The Oregon Legislature met in special session in December of 2020 ultimately passing House Bill 4401 effective immediately upon Governor Brown’s signature. HB 4401 continues to complicate the dynamics of the landlord/tenant relationship and, with seeming intent, places further pitfalls for landlords. Some of you have been hoping for a simple answer to the question of when you can expect to see rental payments again, either from the tenants directly or from the state. On that point, HB 4401 fails the test, creating a confusing mix of timelines related to important time periods—the “emergency period” and the “grace period.”
The emergency period was defined previously in House Bill 4213, the legislature’s eviction moratorium law passed last summer. The emergency period was effectively the period of time wherein landlords could not demand payment from their tenants. HB 4213 also provided a grace period for tenants in the form of a six-month window—ending on March 31, 2021—in which tenants would need to pay back the balances that arose during the emergency period. Those time frames are now fluctuating, depending on whether certain events defined in HB 4401 have occurred.
HB 4401 provided an avenue for landlords to serve nonpayment notices again, at least for January rent only. As good as that sounds, a closer look reveals an empty offering. HB 4401 requires landlords to serve statutory declarations of hardship and a statutory notice of tenants’ rights along with every non-payment notice, every balance- due notice of any kind, and every summons for evictions of any kind. If the landlord fails to do so, the emergency period and grace period are automatically extended until June 30, 2021. The tenant is also provided a defense to any eviction based on non-payment, while the landlord could face exposure under HB 4401’s damages provision.
While HB 4401 did set up a landlord-compensation fund of sorts, as of this writing, no process to apply for said funding exists. Additionally, and most important, you, the landlord, are required to forgive 20 percent of the tenants’ unpaid balance in exchange for funding from the state, along with other restrictions which exist during the “pendency of” their “distribution application.”
While COVID-19 cannot be minimized in the problems it has caused, HB 4401 continues the failure to distinguish between tenants who actually need help (i.e., those who can prove that COVID-19 has caused financial hardship for them) and those who are simply gaming the system (i.e., not paying rent simply because they do not have to).
- Rental Housing Journal by Bradley Kraus February 2021
Given the complexity of this new law, and the potential exposure it creates, we are encouraged to fully understand this law before taking actions that could trigger it. So, I ask of those who are affected by non-paying tenants, please have patience with me and the process as we navigate HB 4401.
