Source of Income now protected statewide

Posted By: Heather Pierce (deleted) Advocacy, Law,

The statewide Source of Income Discrimination law is now in effect with the enforcement period having commenced on September 30, 2018. This new statewide law makes it illegal for rental property owners to use a source of income (i.e. section 8 vouchers, etc.) as a basis to deny tenancy to a rental applicant. Commensurate with this new regulation, rental property owners can mitigate increased financial with the opportunity to access a new landlord mitigation fund. The new fund is housed and administered via the Washington State Department of Commerce and landlords can apply for and receive up to $5,000 in damages caused by an outgoing subsidy recipient tenant.

With “Source of Income” now a protected class when renting housing, the protections cover individuals receiving benefits or subsidy programs including housing assistance, public assistance, emergency rental assistance, veterans’ benefits, social security, supplemental security income or other retirement programs, and other programs administered by any federal, state, local, or nonprofit entity.

Short-term vouchers are also included in the law’s protections, meaning that rental owners may not alter lease term offers to an applicant just because their rent voucher does not cover the duration of the advertised lease agreement. Source of Income does not include income derived in an illegal manner.

If a landlord requires that a prospective tenant or current tenant have a certain threshold level of income, such as using an income to rent ratio, any source of income in the form of a rent voucher or subsidy must be subtracted from the total of the monthly rent prior to calculating if the income criteria have been met. This is similar to what many local jurisdictions have done when passing local Source of Income ordinances over the past few years.

Under the law, a landlord may not refuse to rent to or expel a prospective or current tenant based on their source of income. Additional protections include preventing rental owners from:

  • Publishing or communicating any form of advertisement which indicates a preference, limitation, or requirement based on any source of income.
  • Changing terms of a lease offer, including altering price, terms, conditions, fees, or privileges relating to the rental.
    Attempting to discourage the rental or lease of any real property to a prospective tenant or current tenant.
  • Telling an applicant that a unit is not available for inspection or rental when the dwelling unit in fact is available.
  • Making unavailable or denying a unit to a prospective tenant or current tenant who would be eligible to rent the unit were it not for their source of income.

The lone exception to the new law is if the prospective tenant’s or current tenant’s source of income is conditioned on the real property passing inspection and a written estimate of the cost of improvements necessary to pass inspection is more than $1,500 and the landlord has not received moneys from the landlord mitigation program account to make the improvements. In such circumstances the rental owner could still legally deny the applicant.

A person in violation of these rules can be held liable in a civil action up to 4 and one-half times the monthly rent of the real property at issue, as well as court costs and reasonable attorneys’ fees.

The legislation also carries with it several future reporting requirements to ensure the mitigation fund is being effectively administered and how it can be improved. This process will include RHAWA representatives, as well as tenant advocates, and the housing authorities. That report will include discussion of the effectiveness of the program as well as how it can be improved.

RHAWA is hopeful that the feasibility for expanding the use of the mitigation fund to provide up to ninety-day no interest loans to rental owners who have not received timely rental payments from a housing authority will be added.

Landlords can apply for reimbursed caused by tenant using any form of a housing subsidy for physical damage to property beyond normal wear and tear, unpaid rent and charges associated with tenancy including late charges, non-compliance charges, legal expenses and utility charges. Applications will be made available online through the Washington State Department of Commerce. Unfortunately, landlords with subsidy recipient tenants who moved in or out prior to June 7, 2018 are not eligible to claim reimbursement from the Landlord Mitigation Program. ​