Senate File 403 - Introduced SENATE FILE 403 BY KOELKER (COMPANION TO HF 442 BY LOHSE) A BILL FOR An Act relating to property law by modifying provisions 1 relating to rental properties, manufactured home 2 communities, mobile home parks, and manufactured mobile 3 home communities, modifying provisions governing actions 4 relating to such properties, making penalties applicable, 5 and including effective date and applicability provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 2003XS (2) 89 cm/jh

S.F. 403 DIVISION I 1 GROUNDS FOR TERMINATION OF TENANCY 2 Section 1. Section 562B.10, Code 2021, is amended by adding 3 the following new subsection: 4 NEW SUBSECTION . 4A. a. A landlord may only terminate a 5 tenancy if the tenant engages in any of the following or for 6 any of the following reasons: 7 (1) A material noncompliance with the rental agreement. 8 (2) A material violation of the manufactured home community 9 or mobile home park rules or regulations. 10 (3) Any other violation of this chapter for which 11 termination is a remedy. 12 (4) A legitimate and material business reason the impact of 13 which is not specific to one tenant. 14 (5) A change in the use of the land if change in the use 15 of the land is included in the rental agreement as grounds for 16 termination or nonrenewal. 17 b. A landlord may, upon providing ninety-day prior written 18 notice, elect to not renew a tenancy for any reason not 19 otherwise prohibited by law. 20 c. If the landlord presents evidence of written notice to a 21 tenant on at least three occasions, each notice dated not less 22 than ten days apart, of a condition identified in paragraph 23 “a” , subparagraph (1), (2), or (3), such evidence creates a 24 presumption of the existence of the condition unless and until 25 evidence is introduced which would support a finding of the 26 condition’s nonexistence. 27 Sec. 2. EFFECTIVE DATE. This division of this Act, being 28 deemed of immediate importance, takes effect upon enactment. 29 Sec. 3. APPLICABILITY. This division of this Act applies 30 to landlord decisions to not renew tenancies on or after the 31 effective date of this division of this Act. 32 DIVISION II 33 RETALIATION 34 Sec. 4. Section 562B.32, subsection 1, paragraph d, Code 35 -1- LSB 2003XS (2) 89 cm/jh 1/ 22

S.F. 403 2021, is amended to read as follows: 1 d. For exercising any of the rights and remedies pursuant 2 to this chapter or chapter 216 . 3 Sec. 5. Section 562B.32, subsection 2, Code 2021, is amended 4 to read as follows: 5 2. If the landlord acts in violation of subsection 1 6 of this section , the tenant is entitled to the remedies 7 provided in section 562B.24 and has a defense in an action for 8 possession. In an action by or against the tenant, evidence 9 of a complaint within six months one year prior to the alleged 10 act of retaliation creates a presumption that the landlord’s 11 conduct was in retaliation. The presumption does not arise 12 if the tenant made the complaint after notice of termination 13 of the rental agreement. For the purpose of this subsection , 14 “presumption” means that the trier of fact must find the 15 existence of the fact presumed unless and until evidence is 16 introduced which would support a finding of its nonexistence. 17 Sec. 6. EFFECTIVE DATE. This division of this Act, being 18 deemed of immediate importance, takes effect upon enactment. 19 DIVISION III 20 CONSUMER FRAUD 21 Sec. 7. Section 562B.4, Code 2021, is amended by adding the 22 following new subsection: 23 NEW SUBSECTION . 3. A violation of this chapter by a 24 landlord, or an agent of the landlord, is an unlawful practice 25 under section 714.16. 26 Sec. 8. Section 714.16, subsection 2, Code 2021, is amended 27 by adding the following new paragraph: 28 NEW PARAGRAPH . q. It is an unlawful practice for a landlord 29 or the landlord’s agent to violate any of the provisions of 30 chapter 562B. 31 Sec. 9. EFFECTIVE DATE. This division of this Act, being 32 deemed of immediate importance, takes effect upon enactment. 33 Sec. 10. APPLICABILITY. This division of this Act applies 34 to violations of chapter 562B occurring on or after the 35 -2- LSB 2003XS (2) 89 cm/jh 2/ 22

S.F. 403 effective date of this division of this Act. 1 DIVISION IV 2 RENT INCREASES 3 Sec. 11. Section 562B.14, subsection 7, Code 2021, is 4 amended by striking the subsection and inserting in lieu 5 thereof the following: 6 7. a. A landlord shall not increase the amount of rent due 7 by any tenant in a manufactured home community or mobile home 8 park unless the tenant is notified, in writing, of the rent 9 increase at least one hundred twenty days before the effective 10 date of the rent increase. The effective date of any increase 11 in the amount of rent shall not be less than one year after 12 either the effective date of the most recent rent increase or 13 the beginning of the tenancy, whichever is later. 14 b. A decrease in the number or quality of amenities, 15 services, or utilities provided under the rental agreement 16 without a corresponding and proportionate reduction in rent 17 shall be considered a rent increase for the purposes of this 18 chapter. 19 Sec. 12. EFFECTIVE DATE. This division of this Act, being 20 deemed of immediate importance, takes effect upon enactment. 21 Sec. 13. APPLICABILITY. This division of this Act applies 22 to rent increases under chapter 562B occurring on or after the 23 effective date of this division of this Act. 24 DIVISION V 25 MANUFACTURED HOUSING PROGRAM FUND 26 Sec. 14. Section 16.45, subsection 1, Code 2021, is amended 27 to read as follows: 28 1. A manufactured housing program fund is created within 29 the authority to further the goal of providing affordable 30 housing to Iowans. The moneys in the fund are to be used for 31 the purpose of providing funding to financial institutions or 32 other lenders to finance the purchase by an individual of a 33 manufactured home that is in compliance with all laws, rules, 34 and standards that are applicable to manufactured homes and 35 -3- LSB 2003XS (2) 89 cm/jh 3/ 22

S.F. 403 manufactured housing. The manufactured housing program fund 1 is designed exclusively for manufactured homes sited on leased 2 land. 3 DIVISION VI 4 TENANT COUNTERCLAIM FOR LANDLORD NONCOMPLIANCE 5 Sec. 15. Section 562B.25, Code 2021, is amended by adding 6 the following new subsection: 7 NEW SUBSECTION . 5. a. In an action for possession based 8 upon nonpayment of the rent or in an action for rent where the 9 tenant is in possession, the tenant may counterclaim for an 10 amount which the tenant may recover under the rental agreement 11 or this chapter. In that event, the court from time to time 12 may order the tenant to pay into court all or part of the rent 13 accrued and thereafter accruing, and shall determine the amount 14 due to each party. The party to whom a net amount is owed 15 shall be paid first from the money paid into court, and the 16 balance by the other party. If rent does not remain due after 17 application of this section, judgment shall be entered for 18 the tenant in the action for possession. If the defense or 19 counterclaim by the tenant is without merit and is not raised 20 in good faith, the landlord may recover reasonable attorney 21 fees. 22 b. In an action for rent where the tenant is not in 23 possession, the tenant may counterclaim as provided in 24 paragraph “a” , but the tenant is not required to pay any rent 25 into court. 26 Sec. 16. EFFECTIVE DATE. This division of this Act, being 27 deemed of immediate importance, takes effect upon enactment. 28 Sec. 17. APPLICABILITY. This division of this Act applies 29 to actions for possession filed on or after the effective date 30 of this division of this Act. 31 DIVISION VII 32 DISCLOSURE OF UTILITY CHARGES 33 Sec. 18. Section 562B.14, subsection 6, Code 2021, is 34 amended to read as follows: 35 -4- LSB 2003XS (2) 89 cm/jh 4/ 22

S.F. 403 6. a. The landlord or any person authorized to enter into 1 a rental agreement on the landlord’s behalf shall provide a 2 written explanation of utility rates, charges and services to 3 the prospective tenant before the rental agreement is signed 4 unless the utility charges are paid by the tenant directly to 5 the utility company. 6 b. If a landlord obtains a utility service from a utility 7 provider and furnishes the utility to the tenant and the 8 landlord’s charge to the tenant is based upon the utility 9 provider’s charge or rate for the use of such utility to 10 consumers, an increase in the landlord’s charge to a tenant 11 for the utility that corresponds to the same increase in the 12 utility provider’s charge or rate to the landlord shall be 13 effective thirty days after the landlord provides written 14 notice of such increase to the tenant, unless the landlord does 15 not receive at least sixty days’ prior notice of such increase 16 from the utility provider in which case no prior notice of the 17 increase from the landlord to the tenant is required for the 18 increase to be effective. 19 DIVISION VIII 20 FURNISHING OF WATER AND UTILITY CHARGES 21 Sec. 19. Section 423.3, subsection 103, Code 2021, is 22 amended to read as follows: 23 103. a. (1) The sales price from the sale or furnishing by 24 a water utility of a water service in the state to consumers or 25 users. 26 (2) Water service furnished by a mobile home park that does 27 not engage in the sale of water service. For purposes of this 28 subsection, a mobile home park does not engage in the sale of 29 water service if all of the following apply: 30 (a) The water service is not furnished to tenants for a 31 separately itemized price. 32 (b) The water service is not otherwise identifiable from 33 an invoice, bill, catalogue, price list, rate card, receipt, 34 agreement, or other similar document, including where the total 35 -5- LSB 2003XS (2) 89 cm/jh 5/ 22

S.F. 403 sales price increases when water service is included in the 1 sale to tenants. 2 (c) The water service is incidental to the rental of real 3 property. 4 b. For purposes of this subsection : 5 (1) “Mobile home park” means the same as defined in section 6 562B.7. 7 (1) (2) “Water service” means the delivery of water by 8 piped distribution system. 9 (2) (3) “Water utility” means a public utility as defined 10 in section 476.1 that furnishes water by piped distribution 11 system to the public for compensation. 12 Sec. 20. Section 423G.4, Code 2021, is amended by striking 13 the section and inserting in lieu thereof the following: 14 423G.4 Exemptions. 15 There is exempted from the tax imposed by this chapter the 16 following: 17 1. The sales price from transactions exempt from state 18 sales tax under section 423.3. However, the sales price from 19 transactions exempt from state sales tax under section 423.3, 20 subsection 103, shall not be exempt unless as provided in 21 subsection 2 or 3. 22 2. a. The sales price from the sale or furnishing of water 23 by a mobile home park through a piped distribution system 24 maintained by the mobile home park, to a consumer or user of 25 water who is a tenant, if all of the following apply: 26 (1) The water was obtained from a water utility. 27 (2) A tax was imposed by this chapter on the sales price 28 from the sale or furnishing of water by a water utility to the 29 mobile home park based upon readings of the master meter of the 30 mobile home park. 31 (3) The tenant is not charged for water by the mobile home 32 park in an amount that is more than the rate the tenant would be 33 charged for consuming or using water from the water utility, 34 plus an administrative fee under section 562B.16, subsection 3, 35 -6- LSB 2003XS (2) 89 cm/jh 6/ 22

S.F. 403 not to exceed five dollars per month. 1 b. As used in this section: 2 (1) “Master meter” means a single meter used in determining 3 the amount of water provided to a mobile home park. 4 (2) “Mobile home park” means the same as defined in section 5 562B.7 and also includes a “manufactured home community” , as 6 defined in section 562B.7. 7 (3) “Piped distribution system” includes a submetered 8 distribution system. 9 (4) “Tenant” means the same as defined in section 562B.7. 10 (5) “Water utility” means a public utility as defined in 11 section 476.1 that furnishes water by a piped distribution 12 system to the public for compensation. 13 3. Water service furnished by a mobile home park that does 14 not engage in the sale of water service. For purposes of this 15 subsection, a mobile home park does not engage in the sale of 16 water service if all of the following apply: 17 a. The water service is not furnished to tenants for a 18 separately itemized price. 19 b. The water service is not otherwise identifiable from 20 an invoice, bill, catalogue, price list, rate card, receipt, 21 agreement, or other similar document, including where the total 22 sales price increases when water service is included in the 23 sale to tenants. 24 c. The water service is incidental to the rental of real 25 property. 26 Sec. 21. Section 455B.171, subsection 26, Code 2021, is 27 amended to read as follows: 28 26. “Public water supply system” means , except as provided 29 in section 455B.200, a system for the provision to the public 30 of piped water for human consumption, if the system has at 31 least fifteen service connections or regularly serves at least 32 twenty-five individuals. The term includes any source of 33 water and any collection, treatment, storage, and distribution 34 facilities under control of the operator of the system and used 35 -7- LSB 2003XS (2) 89 cm/jh 7/ 22

S.F. 403 primarily in connection with the system, and any collection or 1 pretreatment storage facilities not under such control which 2 are used primarily in connection with the system. 3 Sec. 22. NEW SECTION . 455B.200 Mobile home parks. 4 1. As used in this section: 5 a. “Mobile home park” means the same as defined in section 6 423G.4. 7 b. “Tenant” means the same as defined in section 562B.7. 8 c. “Water utility” means a public utility as defined in 9 section 476.1 that furnishes water by a piped distribution 10 system to the public for compensation. 11 2. For purposes of this part 1, a mobile home park shall 12 not be considered a public water supply system if the mobile 13 home park sells or furnishes water to a tenant and all of the 14 following apply: 15 a. The water was obtained from a water utility prior to 16 selling or furnishing the water to a tenant. 17 b. The tenant is not charged more than the rate the tenant 18 would be charged for consuming or using water from the water 19 utility, plus an administrative fee under section 562B.16, 20 subsection 3, not to exceed five dollars per month. 21 Sec. 23. Section 562B.14, subsection 6, Code 2021, is 22 amended to read as follows: 23 6. The landlord or any person authorized to enter into 24 a rental agreement on the landlord’s behalf shall provide 25 a written explanation of utility rates, fees, charges , and 26 services , subject to section 562B.16, subsection 3, to the 27 prospective tenant before the rental agreement is signed unless 28 the utility charges are paid by the tenant directly to the 29 utility company. 30 Sec. 24. Section 562B.16, Code 2021, is amended by adding 31 the following new subsection: 32 NEW SUBSECTION . 3. A landlord that is responsible for 33 payment of utilities being provided to the tenant shall not 34 charge to the tenant an amount in excess of the actual cost of 35 -8- LSB 2003XS (2) 89 cm/jh 8/ 22

S.F. 403 the utility and as specified in writing under section 562B.14, 1 subsection 6. However, in addition to the actual cost of the 2 utility, a landlord that is responsible for the payment of one 3 or more utilities being provided to the tenant may impose a 4 monthly utility administration fee to each tenant not to exceed 5 five dollars per month. 6 Sec. 25. Section 562B.25, Code 2021, is amended by adding 7 the following new subsection: 8 NEW SUBSECTION . 2A. The failure of a tenant to pay utility 9 charges that exceed the actual cost of the utility provided 10 as required by section 562B.16, subsection 3, shall not be 11 considered noncompliance with the rental agreement. 12 DIVISION IX 13 UNLAWFUL OUSTER 14 Sec. 26. Section 562B.24, Code 2021, is amended to read as 15 follows: 16 562B.24 Tenant’s remedies for landlord’s unlawful ouster, 17 exclusion or diminution of services. 18 If the landlord unlawfully removes or excludes the tenant 19 from the manufactured home community or mobile home park or 20 willfully diminishes services to the tenant by interrupting 21 or causing the interruption of electric, gas, water , or 22 other essential service to the tenant, the tenant may recover 23 possession, require the restoration of essential services or 24 terminate the rental agreement and, in either case, recover an 25 amount not to exceed two months’ periodic rent , and twice the 26 actual damages sustained by the tenant , and reasonable attorney 27 fees . If the rental agreement is terminated, the landlord 28 shall return all prepaid rent and security. 29 Sec. 27. EFFECTIVE DATE. This division of this Act, being 30 deemed of immediate importance, takes effect upon enactment. 31 Sec. 28. APPLICABILITY. This division of this Act applies 32 to actions under section 562B.24 filed on or after the 33 effective date of this division of this Act. 34 DIVISION X 35 -9- LSB 2003XS (2) 89 cm/jh 9/ 22

S.F. 403 WRONGFUL FAILURE TO PROVIDE ESSENTIAL SERVICES 1 Sec. 29. NEW SECTION . 562B.23A Wrongful failure to supply 2 running water or essential services. 3 1. If contrary to the rental agreement or section 562B.16 4 the landlord deliberately or negligently fails to supply 5 running water or other essential services, the tenant may give 6 written notice to the landlord specifying the breach and may 7 do one of the following: 8 a. Procure reasonable amounts of water or other essential 9 services during the period of the landlord’s noncompliance and 10 deduct the actual and reasonable cost from the rent. 11 b. Recover damages based upon the diminution in the fair 12 market value of the mobile home space. 13 c. Recover any rent already paid for the period of the 14 landlord’s noncompliance which shall be reimbursed on a pro 15 rata basis. 16 2. If the tenant proceeds under this section, the tenant may 17 not proceed under section 562B.22 as to that breach. 18 3. The rights under this section do not arise until the 19 tenant has given notice to the landlord or if the condition was 20 caused by the deliberate or negligent act or omission of the 21 tenant, a member of the tenant’s family, or other person on the 22 premises with the consent of the tenant. 23 Sec. 30. EFFECTIVE DATE. This division of this Act, being 24 deemed of immediate importance, takes effect upon enactment. 25 Sec. 31. APPLICABILITY. This division of this Act applies 26 to actions under section 562B.23A filed on or after the 27 effective date of this division of this Act. 28 DIVISION XI 29 DENIAL OF RENTAL OR REFUSAL OF SALE 30 Sec. 32. Section 562B.19, subsection 3, paragraphs a and c, 31 Code 2021, are amended to read as follows: 32 a. Deny rental unless the tenant or prospective tenant 33 cannot conform to manufactured home community or park rules 34 and regulations. A decision to deny rental shall conform 35 -10- LSB 2003XS (2) 89 cm/jh 10/ 22

S.F. 403 to recognized principles, rules, and standards generally 1 accepted by the professional manufactured home community or 2 park industry to ensure the commercially reasonable safety and 3 financial security of comparable manufactured home communities 4 or mobile home parks. A landlord shall deliver the decision 5 in writing to the tenant or prospective tenant as soon as 6 commercially feasible and shall provide the basis for a denial 7 in writing to the tenant or prospective tenant at the time of 8 the decision. 9 c. Deny any resident of a manufactured home community 10 or mobile home park the right to sell that person’s mobile 11 home at a price of the person’s own choosing, but may reserve 12 the right to approve the purchaser of such mobile home as 13 a tenant but such permission shall only be withheld for a 14 legitimate business reason within the recognized principles, 15 rules, and standards described in paragraph “a” , and may not be 16 unreasonably withheld, provided however, that the landlord may, 17 in the event of a sale to a third party, in order to upgrade 18 the quality of the manufactured home community or mobile home 19 park, require that any mobile home in a rundown condition or in 20 disrepair be removed from the manufactured home community or 21 park within sixty days. If the landlord refuses to approve the 22 purchaser of the mobile home as a tenant, a legitimate business 23 reason for the refusal shall be provided in writing to the 24 resident who is selling the mobile home. 25 DIVISION XII 26 PROHIBITED RENTAL AGREEMENT PROVISION —— HOME EQUIPMENT 27 Sec. 33. Section 562B.11, subsection 1, Code 2021, is 28 amended by adding the following new paragraph: 29 NEW PARAGRAPH . e. Agrees to modify the mobile home, 30 manufactured home, or modular home in a way that would 31 substantially impair the ability of the tenant to move the 32 home from the mobile home space, unless such modification is 33 required by federal law, including but not limited to the 34 model manufactured home installation standards, 24 C.F.R. pt. 35 -11- LSB 2003XS (2) 89 cm/jh 11/ 22

S.F. 403 3285, the manufactured home construction and safety standards, 1 24 C.F.R. pt. 3280, or the manufactured home procedural and 2 enforcement regulations, 24 C.F.R. pt. 3282, or by state or 3 local law, the manufacturer’s installation instructions, any 4 requirement arising from the landlord’s financing of the home 5 or of the mobile home park or manufactured home community in 6 which the home is located, or unless such modification is 7 otherwise necessary for the safe and proper installation of the 8 home. 9 DIVISION XIII 10 RENTAL AGREEMENT TERMS 11 Sec. 34. Section 562B.11, subsection 1, Code 2021, is 12 amended by adding the following new paragraphs: 13 NEW PARAGRAPH . f. Authorizes imposition of fines, 14 penalties, or fees solely as a punishment or in amounts in 15 excess of actual damages or costs incurred. 16 NEW PARAGRAPH . g. Authorizes a person to confess judgment 17 on a claim arising out of the rental agreement. 18 NEW PARAGRAPH . h. Authorizes prohibitions, limitations, 19 additional deposits, or other restrictive policies that are 20 not based on ordinary wear and tear expected to occur during a 21 tenancy or that are not based on community safety standards. 22 Sec. 35. Section 562B.11, subsection 2, Code 2021, is 23 amended to read as follows: 24 2. A provision prohibited by subsection 1 included in a 25 rental agreement is unenforceable. If a landlord or tenant 26 knowingly and willfully uses a rental agreement containing 27 provisions known to be prohibited by this chapter , the other 28 party tenant may recover actual damages sustained by the tenant 29 and not more than three months’ periodic rent and reasonable 30 attorney fees . 31 DIVISION XIV 32 LANDLORD SALES 33 Sec. 36. NEW SECTION . 562B.17A Sale of mobile home by 34 landlord. 35 -12- LSB 2003XS (2) 89 cm/jh 12/ 22

S.F. 403 1. Any sale of a mobile home located in a manufactured 1 home community or mobile home park by a landlord or landlord’s 2 agent shall be by written agreement and the landlord shall 3 produce and assign the current certificate of title obtained 4 from the department of transportation. The agreement shall 5 state the basic terms of sale, including the total cost of 6 the mobile home, finance charges, annual percentage rate, and 7 the frequency and amount of each installment payment. Such 8 agreement shall comply with the finance charge rate limitation 9 in section 103A.58, subsection 1. 10 2. Any such sale that does not comply with this section 11 may be voided by the buyer and the buyer may recover damages 12 incurred, amounts paid as a rental deposit in excess of two 13 months’ rent for the mobile home, and reasonable attorney fees. 14 3. A claim under subsection 2 may be combined with an action 15 under chapter 648. 16 Sec. 37. Section 648.19, subsection 1, Code 2021, is amended 17 to read as follows: 18 1. An action under this chapter shall not be filed in 19 connection with any other action, with the exception of a claim 20 for rent or recovery as provided in section 555B.3 , 562A.24 , 21 562A.32 , 562B.17A, 562B.22 , 562B.25 , or 562B.27 , nor shall it 22 be made the subject of counterclaim. 23 DIVISION XV 24 NONJUDICIAL FORECLOSURE 25 Sec. 38. Section 654.18, Code 2021, is amended by adding the 26 following new subsection: 27 NEW SUBSECTION . 5. Actions under this section initiated 28 on or after July 1, 2021, shall not be allowed for property 29 consisting of a mobile home as defined in section 562B.7. 30 Sec. 39. Section 655A.9, Code 2021, is amended to read as 31 follows: 32 655A.9 Application of chapter. 33 1. This chapter does not apply to real estate used for 34 an agricultural purpose as defined in section 535.13 , or to 35 -13- LSB 2003XS (2) 89 cm/jh 13/ 22

S.F. 403 a one or two family dwelling which is, at the time of the 1 initiation of the foreclosure, occupied by a legal or equitable 2 titleholder. 3 2. Actions under this chapter initiated on or after July 1, 4 2021, shall not be allowed for property consisting of a mobile 5 home as defined in section 562B.7. 6 Sec. 40. EFFECTIVE DATE. This division of this Act, being 7 deemed of immediate importance, takes effect upon enactment. 8 DIVISION XVI 9 SALE OF MANUFACTURED HOME COMMUNITY OR MOBILE HOME PARK 10 Sec. 41. NEW SECTION . 562B.16A Sale of manufactured home 11 community or mobile home park —— notices. 12 1. If a landlord offers for sale all or a portion of the 13 manufactured home community or mobile home park, each current 14 tenant of the community or park shall be given notice of the 15 sale by certified mail not less than ninety days prior to the 16 sale. Each notice must include the name of the proposed buyer, 17 the business address and contact information of the proposed 18 buyer, the proposed date of the sale, and a summary of each 19 tenant’s rights under subsection 2. 20 2. Following the sale of all or a portion of the 21 manufactured home community or mobile home park and upon 22 renewal or extension of a tenancy in the manufactured home 23 community or mobile home park in effect at the time of 24 the sale, the landlord shall not change a term of a rental 25 agreement, excluding a rent increase governed by the notice 26 provision of section 562B.14, subsection 7, paragraph “a” , 27 for the renewed or extended term of the tenancy, unless the 28 tenant is notified in writing of the proposed change at least 29 ninety days prior to the effective date of the change and such 30 notice includes a summary of the tenant’s rights under this 31 subsection. 32 Sec. 42. APPLICABILITY. This division of this Act applies 33 to the sale of manufactured home communities and mobile home 34 parks occurring on or after July 1, 2021. 35 -14- LSB 2003XS (2) 89 cm/jh 14/ 22

S.F. 403 EXPLANATION 1 The inclusion of this explanation does not constitute agreement with 2 the explanation’s substance by the members of the general assembly. 3 This bill relates to property law by modifying provisions 4 relating to rental properties, manufactured home communities, 5 and mobile home parks, and modifying provisions governing 6 actions relating to such properties. 7 Division I of the bill amends Code section 562B.10 to provide 8 that a landlord may only terminate a tenancy if the tenant acts 9 in material noncompliance of the rental agreement, commits a 10 material violation of the manufactured home community or mobile 11 home park rules or regulations, or commits any other violation 12 of Code chapter 562B which allows the remedy of termination, 13 or for a legitimate and material business reason the impact 14 of which is not specific to one tenant or a change in the use 15 of the land if change in the use of the land is included in 16 the rental agreement as grounds for termination or nonrenewal. 17 A landlord may, upon providing 90-day written notice, elect 18 not to renew a tenancy for any reason. If a landlord presents 19 evidence of a written notice to a tenant on at least three 20 occasions and each notice is dated at least 10 days apart and 21 identifies a material noncompliance of the rental agreement, 22 a material violation of the manufactured home community or 23 mobile home park rules or regulations, or any other violation 24 of Code chapter 562B which allows the remedy of termination, 25 such evidence creates a presumption of the existence of the 26 condition unless and until other evidence is introduced which 27 would support otherwise. 28 Division I of the bill takes effect upon enactment and 29 applies to terminations of tenancies on or after the effective 30 date of the division of the bill. 31 Code section 562B.32(1) generally provides that a landlord 32 shall not retaliate by increasing rent or decreasing services 33 or by bringing or threatening to bring an action for possession 34 or by failing to renew a rental agreement after the exercise or 35 -15- LSB 2003XS (2) 89 cm/jh 15/ 22

S.F. 403 assertion of several specified rights and remedies. Division 1 II of the bill adds the exercise of any of the rights and 2 remedies under Code chapter 216 (Iowa civil rights Act of 1965) 3 to that enumerated list. 4 Current law provides that evidence of a complaint within 5 six months prior to the alleged act of retaliation creates a 6 presumption that the landlord’s conduct was in retaliation. 7 Division II of the bill changes that period of presumption from 8 six months to one year. 9 Division II of the bill takes effect upon enactment. 10 Division III of the bill provides that a violation of Code 11 chapter 562B by a landlord or the landlord’s agent is an 12 unlawful practice under Code section 714.16, governing consumer 13 frauds. Division III takes effect upon enactment and applies 14 to violations of Code chapter 562B occurring on or after the 15 effective date of the division. 16 Division IV of the bill modifies provisions governing an 17 increase in the amount of rent paid by a tenant. The bill 18 prohibits a landlord from increasing the amount of rent unless 19 the tenant is notified, in writing, of the rent increase at 20 least 120 days before the effective date of the rent increase. 21 The bill further provides that the effective date of any 22 increase in the amount of rent shall not be less than one year 23 from either the effective date of the most recent rent increase 24 or the beginning of the tenancy, whichever is later. 25 The bill also specifies that a decrease in the number or 26 quality of amenities, services, or utilities provided under 27 the rental agreement without a corresponding and proportionate 28 reduction in rent shall be considered a rent increase for the 29 purposes of the Code chapter. 30 Division IV of the bill takes effect upon enactment. 31 Division V of the bill amends Code section 16.45, which 32 creates the manufactured housing program fund for the purpose 33 of providing funding to financial institutions or other 34 lenders to finance the purchase by an individual of a compliant 35 -16- LSB 2003XS (2) 89 cm/jh 16/ 22

S.F. 403 manufactured home. The bill strikes language providing that 1 the manufactured housing program fund is designed exclusively 2 for manufactured homes sited on leased land. 3 Division VI of the bill amends Code section 562B.25 4 relating to actions by a landlord for noncompliance with a 5 rental agreement by a tenant or failure to pay rent. The 6 bill establishes authority and procedures similar to those 7 under Code section 562A.24 (uniform residential landlord and 8 tenant Act) where in the case of a landlord’s action for 9 possession based upon nonpayment of the rent or in an action 10 for rent where the tenant is in possession, the tenant may 11 counterclaim for an amount which the tenant may recover under 12 the rental agreement or Code chapter 562B. In the event of 13 such a counterclaim, the court from time to time may order the 14 tenant to pay into court all or part of the rent accrued and 15 thereafter accruing, and shall determine the amount due to each 16 party. The party to whom a net amount is owed shall be paid 17 first from the money paid into court, and the balance by the 18 other party. If rent does not remain due after application 19 of the Code section, judgment shall be entered for the tenant 20 in the action for possession. If the defense or counterclaim 21 by the tenant is without merit and is not raised in good 22 faith, the landlord may recover reasonable attorney fees. 23 Additionally, in an action for rent where the tenant is not in 24 possession, the tenant may counterclaim but is not required to 25 pay any rent into court. 26 Division VI of the bill takes effect upon enactment and 27 applies to actions for possession filed on or after the 28 effective date of the division of the bill. 29 Division VII provides that if a landlord obtains a utility 30 service from a utility provider and furnishes that utility to 31 the tenant and the utility provider increases the charge or 32 rate to the landlord, the landlord may increase the charge or 33 rate to the tenant after providing the tenant a 30-day written 34 notice. If the landlord does not receive a 60-day prior notice 35 -17- LSB 2003XS (2) 89 cm/jh 17/ 22

S.F. 403 of a rate increase from the utility provider, the landlord is 1 not required to provide the tenant with a written notice of the 2 rate increase to be effective. 3 Division VIII of the bill provides that water service 4 furnished by a mobile home park that does not sell water 5 service is exempt from the sales tax if all of the following 6 apply: the water is not provided to tenants for a separately 7 itemized price, the water service is not otherwise identifiable 8 from an invoice, bill, catalogue, price list, rate card, 9 receipt, agreement, or other similar document, or the water 10 service, and the water service is incidental to the rental of 11 real property. Division VIII of the bill defines “mobile home 12 park” to mean the same as defined in Code section 562B.7. 13 Division VIII of the bill provides exemptions to Code 14 chapter 423G (water service tax), which include the sales 15 price from transactions exempt from state sales tax under Code 16 section 423.3. However, sales exempt pursuant to Code section 17 423.3(103) are not exempt except as provided for in Code 18 section 423G.4(2) or (3). Code section 423G.4(2) provides the 19 sales price from the sale or furnishing of water by a mobile 20 home provider to a tenant is exempt if all of the following 21 apply: the water was obtained from a water utility, a tax was 22 imposed by Code chapter 423 on the sales price from the sale or 23 furnishing of water by a water utility to the mobile home park, 24 and the tenant is not charged for water by the mobile home park 25 in an amount that is more than the rate the tenant would be 26 charged for consuming or using water from the water utility, 27 plus the administration fee not to exceed $5 per month. Code 28 section 423G.4(3) provides that water furnished by a mobile 29 home park that does not engage in the sale of the water service 30 is exempt if the water service is not furnished to tenants for 31 a separately itemized price, the water service is not otherwise 32 identifiable from an invoice, bill, catalogue, price list, rate 33 card, receipt, agreement, or other similar document, and the 34 water is incidental to the rental of real property. 35 -18- LSB 2003XS (2) 89 cm/jh 18/ 22