SENATE BILL REPORT

EHB 1387

BYRepresentatives Leonard, J. Williams, Nutley, Sanders and Wineberry

Providing for housing security deposits for qualified persons.

House Committe on Housing

Rereferred House Committee on Ways & Means/Appropriations

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 23, 1988; February 25, 1988

Majority Report:  Do pass.

      Signed by Senators Lee, Chairman; Conner, McMullen, Smitherman, Warnke, Williams.

Senate Staff:Charles A. Woods (786-7911)

                  February 25, 1988

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 25, 1988

BACKGROUND:

The Residential and Mobile Home Landlord-Tenant Acts permit the landlord to obtain a security deposit from the tenant for performance of the tenant's obligations under the rental agreement.  Some landlords also collect last month's rent in addition to the standard security deposit.

Some poor or temporarily homeless persons can afford the monthly rent payment, but they do not have the cash needed for the initial lump sum security deposit.

SUMMARY:

The Department of Community Development (department) is required to establish and maintain a rental security deposit guarantee program.  The department will provide grants and technical assistance to local governments and nonprofit corporations who operate emergency housing facilities or transitional housing programs.  The local government or nonprofit corporation must contribute 15 percent of the total amount needed for the security deposit.  The deposit includes last month's rent when it is a normal requirement of the landlord.

The local government or nonprofit corporation will assist homeless persons or families who are temporarily residing in an emergency shelter or transitional housing, or families who are otherwise without adequate shelter.

The landlord, the tenant, and the local government or nonprofit corporation enter into a three party contract where the tenant pays the deposit over time on a monthly basis, and the local government or nonprofit corporation guarantees that the landlord will receive the amount of the deposit.  The funds for the guarantee are provided by a grant from the department to the local government (which covers 85 percent of the needed amount).

The department is to establish rules regarding the eligibility of local governments and nonprofit corporations to receive grants and technical assistance, and the eligibility of tenants to participate in the programs.

Up to one hundred thousand dollars may be used from the Housing Trust Fund for the rental security deposit guarantee program.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: Sylvie McGee, Washington State Coalition for the Homeless (pro); Kris Backes, Washington Housing Finance Commission (pro)