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. 

In a residential eviction case for nonpayment of rent, the landlord MUST accept the tenant’s rental payment, even if it does not include payment for late fees, utility charges, collection fees, or other items not constituting “rent.” Additionally, SB151 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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12 Replies to “What Happened? Nevada Legislature 2019 (Part 1 of 2)”

  1. Re: 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.

    Dumb question: Does this mean all property management companies can no longer serve 5 or rather 7 day notices?

    1. Not a dumb question at all, Audri! I’m sure many PMs in Nevada are wondering the same. As I understand it, the PM company can’t serve these notices anymore (after July 1). Now, they must be served by a Constable, Sheriff, or licensed Process Server. Thanks for reading and commenting!

  2. Thank you Judy,
    How does a landlord now get paid for process server fees, late fees, utility charges, collection fees, or other items not constituting “rent”? Are there any provisions for collection of these things or are we to just hope they pay it?

    1. Hi Allan. As I understand the law, effective July 1, I think we have to count on the court to award these costs/charges, on a case-by-case basis. This will undoubtedly lead to judges being perceived as “pro-landlord” or “pro-tenant.” Not a helpful scenario in the bigger picture, to say the least. I fail to see how this will address the lack of housing in our state, or in any way help those who need it. Badly crafted, and lots of unforeseen negative ramifications, I believe. For example, many PMs will probably tighten their rental qualification criteria, and initiate non-payment eviction actions earlier than they have been doing, which will clog the lower court calendars and put the very folks who need help in greater jeopardy than they are under today’s law. I recommend you check with your attorney, for his/her interpretation of the bill.

      1. Judy, Great commentary on your webpage. With regard to the courts awarding cost/charges, I do not hold out much hope on that because the summary eviction process is just that a summary eviction and is only to determine if the rent was paid. Whether or not costs/charges can be awarded, I am been told in the past by two different Chief Judges that the summary eviction hearing is the wrong court for that and when the costs/charges are brought up it creates a dispute and the summary eviction court does not settle disputes over anything except the rent. Therefore if there is a dispute, the eviction does not get granted until the dispute is resolved. Appealing takes it away from the Justice Court and up the District Court where the fees and eviction could be settled but it is no longer a summary process. Of course, this is just my opinion, and your advice of checking with an attorney is the best advice on the matter.

        1. Hi George. Yes, I agree the excess costs will not likely be awarded in an eviction hearing. Perhaps, a small claims court, as a separate action. It will be interesting to see how this all shakes out. Thanks for reading and commenting!

    2. Not an attorney or judge by any means but the judge has ruled in MANY of the Las Vegas cases that we need to do a 5 day perform or quit to collect money that are not rent. If after 5 days they have not paid, then a 5 day unlawful.

      1. I do not believe you will continue to see judges award eviction for nonpayment of rent if the charges claimed by the landlord include anything other than “rent” as it is defined in this bill. Please keep me posted. It will be interesting to see what the courts do with this, over the next several months.

  3. Thanks for the great information as always! One question I have for you about the late fees. With our current leases before the new laws state the late fees exceeds the 5% do we need to do an addendum to update the lease or are we covered with the “Nevada Laws Apply” and the “Severabilty” clauses from the RSAR Lease? Thanks! Kylie

    1. Hi Kylie! Thanks for reading the post! For an answer to your question, I recommend you speak with your attorney. I’m unable to tell you whether you need a lease amendment, or simply a notice to tenants and a change to your late fee procedures. The important thing is to be sure you abide by the maximum late charges, as called for in the law change. Effective July 1.

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