ORHA News

By: Tia Politi
June 2024

The Eugene Rental Housing Code was first adopted in 2005 and implemented housing standards similar to Oregon habitability law (ORS 90.320) but with a few additions that clarify landlords are responsible to deal with rats in the unit and that each room have a dedicated heating source capable of bringing the temperature of each room up to a minimum of 68 degrees under normal weather conditions. The code also required landlords within the city limits (but not outside the urban growth boundary) to register their units with the city and pay an annual fee of $10 to fund the services provided by the city to enforce the code. The fee was increased in 2022 to $20 per unit to be used, “…for the purpose of offsetting the costs to the city associated with the enforcement of this code and costs associated with providing services to tenants and owners and managers of rental housing, including but not limited to: a rental housing navigator position, rental housing data collection, and tenant support services.”

Services provided to tenants of rental housing, as outlined by the code may include but are not limited to, “…tenant hotline; eviction diversion; support for ex-offenders and other individuals with similar challenges who are struggling to qualify for rental housing; and support for tenants seeking rental housing that is accessible to and usable by persons with disabilities.”

Security deposits and deposit accounting

• Prior to a new tenancy beginning, the landlord must provide the tenant with documentation of the condition of the rental home and receive written confirmation that the tenant has received and reviewed the documentation. The landlord must provide a receipt for the security deposit within 10 days. Providing a copy of the rental agreement with the deposit info listed on it should suffice.
• • The documentation must include photos and a written report. The city is providing a condition report that has space for the tenant(s) to sign acknowledging receipt of the report along with the photos/videos. The photos and/or videos may be delivered personally or sent electronically.
  • The documentation shall, “…show the condition of the rental housing, including the condition of any appliances provided for use by tenants, and a written statement describing the condition of the rental housing, including the condition of any appliances provided for use by tenants, and noting any damage.”
  • “The written statement shall describe each room of the dwelling noting the condition of floors, walls, windows, ceilings, fixtures, cabinets, locks, smoke detectors, and appliances inside and out. The written statement shall also include a description of any exterior components of the dwelling that the tenant is responsible for maintaining.”
• Within 31 days of move out, along with the deposit accounting the landlord must provide not only the written accounting of charges against the deposit, but also provide documentation on the condition of the rental home and a written statement describing the condition or damage the landlord believes justifies the charges. This documentation must include:
• • Photo documentation showing the condition of the rental home, including any appliances provided for use by the tenant.
  • A written statement describing the condition of the rental home, including appliances, and noting any damage.

Maximum Security Deposits
Eugene rental owners may charge a security deposit equal to no more than two months’ rent, with two exceptions. One exception is for those who choose to rent to an applicant they could have denied due to risk factors identified in ORS 90.304. If you do choose to rent to a riskier applicant, you may increase the security deposit to three months’ rent. If you decide to take a chance on an unqualified applicant or if you agree to a material modification to their rental agreement, you may charge an additional security deposit equal to one months’ rent to address that change and/or mitigate your risk. If you charge an additional amount for the reasons cited above, you must give the tenant up to three months to pay the increased deposit.

ORS 90.304 states that a landlord can deny an application based on:
(a) Rental information, including:
(A) Negative or insufficient reports from references or other sources.
(B) An unacceptable or insufficient rental history, such as the lack of a reference from a prior landlord.
(C) A prior action for possession under ORS 105.105 to 105.168 that resulted in a general judgment for the plaintiff or an action for possession that has not yet resulted in dismissal or general judgment.
(D) Inability to verify information regarding a rental history.
(b) Criminal records, including:
(A) An unacceptable criminal history.
(B) Inability to verify information regarding criminal history.
(c) Financial information, including:
(A) Insufficient income.
(B) Negative information provided by a consumer credit reporting agency.
(C) Inability to verify information regarding credit history.
(d) Failure to meet other written screening or admission criteria.(e) The dwelling unit has already been rented.

Remember that under SB 282, evictions or money owed to a prior Landlord from a tenancy that terminated during the COVID-19 Protected Period (April 1, 2020 – February 28, 2022) cannot be considered when evaluating an applicant until after January 2, 2028. Also, under SB 291, landlords must conduct individualized assessments of an applicant with criminal history taking into consideration any supplemental evidence the applicant provides to overcome a negative screening outcome. The assessment must consider the nature and severity of the incidents that would lead to a denial; the number and type of incidents; the time that has elapsed since the date the incidents occurred; and the age of the individual at the time the incidents occurred.

Tenants’ rights handout

• At the time of lease-up, the tenant must receive the Tenant Education Information. This form includes information regarding the rights and obligations of landlords and tenants regarding tenancy termination as well as information about the requirements of the code. The form is available on the city website.

Rental references

• Up to twice per calendar year and within five (5) business days of receiving a written request by the tenant, the landlord shall provide a rental reference utilizing a form approved by the city manager. The form is available on the city website.

Screening – First Come, First Served

If you publicly advertise a rental unit in Eugene, your ad must specify the date and time you will begin accepting applications and the dates of your open application period. “Open application period” is defined as “The period of time during which a landlord will accept rental housing applications for a publicly advertised dwelling unit.” You get to decide what period that is – 48 hours, 72 hours, one week? “Advertised or rented to the general public” is defined as, “…a notice posted or otherwise made available to the general public, whether online, in a hard copy publication, or on a posted sign.”

The advertisement must include information regarding an applicant’s right to request more time to ensure that they have meaningful access to compete for the dwelling unit. “Meaningful access” is defined as, “The ability of a person with limited English language proficiency to use or obtain language assistance services or resources to understand and communicate effectively, including but not limited to translation or interpretation services.” If a limited-English proficiency applicant requests additional time and if they submit their completed application within 24 hours of their request, the date and time of the request will serve as the date and time of receipt of the application for determining the order in which applications are received.

Here’s one possible statement to consider including: “Applications will be accepted between September 2 - 5, 2024. If you are an applicant with limited English proficiency, you are entitled to submit a request for an additional 24 hours to provide you with more time to seek language assistance services for the purpose of complying with the Landlord’s screening and application requirements.” A landlord is not required to provide translation or interpretation services to an applicant.

You must digitally or manually record the date and time of receipt of each application received (regardless of whether you assess an applicant screening charge) during the open application period and if a prospective renter applies prior to the open application period, their application is considered received eight hours after the start of that open application period. You are then required to screen applications in the order in which they are received, and must accept, conditionally accept, or deny applications in the order of receipt.

If requested, you must notify the applicant of their place in line within 48 hours of the request. Remember, under state law this is a requirement any time you charge a screening fee. A landlord may simultaneously process multiple rental housing applications, but must accept, conditionally accept, or deny rental housing applications in order of receipt. Let’s say that you get three applications at approximately the same time. You record the order of receipt but may begin processing all three. If, for example, you get all the info needed from the third applicant prior to receiving the info for the first two, you may select the third applicant, but first would need to deny the first two. 

If you offer to rent your unit to an applicant and they do not accept the offer to rent within 48 hours of the time the offer is made, you may provide more time or move on to the next applicant.

What does it mean to accept an offer to rent? The ordinance does not say, but to my mind, accepting an offer to rent would mean either the tenant pays all funds due and takes possession of the dwelling unit if it’s move-in ready, or paying a deposit-to-hold and signing the Deposit-to-Hold Agreement – ORHA form #S7 if it’s not, thereby obligating themselves to rent at some point in the future. In any event, you must provide 48 hours for them to accept or decline your offer before moving on. 

You may refuse to process applications under the following conditions:

1. The application is materially incomplete. If a landlord refuses to process an application because it is materially incomplete, the landlord must notify the applicant in writing within 48 hours of deeming the application incomplete. The notification to the applicant must inform them that their application will not be processed and must state what made the application materially incomplete.
2. The application has been submitted by an applicant who has violated a rental agreement with the same landlord reviewing the application three or more times during the 12-month period preceding the date of the application, the landlord musty notify the applicant in writing within 48 hours that their application will not be processed and provide copies of the written documentation of the violations that were previously provided to the tenant.

The following are exempt from the screening rules under the code:

1. Affordable landlords (Typically, agencies who provide HUD-financed housing such as Homes for Good, ShelterCare, or St. Vinnie’s.).
2. A dwelling unit occupied by the landlord as their principal residence.
3. A unit of middle housing when the landlord’s principal residence is another unit of middle housing on the same lot or parcel (for example, duplex, triplex, quadplex, townhouse, or a cottage).
4. An accessory dwelling unit located on the same lot or parcel as the landlord’s principal residence.
5. A dwelling unit that will be shared with an existing tenant who has a separate rental agreement for the dwelling unit (i.e., renting individual rooms).
6. A dwelling unit not advertised to the general public.

Eugene Code Relocation Assistance
Landlords must provide a minimum of 90 days’ written notice to terminate tenancy for no cause in a month-to-month tenancy in the first year. The termination notice must include information about the amount of relocation assistance for which the tenant is eligible with a description of their rights and obligations. The Tenants’ Rights & Obligations for Relocation Assistance form is available on the city’s website.

Unless exempt, you must pay the tenant two month’s periodic rent if you terminate the tenancy for no cause in the first year, or for a Qualifying Landlord Reason, and the relocation assistance must be paid within 45 days of delivery of the termination notice. If the tenant remains in the dwelling unit after the date of termination without the landlord’s permission, the Tenant must immediately repay the relocation assistance.

The city manager’s interpretive rules require that the payment shall be paid directly to a tenant(s) listed on the rental agreement using one of the following payment methods:

1) A cashier’s check that is delivered by first-class mail or in person.
2) A traceable electronic payment method such as a cash app or an electronic bank transfer if allowed under the written rental agreement. (Under state law, landlords may only pay tenants any amount owed by first-class mail or personal delivery unless the parties have agreed to electronic payments in writing. The tenant may only consent to this delivery method after the tenancy has begun and they have taken possession of the unit – use ORHA form #O16 – Agreement to Accept Electronically Transferred Funds.)
3) A cash payment with a receipt. (So, if you’re paying the tenant(s) with cash, get a receipt!)

If using ORHA forms for termination, you must add some info:

• The amount of state relocation assistance the tenant is eligible to receive if the landlord is obligated to pay the state fee, along with a statement that the state assistance will be deducted from the city-required assistance.

State relocation assistance

You may also be required to pay a relocation assistance under state law if you hold an ownership interest in more than four residential rental units in Oregon and are serving notice of termination for a Qualifying Landlord Reason. If you are required to pay the state assistance of one month’s rent, those funds must be provided with the notice, but you can reduce the amount of the city fee from the amount of the state assistance you paid with your notice. This results in two separate payments delivered at different times, with a right to recover only one of these (the city fee) if the Tenant does not vacate.

Relocation assistance exemptions

1. Week-to-week tenancies.
2. Occupancy in the same dwelling unit where the landlord has occupied the unit as their primary residence for at least six months prior to service of notice to terminate.
3. Tenants that occupy one unit of middle housing where the landlord’s primary residence is another unit of middle housing on the same lot or parcel and the landlord has occupied the unit as their primary residence for at least six months prior to service of notice to terminate.
4. Tenants that occupy an accessory dwelling unit (ADU) and the landlord’s primary residence is on the same lot or parcel and the landlord has occupied the unit as their primary residence for at least six months prior to service of notice to terminate.
5. Landlords who temporarily rent out their primary residence during their absence of not more than three (3) years and the landlord returns and reoccupies the unit as their primary residence within that time.
6. Landlords who temporarily rent out their primary residence due to deployment in the armed forces and the landlord returns and reoccupies the unit as their primary residence.
7. Units of affordable housing.
8. A dwelling unit that is subject to and in compliance with the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970.
9. A dwelling unit rendered immediately uninhabitable not due to the action or inaction of a landlord or tenant.
10. A dwelling unit rented for less than six (6) months where the landlord will be demolishing the unit and has provided the tenant with verification of submission of a demolition permit prior to the execution of the rental agreement.
11. A unit rented under a fixed-term lease where the landlord’s intent is to sell or permanently convert the dwelling unit to a use other than as a dwelling unit and is a term of the executed rental agreement.

Qualification exemption process

1. For exemptions claimed under 1, 5, 6, 7, 10 & 11 above, no later than the time of execution of the rental agreement, you must provide each tenant who is a party to the rental agreement with written notice that the tenancy is exempt from relocation assistance.The city has the required exemption form available on their website.

2. For exemptions claimed under 2, 3 & 4 above, where the landlord is living in the dwelling unit or on the same lot or parcel of land at the time of execution of the rental agreement, no later than the time of execution of the rental agreement you must provide the Tenant(s) with written notice that the tenancy is exempt from relocation assistance.
3. For exemptions claimed under 2, 3 & 4, if you move into the dwelling unit or onto the lot or parcel during the term of the rental agreement, within 30 days of occupancy, you must provide the tenant(s) with written notice that the tenancy will be exempt from relocation assistance once you have occupied the unit as your principal residence for at least six months. The notice requirement applies to you if you move into the unit or onto the lot or parcel on or after September 1, 2023.
4. For rental agreements executed prior to the ordinance effective date, Section 7 of the ordinance provided 30 days for landlords to notify tenants and the City of exemptions 1, 5, 6, 10, and 11, landlords must have provided written notice to the Tenant and reported the exemption to the city by September 24, 2023.
5. Except for affordable landlords, who are not required to file exemptions, within 30 days of the date you provide the tenant with the notice of exemption you must submit to the City a notice of relocation assistance exemption. The form is available on the city website.

Lease Renewal in the First Year

In a fixed-term lease with a specified ending date that falls within the first year of occupancy, unless exempt from payment of city relocation fees, you must follow this process:

1. At least 90 days prior to the specified ending date of the fixed term, provide the tenant with a written statement informing them of their right to receive relocation assistance and the means for eligibility. The city has a form on their website. I recommend that you provide the form at the time of lease up, so you don’t forget.
2. For the tenant to be eligible to receive relocation assistance, the Tenant must, at least 60 days prior to the specified ending date of the fixed term provide you with written notice of their desire to renew the fixed term agreement.
3. Within 30 days of the written notice from the tenant, you must either:

(1) Provide the tenant with written notice that you are declining to renew the lease and pay the tenant two month’s rent as a relocation assistance or;
(2) Provide the tenant with written notice that you agree to renew the lease. There is no specified term stated for length of lease renewal, but the lease renewal terms may not be a “substantial change” from the existing terms.

a. Substantial change means a change of terms from those included in a prior rental agreement between a landlord and tenant that substantially disadvantages the tenant, and the landlord does not provide for a commensurate decrease in rent. Examples of substantial changes to a rental agreement include but are not limited to: tenant responsibility for payment of utilities previously included in the monthly rent; tenant responsibility for payment for a parking spot previously included in the monthly rent; landlord no longer allowing pets to occupy the dwelling unit; reduction of space available for tenant use; reduction of amenities available for tenant use; and removal of furnishings from furnished units.

4. A tenant who has received relocation assistance and either agrees to the landlord’s conditions of renewal or remains in the dwelling unit after you decline to renew and serve notice terminating their tenancy, must immediately repay the relocation assistance.

Rent increases

Unless exempt, you are subject to the city notice requirements and payment of relocation assistance if you increase the tenant’s rent by the maximum allowable percentage or above in a specific year.  When raising rent, the 90-day notice must state the amount of the new rent, the dollar amount by which the rent will increase, the percentage of the increase, and the date the increase will be effective. The notice must also specify the amount of relocation assistance for which the tenant is eligible and include a description of the tenant’s rights and obligations. The city has a rent increase form on their website.

A tenant who receives notice of rent increase for the maximum allowable amount may, within 30 days of the date of the notice, request in writing for the landlord to pay relocation assistance. If the tenant fails to request it within that timeframe, they are not eligible for assistance, may not request payment, and the rent increase amount will stand. If the tenant requests relocation assistance within the 30-day period, the landlord must pay the tenant the required assistance of two-month’s rent at least 45 days prior to the date of the rent increase.

A tenant who receives relocation assistance for a maximum rent increase, must within 45 days of the date of receipt of the assistance, either: (1) provide you with written notice of termination of the rental agreement and vacate the unit; or (2) repay the relocation assistance and remain in the unit, subject to the increased rent. If you don’t intend to raise rent to the maximum, you don’t have to provide the information on relocation assistance. To avoid that payment, stay below the rent cap.

Please note that under state law, properties built within the past 15 years are exempt from the rent cap, but properties subject to the Eugene Code are not exempt for that reason. 

Relocation assistance reporting
Unless you are exempt from payment of relocation assistance, you must report your relocation assistance payment to the city within 60 days of paying the Tenant. The city has the required form available on their website.

What about the two-unit, owner-occupied exemptions listed in 90.427?
Good question! This part of state law clarifies the following:

(8) If the tenancy is for occupancy in a dwelling unit that is located in the same building or on the same property as the landlord’s primary residence, and the building or the property contains not more than two dwelling units, the landlord may terminate the tenancy at any time after the first year of occupancy:
(a) For a month-to-month tenancy:
(A) For cause and with notice as described in ORS 86.782 (6)(c), 90.380 (5), 90.392, 90.394, 90.396, 90.398, 90.405, 90.440 or 90.445;
(B) Without cause by giving the tenant notice in writing not less than 60 days prior to the date designated in the notice for the termination of the tenancy; or
(C) Without cause by giving the tenant notice in writing not less than 30 days prior to the date designated in the notice for the termination of the tenancy if:
(i) The dwelling unit is purchased separately from any other dwelling unit;
(ii) 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; and
(iii) The landlord has provided the notice, and written evidence of the offer to purchase the dwelling unit, to the tenant not more than 120 days after accepting the offer to purchase.
(b) For a fixed term tenancy:
(A) During the term of the tenancy, only for cause and with notice as described in ORS 86.782 (6)(c), 90.380 (5), 90.392, 90.394, 90.396, 90.398, 90.405, 90.440 or 90.445; or
(B) At any time during the fixed term, without cause by giving the tenant notice in writing not less than 30 days prior to the specified ending date for the fixed term, or 30 days prior to the date designated in the notice for the termination of the tenancy, whichever is later.

So, while the state statute provides certain exemptions regarding terminations in this situation, the Eugene code does not specifically address the allowable exemptions for what I call the “Duplex Rule” except for the landlord being allowed to claim an exemption at the time of move in or if the landlord move into an adjoining unit and then provides the exemption. However, just because state law allows a landlord to terminate a tenancy differently or on a shorter timeframe, doesn’t mean the city does! The city is aware of the absence of guidelines and may consider providing additional clarification during Phase III. In the meantime, use a 90-day notice just to be safe.

Tenancy termination and eviction reporting
You must report all termination notices to the city that result in a termination of tenancy within 30 days of the date the tenant vacates the dwelling unit, except for week-to-week tenancies if exempt. So, any landlord-initiated notice from you to them where the Tenant vacates the unit in response to the notice or by legal eviction. Your report to the city must include a copy of the termination notice served. The city has created an online form. If you are unable to access the form through the Rental Housing Program website, Housing Navigator Amy Cameron said to come in to the office during business hours and staff can assist. The code office is located at 99 W. 10th Avenue, Eugene, OR  97401 - 541-682-5383.

A tenant who gives notice to vacate and moves out or otherwise abandons the unit when the landlord has not served a termination notice or evicted the tenant is not a reportable event. 

Complaint process and qualifications

• If a tenant or applicant believes a landlord has violated the code they may file a complaint. A person who files a complaint must be a party to the current rental agreement, or an agent of the party:
• • To file a complaint, the tenant must first send a notice in writing of the alleged violation to the owner/agent and provide a copy of that written notice at the time the complaint is filed. “In writing” according to the code, means “…a written communication of any type, including emails and text messages.” The city manager is then authorized to investigate the complaint.

i. For complaints related to lack of essential services, application processing in order received, or maximum security deposits the complaint may be filed no sooner than 48 hours after providing written notice to the owner/agent.

ii. For complaints not related to the lack of essential services, application processing in order received, or maximum security deposits the complaint may be filed no sooner than 10 days after providing the written notice to the landlord.

City process for substantiated complaints

• If the city manager determines that a complaint is valid, they will issue a notice to the owner/agent providing a timeline for compliance:
• • For non-habitability and non-essential maintenance issues, 10 days to remedy the violation, including any needed repairs, unless the repairs cannot be completed within 10 days. If that is the case, the landlord must submit a compliance schedule acceptable to the city within 10 days.
  • For habitability complaints regarding a lack of essential services, applications processed in order received, maximum security deposits, 48 hours, unless the repairs cannot be completed within 48 hours. If that is the case, the landlord must submit a compliance schedule acceptable to the city within 48 hours.

Complaint process outline requires that the city confirm the following:

1) Confirm that the complainant has standing to file a complaint.
2) Confirm that the subject of the complaint could be a violation of the code.
3) Except for complaints related to applications not processed in order received, security deposit overcharge or lack of essential services, confirm that the landlord has had 10 days since mailing of the written notice by the tenant to respond to the complaint.
4) For complaints regarding violations of the screening charge limit, applications processed in order received, maximum security deposits, or lack of essential services, confirm that the landlord has had 48 hours from the time the tenant provided written notice to respond to the complaint, and
5) Provide notice to the landlord of the complaint per written procedures.

Landlord noncompliance with city order to correct

• If the city manager finds that a complaint was valid and the landlord did not respond timely as required, the manager may issue an administrative civil penalty, initiate a prosecution in municipal court, and initiate action to recover all city costs association with the processing of the complaint, investigation, and resolution of the issue.
• • This information will be sent to the landlord along with deadline for repair and re-inspection of the dwelling unit, and a statement that they may appeal the notice and order.

Penalties

The code has also been expanded to include the changes listed above in the processing complaints and created a painful financial penalty for landlords who fail to comply. 

A landlord that violates the relocation assistance provisions for rent increases and terminations is liable to an individual eligible for relocation assistance in an amount equal to three months’ rent as well as actual damages, relocation assistance, and reasonable attorney assistance and costs. That means that any Tenant (not just household of tenants as a group) claiming to be aggrieved by a landlord’s violation has an individual cause for action in any court of competent jurisdiction for damages and any other remedies as may be appropriate under law.

Take Away: There’s a lot of steps to do just right and big-time monetary penalties if you don’t. Get professional advice so you don’t stumble…

Phase Three Recommendations include:

• Prohibit denial of applicants for credit defaults related to medical or education debt, and limit screening for minimum credit score.
• Loosen minimum monthly gross income screening standards to no greater than twice the monthly rent.
• Local moratorium on no-cause evictions

The good news
None of these restrictions apply to for-cause notices.

I’ve been saying for years, we’re all going to have to get good at holding tenants accountable for their misbehavior because the easy route of no-cause notices will likely continue to become more restrictive. That means no more lazy-landlording. You must inspect; you must act on breach of contract; you must avoid waiver; you must learn how to prepare and serve legal notices; and you must stop renting to people because you feel sorry for them or are trying to be nice. Remember, no good deed goes unpunished. This is a business, tighten up your standards people and remember: even with all the increasing regulatory load we’re experiencing, if you have a good property and good people in that property, rental property ownership is still one of the best ways to build financial stability and generational wealth over time. So, stop whining and start learning! 

The Takeaway
Laws and rules, taxes and fees for most businesses are usually a moving target based on government interference. Rental property management is no exception. As these ordinances take shape make sure you stay plugged in to the nuances and new limitations on how you are allowed to operate, and remember every business has its downsides. Keep your eye on the prize and focus on the positive:  rental ownership is still a tried-and-true way to build generational wealth and financial stability over time, and if you have a good renter and a good property there’s no easier job in the world

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.
Rev 5/2024

By: Tia Politi, ORHA President
May 2024

Looking forward to our May meeting and Property Management Palooza this month in beautiful Hermiston! Committee meetings for the month of May have been scheduled virtually for the Friday before Palooza, May 10th so we can focus on the seminar and board meeting. Hope to see you there virtually or in person.

For those attending the Palooza, a group of us will be heading out to Nookie’s Hermiston Brewing Company – 125 N 1st Street, Hermiston – at 6 p.m. Join us if you can, and thanks to Joe Bachmeier of Bachmeier Property Management in Pendleton for setting it up.

If you’re staying over Saturday night, we’re looking at some options for another fun thing to do that evening, and we’ll share details at the Board Meeting if you wish to join us - more food, drink, and merriment – always a good time!

Remember, if you’re bringing the family, there’s a lot to do in Hermiston and the surrounding areas and Eastern Oregon is spectacular in the Spring. In Hermiston, there’s the Hermiston Family Aquatic Center, Butte Park with a great view if you hike to the top of the Butte, the Hermiston Raceway, Desert Lane Bowling Alley & Arcade, and Winery Tours.

The town of Hermiston has long been a stopover for travelers. The Lewis and Clark Corps of Discovery passed the distinctive outcropping of Hat Rock, now a state park, and wrote about it in their journals. The town site in the 1860s was known as an overnight spot for horseback travelers who frequented an Old West hotel and bar here. The Maxwell Siding Railroad Display recalls a former time when rail was king. Visitors can view the early 20th-century rail cars and collection of railroad memorabilia. (Tours are available by appointment.)

Umatilla is only a 12-minute drive from Hermiston and offers their own array of things to do. Head down to the river at the Umatilla Marina R.V. Park, a great spot for boaters, and the McNary National Wildlife Refuge, with walking paths around the ponds and sloughs that provide key habitat for migrating and resident water birds as well as other wildlife. Visit the nearby Pacific Salmon Visitor Information Center at McNary Lock and Dam to learn about the life cycle of salmon and the history of hydropower in the Columbia. Don’t miss your photo op with the giant cowboy sign outside the Columbia Harvest Foods store. Then head west toward the Umatilla National Wildlife Refuge, where you can look for burrowing owls, overwintering eagles, mule deer and badgers.

Thank you for your support!

By: Tia Politi
May 2024

Pest control in rental properties:  Who’s responsible?

ORS 90.320 clearly requires landlords to turn over a rental property free of pests at the beginning of tenancy but provides little guidance for responsibility for pest control during the tenancy. So, who is responsible when pests invade a rental property? As usual, it depends. The law of damages implies that if a problem was fully or partly caused by the negligence or direct actions of one party or the other, that party is fully or partly responsible for the resulting damage (ORS 90.125). It’s important at the time of move in to use our Pest Agreement – ORHA form #M12, which lists actions the tenant should take to minimize the possibility of an infestation.

Except the requirement for landlords to turn over a unit pest free, there are few clear-cut guidelines, and the following information is simply my opinion based on experience. Determining financial or personal responsibility in any situation requires a bit of reasoning, thought and investigation, relying on the Reasonable Person Standard. The standard denotes a hypothetical person in society who exercises average care, skill, and judgment in conduct and who serves as a comparative standard for determining liability.

Pests are everywhere. Some are just minor nuisances like flies and mosquitos; others cause property damage, such as raccoons, or wood-eating insects like termites and carpenter ants. The worst are deadly, such as brown recluse spiders, or for people with severe allergies: bees, wasps, and yellow jackets. Pests include insects and spiders, rodents and mammals, feral cats, and even snakes.

Some pests, like ants or spiders, don’t need an invitation, they are able to squeeze through the tiniest of openings, and while they can be attracted to some substance on or in a property, it can be difficult to draw a direct correlation between tenant behavior and infestation. Other pests like bedbugs or cockroaches are hitchhikers and only come along for the ride, pretty much guaranteeing that the tenant or a visitor caused the problem. And tenants can invite pests to the property by purposeful or negligent behavior, such as failing to maintain the home and grounds in a sanitary condition, keeping chickens or other livestock, keeping a compost pile, or feeding wildlife. But the final consideration is, and always should be, whether the cause of an infestation correlated to tenant behavior can be proven in a court of law by a preponderance of the evidence.

Bats – I used to live in a house that had larger shingle siding and some of the openings were large enough to house bats. I love it. They eat lots of bugs and don’t bother me or my pets; however, if they managed to get into my attic space that would be a problem, and if they got inside one of my rentals it would be my responsibility to get rid of them. At one time, I was a bit of a reality-show geek, and one of the shows I used to watch was Billy the Exterminator. I learned some great techniques for pest removal from Billy. With bats, he would find out where they were getting in and out, seal up all but one entry point, then during daylight hours tack a long, lightweight piece of weighted mesh fabric or screen above the opening. At night when the bats left to feed, they were able to push aside the screen to get out, but were unable to get back in. He would then seal up the entry point and get to work cleaning up the nesting area. While researching bedbugs, I learned about bat bugs which are very similar and can cause similar problems, so it is best to bat-proof your rentals.

Bedbugs – The consensus is that bedbugs are hitchhikers and can be considered a tenant-caused problem. In multifamily units, though, bedbugs have been known to migrate from one unit to another through electrical outlets and other openings. That can make it difficult to clearly identify a culprit. There are specially trained bedbug detection dogs that may be able to determine ground zero for the source of the infestation, but if there is no clear source, the landlord may have to provide treatment at their own expense. If it can be proven with certainty that a tenant caused an infestation, they are financially responsible to pay for eradication, but it can be difficult to prove that a house or unit was bedbug-free on move in, so some landlords are taking the extra step of hiring bedbug detection dogs to certify their units clear, providing concrete evidence that a tenant is responsible for the problem if a dispute arises.

If caught early, bedbug eradication is relatively easy; if allowed to develop into a large infestation, eradication could take weeks or months. Inspecting for bedbugs is extremely invasive, and eradication requires a substantial investment of time and effort by the resident. If you have a confirmed bedbug problem in a unit, I advise you to treat first and point fingers later. Treatment is quite costly, but only becomes more so the longer an infestation goes on. While a landlord may or may not be able to pass on the costs of treatment depending on the circumstances, first get the problem under control yourself. I would not let tenants take charge of this process, as they may be mostly concerned about cost and may try things that are dangerous or ineffective, exacerbating the problem, or endangering their health.

One landlord I know lives in the lower half of a two-unit duplex, and his tenant above reported bedbugs. Instead of treating the problem, he told his tenant to take care of it (which he hasn’t), and sprayed foam into all access points leading to his unit. So far, he has avoided getting them, but the problem is still there and growing and he will have to deal with it eventually, likely at a far higher cost.

With increased reports of bedbugs in our area, the smart landlord will do their best to educate their residents. To that end, I have created a free two-page handout Bedbug Notice that you may find useful to provide. The handout can be found in the Members Only section of Lane ROA's website (www.laneroa.com).

Bees, Hornets, Wasps, Yellow Jackets – A landlord would be hard-pressed to justify charging a tenant for removal of a ground nest of aggressive yellow jackets, a bald-faced hornet nest, or honey bees living in the walls of the unit. (Honey bees are essential for pollinating the food we all eat, so please don’t kill them. There are beekeepers who can remove the hive.) Biting or stinging insect infestations become more urgent for a landlord if there are household members who are allergic to the sting or bite of these kinds of pests, and whose lives are at risk by the presence of the pests. If I ask a tenant to stand back and spray poison on such insects, I may be exposing them to risk as well, so I would likely deal with that situation at my own expense. Paper wasp nests can be easily swept or washed off the exterior of a property, so I usually ask them to remove paper wasp nests.

Cats – The feral cat population is out of control everywhere, and I have experienced issues with kind-hearted but misguided residents who feel bad for them and either feed them regularly or allow them to live under the unit by removing the foundation vents. Once under the house, the cats breed, urinate, defecate, and claw out the under-floor insulation, creating a nasty situation for the property owner. Tenants can and should be charged for the removal and repair of any damage if they allow or contribute to this problem. For some tenants, it’s an ongoing issue which they can’t seem to stop, and I have had to terminate the tenancies of residents who refused to modify their behavior.

I once had a tenant who lived next door to a neighbor who notoriously fed the feral cats in the neighborhood, causing problems and concerns for her health as they can transmit toxoplasmosis. The city wouldn’t or couldn’t do anything about it, so she had to come up with her own methods of dealing with it. Apparently, using a Super Soaker filled with ammonia is a great deterrent, but the Humane Society recommends less offensive methods such as motion-activated ultrasonic sound devices, motion activated sprinklers, or cat proof fencing such as placement of rolling bars or pokey protrusions placed on the top of the fence.

Cockroaches – If the property was cockroach-free on move in, it’s likely they hitchhiked in with the tenant or one of their guests. If the property is a stand-alone single-family home, I would pass on the charge for eradication, especially if they have lived in the property for some time. In the case of a tenant who reports roaches close to moving in, it may not be so clear. In a multi-family unit, it’s also much harder to say, as, like bedbugs, they can easily spread from one unit to another, and are very difficult to completely eradicate. Some buildings have ongoing roach problems that require regular periodic treatment.

Fleas – In my experience, fleas are a tenant-caused problem obligating residents to pay for treatment, but rat fleas are a different story. If you have a property with rats, the fleas that live on the rats under the house or in the walls and ceilings can find their way inside. These are the worst fleas because they can carry bubonic plague – rare, but still present in the world. So just because your resident has fleas doesn’t necessarily mean they caused the problem.

I once had a tenant call to report they were being bitten by fleas. My first thought was that they had snuck in an animal, but as it turned out rats had dug under the foundation and were living under the home, and they were the source of the fleas. They wanted out so we released them from their lease, and they found another unit. We sealed up the home and treated the fleas and were able to re-rent it, but with a filthy neighbor next door attracting the rats, we had to keep a closer eye on that unit.

I once had a tenant leave a unit with a terrible flea infestation that took almost a month to eradicate. The usual flea bomb method failed twice, and we finally had to hire a professional. The tenant’s cosigner swore that her sweet boy did not have any animals and the fleas must have jumped in through the door. I spoke to other residents of the six-plex who informed me the tenant had been keeping two dogs and a cat in the unit. Mom paid.

Flies – Common house flies are not a landlord’s problem. State law does not require landlords to provide window screens, but the Eugene Housing Code says you must. I do provide screens and I think you should too. Would you want to live in a home with no window screens? And sometimes flies can develop nests in the house walls resulting in an explosive infestation in late winter or early spring, which I contend is a landlord’s problem to resolve.

And there are many types of flies. One of my tenants reported Drain flies in the bathroom sink drains. I had never heard of such a thing, but looked it up on the internet and guess what? There are tiny flies that live in sink drains. They are very hardy and can withstand many different types of chemicals, but in my research, I found that hydrogen peroxide down the drains periodically can eradicate them. If your residents report Drain flies, ask them to do that, and consider providing peroxide, or not.

Food pests – Food pests are a tenant-caused problem for them to resolve. If there is no accessible food, there will be no pests.

Gophers & Moles – Usually, a mole or two isn’t going to cause a problem, but I once declined to take over management of a country property that had an enormous gopher problem. The colony literally had dozens of hills in an area of about a half-acre right next to the house, and the owners didn’t want to do anything about it. The turned-up ground created a morass of tripping hazards creating a liability issue for all concerned. Not the tenant’s problem to solve.

Mice, Voles – You can ask to have your tenants do their best to trap them or put out poison, and many landlords ask tenants to do their best to get rid of them on their own, but with my personal rentals, I don’t. I just put poison under each of my rentals every year because mice and voles are ubiquitous and can literally get through a hole the size of a lag bolt. Trapping is difficult, icky, and time consuming. When my household experienced a mouse infestation many years ago, we tried trapping, but the varmints bred faster than we could trap them. Poison took less than a week and the problem was solved, but if the tenant has pets and eats a poisoned rodent, it can make them sick, so you may choose to try a different method.

Mosquitos – The best prevention technique is to remove all sources of stagnant water on the premises. Most often, I have had mosquito larvae breeding in a neglected pool or pond with no water flow. Of course, you don’t want to allow pools, but I once had a tenant with a sandbox that flooded during Spring rains and then became filled with larvae. If you discover a problem like this, a bit of bleach or dish soap poured into the stagnant water should kill the larvae.

Raccoons – Coons are wily critters with an uncanny ability to climb up overhanging tree branches and break into attic spaces. Your tenant can’t control them, but they can exacerbate the problem by feeding them. I once had a tenant who loved and fed them – he felt a spiritual connection to them. The neighbors were unhappy and so was the owner. We served a notice of termination, and once the tenant was gone and stopped feeding them, the problem eventually resolved itself. If you are thinking of trapping and removing things like feral cats, raccoons or possums check city or county code as it might be against the law to trap and relocate these pesky critters unless they are inside the unit.

Rats – There is broad consensus that rats in the dwelling unit are a landlord’s problem to eradicate. Rats dig under foundations and chew through floors, walls, and ceilings to gain entry, and while tenant behavior can attract them, rats don’t seem to need an engraved invitation. Using poison on rats is not recommended because it can create another problem: the smell of their decomposing bodies in or under the rental unit. It’s nasty, which is why exterminators generally use traps to get rid of them. Rats and chicken coops or compost piles seem to go together so don’t allow these uses on your properties. I even prohibit tenants from feeding any birds on the property except hummingbirds as the seeds attract not only birds, but chipmunks, squirrels and rats as well.

Scorpions – Rare in rainy Western Oregon, scorpions have been known to establish nests in sun-drenched rock piles, but there are incidences of scorpions nesting in or under homes. This would be the landlord’s responsibility to eradicate.

Skunks – These odiferous critters love to take advantage of breached foundation vents and nest in open areas under sheds and houses; they are the landlord’s problem, not the tenant’s. Property owners would be well-advised to make sure all areas are sealed up with wire fencing or other effective barriers to prevent entry in the first place. For skunks, or larger mammals like feral cats under the rental unit, one of my contractors has created a great method for getting them out. Purchase a live trap of the appropriate size, cut out the back non-opening end of it, and seal up all access points except for one under the affected building, then attach the open end of the trap securely to that opening. The animals will be frightened to go through it at first, but eventually will get hungry or thirsty enough to push the flap open and get out, but they won’t be able to get back in. Once you’re sure that every unwanted intruder is out, remove the trap and seal up the opening.

Snakes – Common Garden snakes are generally not damaging, hazardous or inclined to nest in houses, and are not something that needs to be addressed unless they do establish a nest under the house or are otherwise entering the domicile. One of our members had that problem and had to replace some siding and seal up the entry point. Rarely seen west of the Cascades, and even more rarely a problem for residents, we do have rattlesnakes in Oregon. Certainly, tenants should not be responsible to pay for the eradication of dangerous creatures from the home.

Spiders – Common household spiders or spiders in the yard generally would not be something requiring action by the landlord; however, if you discover some sort of problem with a deadly breed of spider, such as the brown recluse, I will make sure that problem gets resolved and not require the tenant to take corrective action or pay for it. We had residents years ago who wanted us to spray the yard for common spiders. We clearly felt the spiders posed no problem, and therefore was an unreasonable request. We offered to have it done if they would pay for it, but they declined.

Stink Bugs – Stink bugs are an agricultural pest that cause considerable damage to gardens, and while they are not dangerous to humans are ugly and stinky when crushed. Should those pesky bugs make their way into your home or your rental home, try to locate the opening to which they are gaining access. Typically, they will emerge from cracks around baseboards, around window and door trim and around exhaust fans or lights in the ceilings. Both live and dead bugs can be removed with the use of a vacuum cleaner. Stink bugs will begin their search for warmer homes as cool, fall weather approaches. The best way to combat the invasion of stink bugs into your home is to seal cracks around windows, doors, siding, utility pipes, behind chimneys and so forth with a good-quality silicone or silicone-latex caulk, and repair or replace damaged screens on doors and windows.

Tiny House Ants – In my experience, most landlords have their tenants take responsibility for eradicating tiny ants. I too, was of that mindset until my home was attacked. My family and I lived in our previous home for 15 years with nary an ant problem. We had lived in our current home for 13 years when we were infested by sugar ants. Nothing had changed about the way we live that would suggest we did anything to attract them. We purchased Terro and diligently set about eradication. After about three months, just as we felt we were getting a handle on the problem, a new colony moved in, and we started the process again. This went on and on. Every time it looked like we were winning, here they would come from a totally different place – first it was the kitchen, then they attacked the dog food beside our sliding glass door, then the upstairs bathroom, then from under the fireplace, then in an upstairs bedroom. The next year, in addition to the sugar ants, a new type of tiny ant seemed to find our home suitable for residency. These new ants swarm in much greater numbers and aren’t as attracted to the Terro.

We finally got rid of them but would have been better off to have hired an exterminator to begin with. If I was a tenant, I would find it ludicrous for my landlord to charge me for an exterminator when I did everything within my power to get them gone. I tell this story to point out that no matter how faithful a resident might be in trying to eradicate the little buggers on their own, it can take an unreasonable amount of time and effort. Maybe there are other products that can do the job, and I encourage landlords to share tips in the bulletin, but the bottom line is, how much effort and expense can a landlord expect a resident to exert?

Also, there are subterranean ants that can just burrow from under one house to another. At our March 2024 General Meeting, Lane ROA Secretary and licensed contractor Devin Gates said you can tell if you have subterranean ants by crushing their bodies. If they emit the odor of turpentine that’s what you have, and it may be that the only effective method is regular pest treatment. Someone else at that meeting said that Advion Ant Gel is apparently a more effective remedy for ant eradication, but also more toxic than Terro.

Wood-eating insects – Residents can attract termites and carpenter ants by keeping rotting wood in the yard or against the house, so make it clear that this is a prohibited behavior. Other than that, in general, residents don’t contribute to these critters, and they would be a landlord’s responsibility to eradicate.

An ounce of prevention is worth a pound of cure, so here are steps you can take to help make your property less attractive to pests:

1. Keep grass, weeds, shrubs, trees, and tree limbs well away from the roof and siding.
2. Check for entry points and seal up everything you can find (spray foam is fun and there’s some that is specifically designed to deter mice); larger gaps and holes can be filled with steel wool. And look for entry points within the home as well, especially under sinks where water and waste lines enter as there may be gaps around the pipes.
3. Make sure foundation vents are solid. Upgrade from basic screens to rigid, framed vents.
4. Make sure your eave vents are sturdy and will withstand a raccoon’s determined efforts to enter.
5. Create a bug barrier to entry by treating the perimeter of the property with borax, diatomaceous earth, or insect killer once or twice a year.
6. Repair any wet or dry rot in the structure.
7. Don’t permit residents to compost food waste on the property.
8. Don’t permit residents to keep chickens.
9. Don’t permit residents to leave food or water outside for their domesticated pets or assistance animals.
10. Don’t permit residents to feed or water feral cats, birds, or wildlife.
11. Don’t permit residents to pile anything against the side of the structure or keep any rotting wood on the premises.
12. Don’t permit residents to haphazardly pile clothes or other personal items throughout the dwelling unit which can conceal a potential problem.
13. Require residents to store food in sealed plastic or glass containers.
14. Remind residents that garbage containing food scraps should be placed in tightly covered trash cans and garbage regularly removed from the home.

At what point is it wise to step in or bring in a professional? Immediately for a pest that is potentially hazardous to the health and safety of the residents, or damaging to the property; and eventually, if what the landlord or the tenant is doing isn’t working. When the decision is made to hire a professional, be prepared for possible concerns from residents who may have chemical sensitivities, or fears about possible health risks of chemical pest control. Residents may also object to the idea of pests suffering from ingesting poison, or from being injured or killed by trapping. There are online websites and blogs that tout natural remedies for pest control, and there are pest control companies that specialize in humane removal and natural pest control solutions.

Residents are our customers, and as caring and intelligent business owners, we want to do our best to keep them happy, but natural methods may take longer, require more intensive involvement on the landlord or tenant’s part, and cost more. It seems reasonable to charge the tenants for the higher costs incurred for a special type of removal of a particular pest if tenant objections incur higher expense for the landlord. 

Responsibility for pests is sometimes clear and other times cloudy, but if there is concrete evidence that a tenant caused or contributed to a pest problem by their willful or negligent behavior, it is appropriate to charge them for remediation. And the law requires their cooperation. One of my favorite sections of landlord-tenant law is ORS 90.325, the Tenant Duties section, which states in part, “The tenant shall…keep all areas of the premises under control of the tenant in every part as clean, sanitary and free from all accumulations of debris, filth, rubbish, garbage, rodents and vermin, as the condition of the premises permits and to the extent that the tenant is responsible for causing the problem. The tenant shall cooperate to a reasonable extent in assisting the landlord in any reasonable effort to remedy the problem.”

If in doubt, landlords should imagine themselves in a courtroom explaining their reasoning to a judge because that’s who could be the final arbiter in case of a dispute over responsibility.

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.

Rev 4/2024

By: Tia Politi, ORHA President
April 2024

Badon recap
We had a fun and productive meeting in Bandon last month, with amazing weather and a great turnout. Eleven of us gathered at Lord Bennett’s restaurant on Friday evening for a fantastic dinner and Saturday after the meeting another group headed to the Irish Festival at the Bandon Fisheries Warehouse for Irish food and music. There was wine, beer, cheese and chocolate tastings and I had my first Irish Banger with Mash and despite my Irish heritage it’s not my new favorite food. 

Treasurer Dan Griffin took us through the preliminary budget for the 2024-25 fiscal year and the board provided feedback for the Finance Committee to adjust prior to the vote in May.

The Forms Committee updated the board on the progress of the new ORHA Law Book. Sections are being formatted by Independent Contractor Ben Seamans and I have started working on commentary. It’s been a long time coming, but we hope to have the new book ready later this year, then we can pivot to a new Forms Manual. On that subject, remember that if you have ideas for changes to our existing forms or suggestions for new forms, you can either submit a support ticket on the ORHA Forms Store (https://forms.office.com/r/LEfvp8izL1), or email me at forms@oregonrentalhousing.com.

The Education Committee led by Chair Violet Wilson, and Co-Chair Rain Maryott, are looking for ways to provide more education at the state level and include proceeds in the profit-sharing like we do with the Forms Store, while still allowing for county associations to offer their own classes. This approach would really level the playing field for the smaller chapters but may impact a few of the larger chapters, so discussions are ongoing.

The Technology Committee led by Chair Cloud Miller, is continuing to work on virtual versions of our Forms Manual and Law Book, the proceeds of which would also be included in profit-sharing to the local associations and allow us to make changes in real time as forms or laws change. At some point, we need to look at how we offer forms as well. The Forms Store continues to grow and yet many of our members want printed forms. How do we move toward an online-only model while continuing to serve our less techy members? How do we keep the chapters from having to dispose of inventory when a form changes thereby impacting their bottom line? The Forms and Technology Committees are discussing solutions, and we hope to have some options to vote on later this year.

Survey Committee Update
Many thanks to Mid-Columbia Rental Owners Association Secretary/Treasurer Tanya Dean for stepping up to take over the ORHA Survey Committee. With former Committee Chair Alex Wilkins providing guidance, we’re excited to see a return to surveys of our members. They provide a window into what’s really happening across the state.

Property Management Palooza is coming!
Looking forward to heading east in May for our annual Property Management Palooza and ORHA Board Meeting for our “Far-Flung” meeting. Every year we travel to an area where we don’t usually go to host a seminar and draw attention to an area of the state that we don’t often visit.

This year, we will be in Hermiston and the all-day seminar will take place at the Oxford Suites Hotel on Friday, May 17th – Online registration is required, and the registration will soon be available on the ORHA website. Normally, during Palooza time, we hold committee meetings on the Thursday before the meeting, but due to the distance, we’ll be scheduling those for the week before, on Friday, May 10th. The ORHA Office emailed the May Board Meeting Notice to all ORHA Delegates on 04/01/2024 – Please check your email for further details, RSVPs are required before 04/16/2024.

If you don’t care for a long drive, virtual attendance options will be available, but we encourage you to come in person if you can. Bring the family and enjoy a tax-deductible trip with top-notch education. As usual the presenters will be donating their teaching time and proceeds from the seminar will be distributed to each of the participating associations.

Thank you for your support.

By: Tia Politi
April 2023

Increasing state and local regulations are causing many rental owners who may have toyed with the idea of an exit strategy to get more serious about selling their rentals. Some are taking the tax hit, but others are using the 1031 exchange process and buying rental properties in less restrictive areas of Oregon or in other states. If you’re a landlord who’s thinking about selling or a realtor marketing a tenant-occupied property, here’s some food for thought.

Tenancy termination
The passage of Senate Bill 608 in 2019 changed how rental owners could terminate tenancy. The law enshrined in ORS 90.427 does continue to allow termination of tenancy for no-cause in the first year, but after the first year, tenancy termination is limited to for-cause terminations or for one of four Qualifying Landlord Reasons. So, if the tenant is violating the rental agreement or landlord-tenant law – not paying rent, not keeping the unit in a clean condition, disturbing the peaceful enjoyment of neighbors, etc. – you may want to contact an attorney or eviction specialist to check on your options there.

Otherwise, your only other termination option (with one exception) is to terminate for one of four allowable Qualifying Landlord Reasons (QLR), each of which require a minimum 90-day written notice.

1. The property is being demolished or converted to a different use other than residential use within a reasonable time.
2. The landlord intends to undertake repairs or renovations to the property within a reasonable time and the property is unsafe or unfit for occupancy or 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 at the time the notice is delivered.
4. The landlord is selling the dwelling unit separately from any other unit and has accepted an offer within the past 120 days from a buyer who intends in good faith to occupy the dwelling unit as their primary residence.

For reason number four, you cannot serve notice just because you are marketing the unit for sale. You must have an accepted offer from a buyer who intends to occupy the home as their primary residence. Also, the notice must include “written evidence of the accepted offer” to purchase the unit and be served within 120 days after accepting the offer. The sales agreement may state that the buyer intends in good faith to occupy the dwelling unit as a primary residence, but if not, a signed affidavit from the buyer can be included with a copy of the accepted offer.

How are you 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 occupy as their primary residence? You won’t until you get an offer, but rentals generally make ideal starter homes for first-time homebuyers.

If a buyer is purchasing a property for a family member to live in, and the family member is not on title, they must wait until they own the property and may then serve a 90-day notice for that reason.

ORS 90.427(1)(b) “Immediate family” means:
(A) An adult person related by blood, adoption, marriage or domestic partnership, as defined in ORS 106.310, or as defined or described in similar law in another jurisdiction;
(B) An unmarried parent of a joint child;
(C) A child, grandchild, foster child, ward or guardian; or
(D) A child, grandchild, foster child, ward or guardian of any person listed in subparagraph (A) or (B) of this paragraph.

Once an offer is proffered and accepted, the seller can provide the tenant(s) with Notice of Termination-Qualifying Landlord Reason - ORHA form #T5, 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 with an ownership interest in four or fewer residential dwelling units subject to ORS Chapter 90 are exempt from the payment of relocation expenses. If required, the relocation payment must be included with the notice. It cannot be issued as a credit, and it does not matter if the tenant owes you money for something else. You must include payment with the notice.

Eugene and Portland additional requirements
Termination notices for properties within the city limits of Eugene or Portland have additional requirements when serving notice to terminate for no cause, nonrenewal of lease, or for a Qualifying Landlord Reason. Also, relocation expenses in these cities are much higher with few allowable exemptions that must be claimed through a reporting process to each city’s housing bureau or agency with specific timelines. Both cities allow the amount of the city fee to be reduced by the amount of the state fee, and both allow for the city fee to be paid within 45 days of delivery of the notice, not immediately like the state fee.

Eugene rules can be found here:  https://www.eugene-or.gov/845/Rental-Housing-Code
Portland rules can be found here:  https://www.portland.gov/phb/rental-services

Any notice of termination must be prepared and served in accordance with ORS 90.150, 90.155 & 90.160, and will remain in effect for the purchaser if the sales closes during the term of the notice. The buyer can end up with liability if the seller fails to prepare and serve the notice in accordance with the law. The tenant has the right of due process and can challenge the notice in court. If the buyer proceeds to eviction court, and they have inherited a defective or imperfectly served notice of termination, they could lose the case, maybe have a judgment rendered against them, possibly must pay the tenant’s attorney, and start over again. Who will be sued if that happens? Everyone. Get professional assistance.

Terminate to renovate?
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 strategy may be to terminate tenancy for another QLR, 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.

Realtors encourage sellers to spruce up the unit prior to marketing, but how significant do the repairs or renovations need to be to claim the right to terminate for renovation? One attorney I took a class from on this subject said any renovation had better impact habitability, so check out ORS 90.320, the Habitability section of landlord-tenant law. You may be challenged and must justify your decision to a judge, so be prepared to think about this ahead of time.

A full interior repaint might qualify on an older home with lead-based paint that is substantially peeling, but might not, and maybe replacement of flooring, ceiling tiles or texture containing asbestos. Kitchen or bath remodels would likely render the unit uninhabitable, especially if there’s only one bathroom, but things like new windows may not. Unless there is significant rot requiring structural repair, or you are increasing or decreasing the size, new windows can be installed from the outside with little disruption. Re-wiring, re-piping, repairing significant rot in subfloors or walls, replacing kitchen cabinets or tub surrounds, tearing open walls to create an open floor plan, abating hazardous materials, these are examples of renovation work that would more than likely pass the ‘unsafe or unfit for occupancy’ threshold.

Supporting facts
To terminate tenancy for a QLR requires that the landlord provide “supporting facts” regarding the reason for termination. For a property sale to an owner-occ buyer, you must include, “written evidence of the accepted offer.” For the renovation option you must describe the work you intend to do that will render the unit “unsafe or unfit to occupy.” For example, in 2021, hubby and I gave notice to tenants in a property we wanted to sell that needed substantial renovation. We had dug a new well the year before, but still needed to move our pressure tank to the new well house, dig and place water lines, cap off the old water lines, and hook up to the new well. We also intended to tear out part of a wall, update the bathroom, upgrade some electrical and other plumbing, and of course, do a lot of cosmetic work. We put together a list of those items to include with our notice. In another unit, we had to tear out and rebuild the only bathroom, so even though we were also doing substantial cosmetic work, that’s what we listed as our supporting facts, because that’s what was going to render the unit uninhabitable.

Some landlords (and one notice I saw from an attorney) quote the statute as their supporting facts, i.e., “We intend to undertake repairs or renovations to the property that will render the unit unsafe or unfit to occupy.” I always thought that would not be good enough and one of my colleagues in Salem told me about a case the landlord lost where that’s all they had written. The judge said it wasn’t enough. They needed to describe the renovations.

If you’re hiring a contractor to perform the repairs, they can describe the renovations and you can attach a copy of their bid. If you’re doing the work yourself, describe what you’re doing that will render the unit unsafe or unfit. Even then, a tenant can sue later if they feel your level of renovation wasn’t enough to render the unit unsafe or unfit. One member had a foundation issue in an older home that required a large section of floor to be cut out, so served proper notice. But when the tenant moved and her contractor cut open the living room floor, they found that the foundation repair was less substantial than they had thought. They were able to fix it quickly and the rental owner got the unit back in shape and back on the rental market. The tenant saw that the property was being advertised for rent soon after his move out and is suing. I think she’ll be okay because the only way to determine the extent of the repair was to cut out the floor, she has her contractor to testify for her, and she gave the notice in good faith, but we’ll see what the judge says when the case is heard.

Note:  Your insurance policy may not provide full coverage for your unit if it is vacant for more than 30 days, so contact your insurance company to learn about insurance options for vacant properties.

The duplex rule
Termination rules do provide a narrow exception for owners with no more than two units on the same tax lot where one unit is their primary residence. Landlords are allowed to terminate tenancy for no-cause with a 60-day written notice. Also, in these types of situations, a 30-day notice of termination is allowed 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 sale. For either reason use Notice of Termination – Two-Unit/Owner-Occupied Property – ORHA form #T7. And just like with a QLR, if you’re terminating in 30 days based on a buyer occupying the tenant’s unit as their primary residence, you need to include a copy of the offer within 120 days of accepting it.

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 for one of the four QLRs allowed by law, or sell the property as-is and the buyer can issue the notice for the QLR 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.

A problem with the statute wording
You may notice that the statute – ORS 90.427(5)(c) – that allows a landlord to issue the 90-day notice if they are selling the property to an owner-occ buyer says, “…the landlord has accepted an offer to purchase the dwelling unit separately from any other dwelling unit from a person who intends in good faith to occupy the dwelling unit as the person’s primary residence. So, does that limit a seller’s right to terminate tenancy for buyers to occupy one or both sides of a duplex? Or a main house and an ADU?

I don’t think so, because later in the same statute – ORS 90.427(8)(a)(C)(i) – when referring to the two-unit owner-occupied exemption it uses the same language “the dwelling unit is purchased separately from any other dwelling unit,” and because that part of the statute specifically applies to a two-unit property, attached or unattached, to my mind (not legal advice, only lay-person reasoning) it indicates you may serve a notice to terminate for buyers to live in one or both sides. I’m not aware of any case law on this subject, so if you get pushback you may want to get some qualified legal advice before proceeding.

Getting the renter's cooperation
I’ve always recommended to owners wanting to sell that they first offer the property to the renter. Maybe you can carry the note or maybe not, and while it is rare that an offer like this results in a successful purchase, it’s not unheard of either. If that’s not an option, sellers and their realtors should always consider ways to garner the renter’s cooperation in the process. They’re not going to be happy about the situation. Many rental owners with long-term renters have kept their rents low, and the renter is likely to experience some amount of sticker shock when they head out to shop for a new home. There is also a lack of available units, making their situation even more bleak.

And while COVID is now endemic, it’s still important to take into consideration renters’ worries about exposure. I think it’s a good idea for rental owners to reach out to the renters and let them know how the process will go and what steps you will take to reduce the number of showings. It might look something like this:

• The realtor will make an appointment to shoot a detailed walk-through video and take lots of pictures, taking all reasonable precautions by always wearing a mask and gloves, if the renter wants that. The realtor may also want to consider having a forehead thermometer with them to provide proof to the renters that they and anyone they show the property to has a normal temperature. And if you expect the unit won’t look its best, some realtors or their clients are paying to have someone come over and clean the home or spruce up the landscaping prior to shooting a video or taking pictures, even if that is the renter’s responsibility.
• Require any interested parties to watch the video, look at the photos and do a drive-by of the unit. Then, make sure they are financially pre-qualified in some fashion to schedule a time to view the property. That will eliminate the looky-loos and reduce in-person showings to serious buyers only.
• Provide ‘consideration’ for each showing (and maybe even for allowing the realtor in to do the video and take pictures). Consideration means money. Perhaps a credit or payment of $25 per showing or per hour for an open house. I’m not saying $25 is the magic number, just what seems about right to me. Money makes everything better; not perfect, but better.

I also recommend working with the renters picking one or two weekdays and one weekend day per week that works best for them and doing your best to limit showings to those two or three days, if possible. Try to understand how disruptive it would be to have strangers tromping through your home. Their home is their sanctuary, their safe place as yours is to you. You’ll have a better chance of garnering their cooperation by being sensitive to that – at least they have some assurance that for four or five days every week they will be left alone to live their lives.

Let the renters know what the timeline is for termination so they can start planning. Let them know about the 90-day notice period so they have assurance there will be time to look for and secure new housing.

Entry without notice to show the property
ORS 90.322 states in part that, “A landlord and tenant may agree that the landlord or the landlord’s agent may enter the dwelling unit and the premises without notice at reasonable times for the purpose of showing the premises to a prospective buyer, provided that the agreement:

(A) Is executed at a time when the landlord is actively engaged in attempts to sell the premises;
(B) Is reflected in a writing separate from the rental agreement and signed by both parties; and
(C) Is supported by separate consideration recited in the agreement.

So, if the renters are willing, you can enter into an agreement for property showing using, Entrance Agreement for Property Showing - ORHA form #O13.  In my experience few, if any, renters are okay with allowing realtors or owners to show a property without notice, but it’s worth asking.

Denial of entry
What if, despite all your efforts to gain cooperation, the renter just won’t cooperate? While ORS 90.322 specifies that a landlord has the right of entry after providing a minimum of 24 hours’ notice, it also allows renters to issue a reasonable denial of entry, “Unreasonable time” refers to a time of day, day of the week or particular time that conflicts with the tenant’s reasonable and specific plans to use the premises.’ So, if you want to enter at 2:00 p.m. on Saturday, but the tenant has scheduled their child’s birthday party at that time, those are reasonable and specific plans to use the premises. The statute goes on to say that “A landlord may not abuse the right of access or use it to harass the tenant. A tenant may not unreasonably withhold consent from the landlord to enter.” Tenants can assert denial of entry by actual notice (calling you, emailing or texting, etc.) or by posting a note on the entry and you are not allowed to enter.

If the renters won’t cooperate regarding setting specific days for showings, you’ll have to serve a 24-Hour Notice to Enter – ORHA form #O4 each time you want to enter. If you have the right listed in your rental agreement, you may email or text your notice to enter. To bolster your case that a specific denial of entry is unreasonable, you may want to include some language like this:

“We will take any COVID-safe precautions you request. We will only spend as little time in the unit as possible and expect the walk-through will take a maximum of 15-20 minutes. If our requested time and date for entry conflicts with your specific plans to use the property at that time, we will accommodate a different time or day within a 48-hour period following our intended date and time of entry. Please contact us right away to reschedule.”

The way to gain entry (or possession) after a tenant has unreasonably denied your request is to serve a Notice of Termination with Cause – ORHA form #VT5, as allowed by ORS 90.392. I call this notice a 30/14, some folks call it a 14/30. The notice provides the renter with a minimum 14-day cure period to allow entry, or the tenancy would terminate within a minimum of 30 days. While that is a long time to wait to enter, once that notice is in place if they don’t cure you can evict. If they do initially cure the notice and let you in, but unreasonably deny entry again within six months of service of the original 30/14, the same statute allows you to serve a Repeat Violation Termination Notice – ORHA form #T1 and terminate the tenancy with 10 days’ written notice. The renter has no right to cure this notice.

If you find yourself in this situation, remember, the denial must be unreasonable and you may have to prove that both the original denial of entry and the repeat denial were unreasonable, and that your notice(s) are perfect in every way. That’s why it’s helpful to start with a plan as I’ve outlined above so you have something to show a judge in the event you end up in eviction court. Communications with the renter showing the efforts you made to address any concerns and your attempts to be flexible and adapt to their schedule should be helpful in proving their specific denial was unreasonable.

Delayed or accelerated move out
Just because a notice of termination is served, doesn’t mean that the timing will work out. At least half of the time, there is some delay in the move out – sometimes because the timing for a unit the renters have been approved for isn’t ready, sometimes because they have been unable to find anything. I always encourage owners to build in some sort of flexibility to the move out date. If in the end the renter needs more time, if you can, be ready to offer some sort of extension. But only agree if the renter puts their notice to vacate in writing to you and pays the prorated rent for the extra time. Use Notice of Termination from Tenant – ORHA form #T10.

If you can’t offer more time, and the renter won’t move out, the only other option is to initiate an eviction action in court, which can take three to five weeks or more. If the termination notice is contested, the process can be delayed further, so everyone should factor that into the timing of the notice to vacate. And remember that even if you serve a 90-day notice, the tenants may instead find something quickly and provide just 30 days’ notice to vacate which could throw off the timing as well, although for buyers and sellers that may be less of a concern.

What if the sale falls through?
You must rescind the notice and start all over again with a new notice once you receive and accept another offer. If you were required to pay relocation expenses to the tenant, however, you don’t need to pay them again.

When to close
If a buyer intends to live in the property and makes an offer, most buyers will need a mortgage to purchase, have an interest rate lock that expires in 45 days, and be required to occupy the home within 30-45 days after closing. With the current volatility in interest rates, buyers who need a mortgage and the sellers hoping to sell, are having a tougher time. If the property sale closes during the notice period, the buyers will be ones tasked with handling the move out and deposit accounting. This can be a big headache if they are not landlords and/or if the seller’s property condition reports are shoddy or nonexistent.

Even though it can impact interest rates, buyers might be well advised to wait for the tenants to move out before closing on the sale to avoid the hassles of security deposit reconciliation and maybe even eviction. And, if that’s not possible buyers may just have to suck it up and refund the entire deposit if there’s no evidence from the seller regarding condition. Just one more thing to think about and plan for.

Cash for keys
Cash for keys is a tried-and-true method for regaining possession of a property and nothing 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. We have a great new form Mutual Termination Agreement – Release of All Claim – ORHA form #T9. Use it to record the terms and if the tenant fails to move out, it can form the basis for an eviction. Whatever amount of money you agree to pay, you may have to provide at least part of the funds up front, so they have money to put down somewhere else. Try to negotiate paying only part of it and specify that they only get the remainder in exchange for possession of the property at the agreed upon time. That way if they don’t move out when they agree, you don’t have to pay them the rest.

Marketing an investment property
Termination laws don’t 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 regarding 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 to increase rents within the limits imposed by ORS 90.323 until your rents are market rate so that your property can command the best sales price.

The quality of the tenancies 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. Maybe you should think about removing your problem residents ahead of offering the property for sale. Also, the completeness of the seller’s tenancy documents can also help or hurt the sale. If there are gaps or flaws in paperwork, fix them now, 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 adequate documentation on the condition of the units on move in, copies of work orders, accurate and complete tenant ledgers, good notes, and copies of notices regarding lease violations during the tenancy, and detailed inspection reports.

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 $6,000. 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.

The takeaway
A property sale with tenants in place 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. For realtors, fulfilling your fiduciary duty to your clients means educating yourselves on the mandates of ORS 90.427 and all its intricacies to provide clients with the best information possible as to the benefits, drawbacks, and possible outcomes of selling tenant-occupied rental property.

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.

Rev. 3/2024

By: Tia Politi, ORHA President

March 2024

Meeting in Bandon
Looking forward to seeing our association delegates at this month’s Board Meeting in beautiful Bandon. See the March 2024 Board Meeting Notice from the ORHA Office for dates, times and location. You should have already received your invitation and secured your place. We will be meeting at Lord Bennett's Friday night at 6 p.m. for a no-host delegates dinner just to eat some good food and hang out - hope you will join us. If you’ll be staying Saturday night, we’ll figure out something to do. It’s St. Patrick’s Day weekend and there’s an Irish festival, so we may head over there for food and fun.

The committee meetings will be held at the Wizard Hat Beach House – See Board Packet for Address – as will the Sunday morning training. This meeting’s training will be 9-10 a.m. and I’ll be talking about how to handle a landlord helpline for your association. It’s a challenge but dramatically increases a chapter’s value to its members. I’ll be discussing setting up a dedicated Google Voice phone number for callers, tracking calls and topics to guide the board in educational offerings, directing callers to our forms and manuals, dealing with people who take too much time, and how to answer landlord questions without giving legal advice.

Property Management Palooza!
Mark your calendars for this year’s Property Management Seminar in beautiful Hermiston, Oregon, Friday May 17, 2024. Classes will be held at the Oxford Suites at 1050 N 1st St, Hermiston. We should have four teachers this time, Christian Bryant, president of the Portland Area ROA, Jason Miller, ORHA Legislative Director, Violet Wilson, ORHA Executive Committee Advisor and chair of the ORHA Education Committee, and myself. Meetings have begun and we’ll send you more info on the class times and topics next month.

The Palooza is our way of highlighting a smaller chapter and helping them boost their finances. In this case we’re working with all our eastern Oregon folks and while the distances are vast, it’s a beautiful drive. So please mark your calendars for an all-day seminar. If you can’t make it in person, we will be offering virtual attendance options as well, but we encourage you to come in person if you can. Remember, when you travel for business it’s a tax deduction!

There’s a lot to do in Hermiston and the surrounding areas and Eastern Oregon is spectacular in the Spring, so bring the family for a mini vacation. In Hermiston, there’s the Hermiston Family Aquatic Center, Butte Park with a great view if you hike to the top of the Butte, the Hermiston Raceway, Desert Lane Bowling Alley & Arcade, and Winery Tours.

The town of Hermiston has long been a stopover for travelers. The Lewis and Clark Corps of Discovery passed the distinctive outcropping of Hat Rock, now a state park, and wrote about it in their journals. The town site in the 1860s was known as an overnight spot for horseback travelers who frequented an Old West hotel and bar here. The Maxwell Siding Railroad Display recalls a former time when rail was king. Visitors can view the early 20th-century rail cars and collection of railroad memorabilia. (Tours are available by appointment.)

Umatilla is only a 12-minute drive from Hermiston and offers their own array of things to do. Head down to the river at the Umatilla Marina R.V. Park, a great spot for boaters, and the McNary National Wildlife Refuge, with walking paths around the ponds and sloughs that provide key habitat for migrating and resident water birds as well as other wildlife. Visit the nearby Pacific Salmon Visitor Information Center at McNary Lock and Dam to learn about the life cycle of salmon and the history of hydropower in the Columbia. Don’t miss your photo op with the giant cowboy sign outside the Columbia Harvest Foods store. Then head west toward the Umatilla National Wildlife Refuge, where you can look for burrowing owls, overwintering eagles, mule deer and badgers.

We hope to see you there!

By: Tia Politi, ORHA President
February 2024

Hope you survived the January ice storm in good health. Looking forward to seeing our ORHA delegates next month in beautiful Bandon! You’ll receive information soon on the location and registration. See Office Manager Ben Seamans’ Office Report later in the newsletter.

We’re gearing up for the short legislative session, and our legislative team – Lobbyist Shawn Miller, Legislative Director Jason Miller, and Deputy Legislative Director Ben Seamans – are ready for action. Nothing like the excruciating long session, but the attacks on the largest contingent of small business owners in the state continue unabated. The one bright spot is an additional $65 million in rent assistance that the Governor is carving out to help keep people housed.

Or is it? As an eviction specialist I’ve seen many sad cases over the years where a few months’ rent would have saved a tenancy or allowed a resident to move on without loads of debt hanging over their head, but what I’ve seen happening with the distribution of rent assistance is anything but orderly or fair. For more than two years, I have been helping an owner serve notice, take his renters to court, and then have them get bailed out. These are two able-bodied folks in their 30’s who could work, but don’t seem to want to or they’re choosing to spend their money on things other than rent.

They’ve gotten at least four rounds of rent assistance while others are told there are no more funds left. What’s wrong with this picture? Also, some agencies cover other costs, and some don’t. I’ve had some owners reimbursed for everything, including late fees, NSF fees, utilities and court costs, and others only get rent. Some get rent through that month; others get rent paid ahead with seemingly no rhyme or reason as to the disparity.  And I imagine you saw the article about the millions of dollars that have been fraudulently distributed – what a mess. Challenging to remain optimistic…anyway, glad rental owners are getting some money.

Landlords are commonly seen as rich, opportunistic, and greedy, when the truth for most of us is that we scraped and saved and worked full time jobs while trying to build some sort of reasonable retirement for ourselves and something to pass to our children. Most of us did not inherit our rentals. Most of us have 1-4 units. Most of us still work full time. Most of us still have mortgages. Most of us care deeply about our renters’ experience. Not sure how we can change the stereotype, but it takes all of us running our rental businesses ethically and policing our own. I’m also president of the Rental Owners Association of Lane County. Just like ORHA, we have a code of ethics and at Lane we have removed members from our membership rolls for unethical behavior. I hope all our chapters do the same. It only takes a few bad apples to make us all look bad.

By: Tia Politi
February 2024

What is a fee? A fee is a non-refundable charge to a tenant, most often for a violation of the rental agreement, but also for certain landlord expenses. A landlord is not obligated to account for or return to the tenant any lawfully charged fee. (Screening fees are charged pre-tenancy, and have their own requirements and restrictions. They are not addressed in this discussion.)

A fee must be described in a written rental agreement. If it’s not in the written agreement or you have not implemented a change in terms in the case of municipal fees, you can’t charge any fees at all. There are two types:  contractual fees and noncompliance fees.

Contractual Fees include:

1. Late payment of rent fee.
2. Smoke/CO alarm tampering fee.
3. Dishonored check fee.
4. Lease-break fee.
5. HOA/COA move-in or move-out fees.
6. Municipal services pass-through fees.

Noncompliance Fees include:

1. Late payment of a utility or service charge.
2. Failure to clean up animal waste (pet or assistance animal) from a part of the premises other than the dwelling unit.
3. Failure to clean up garbage, rubbish, or other waste from a part of the premises other than the dwelling unit.
4. Parking violations or improper use of vehicles within the premises.
5. Smoking in a clearly designated nonsmoking unit or area of the premises.
6. Keeping on the premises an unauthorized pet capable of causing damage to persons or property, as described in ORS 90.405. 

Contractual fees require no further notice prior to assessment, than being described in a written rental agreement. Once the tenant commits the violation, you assess the fee.

Non-compliance fees require that upon first occurrence of a violation you must provide a written Warning Notice – Notice of Noncompliance – ORHA form #V1. If the tenant commits the same or substantially the same offense within one year, you may assess the fee and may assess repeated fees repeatedly during that year if the behavior continues. 

In the Oregon Rental Housing Association rental agreement, all fees, whether contractual or noncompliance, are due immediately upon default.

CONTRACTUAL FEES

Late Rent
You may charge a fee for late payment of rent when the tenant pays rent beyond the statutorily allowable grace period. If allowed by contract you may assess a late fee for any rent payment received after 11:59 p.m. on the 4th day of the rental period or after 11:59 p.m. on the 7th day of the rental period, depending on what you have stated in the agreement. 

A tenant may be allowed an even longer grace period if they are disabled. When a late fee may be assessed to a disabled resident is dependent upon when they receive their disability payment from the government. Under Fair Housing regulations a landlord must make an exception to their normal policies to accommodate a disability-related need and payments are no exception. So, what’s fair in this situation? I think once you know that the tenant doesn’t get their assistance payment until say, the 10th of the month, it might be reasonable to extend the grace period through midnight of the 14th. 

If you are required to extend your grace period, do it, but don’t change your due date for rent. Just keep it the first but extend the grace period to accommodate their payment schedule. I once had a disabled renter who had no bank account, and no car. She got her disability payments on the 3rd of each month, so I extended her grace period through midnight of the 7th to give her enough time to cash her check and pay her rent.

There are three types of late rent fees a landlord may charge:

1. A one-time charge in an amount not to exceed the amount customary to the local area. A landlord whose rental is in Bend or Portland may be allowed a higher fee than one whose rental is in Reedsport or La Grande. A reasonably safe amount might be up to $100, but just like everything rates increase over time, and I’m starting to see flat fees of $200 and in one recent case, even $250. Not sure what would happen if the amount of the fee were litigated, so keep that in mind when you’re establishing the amount. I know of one management company who has staggered rates based on the rent amount, so a higher flat fee if the unit is a higher-end property.
2. The second choice is a daily fee that may be charged as early of the 5th day of the rental period with daily fees being assessed each day after that until rent is paid in full for that rental period only. The daily amount may not exceed 6% of the reasonable and customary one-time amount, so if we agree that a late fee of $100 is reasonable in your market that would mean a daily rate of $6; if we agree that a late fee of $200 is reasonable in your market, then a daily rate of $12. 
3. The third choice is the most painful of the three for the tenant, and that’s a late fee of 5% of the rent amount for every five-day period or portion thereof until rent is paid in full for that rental period only. These can really add up. For example, if the rent is $1500 per month, then 5% is $75. Multiply that by each 5-day period and if rent isn’t paid until the end of the month the tenant can be responsible for a whopping $450. 

Changing the type or amount of the late fee
A landlord may change the type or amount of late fee in a month-to-month agreement with a 30-day written notice. If they are in a lease, you’ll have to wait to change the fee. All my renters have a late fee amount of $50, low by today’s standards, but I’m in no hurry to change it because they all pay on time. But if they weren’t paying on time, I would serve our new form Late Fee/Renters Insurance Notice of Change in Terms – ORHA form #O15 and change it to option three. The idea is to incentive on-time payment, so if you’re experiencing repeated issues with late payment of rent you might consider this type of change.

Insufficient Funds
Landlords may assess a fee of $35, plus bank charges for any dishonored check submitted as payment by a tenant. It’s very rare, but I did once have a tenant prove that the returned payment was a bank error, and the bank paid the charge on her behalf.

Lease-Break
You may charge a fee to a tenant who breaks a fixed-term lease without cause if provided for in the written rental agreement. The fee may not exceed 1-1/2 times the monthly rent. If you charge the fee:

• You may not recover unpaid rent for any period of the fixed term tenancy beyond the date that you knew or reasonably should have known of the abandonment or relinquishment.
• You may not recover damages related to the cost of renting the dwelling unit to a new tenant. 
• You may not charge a lease-break fee in cases of termination of tenancy related to domestic violence, sexual assault or stalking as described in ORS 90.453(2), or for a tenant being called to active-duty military service as described in ORS 90.472 or 90.475, or if the lease is broken for cause.

Smoke/CO Alarm Tampering
You may assess a fee for tampering with a properly functioning smoke or CO alarm. The fee is not to exceed $250 per occurrence, and you may not assess the fee if the Fire Marshall has already done so. I once managed a fraternity and the fire Marshall had inspected, discovered the violation, and charged the fee and I couldn’t pile on darn it.

HOA/COA Move-in/Move-out
You may pass through move-in or move-out fees assessed by your condominium or homeowner’s association. To pass on the fee:

• You must disclose the fee in writing prior to accepting any money, even a screening fee. Our application has a box you can check and a blank to fill in to notify the applicant what amount they will be responsible for paying.
• You must bill the tenant within 30 days of receiving the association’s bill, provide a copy of the invoice with the bill, and allow the resident up to 30 days from the date of billing to pay.

Municipal and Utilities Pass-Through
You may pass on municipal fees and charges to tenants.

• The pass-through charges must be stated in the written rental agreement.
• The charge must be imposed on you by a utility or service provider, on behalf of the provider or a government agency for municipal services, or for general use of a public resource related to the dwelling unit, including assessments for street maintenance, transit, public safety, or parks and open space. To assess a municipal fee:
• • You must bill the tenant in writing within 30 days of receipt of the provider’s bill and include a copy of the bill.
  • You must provide the tenant 30 days or more to pay. 
  • If not stated in the written rental agreement, the fee may be added to an existing periodic agreement with 60 days’ written notice. 

NONCOMPLIANCE FEES 

• Prior to charging a noncompliance fee, you must issue a written warning notice within 30 days of discovery of an initial violation that states a specific noncompliance, and the amount of the fee for a second noncompliance, or for any subsequent noncompliance, that occurs within one year after the issuance of the written warning notice. Use Notice of Non-Compliance – ORHA form #V1.
• You may not issue a Warning Notice prior to a violation being committed by the tenant.
• For any specific violation, the right to charge a fee stops one year from the date of issuance of the first written Warning Notice. Once the year has passed, you must issue a new warning notice prior to charging fees again for that specific violation. 
• Noncompliance fees must be assessed within 30 days of discovery of the act constituting the violation. 
• You may instead serve a for-cause notice and terminate a tenancy for the violation instead of assessing a fee but may not assess a fee and terminate a tenancy for the same violation; however, you may terminate a tenancy for failure to pay outstanding noncompliance fees billed to the tenant.  

Allowable noncompliance fees include:

• The late payment of a utility or service charge that the tenant owes the landlord as described in ORS 90.315. 
• Failure to clean up animal (pet or assistance animal) waste, garbage, rubbish, and other waste from a part of the premises other than the dwelling unit.
• A parking violation, or the improper use of a vehicle within the premises.

The allowable fees for these violations are limited to $50 for the second offense, and $50 plus 5% of the rent amount for all subsequent similar violations that occur within one year of issuance of the required written warning notice. 

Two other noncompliance fees are higher:

• Smoking in a clearly designated nonsmoking unit or area of the premises. 

You may charge a $250 noncompliance fee as early as 24 hours after the effective date of the written warning notice for violating this prohibition, and repeated fees for every 24-hour period during which the tenant continues to violate this provision.

•  Keeping on the premises an unauthorized pet capable of causing damage to persons or property, as described in ORS 90.405. 

You may charge a $250 noncompliance fee as early as 48 hours after the effective date of the written warning notice if the tenant fails to remove the unauthorized pet, and repeated fees for every 48-hour period during which the animal remains on the premises.  

Interestingly, the statute does not provide timelines for how long tenants have to cure the other listed violations, so do what’s reasonable.

GETTING PAID

• Notify the tenant that they owe a fee 

Send a bill to the tenant each time they incur a fee, stating the violation, the fee they owe, the fee they will owe upon future violations, and how long they have to pay. The length of time a tenant has to pay a fee after notification can be defined in the rental agreement; if not defined, 30 days seems reasonable.

• Collect the fee or terminate 

If the tenant does not voluntarily pay a bill for a lawfully charged fee, you may send a Notice of Termination with Cause - ORHA form #VT5, providing a final opportunity to remit the funds or the tenancy terminates. If the tenant neither pays nor moves, you may evict them on that basis.

PENALTIES AND OTHER CONSIDERATIONS

• Landlord penalty for violation

If a landlord charges a tenant a fee in violation of this section, the tenant may recover twice the actual damages of the tenant or $300, whichever is greater (90.302). This penalty applies to all fees except for municipal fees or utilities pass-through, in which case the landlord penalty is one months’ rent or twice the tenant’s actual damages (90.315).

Concerns about proof, documentation
You must take care to ensure that you have and retain proper documentation and proof of the violation prior to issuing a warning notice or assessing a fee. If a tenant disagrees with your assessment, the conflict could end up in court, where legitimate evidence will be required.

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.

By: Tia Politi, ORHA President
January 2024
Welcome to our new members of the Executive Committee
I’m pleased to announce that at our November meeting, Dan Griffin of the Central Oregon Rental Owners Association was elected Treasurer to serve out the remaining term after our previous Treasurer resigned. With his gift for numbers Dan is a great choice. Dan is a licensed real estate broker and an investor. He’s working on his business start-up and he and his wife own five rental properties in Central Oregon. They have a 3-year-old daughter and a baby on the way. Originally from the Chicago area, Dan moved to Oregon nearly 11 years ago. He spends his free time building an off-grid cabin in a remote area east of Bend and training jiu jitsu. Thanks, Dan, for agreeing to serve.

With our new Treasurer, a fantastic bookkeeper, Lori Black, along with Finance Committee Chair Dennis Chappa’s experience and tutelage, we’re in a good place with our finances. 

You might recall that last year the board voted to reduce our regions from five to four, and in accordance with our bylaws, each area must be represented unless there’s no one willing to serve from a particular region, so with the prior Treasurer’s resignation, we were left without a representative from the Southern Region to serve on the Executive Committee, so... 

…I’m also pleased to announce that Joanne Williams from the Rental Owners Association of Douglas County has agreed to serve as At-Large Member. She was a computer programmer for 30 years until her purchase of Centerpointe Property Management in 2020. Her company has 11 employees, including her daughter who will be taking over the business someday. Centerpointe manages around 700 regular rental units and three HOA’s with around 300 units. 

Joanne has lived in Roseburg most of her life and caught the rental bug from her grandmother who was a longtime landlord. She bought her first property in 1998 to supplement her retirement, and recently bought a 7^th unit. She says Monopoly is her favorite board game, and she enjoys camping and hiking in her limited spare time. She’s a proud mom of two, and a grandma of two. A fun fact about Joanne is that she appeared on TV in the show Swift Justice, and she won! Thanks, Joanne, for agreeing to serve.

New forms available for 2024 law changes
With the advent of new laws that took effect this year, including a requirement to allow child care in rental properties, and an allowance to serve notice by email and mail among other changes, the Forms Committee is rolling out new forms and forms changes to help you navigate. Read my article on New Forms and Forms Changes – Part II in my Forms Committee Report later in the newsletter.

The article also highlights an important change you’re going to see in all of our forms regarding our service boxes, so check it out!

One of the biggest challenges we face with our online Forms Store is the cost of developing and programming fillable forms. In November, the board accepted the committee’s recommendation to offer some forms on the site that will not be fillable. At a cost of around 10% of what it would normally cost to offer fillable forms, it will enable us to offer many forms we thought would be helpful but were not within our budget to produce. It will also allow us to see if the use of some forms justifies making them fillable in the future. Just like with printed forms, they are copyrighted, so you aren’t allowed to just print one and copy them for the future.

Remember, what we do costs money and when you unlawfully copy our forms, it impacts our ability to improve our offerings. We work hard to help our members run a successful rental business and appreciate your support, financial and otherwise.

Watch out for fraud!
Late last year, a member sent me a very realistic looking letter purporting to approve rent assistance from Catholic Community Services for her renter, but when the member called their office, they had not received an application from the tenant nor approved anything. 

Fraudsters are getting better all the time. If your tenant claims to have applied for assistance or been approved for assistance, even if they have official-looking documents you should contact the agency to check.

No meeting this month
Remember, there is no January meeting, so we’ll see all our delegates in Bandon in March. Looking forward to work and play.

Property Management Palooza!
This year’s Property Management Seminar is being held in beautiful Hermiston, Oregon, Friday May 17, 2024. The Palooza is our way of highlighting a smaller chapter and helping them boost their finances. In this case we’re working with all our eastern Oregon folks and while the distances are vast, it’s a beautiful drive. So please mark your calendars for an all-day seminar. If you can’t make it in person, we will be offering virtual attendance options as well, but we encourage you to come in person if you can. Remember, when you travel for business it’s a tax deduction! 

There’s a lot to do in Hermiston and the surrounding areas and Eastern Oregon is spectacular in the Spring. In Hermiston, there’s the Hermiston Family Aquatic Center, Butte Park with a great view if you hike to the top of the Butte, the Hermiston Raceway, Desert Lane Bowling Alley & Arcade, and Winery Tours.

The town of Hermiston has long been a stopover for travelers. The Lewis and Clark Corps of Discovery passed the distinctive outcropping of Hat Rock, now a state park, and wrote about it in their journals. The town site in the 1860s was known as an overnight spot for horseback travelers who frequented an Old West hotel and bar here. The Maxwell Siding Railroad Display recalls a former time when rail was king. Visitors can view the early 20th-century rail cars and collection of railroad memorabilia. (Tours are available by appointment.)

Umatilla is only a 12-minute drive from Hermiston and offers their own array of things to do. Head down to the river at the Umatilla Marina R.V. Park, a great spot for boaters, and the McNary National Wildlife Refuge, with walking paths around the ponds and sloughs that provide key habitat for migrating and resident water birds as well as other wildlife. Visit the nearby Pacific Salmon Visitor Information Center at McNary Lock and Dam to learn about the life cycle of salmon and the history of hydropower in the Columbia. Don’t miss your photo op with the giant cowboy sign outside the Columbia Harvest Foods store. Then head west toward the Umatilla National Wildlife Refuge, where you can look for burrowing owls, overwintering eagles, mule deer and badgers. 

We hope to see you there!

Tia Politi, President
Oregon Rental Housing Association

By: Tia Politi, ORHA Forms Committee Chair
January 2024

Senate Bill 1069

Service of notice by email-and-mail
In this month’s newsletter, you’ll find an educational article on Senate Bill 1069, written by Eugene attorney Brian Cox. In November, I let you know that considering the new law allowing service of notice by email and mail, the board would be deciding what to do with the Service Boxes on our forms. The Forms Committee provided the board with three options:

1)     Do nothing and discourage email-and-mail service.
2)     Add Email-and-Mail as a fourth option.
3)     Change the service box to allow for only two options – First Class Mail and Other.

The board voted unanimously for option 3 and here’s why. We already have many issues with our members serving notice improperly. I am an eviction specialist and staff five landlord helplines around the state as part of my business, and the biggest reason landlords lose in eviction court, or must re-serve a notice is due to “imperfect service.” Despite all our articles and classes and helplines, folks still mess this up more than anything else and it’s a bad thing to mess up! A tenant attorney would be happy to educate you for an exorbitant fee. We don’t recommend it for the casual landlord. What if you forget to email one of the tenants? What if their power is out? What if they lost their internet? SB 1069 was presented as something wonderful for landlords, but many of us disagreed.

The changes to our service boxes will happen over time, and existing forms are still usable. 

First Class Mail (with 4 days added to account for mailing time) is ALWAYS the most secure way to serve a legal notice – ask any landlord-tenant attorney, so why give our members another way to mess up? Instead, we encourage you to serve all notices by First Class Mail, and if you want to do it another way AND you know what you’re doing, you can fill in the “Other” method of service. 

If you still wish to serve legal notice by this method, the parties must enter into a written agreement after the tenancy begins and the tenant has taken possession of the unit. The agreement must specify the email address from which you will send or receive email notice and from which email addresses the tenant will send or receive email notice and provide for a change of email address, electronic payment or termination of the agreement by either party with three days’ written notice. The agreement must also include a state disclosure warning tenants about the consequences of their decision. Use Agreement to Exchange Notice by Email and Mail – ORHA form #O17. Please remember you may not copy our forms.

Refunding money by electronic means
There was another better change that came with SB 1069, an allowance for landlords to refund moneys owed to the tenant by electronic means. This is fantastic for both parties. How many times have you mailed a check the tenant never got? It’s happened to me - not a lot - but it’s a hassle when it happens, and the tenant is always mad even though it’s not your fault. 

Just like the allowance to email-and-mail notices, the agreement to refund money by electronic means must be signed after the tenancy has begun and the tenant has taken possession of the unit. We have a great new form available. Agreement to Accept Electronically Transferred Funds - ORHA form #O16. Please remember you may not copy our forms.

Childcare in Rental Properties
One of the most concerning legislative changes from the 2023 long session is the requirement for landlords to allow tenants to operate a for-profit daycare in the rental property. See my article later in the newsletter for specifics on the new law, and hopefully you will be somewhat reassured. Becoming a registered or certified family child care home is complicated – only the most responsible of renters will be able to meet the requirements. 

For landlords whose tenants meet those requirements, we have developed a new form In Home Child Care Agreement – ORHA form #MO7. Please remember you may not copy our forms.

Application to Rent
Form S1 has been updated to comply with the requirements of HB 2680 adding gender identity as a protected class and providing the required disclosure for landlords who assess an applicant screening charge. As I mentioned in November, if you don’t charge for screening the old forms are still usable, but if you do you must replace your forms, or you will be out of compliance with ORS 90.295 and may incur a fee of twice the amount of the screening charge plus $250. 

Eugene Lease Renewal Notification – ORHA Form MO8EU
This new form meets the requirements of the Eugene Rental Housing Code Ordinance 20694 that requires landlords whose tenants are in the first year of a fixed-term lease of less than one year to provide notification to the tenants of their right to request a renewal of their lease or receive relocation expenses of two months’ rent. 

The form can be provided at the time of move in or no less than 90 days prior to the expiration of the fixed term. Beware, the penalties for not serving the form are severe. Please remember you may not copy our forms.

Happy New Year!

Tia Politi, ORHA Forms Chair