SB2127 SD2

SECTION 1. The legislature finds that there are numerous barriers to accessing affordable housing for low-income households and people experiencing homelessness. There is significant competition for rental units in the State, with landlords often receiving multiple applications per unit. Individuals and families must often apply to as many open rentals as possible, which can cost hundreds of dollars. While the legislature recognizes that landlords and their agents need to collect application fees in order to vet all applicants, the legislature believes that the costs of multiple applications for prospective tenants can result in significant economic hardship, especially in a tight housing market.

The legislature further finds that to help individuals and families seeking rental housing in the State, the legislature enacted Act 200, Session Laws of Hawaii 2023, which authorizes an application screening fee for rental applications to ensure that costs associated with vetting an application are used only for that purpose and any remaining fees are returned to the applicant. However, an applicant will still be required to submit multiple application fees to landlords or their agents who are using those fees to obtain similar information. Allowing an applicant to receive a copy of certain information to provide to another landlord or the landlord's agent will further reduce the financial burden of applying for rental units and reduce the work of landlords and their agents to obtain certain information.

Accordingly, the purpose of this Act is to allow an applicant to request a copy of the applicant's criminal background check and credit report from one landlord or the landlord's agent to provide to another landlord or that landlord's agent in lieu of paying a fee to cover the costs of obtaining another criminal background check or credit report.

SECTION 2. Section 521-46, Hawaii Revised Statutes, is amended to read as follows:

"[[]§521-46[]] Application screening fee. (a) When a landlord or the landlord's agent receives a request from an applicant to rent a dwelling unit, the landlord or the landlord's agent may charge the applicant an application screening fee at the time the application is processed for the dwelling unit to cover the costs of obtaining information about the applicant; provided that [a]:

(1) A landlord or the landlord's agent shall only charge an application screening fee for an applicant who is eighteen years of age or older or an emancipated minor[.];

(2) If an applicant provides a landlord or the landlord's agent with a copy of the applicant's criminal background check or credit report received within thirty days from another landlord or that landlord's agent that has not been falsely altered, the landlord or the landlord's agent shall not charge an application fee to cover the costs of obtaining another criminal background check or credit report; and

(3) If a comprehensive reusable tenant screening report is made available to the landlord or the landlord's agent and is received within thirty days, the landlord or the landlord's agent shall not charge an application fee.

Information sought by the landlord or the landlord's agent charging the fee may include personal reference checks, tenant reports, criminal background checks, and credit reports produced by any consumer credit reporting agency.

(b) Upon request by the applicant, a landlord or the landlord's agent shall provide to the applicant a:

(1) Receipt for payment of the application screening fee; [~~and~~]

(2) Breakdown of costs covered by the application screening fee[.]; and

(3) Copy of the applicant's criminal background checks and credit reports that are less than thirty days old.

(c) A landlord or the landlord's agent shall return to the applicant any amount of the application screening fee that is not used for the purposes authorized by this section within thirty days after the landlord has submitted screening requests.

(d) It is a violation, punishable by a fine of $1,000, for an applicant to present a copy of the applicant's criminal background check or credit report that has been falsely altered.

[~~(d)~~] (e) For the purposes of this section:

"Consumer credit reporting agency" has the same meaning as in section 489P-2.

"Credit report" has the same meaning as in section 489P-2.

"Falsely altered", in relation to a written instrument, means a written instrument that has been changed, without the authority of the ostensible maker, drawer, or issuing commercial establishment, whether complete or incomplete, by means of erasure, obliteration, deletion, insertion of new matter, transposition of matter, or in any other manner, so that the instrument so altered falsely appears or purports to be in all respects an authentic creation of its ostensible maker, or authorized by the maker or issuing commercial establishment."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 2040.

Report Title:

Rental Application Screening Fee; Criminal Background Check; Credit Report

Description:

Prohibits a landlord or the landlord's agent from charging an application fee for a criminal background check or credit report if an applicant provides a copy of a criminal background check or credit report that has not been falsely altered or makes a comprehensive reusable tenant report available to the landlord or the landlord's agent. Requires a landlord or the landlord's agent to provide, upon request, a copy of an applicant's criminal background check or credit report. Establishes penalties for providing a falsely altered copy of a background check or credit report. Defines "falsely altered". Takes effect 7/1/2040. (SD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

THE SENATE	S.B. NO.	2127
THIRTY-SECOND LEGISLATURE, 2024		S.D. 2
STATE OF HAWAII