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No fiscal implication to the State is anticipated.
SB 1367 would make a couple of key changes to the Property
Code. Firstly, this legislation would increase the punishment against a
landlord that violates any provision of Subchapter C (Residential Landlord’s
Lien) of Chapter 54 (Landlord’s liens). A landlord who violates this subchapter
would have to pay back the tenant with $1,000. This would be on top of providing
one month’s rent, as well as any actual damages the tenant may have received
(both provisions are already in statute).
Secondly, according to this legislation, when an owner sells his or her interest in a rental property, he or she would still be liable for the security deposit until the new owner has received the deposit or has agreed to assume liability of it.
Lastly, SB 1367 adds a new section that concerns lease agreements without a security deposit. If a lease agreement did not require a security deposit and the tenant is responsible for damages to the unit, the landlord must notify the tenant in writing that he or she is making a claim on the damages made by the tenant. This notification would have to be sent before the landlord actually files the claim. Additionally, if the landlord fails to provide notification then he or she forfeits the right to collect from the tenant.
Reps. Anchia and Oliveira are the House sponsors of this legislation.
This bill is substantively the same as when we reported on it in its original chamber. However it is important to note that there is a House substitute which makes minor amendments that do not change our overall view of the bill. We continue to support SB 1367.
First chamber recommendation:
We support SB 1367 because it protects a person’s property rights. While there are some increased penalties that would be charged to a landlord who violates the statutes, these would be increases on existing penalties rather than new penalties altogether.
The most significant provision of this legislation would require a landlord to provide notice to a tenant or former tenant of damages owed prior to filing a claim. This serves two important purposes that work in the interests of the tenant's property rights. It affords the tenant the opportunity to pay for the damages rather than have a claim filed against them. It also protects the tenant from having a landlord file a negative report against the tenant's credit without the tenant even knowing about it until their credit is run for something else or they hear from a debt collection agency.
For these reasons we support SB 1367.