What actions must Colorado landlords and property managers take after passage of the new state law known as House Bill 19-1106?
The purpose of this article is to summarize a Colorado Landlord’s[1] ‘action items’ arising out of the passage of House Bill 19-1106 (HB 1106) in 2019 and House Bill 2023-1099 (HB 1099) in 2023 and to introduce Frascona, Joiner, Goodman and Greenstein, P.C.’s updated product: the Rental Application Fairness Act Compliance Packet (RAFA Compliance Packet). HB 1106 and HB 1099 are also referred to as “RAFA” in this article.
This article does not provide an in-depth review of RAFA. The actual text of HB 1106 and HB 1099 can be accessed by clicking here and here, respectively.
I. Portable Tenant Screening Report Notice
Prior to conducting any tenant screening activities, HB 1099 requires a landlord to provide a prospective tenant with a Portable Tenant Screening Report Notice unless exempted under the law. If a prospective tenant provides a landlord with a Screening Report, the landlord must accept it and cannot charge a fee for it. The Landlord can provide the Notice in a variety of ways and may institute certain requirements of the Screening Report. A Landlord is excepted from the Screening Report requirements only if it accepts only one application per dwelling unit and refunds the rental application fee from each tenant not signing a lease. The RAFA Compliance Packet includes a Portable Tenant Screening Report Notice as well as instruction on how and where to implement.
Assuming a prospective tenant does not provide a Screening Report and the Landlord is not exempt from the Notice, then the Landlord must then consider the Rental Application Fee Disclosure.
II. Rental Application Fee Disclosure
A Landlord may not charge a rental application fee to a prospective tenant unless the Landlord uses the entire amount of the fee to cover the Landlord’s costs in processing the rental application. To comply with the new requirement, a Landlord must disclose to the prospective tenant certain details concerning the rental application fee. The RAFA Compliance Packet includes a Rental Application Fee Disclosure to keep the Landlord in compliance with the law.
III. Rental Application Fee Receipt
A Landlord must also provide each prospective tenant with a receipt whenever it receives a rental application fee. The RAFA Compliance Packet also includes a Rental Application Fee Receipt specifically crafted based on the language of RAFA for Landlords to provide to prospective tenants.
IV. Rental Application Denial Letter
A Landlord is required to provide any denied prospective tenant with notice of such denial. Not only must the Landlord provide the denied prospective tenant with notice of the denial, but it must also explain the reason for the denial. The Rental Application Denial Letter included in the RAFA Compliance Packet includes ‘check-the-box’ options individually tailored to RAFA and other state and federal laws so that the Landlord can quickly and efficiently process and distribute each required denial letter. The RAFA Compliance Packet also includes an Adverse Action Addendum for use when a Landlord denies a prospective tenant for particular reasons that, by law, require the provision of additional information.
V. Rental Application Fee Refund Receipt
Lastly, HB 1106 requires that a Landlord refund to a prospective tenant all unused portions of the rental application fee. If the Landlord does not use the entire rental application fee in processing the rental application, then it can utilize the Rental Application Fee Refund Receipt included in the RAFA Compliance Packet to close the loop on RAFA compliance.
This article is not intended to provide legal advice to the reader. If you have any questions about RAFA compliance, please contact Zachary Grey. To purchase the RAFA Compliance Packet, click here.
[1] C.R.S. § 38-12-902(2) defines “Landlord” as an owner, manager, lessor, or sublessor of a dwelling unit. C.R.S. § 38-12-902(1) defines “Dwelling Unit” as a structure or the part of a structure that is used as a home, residence, or sleeping place.
