days of the tenant’s motion, and may award the tenant the ability to retrieve “essential personal effects,” even after an initial 5-day period following removal of the tenant. Further, the court may award the tenant damages up to $2,500, if the court finds the landlord acted improperly in handling the tenant’s personal property. 

For commercial tenancies, the landlord will have no liability for disposing of a tenant’s personal property after the tenant vacates (or is removed), provided the landlord gave a minimum of 14 days’ notice to the tenant via Certified USPS mail. 

SB151 also provides that eviction records are automatically sealed by the court if the landlord fails to pursue the action through to a court order for removal of the tenant.

Thanks to a ‘friendly amendment’ from the Nevada Association of REALTORS, a tenant retains all rights and responsibilities under a residential lease when the property is sold in a ‘traditional’ (non-foreclosure) method. Conversely, the new owner of the property is bound to the landlord’s terms under that agreement, a welcome clarification of existing law contained in SB151. 

All eviction notices must be served by a sheriff, constable, or licensed process server!  Due to circumstances of improper service described during hearings for SB151, the final version of the bill provides that all such notices be served by someone licensed to serve notices in Nevada. The landlord may no longer serve these notices him/herself. 

SB151 adds new section to NRS 118A (Nevada’s Residential Landlord/Tenant Act) that defines the term “Periodic Rent.”That definition clearly states that “rent” means only the amount that is payable each month, and nothing more. Presumably, this provision of the bill seeks to omit late charges and tenant repair chargebacks from the definition of “rent.” 

Speaking of late fees,this may be the biggest change to residential landlord/tenant law: SB151 limits late fees significantly. Late fees now may not exceed 5% of the periodic rent (not 5% of the balance then due). Daily (cumulative) late fees are now a thing of the past.

All sections of SB151 become effective July 1, 2019.

Stay tuned for Part 2 of this post, where we’ll take a look at other 2019 changes to Nevada law affecting the property management industry.

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