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Agenda 10/25/2022 Item # 9C (Ordinance - To consider an Ordinance in support of long-term County tenants who are impacted by rent increases)10/25/2022 EXECUTIVE SUMMARY Recommendation to consider an Ordinance to establish a Notice to Tenant Ordinance relating to landlords providing written notice of rent increases over 5% to tenants with leases of one year or longer. OBJECTIVE: To consider an Ordinance in support of long-term County tenants who are impacted by rent increases. CONSIDERATIONS: As background, the cost of housing is on the rise throughout not only Collier County but also Florida and nationwide. Comparing Collier County to other areas in Florida, Collier continues to have some of the highest rents and least number of affordable units in southwest Florida. A recent article in the Washington Post identified the Naples-Marco Island Metro Area as having the highest rental increases in the nat ion. The residential rental rates in the area have increased by 39% from the first quarter 2020 to the first quarter 2022. Redfin economists have stated in a recent Washington Post article, the reason behind the rent increases is “the pandemic was kind of a pause on the economy and now that things are reopening, inflation is picking up, rents are going up and people are realizing they don’t have as much disposable income as they might have thought they had.” Housing specialists cite the reason for rent increases as (a) demand, (b) pricey and competitive home buying market has priced many would-be homebuyers out of the market, (c) expiration of rent freezes and other measures that kept rents lower during the pandemic are now expired, and (d) wealthy renters who are able to pay more (high paying industries allow people to work from anywhere thus the migration from high paying markets like Chicago and New York to more affordable areas). This fast-changing market has caused increases in rental rates and as such communities across the nation and Florida are enacting rental ordinances to address termination periods and rent increase notification requirements. Several communities in Florida have enacted similar ordinances, including the City of Naples. On April 26, 2022, the Board of County Commissioners approved Agenda Item #11E and authorized staff to move forward with advertising an ordinance to establish a Fair Notice to Tenant Ordinance requiring landlords to provide a 60-day fair notice for tenants in long term leases experiencing a 5% or greater rent increase. On May 10, 2022, Agenda Item #9B, the Board voted down the Ordinance 3-2 and directed staff to facilitate public input and bring the Ordinance back at the next scheduled meeting for reconsideration. On May 16, 2022, staff held a Public Meeting in conjunction with members of the Affordable Housing Advisory Committee (AHAC). A quorum was not present. The meeting was attended by 16 persons on Zoom (2 AHAC members) and 15 community members, including 4 members of the AHAC. Based on feedback received at this meeting, Housing staff supports the following language changes to the Ordinance for Board consideration: 1. Remove the word “Fair”; 2. Add language to the written notice providing the website and phone number for Community and Human Services; 3. Remove Section III options to: (1) accept the proposed amendment; (2) reach an acceptable compromise, or (3) reject the proposed amendment to their tenancy. If the required 60 days written notice has been provided and the tenant has not agreed to the proposed amendment or an acceptable compromise, the landlord may impose the proposed amended term(s) or require the tenant(s) to vacate the residence; 4. Require the tenant to provide the landlord 30 days notice if they are going to accept the rent increase. On May 24, 2022, Agenda Item #9A, a motion to further continue the agenda item failed 2/2, and a motion to approve the proposed ordinance as written failed for lack of a second. On September 13, 2022, a public peti tion request was made to again consider enacting the ordinance, and the Board directed that the proposed ordinance be once again advertised and brought back as an agenda item for consideration. FISCAL IMPACT: Advertising costs for this item were $511. The future fiscal impact if additional Code Enforcement staff is necessary to administer is unknown at this time. GROWTH MANAGEMENT IMPACT: There is no Growth Management impact. LEGAL CONSIDERATIONS: In light of the Board’s discussion on April 26th I amended the proposed 9.C Packet Pg. 81 10/25/2022 ordinance to apply to only those leases of one year or longer (eliminating the month-to-month issue) and included a specific violations and penalties clause. The proposed ordinance reads in relevant part as follows: SECTION THREE: Fair Notice to Tenant on Rent Increase More Than Five Percent A residential landlord that proposes to increase the rental rate by more than five percent at the end of a lease for a term of one year or longer must provide 60 days written notice to the tenant before the tenant must either: (1) accept the proposed amendment; (2) reach an acceptable compromise; or (3) reject the proposed amendment to their tenancy. If the required 60 days written notice has been provided and the tenant has not agreed to the proposed amendment or an acceptable compromise, the landlord may impose the proposed amended term(s) or require the tenant(s) to vacate the residence. SECTION FOUR: Violations and Penalties All violations of this ordinance may be processed according to the Collier Co unty Consolidated Code Enforcement Ordinance (Ordinance No. 2010-04, as amended) and per the provisions of F.S. chapter 162, parts I or II, as may be applicable. A violation of this ordinance shall be punishable by a fine not exceeding $500.00. A separate penalty may be imposed for each violation of this ordinance. In keeping with the Board’s discussion, I also added an additional Whereas clause to include the following policy reason for the proposed ordinance: WHEREAS, there are programs which are available to assist tenants in paying their rents, which application process takes a minimum of 30 days; During the April 26th discussion Staff advised the Board that there are currently millions of dollars in government programs in place for the express purpose of rental assistance to Collier County residents, which take a minimum of 30 days to process, which programs would be rendered moot without sufficient time for the tenants to apply and receive the funding. Requiring 60 days’ notice of a rent increase over 5% allows those tenants the opportunity to apply for and obtain the assistance. With that noted, this item is approved as to form and legality. -JAK RECOMMENDATION: To enact an Ordinance to establish a Notice to Tenant Ordinance relating to landlords providing written notice of rent increases over five percent to tenants with leases of one year or longer. Prepared By: Jeffrey A. Klatzkow, County Attorney ATTACHMENT(S) 1. Ordinance - Fair Notice to Tenant (PDF) 2. legal ad - agenda ID 23442 (PDF) 9.C Packet Pg. 82 10/25/2022 COLLIER COUNTY Board of County Commissioners Item Number: 9.C Doc ID: 23500 Item Summary: *** This Item continued from the September 27, 2022, BCC Meeting. *** Recommendation to consider an Ordinance to establish a Notice to Tenant Ordinance relating to landlords providing written notice of rent increases over 5% to tenants with leases of one year or longer. Meeting Date: 10/25/2022 Prepared by: Title: Sr. Operations Analyst – County Manager's Office Name: Geoffrey Willig 10/14/2022 11:51 AM Submitted by: Title: Deputy County Manager – County Manager's Office Name: Amy Patterson 10/14/2022 11:51 AM Approved By: Review: Growth Management Department Jacob LaRow Additional Reviewer Completed 10/18/2022 5:45 AM Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 10/18/2022 8:26 AM County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 10/18/2022 9:09 AM Office of Management and Budget Susan Usher Additional Reviewer Completed 10/18/2022 9:56 AM County Manager's Office Amy Patterson Level 4 County Manager Review Completed 10/19/2022 3:20 PM Board of County Commissioners Geoffrey Willig Meeting Pending 10/25/2022 9:00 AM 9.C Packet Pg. 83 9.C.1 Packet Pg. 84 Attachment: Ordinance - Fair Notice to Tenant (23500 : Notice to Tenant Ordinance) 9.C.1 Packet Pg. 85 Attachment: Ordinance - Fair Notice to Tenant (23500 : Notice to Tenant Ordinance) 9.C.1 Packet Pg. 86 Attachment: Ordinance - Fair Notice to Tenant (23500 : Notice to Tenant Ordinance) 9.C.2 Packet Pg. 87 Attachment: legal ad - agenda ID 23442 (23500 : Notice to Tenant Ordinance)