October 2017 - Vol. 9 Issue 10
Rental Housing Journal Utah
2. 3. 5. 5.
President’s Message – Upcoming UAA Membership Renewals Are Upon Us Director’s Message – Preparing For Natural Disasters What IS "Normal Wear and Tear"? Ask the Attorney – Requalifying Tenants Upon Renewal
UPCOMING EVENTS Good Landlord Class South Ogden City Hall............................. Wed, Dec 16th Salt Lake............................................................ Sat, Dec 16th Ogden............................................................. Tues, Dec 19th Salt Lake.............................................................Fri, Dec 29th www.GoodLandlordingTraining.com
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UAA Annual Meeting UAA Office ............................................ (448 E Winchester #460, Murray)
www.rentalhousingjournal.com • Professional Publishing, Inc Official Publication of The Utah Apartment Association Utah’s Leading Advocate for the Rental Housing Industry – 888-244-0401 – WWW.UAAHQ.ORG
What is the best way to communicate with your tenants?
UAA PAC Fundraising Efforts Underway
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s of publication, the Utah Apartment Association has raised just over >>>> in Political Action funds this year. The majority of that comes from people like you, who have paid a contribution with their UAA Dues for 2017 or 2018 or made special donations throughout the year. In addition to these donations the UAA hosts two fund raisers each year that specifically benefit
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Our annual goal for Political Contributions is $100,000. We are currently more than half way there, and are anticipating that as pledges are fulfilled and donations are made with dues that we should reach it before the end of the year. However we need your help to do that!
What the UAA PAC Does for you
By Taylor Smith
ometimes landlords mistakenly imagine that once they have gotten rid of an old tenant and successfully put a new tenant into a unit, they don’t have to do anything else except respond to maintenance requests and collect rent. If only it were that easy. The key to being a successful landlord is figuring out how to do two things well: asset management and customer service. Asset management involves doing frequent inspections, responding to maintenance needs, and making plans for future upkeep
our political efforts. First in August was the UAA Reverse Trade Show, which raised more than $13,000 for the PAC. Next was the UAA PAC Luncheon at Top Golf in Midvale on October 18th where more than $30,000 was raised or was pledged by individuals and companies who wanted to come find out more about the political efforts on behalf of the rental industry by the UAA.
By Taylor Smith
Utah Apartment Association
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y now all of you who receive this publication should have also received a bill for your 2018 UAA Annual Dues, along with an invitation to send a donation for the Utah Apartment Association Political Action Committee (UAA PAC), with the amount set according to the number of units you own. We continued on page 6 would like to thank all of you who have paid your dues. It is always a good feeling as an employee at the association to know that you value our work on your behalf. We would also like to give a special thanks to those of you who have donated to the PAC. Our Government Affairs efforts are at the heart of what we do for our members, and this fund enables us to represent you at all levels of Government in Utah.
is used to help fund our lobbyists, and to contribute to the campaigns of elected officials and candidates who are private property friendly and willing to work to correct or improve certain laws, or willing to block laws that would harm our industry. Some of the money is also How is the PAC money spent in hosing fundraisers, which used? are designed to increase the impact From time to time as we send out of your donations. The candidates that we support the annual renewal notices, we are asked what the PAC is and what it are carefully chosen by Executive does. The money in the UAA PAC Committee with the help of the
PAC and Government Affairs Committees who review the voting records and history of the candidates in question and that of their opponents. We do not allow things like party affiliation or positions on other issues to impact the committee’s decision, we only evaluate candidates based on how their views and votes will impact the businesses of our members and other landlords, property managers and investors throughout the state. continued on page 7
Utah Apartment Association 448 E Winchester St Ste. 460 Salt Lake City, UT 84107 Ph: (801) 487-5619 Fax: (801) 484-8649 www.uaahq.org
President’s Message The Tribute Awards
Peter Harradine, AIT, CAM 2017 UAA Board Chair Utah Apartment Association
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very year about this time, the UAA awards committee undertakes an enormous project. The goal of the Tribute Awards committee is to honor the excellence innovation and talent in our industry. The first step is soliciting our industry twenty five awards. This involves soliciting nominations from major property management companies, vendors, and others. The committee strives diligently to identify a diverse and eclectic group of both individuals and properties. While there will only be one winner per category, a side goal of the processes is to honor many deserving individuals and properties in addition to the winner. Second, the awards committee establishes and implements a judging processes. This processes involves interviews based on preset questions and criteria, submissions from nominees, and property shops. For instance, the leasing agent of the year award has three components. After talented individuals are identified as nominees, they are notified and congratulated. They are given a nomination form to complete that gives them an opportunity to promote their virtues and display their knowledge and skill. This nominee form will be one third of their total score. Then, they are Advertise in Rental Housing Journal Utah Circulated to over 6,000 apartment owners, on-site and maintenance personnel monthly. Call 503-221-1260 for more information
interviewed by individuals familiar with property managements that work in single family property management. These interviews also constitute a third of their score. Finally, once the finalists are identified secret shoppers are sent to their property pretending to be renters and they are scored by these professional leasing testers. This is the final third of their score.
The tribute awards processes will I want to thank the awards involve hundreds, if not thousands committee the volunteers and the of hours from UAA staff, committee staff for their monumental efforts members, and volunteers. It will to honor the best in our industry. involve hundreds of paid shoppers who visit properties to assess quality and measure innovations. In the end dozens of winners and hundreds of finalists will be recognized for their talents, skills, and achievements.
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Rental Housing Journal Utah · September 2017
Utah Apartment Association 448 E Winchester St Ste. 460 Salt Lake City, UT 84107 Ph: (801) 487-5619 Fax: (801) 484-8649 www.uaahq.org
Director’s Message
Membership Benefits
L. Paul Smith, CAE UAA Executive Director Utah Apartment Association
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ou may have heard the following quote before: “Every man owes a part of his time to the business in which he is engaged. No man has the moral right to withhold his support from an organization that is striving to improve conditions within his sphere” – Theodore Roosevelt It is renewal season, and many of you have seen your renewal invoices in the mail. For big complexes that have previously budgeted them for January, this is a reminder. For small owners, paying early means
you can claim your dues on your 2014 taxes! Because we have a diverse membership population in the UAA many people have a variety of reasons for being members of the Association. Some join for the legislative efforts that the UAA provides and the support that is given proactively to protect owners, investors, and landlords. Others have joined for the UAA to become more involved and more engaged in the industry. The Utah Apartment Association was recently awarded the highest membership increase throughout the entire National Apartment Association. This was a HUGE honor for us, and we are very excited. But we have found out that many people, big and small, do not know all of the benefits of membership. Do you remember why you joined? Here are just a few reasons why you should renew your membership or even re-instate it if it has lapsed. yLegislative y Advocacy – Without the legislative advocacy we
You never know what is covered until it is not covered! Service Line Coverage - Covers the replacement or repair of underground sewer or water lines, even if the damage is caused by wear and tear.
Ordinance and Law - Covers up to 10% of the dwelling coverage. Helps cover improvements to the structure required by increased ordinance or law requirements.
Earthquake Coverage - Available on all residential properties and select commercial properties.
Sewer or Drain Backup - Covers damage to the structure from a water or sewer backup.
Replacement Cost - (Special Form) Coverage on repairs, even on older buildings.
Increased Replacement Cost Increases the coverage on the dwelling to 125%.
provide it would be much more expensive to operate your business. There would be MANY more regulations hindering your investments. yEducation y – The UAA is an invaluable tool in educating our industry. Even owners who are professionals benefit when the UAA educates others. We all benefit from the UAA education programs! yLandlord y Guide, Forms, Industry Publications – Running alongside our education classes and events are our publications & forms. Keeping you educated and informed increases your revenue. As well has having up to date legal forms is necessary when operating a rental. yDiscounted y Tenant Screening – It may not seem like a huge benefit to some. But everyone benefits from tenant screening. Choosing the correct tenant decreases your liability, damage, and loss. With our up to date screening services it saves you more than just the cost of the screening, it can save you thousands! yStaff y Hotline – We are available to answer your questions whenever the office is open. yOnline y rent-pay and property management software – Available as a service to all members who would like to use it. This is especially useful for taking electronic rent payments.
yEvents y – From the annual Trade Show to the Golf Tournament and Apartment All-Stars class, the UAA has events for everybody so that you have the opportunity to learn and network with other professionals. yNetworking y – One of the most valuable resources in the association is the other members. We strive to give you opportunities to meet with other members regularly to make connections and learn from other people in the industry. At its simplest level, the UAA is a pool of resources for those in our business, and a voice of advocacy for our industry. It is a network of individuals and companies committed to professionalism and excellence. It is an organization committed to honoring our noble profession. We are a group committed to efficient and profitable businesses who wish to combine our efforts to assure continued opportunity in our profession and limited government interference! Please renew your membership and commit to getting other property owners, managers, and ancillary businesses to support the UAA and assure we can continue to effectively pursue our mission.
yOnline y videos – We have made a series of informational videos on topics of interest to landlords. We also posts video of our meetings and some events online for those who are not able to attend in person.
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Circulated to over 6,000 apartment owners, on-site and maintenance personnel monthly.
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Rental Housing Journal Utah
Good Health is Good Business Smoke-free rental housing in Utah.
By Cassandra Fairclough, Utah Department of Health
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moke-free housing has become the norm across the U.S. and right here in Utah. There is no federal or state law that prohibits an owner from implementing a smoke-free policy for properties. In Utah, the Second Hand Smoke Amendments establish secondhand smoke as a nuisance under the law, and give authority for apartment rental contracts to include prohibitions on smoking in units, on the premises, or both. The Utah Indoor Clean Air Act bans smoking within 25 feet of any entranceway, exit, open window or air intake of buildings where smoking is prohibited. It also establishes the rights of owners, agents and proprietors to ban smoking anywhere on their premises. Secondhand smoke is the thirdleading cause of preventable death in the U.S. and is responsible for heart disease and lung cancer, in nonsmoking adults, and ear infections, respiratory complications, and risk
illness, heart disease, cancer and other adverse health effects for those living in neighboring residences. Many property owners and managers throughout Utah have adopted a non-smoking policy not only to improve the health of their residents, but also their bottom line. “The main reason for the decision to become smoke-free communities is for the health of our tenants,” says Sandy Aldrich, Occupancy Director, Danville Development Corporation. Advantages of a Smoke-free Policy of sudden infant death syndrome, in children. A resident who smokes in a unit puts future residents at risk. Secondhand smoke can travel through air ducts, cracks in walls and floors, and along plumbing and electrical lines to the unit for years. The most recent U.S. Surgeon General’s Report published in 2010 states that, “The debate is over, the
science is clear; there is no safe level of exposure to secondhand smoke.” The U.S. Department of Housing and Urban Development (HUD) strongly encourages all HUDfunded and subsidized properties to pass smoke-free policies. HUD made its recommendation because environmental tobacco smoke can migrate between units in multifamily housing, causing respiratory
Market Demand As residents understand the health dangers of secondhand smoke, more are looking for housing that prohibits smoking. Currently, 93% of Utah households do not allow smoking in their home. However, individuals have no control over lingering smoke continued on page 5
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Rental Housing Journal Utah · October 2017
Rental Housing Journal Utah
Salt Lake County announces new initiative with the Road Home Ask the Attorney Security Deposits
by Paul Smith The Utah Apartment Association received the following letter that we were asked to share with you. “Dear Salt Lake County Landlord: Salt Lake County is working with a broad spectrum of our community to provide housing solutions that meet the needs of all members of our community, including landlords. This year, the State of Utah, Salt Lake County, Salt Lake City and private donors have joined forces in an unprecedented way. I’m reaching out to you to ask for your help and to share a specific program that offers benefits to all stakeholders. Salt Lake County is collaborating on a new initiative with The Road Home. With support from private funders, The Road Home will offer a temporary subsidy with services for individuals who are currently living in the shelter or on the streets. Each of these individuals will have a dedicated case manager to help them gain income to cover the full cost of their rent over time. The will receive assistance with the cost of moving into housing, getting and keeping jobs that cover the cost of their rent, and ongoing case management to help smooth their transition to self-sufficiency. Wherever possible, the program will also match individuals with roommates to help make housing even more affordable. Landlords are an important stakeholder in housing solutions and we want to work with you to ensure that the initiative works for everyone. I believe that participating in this program will offer a benefit to property owners like you. Rent money is supplemented for a time period, there is a low turnover in tenants, and dedicated case managers can be called on should issues with tenants arise. We know that the solution must work for everyone involved with short- and long-term housing solutions in order for our community to be a leader in successfully addressing the issue. If you are interested in participating in this initiative, please contact Michelle Flynn at The Road Home at (801) 330-1824 or by email at mflynn@theroadhome.org. The Utah way is for everyone to come together on a solution that benefits our community. I look forward to having you as a valued partner in that effort. Sincerely, Ben McAdams Salt Lake County Mayor
Advertise in Rental Housing Journal Utah Circulated to over 6,000 apartment owners, on-site and maintenance personnel monthly.
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Rental Housing Journal Utah · October 2017
By Kirk Cullimore, Jr.
Law Offices of Kirk Cullimore
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our resident just vacated. You check the unit and no surprise, the unit is a mess. Fortunately, resident paid a security deposit. Now what? Whether your resident gave proper written notice at the end of the lease or skipped before the lease expired, your obligations as a landlord under Utah law on how
you handle the security deposit are the same. What then are those obligations? Under Utah law, upon termination of a resident’s tenancy, you may apply money held as a deposit “toward the payment of rent, damages to the premises beyond reasonable wear and tear, other costs and fees provided for in the contract, or cleaning of the unit.” (Utah Code § 57-17-3(1)) This means you can apply the resident’s security deposit towards any monies owed pursuant to the lease, including cleaning and damages. If your resident signed a Cleaning and Damages Addendum
(or something similar), any of the applicable charges can be deducted from the security deposit. If your resident did not sign an applicable Addendum, then charges for cleaning, carpet cleaning, painting, plus anything damaged that must be either repaired/replaced (all subject to normal wear and tear), can be deducted from the security deposit. In cases where there is no applicable Addendum, documentation, including receipts, invoices, and pictures, is crucial. It is not uncommon for former residents to dispute charges for cleaning/ damage; having documentation, especially pictures, only bolsters the likelihood of those charges
being awarded if contested in court. In addition to deducting amounts for cleaning/damages from the security deposit, you can also include any future rent owed, subject to your obligation to mitigate damages. Look for a future article that will discuss in more detail mitigation and future rent. After applying resident’s security deposit towards monies owed, then what? Under Utah law, you then have an obligation to send to the resident a written accounting reflecting how you applied the continued on page 5 5
Rental Housing Journal Utah
Ways to Communicate ...continued from page 1 and upgrades to the property. Customer service, on the other hand is a bit more nebulous, but the cornerstone to good customer service in the Rental industry is good communication. So, how should you communicate effectively with your tenants? Here are the advantages and disadvantages of some of the more common communication techniques landlords use to communicate with tenants.
Face to Face Advantages: Meeting face to face with your tenants is the best way to communicate and make sure that both sides are understood, especially since you can pick up on body language. Many landlords insist on meeting face to face during the application process and at the lease singing. Disadvantages: Unfortunately, meeting in person can be difficult to arrange and involves travel by one or both parties. Also, some tenants would rather be left alone and feel that frequent requests for face to face meetings are intrusive. Finally, face to face meetings don’t leave a record, so you and the tenant will have to rely on each other’s memories for what was said.
Phone Calls Advantages: Talking on the phone usually means getting an immediate response to questions that you are asking and enables a discussion. Disadvantages: Many tenants will screen their calls. Furthermore, playing phone tag is frustrating and time consuming. Also, like in person meetings, there is no automatic record made of the interaction (unless you record your phone calls, something which might be illegal unless you notify the person on the other line.)
Text Messages Advantages: Many tenants prefer communicating via text because it is much less intrusive than a phone call or visit. It is also often easier to communicate because texting allows “asynchronous communication” where you can send messages back and forth when convenient (most people will respond faster to a text than a voice mail). Perhaps most important, texts leave a record that you can use later. Disadvantages: It can be difficult to get an immediate response from tenants, and conversations can take longer. It is also harder to pick up on nuances, such as sarcasm, in writing. Finally, the size limitations on texts can make it difficult to 6
Good Health ...continued from page 4
send long messages.
from previous tenants. National surveys show that there is support E-mails for no-smoking policies, and that Advantages: E-mails offer many of even smokers prefer to smoke the same advantages as texts, but they outside. allow you to develop your thoughts more carefully. They also allow for Lower Cleaning Costs flexibility in when and where you Property owners and managers will respond, and can seem more understand the high maintenance professional than just sending texts - costs associated with having and they are free to set up and use! smoking in their units, including: Above all, e-mails are the easiest way cigarette burn marks, nicotineof recording your communications and tar-stained walls, and carpets for future use. that smell of tobacco smoke. On Disadvantages: E-mails can often average, it costs two to seven come across as impersonal, and if times more to clean a unit that they are sent in an argumentative has been smoked in. “We decided tone they can escalate quickly. You to implement a smoke-free policy should always be calm while writing on our properties to eliminate the an e-mail. Also, sometimes people health risks of secondhand smoke don’t check their e-mail frequently, and also to cut down on smoke so you might want to check with damage in our apartment units,” the tenant before communicating says Jenifer Ewoniuk, Cowboy with them this way. Properties.
Conclusion
Lower Fire Risk
What is the best way to communicate with your tenants? The best answer is “however they prefer to communicate” but you should also consider the pros and cons of other methods. Being a professional landlord means being able to communicate effectively, and you should become comfortable with making visits and phone calls on the one hand and sending text messages and e-mails on the other.
Smoke-free policies can increase the safety of residents and property. According to the National Fire Protection Association, smoking materials are the leading cause of home fire deaths in the United States. In 2010, U.S. fire departments responded to an estimated 90,800 smoking material fires. These fires caused 610 civilian deaths, 1,570 civilian injuries, and $663 million in direct property damage. Just this past June in Ogden, two fires at the same complex were blamed on cigarettes. According to the Salt Lake Tribune, the Ogden City Fire Marshal determined that discarded cigarettes sparked the two separate fires, one of which killed a dog. The city estimated the damage from both fires at $250,000. The Utah Department of Health has developed a new toolkit titled “Good Health Is Good Business: A landlord’s guide to increasing revenue by adopting smoke-free polices.” The guide
encourages smoke-free policies in apartments and condominiums. It has everything you need to ask questions of your tenants, write an addition to your lease that covers a smoke-free policy, and know how to let your residents know about the policy. Once you have decided to go smoke-free, the toolkit can help you establish a time frame and put the policy into action. The toolkit is available online, as well as in hardcopy. The Utah Smoke-free Housing Statewide Directory, an online resource, lists rental properties that have adopted a non-smoking policy. The directory provides a free service to property managers and owners who wish to list their properties. Numerous affordable housing units throughout Utah have adopted policies. Although these units may not be listed in the directory, the communities are tracked in a database. The Utah Department of Health keeps a database of all rentals that have adopted a policy. As of June 2014, the database has nearly 400 communities, which comprise of 2,000 buildings and 24,194 units. If your unit is smoke-free, and you want to be listed in the directory, contact the Utah Department of Health at the number below. To access the toolkit and learn more about smoke free policies, visit http://www.tobaccofreeutah. org/pdfs/utah_landlord_guide. pdf. A video highlighting smokefree policies in Utah is available for viewing on YouTube. Please check out the Department’s online resources, or contact Cassandra Fairclough at 801-573-6754 for more information on adopting a smoke-free policy in your community.
Advertise in Rental Housing Journal Utah Circulated to over 6,000 apartment owners, on-site and maintenance personnel monthly.
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Rental Housing Journal Utah
What the UAA PAC Does ...continued from page 1
Ask the Attorney ...continued from page 5 security deposit. When must you provide this written accounting and where do you send it? Utah law specifically requires that “no later than 30 days after the day on which a renter vacates and returns possession of a rental property,” you “shall deliver to the renter at the renter's last known address: (a) the balance of any deposit; (b) the balance of any prepaid rent; and (c) if the owner or owner’s agent made any deductions from the deposit or prepaid rent, a written notice that itemizes and explains the reason for each deduction.” (Utah Code § 57-17-3(2)) What if you fail to deliver the written accounting within 30 days of your renter vacating and returning possession of the unit back to you? If that were to happen, all is not lost, as Utah law then shifts obligations upon the renter. The renter may then serve you written notice. The renter’s written notice must substantially comply with the form provided in the applicable statute and must be served in the same manner as you are required to serve eviction notices, i.e. either (1) personally to the owner/owner’s agent at the address provided in the lease agreement; (2) leaving a copy with a person of reasonable age and discretion if owner/owner’s agent is absent at the address provided
in the lease agreement; (3) if no one can be found at the address provided in the lease agreement, affixing a copy in a conspicuous place at the address provided in the lease agreement; or (4) sending a copy through registered/certified mail to the owner/owner’s agent at the address provided in the lease agreement. (See Utah Code § 5717-3(4)) If the tenant’s written notice complies with the law and is properly served, you must provide the written accounting within five (5) business days of service. Otherwise, if you fail to do so, the former tenant can initiate litigation where your failure to comply with former resident’s written notice would require you to refund the entire security deposit, a penalty of $100.00, as well as the possibility of being responsible for resident’s court costs and attorney fees. (See Utah Code § 57-17-3(3)(b)) Best practice is obviously to send the written accounting sooner than later. However, should that not happen within 30 days, get it done as soon as you can, as there is no real concern unless or until resident properly serves you the required written notice by law.
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Rental Housing Journal Utah · October 2017
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Sometimes people imagine that such donations “buy” either votes or access to elected officials. This is not the case with us and our industry. We are only concerned with one straightforward goal: ensuring that those who would work with us anyway (regardless of our donation) are elected, and that those who would not help our industry (or would actually hurt it) are not elected. Finally, in addition to working with campaigns and lobbyists, the UAA keeps a small reserve in the PAC fund for future efforts and to ensure that we have sufficient funds on hand for any direct campaigning on an issue that directly impacts landlords which might arise in a referendum or other similar proposal. If you are interested in learning more about the process of how PAC funds are distributed, you are more than welcome to come to any meetings of the Government Affairs Committee or the Board of Directors. Just call the UAA staff and find out when they are next meeting. You may even find that you would like to volunteer your time to be a part of the committee and participate in the process! What have we accomplished? Over the last several years the Government Affairs Program of the Utah Apartment Association has had significant success. Among other things, we: 1. Passed a rent and fee control prohibition statute so cities, like Salt Lake City, that were not allowing landlords to charge tenants an application fee for a background check, could not limit fees or control rents. 2. Prohibited cities and health departments from requiring costly retrofits to older properties like installation of fire sprinklers. 3. Changed state law to prohibit cities from requiring utilities be paid by landlords. 4. Prohibited cities from kicking landlords out of a Good Landlord program based solely on number of police calls. 5. Prohibited cities from charging inspection fees to landlords. 6. Required cities provide separate notice and opportunity to cure for each code violation (some cities gave one warning and if there was a problem again, even a year later, they went straight to fines).
7. Required cities to send notice of any violation to both the property manager and the owner. 8. Standardized Fit Premises Acts (Landlord/Tenant laws) to one state statute. Previously cities had the ability to write their own. Standardizing the laws prevents confusion, reduces ambiguity and creates consistency. 9. Clarified rules on how many unrelated occupants can reside in a unit (4 in cities without universities, 3 in cities with). Some cities were not allowing renter households of more than two unrelated people. 10. Decreased the amount of days that a landlord needs to hold abandoned property from 30 days to 15 days. 11. Assisted the Real Estate Division in modernizing property management regulations to allow referral fees to residents, bonuses to employees and updating trust account rules. 12. Helped pass legislation requiring tenants who did not receive their security deposit to give an official new address and additional five day notice prior to suing the landlord for deposit refunds. 13. Helped to create a fund that is set aside to cover damages done by tenants on Section 8 Housing. 14. Streamlined the eviction process to give additional protections to landlords while ensuring that the process moves at a reasonable pace for everybody. A few years ago the UAA was awarded a prestigious Paragon Award from the National Apartment Association for our Government Affairs Program. We are honored to have been recognized the best in the Nation, but we are not taking anything for granted. Our continued efforts will take time, effort and money to ensure that the Rental Housing Industry in Utah is one of the best in the country. If you weren’t able to donate to the UAA PAC when you sent in your dues check, don’t worry! You can make a donation at any time by calling the UAA staff or by sending in a check by mail. And if you did make a donation, thank you again for helping us work to preserve and improve the laws governing our industry.
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Rental Housing Journal Utah
LOWER MAINTENANCE COSTS AND LESS TENANT TURNOVER. GO SMOKE-FREE. www.tobaccofreeutah.org/muh-intro.html
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Rental Housing Journal Utah · October 2017