SF 403 (LSB 2003XS (2) 89)

SENATE FILE 403

BY  KOELKER

(COMPANION TO HF 442 BY LOHSE)

A BILL FOR

An Act relating to property law by modifying provisions relating to rental properties, manufactured home communities, mobile home parks, and manufactured mobile home communities, modifying provisions governing actions relating to such properties, making penalties applicable, and including effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I
GROUNDS FOR TERMINATION OF TENANCY

    Section 1.  Section 562B.10, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  4A.  a.  A landlord may only terminate a tenancy if the tenant engages in any of the following or for any of the following reasons:
   (1)  A material noncompliance with the rental agreement.
   (2)  A material violation of the manufactured home community or mobile home park rules or regulations.
   (3)  Any other violation of this chapter for which termination is a remedy.
   (4)  A legitimate and material business reason the impact of which is not specific to one tenant.
   (5)  A change in the use of the land if change in the use of the land is included in the rental agreement as grounds for termination or nonrenewal.
   b.  A landlord may, upon providing ninety-day prior written notice, elect to not renew a tenancy for any reason not otherwise prohibited by law.
   c.  If the landlord presents evidence of written notice to a tenant on at least three occasions, each notice dated not less than ten days apart, of a condition identified in paragraph “a”, subparagraph (1), (2), or (3), such evidence creates a presumption of the existence of the condition unless and until evidence is introduced which would support a finding of the condition’s nonexistence.
    Sec. 2.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 3.  APPLICABILITY.  This division of this Act applies to landlord decisions to not renew tenancies on or after the effective date of this division of this Act.
DIVISION II
RETALIATION

    Sec. 4.  Section 562B.32, subsection 1, paragraph d, Code 2021, is amended to read as follows:
   d.  For exercising any of the rights and remedies pursuant to this chapter or chapter 216.
    Sec. 5.  Section 562B.32, subsection 2, Code 2021, is amended to read as follows:
   2.  If the landlord acts in violation of subsection 1 of this section, the tenant is entitled to the remedies provided in section 562B.24 and has a defense in an action for possession. In an action by or against the tenant, evidence of a complaint within six months one year prior to the alleged act of retaliation creates a presumption that the landlord’s conduct was in retaliation. The presumption does not arise if the tenant made the complaint after notice of termination of the rental agreement. For the purpose of this subsection, “presumption” means that the trier of fact must find the existence of the fact presumed unless and until evidence is introduced which would support a finding of its nonexistence.
    Sec. 6.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
DIVISION III
CONSUMER FRAUD

    Sec. 7.  Section 562B.4, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  3.  A violation of this chapter by a landlord, or an agent of the landlord, is an unlawful practice under section 714.16.
    Sec. 8.  Section 714.16, subsection 2, Code 2021, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  q.  It is an unlawful practice for a landlord or the landlord’s agent to violate any of the provisions of chapter 562B.
    Sec. 9.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 10.  APPLICABILITY.  This division of this Act applies to violations of chapter 562B occurring on or after the effective date of this division of this Act.
DIVISION IV
RENT INCREASES

    Sec. 11.  Section 562B.14, subsection 7, Code 2021, is amended by striking the subsection and inserting in lieu thereof the following:
   7.  a.  A landlord shall not increase the amount of rent due by any tenant in a manufactured home community or mobile home park unless the tenant is notified, in writing, of the rent increase at least one hundred twenty days before the effective date of the rent increase. The effective date of any increase in the amount of rent shall not be less than one year after either the effective date of the most recent rent increase or the beginning of the tenancy, whichever is later.
   b.  A decrease in the number or quality of amenities, services, or utilities provided under the rental agreement without a corresponding and proportionate reduction in rent shall be considered a rent increase for the purposes of this chapter.
    Sec. 12.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 13.  APPLICABILITY.  This division of this Act applies to rent increases under chapter 562B occurring on or after the effective date of this division of this Act.
DIVISION V
MANUFACTURED HOUSING PROGRAM FUND

    Sec. 14.  Section 16.45, subsection 1, Code 2021, is amended to read as follows:
   1.  A manufactured housing program fund is created within the authority to further the goal of providing affordable housing to Iowans. The moneys in the fund are to be used for the purpose of providing funding to financial institutions or other lenders to finance the purchase by an individual of a manufactured home that is in compliance with all laws, rules, and standards that are applicable to manufactured homes and manufactured housing. The manufactured housing program fund is designed exclusively for manufactured homes sited on leased land.
DIVISION VI
TENANT COUNTERCLAIM FOR LANDLORD NONCOMPLIANCE

    Sec. 15.  Section 562B.25, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  5.  a.  In an action for possession based upon nonpayment of the rent or in an action for rent where the tenant is in possession, the tenant may counterclaim for an amount which the tenant may recover under the rental agreement or this chapter. In that event, the court from time to time may order the tenant to pay into court all or part of the rent accrued and thereafter accruing, and shall determine the amount due to each party. The party to whom a net amount is owed shall be paid first from the money paid into court, and the balance by the other party. If rent does not remain due after application of this section, judgment shall be entered for the tenant in the action for possession. If the defense or counterclaim by the tenant is without merit and is not raised in good faith, the landlord may recover reasonable attorney fees.
   b.  In an action for rent where the tenant is not in possession, the tenant may counterclaim as provided in paragraph “a”, but the tenant is not required to pay any rent into court.
    Sec. 16.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 17.  APPLICABILITY.  This division of this Act applies to actions for possession filed on or after the effective date of this division of this Act.
DIVISION VII
DISCLOSURE OF UTILITY CHARGES

    Sec. 18.  Section 562B.14, subsection 6, Code 2021, is amended to read as follows:
   6.  a.  The landlord or any person authorized to enter into a rental agreement on the landlord’s behalf shall provide a written explanation of utility rates, charges and services to the prospective tenant before the rental agreement is signed unless the utility charges are paid by the tenant directly to the utility company.
   b.  If a landlord obtains a utility service from a utility provider and furnishes the utility to the tenant and the landlord’s charge to the tenant is based upon the utility provider’s charge or rate for the use of such utility to consumers, an increase in the landlord’s charge to a tenant for the utility that corresponds to the same increase in the utility provider’s charge or rate to the landlord shall be effective thirty days after the landlord provides written notice of such increase to the tenant, unless the landlord does not receive at least sixty days’ prior notice of such increase from the utility provider in which case no prior notice of the increase from the landlord to the tenant is required for the increase to be effective.
DIVISION VIII
FURNISHING OF WATER AND UTILITY CHARGES

    Sec. 19.  Section 423.3, subsection 103, Code 2021, is amended to read as follows:
   103.  a.  (1)  The sales price from the sale or furnishing by a water utility of a water service in the state to consumers or users. 
   (2)  Water service furnished by a mobile home park that does not engage in the sale of water service. For purposes of this subsection, a mobile home park does not engage in the sale of water service if all of the following apply:
   (a)  The water service is not furnished to tenants for a separately itemized price.
   (b)  The water service is not otherwise identifiable from an invoice, bill, catalogue, price list, rate card, receipt, agreement, or other similar document, including where the total sales price increases when water service is included in the sale to tenants.
   (c)  The water service is incidental to the rental of real property.
   b.  For purposes of this subsection: 
   (1)  “Mobile home park” means the same as defined in section 562B.7.
   (1)  (2)  “Water service” means the delivery of water by piped distribution system.
   (2)  (3)  “Water utility” means a public utility as defined in section 476.1 that furnishes water by piped distribution system to the public for compensation.
    Sec. 20.  Section 423G.4, Code 2021, is amended by striking the section and inserting in lieu thereof the following:
   423G.4  Exemptions.
   There is exempted from the tax imposed by this chapter the following:
   1.  The sales price from transactions exempt from state sales tax under section 423.3. However, the sales price from transactions exempt from state sales tax under section 423.3, subsection 103, shall not be exempt unless as provided in subsection 2 or 3.
   2.  a.  The sales price from the sale or furnishing of water by a mobile home park through a piped distribution system maintained by the mobile home park, to a consumer or user of water who is a tenant, if all of the following apply:
   (1)  The water was obtained from a water utility.
   (2)  A tax was imposed by this chapter on the sales price from the sale or furnishing of water by a water utility to the mobile home park based upon readings of the master meter of the mobile home park.
   (3)  The tenant is not charged for water by the mobile home park in an amount that is more than the rate the tenant would be charged for consuming or using water from the water utility, plus an administrative fee under section 562B.16, subsection 3, not to exceed five dollars per month.
   b.  As used in this section: 
   (1)  “Master meter” means a single meter used in determining the amount of water provided to a mobile home park.
   (2)  “Mobile home park” means the same as defined in section 562B.7 and also includes a “manufactured home community”, as defined in section 562B.7.
   (3)  “Piped distribution system” includes a submetered distribution system.
   (4)  “Tenant” means the same as defined in section 562B.7.
   (5)  “Water utility” means a public utility as defined in section 476.1 that furnishes water by a piped distribution system to the public for compensation.
   3.  Water service furnished by a mobile home park that does not engage in the sale of water service. For purposes of this subsection, a mobile home park does not engage in the sale of water service if all of the following apply:
   a.  The water service is not furnished to tenants for a separately itemized price.
   b.  The water service is not otherwise identifiable from an invoice, bill, catalogue, price list, rate card, receipt, agreement, or other similar document, including where the total sales price increases when water service is included in the sale to tenants.
   c.  The water service is incidental to the rental of real property.
    Sec. 21.  Section 455B.171, subsection 26, Code 2021, is amended to read as follows:
   26.  “Public water supply system” means, except as provided in section 455B.200, a system for the provision to the public of piped water for human consumption, if the system has at least fifteen service connections or regularly serves at least twenty-five individuals. The term includes any source of water and any collection, treatment, storage, and distribution facilities under control of the operator of the system and used primarily in connection with the system, and any collection or pretreatment storage facilities not under such control which are used primarily in connection with the system.
    Sec. 22.  NEW SECTION.  455B.200  Mobile home parks.
   1.  As used in this section:
   a.  “Mobile home park” means the same as defined in section 423G.4.
   b.  “Tenant” means the same as defined in section 562B.7.
   c.  “Water utility” means a public utility as defined in section 476.1 that furnishes water by a piped distribution system to the public for compensation.
   2.  For purposes of this part 1, a mobile home park shall not be considered a public water supply system if the mobile home park sells or furnishes water to a tenant and all of the following apply:
   a.  The water was obtained from a water utility prior to selling or furnishing the water to a tenant.
   b.  The tenant is not charged more than the rate the tenant would be charged for consuming or using water from the water utility, plus an administrative fee under section 562B.16, subsection 3, not to exceed five dollars per month.
    Sec. 23.  Section 562B.14, subsection 6, Code 2021, is amended to read as follows:
   6.  The landlord or any person authorized to enter into a rental agreement on the landlord’s behalf shall provide a written explanation of utility rates, fees, charges, and services, subject to section 562B.16, subsection 3, to the prospective tenant before the rental agreement is signed unless the utility charges are paid by the tenant directly to the utility company.
    Sec. 24.  Section 562B.16, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  3.  A landlord that is responsible for payment of utilities being provided to the tenant shall not charge to the tenant an amount in excess of the actual cost of the utility and as specified in writing under section 562B.14, subsection 6. However, in addition to the actual cost of the utility, a landlord that is responsible for the payment of one or more utilities being provided to the tenant may impose a monthly utility administration fee to each tenant not to exceed five dollars per month.
    Sec. 25.  Section 562B.25, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  2A.  The failure of a tenant to pay utility charges that exceed the actual cost of the utility provided as required by section 562B.16, subsection 3, shall not be considered noncompliance with the rental agreement.
DIVISION IX
UNLAWFUL OUSTER

    Sec. 26.  Section 562B.24, Code 2021, is amended to read as follows:
   562B.24  Tenant’s remedies for landlord’s unlawful ouster, exclusion or diminution of services.
   If the landlord unlawfully removes or excludes the tenant from the manufactured home community or mobile home park or willfully diminishes services to the tenant by interrupting or causing the interruption of electric, gas, water, or other essential service to the tenant, the tenant may recover possession, require the restoration of essential services or terminate the rental agreement and, in either case, recover an amount not to exceed two months’ periodic rent, and twice the actual damages sustained by the tenant, and reasonable attorney fees.  If the rental agreement is terminated, the landlord shall return all prepaid rent and security.
    Sec. 27.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 28.  APPLICABILITY.  This division of this Act applies to actions under section 562B.24 filed on or after the effective date of this division of this Act.
DIVISION X
WRONGFUL FAILURE TO PROVIDE ESSENTIAL SERVICES

    Sec. 29.  NEW SECTION.  562B.23A  Wrongful failure to supply running water or essential services.
   1.  If contrary to the rental agreement or section 562B.16 the landlord deliberately or negligently fails to supply running water or other essential services, the tenant may give written notice to the landlord specifying the breach and may do one of the following:
   a.  Procure reasonable amounts of water or other essential services during the period of the landlord’s noncompliance and deduct the actual and reasonable cost from the rent.
   b.  Recover damages based upon the diminution in the fair market value of the mobile home space.
   c.  Recover any rent already paid for the period of the landlord’s noncompliance which shall be reimbursed on a pro rata basis.
   2.  If the tenant proceeds under this section, the tenant may not proceed under section 562B.22 as to that breach.
   3.  The rights under this section do not arise until the tenant has given notice to the landlord or if the condition was caused by the deliberate or negligent act or omission of the tenant, a member of the tenant’s family, or other person on the premises with the consent of the tenant.
    Sec. 30.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 31.  APPLICABILITY.  This division of this Act applies to actions under section 562B.23A filed on or after the effective date of this division of this Act.
DIVISION XI
DENIAL OF RENTAL OR REFUSAL OF SALE

    Sec. 32.  Section 562B.19, subsection 3, paragraphs a and c, Code 2021, are amended to read as follows:
   a.  Deny rental unless the tenant or prospective tenant cannot conform to manufactured home community or park rules and regulations.  A decision to deny rental shall conform to recognized principles, rules, and standards generally accepted by the professional manufactured home community or park industry to ensure the commercially reasonable safety and financial security of comparable manufactured home communities or mobile home parks. A landlord shall deliver the decision in writing to the tenant or prospective tenant as soon as commercially feasible and shall provide the basis for a denial in writing to the tenant or prospective tenant at the time of the decision.
   c.  Deny any resident of a manufactured home community or mobile home park the right to sell that person’s mobile home at a price of the person’s own choosing, but may reserve the right to approve the purchaser of such mobile home as a tenant but such permission shall only be withheld for a legitimate business reason within the recognized principles, rules, and standards described in paragraph “a”, and may not be unreasonably withheld, provided however, that the landlord may, in the event of a sale to a third party, in order to upgrade the quality of the manufactured home community or mobile home park, require that any mobile home in a rundown condition or in disrepair be removed from the manufactured home community or park within sixty days.  If the landlord refuses to approve the purchaser of the mobile home as a tenant, a legitimate business reason for the refusal shall be provided in writing to the resident who is selling the mobile home.
DIVISION XII
PROHIBITED RENTAL AGREEMENT PROVISION —— HOME EQUIPMENT

    Sec. 33.  Section 562B.11, subsection 1, Code 2021, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  e.  Agrees to modify the mobile home, manufactured home, or modular home in a way that would substantially impair the ability of the tenant to move the home from the mobile home space, unless such modification is required by federal law, including but not limited to the model manufactured home installation standards, 24 C.F.R. pt. 3285, the manufactured home construction and safety standards, 24 C.F.R. pt. 3280, or the manufactured home procedural and enforcement regulations, 24 C.F.R. pt. 3282, or by state or local law, the manufacturer’s installation instructions, any requirement arising from the landlord’s financing of the home or of the mobile home park or manufactured home community in which the home is located, or unless such modification is otherwise necessary for the safe and proper installation of the home.
DIVISION XIII
RENTAL AGREEMENT TERMS

    Sec. 34.  Section 562B.11, subsection 1, Code 2021, is amended by adding the following new paragraphs:
   NEW PARAGRAPH.  f.  Authorizes imposition of fines, penalties, or fees solely as a punishment or in amounts in excess of actual damages or costs incurred.
   NEW PARAGRAPH.  g.  Authorizes a person to confess judgment on a claim arising out of the rental agreement.
   NEW PARAGRAPH.  h.  Authorizes prohibitions, limitations, additional deposits, or other restrictive policies that are not based on ordinary wear and tear expected to occur during a tenancy or that are not based on community safety standards.
    Sec. 35.  Section 562B.11, subsection 2, Code 2021, is amended to read as follows:
   2.  A provision prohibited by subsection 1 included in a rental agreement is unenforceable. If a landlord or tenant knowingly and willfully uses a rental agreement containing provisions known to be prohibited by this chapter, the other party tenant may recover actual damages sustained by the tenant and not more than three months’ periodic rent and reasonable attorney fees.
DIVISION XIV
LANDLORD SALES

    Sec. 36.  NEW SECTION.  562B.17A  Sale of mobile home by landlord.
   1.  Any sale of a mobile home located in a manufactured home community or mobile home park by a landlord or landlord’s agent shall be by written agreement and the landlord shall produce and assign the current certificate of title obtained from the department of transportation. The agreement shall state the basic terms of sale, including the total cost of the mobile home, finance charges, annual percentage rate, and the frequency and amount of each installment payment. Such agreement shall comply with the finance charge rate limitation in section 103A.58, subsection 1.
   2.  Any such sale that does not comply with this section may be voided by the buyer and the buyer may recover damages incurred, amounts paid as a rental deposit in excess of two months’ rent for the mobile home, and reasonable attorney fees.
   3.  A claim under subsection 2 may be combined with an action under chapter 648.
    Sec. 37.  Section 648.19, subsection 1, Code 2021, is amended to read as follows:
   1.  An action under this chapter shall not be filed in connection with any other action, with the exception of a claim for rent or recovery as provided in section 555B.3, 562A.24, 562A.32, 562B.17A, 562B.22, 562B.25, or 562B.27, nor shall it be made the subject of counterclaim.
DIVISION XV
NONJUDICIAL FORECLOSURE

    Sec. 38.  Section 654.18, Code 2021, is amended by adding the following new subsection:
   NEW SUBSECTION.  5.  Actions under this section initiated on or after July 1, 2021, shall not be allowed for property consisting of a mobile home as defined in section 562B.7.
    Sec. 39.  Section 655A.9, Code 2021, is amended to read as follows:
   655A.9  Application of chapter.
   1.  This chapter does not apply to real estate used for an agricultural purpose as defined in section 535.13, or to a one or two family dwelling which is, at the time of the initiation of the foreclosure, occupied by a legal or equitable titleholder.
   2.  Actions under this chapter initiated on or after July 1, 2021, shall not be allowed for property consisting of a mobile home as defined in section 562B.7.
    Sec. 40.  EFFECTIVE DATE.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
DIVISION XVI
SALE OF MANUFACTURED HOME COMMUNITY OR MOBILE HOME PARK

    Sec. 41.  NEW SECTION.  562B.16A  Sale of manufactured home community or mobile home park —— notices.
   1.  If a landlord offers for sale all or a portion of the manufactured home community or mobile home park, each current tenant of the community or park shall be given notice of the sale by certified mail not less than ninety days prior to the sale. Each notice must include the name of the proposed buyer, the business address and contact information of the proposed buyer, the proposed date of the sale, and a summary of each tenant’s rights under subsection 2.
   2.  Following the sale of all or a portion of the manufactured home community or mobile home park and upon renewal or extension of a tenancy in the manufactured home community or mobile home park in effect at the time of the sale, the landlord shall not change a term of a rental agreement, excluding a rent increase governed by the notice provision of section 562B.14, subsection 7, paragraph “a”, for the renewed or extended term of the tenancy, unless the tenant is notified in writing of the proposed change at least ninety days prior to the effective date of the change and such notice includes a summary of the tenant’s rights under this subsection.
    Sec. 42.  APPLICABILITY.  This division of this Act applies to the sale of manufactured home communities and mobile home parks occurring on or after July 1, 2021.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to property law by modifying provisions relating to rental properties, manufactured home communities, and mobile home parks, and modifying provisions governing actions relating to such properties.
   Division I of the bill amends Code section 562B.10 to provide that a landlord may only terminate a tenancy if the tenant acts in material noncompliance of the rental agreement, commits a material violation of the manufactured home community or mobile home park rules or regulations, or commits any other violation of Code chapter 562B which allows the remedy of termination, or for a legitimate and material business reason the impact of which is not specific to one tenant or a change in the use of the land if change in the use of the land is included in the rental agreement as grounds for termination or nonrenewal. A landlord may, upon providing 90-day written notice, elect not to renew a tenancy for any reason. If a landlord presents evidence of a written notice to a tenant on at least three occasions and each notice is dated at least 10 days apart and identifies a material noncompliance of the rental agreement, a material violation of the manufactured home community or mobile home park rules or regulations, or any other violation of Code chapter 562B which allows the remedy of termination, such evidence creates a presumption of the existence of the condition unless and until other evidence is introduced which would support otherwise.
   Division I of the bill takes effect upon enactment and applies to terminations of tenancies on or after the effective date of the division of the bill.
   Code section 562B.32(1) generally provides that a landlord shall not retaliate by increasing rent or decreasing services or by bringing or threatening to bring an action for possession or by failing to renew a rental agreement after the exercise or assertion of several specified rights and remedies. Division II of the bill adds the exercise of any of the rights and remedies under Code chapter 216 (Iowa civil rights Act of 1965) to that enumerated list.
   Current law provides that evidence of a complaint within six months prior to the alleged act of retaliation creates a presumption that the landlord’s conduct was in retaliation. Division II of the bill changes that period of presumption from six months to one year.
   Division II of the bill takes effect upon enactment.
   Division III of the bill provides that a violation of Code chapter 562B by a landlord or the landlord’s agent is an unlawful practice under Code section 714.16, governing consumer frauds. Division III takes effect upon enactment and applies to violations of Code chapter 562B occurring on or after the effective date of the division.
   Division IV of the bill modifies provisions governing an increase in the amount of rent paid by a tenant. The bill prohibits a landlord from increasing the amount of rent unless the tenant is notified, in writing, of the rent increase at least 120 days before the effective date of the rent increase. The bill further provides that the effective date of any increase in the amount of rent shall not be less than one year from either the effective date of the most recent rent increase or the beginning of the tenancy, whichever is later.
   The bill also specifies that a decrease in the number or quality of amenities, services, or utilities provided under the rental agreement without a corresponding and proportionate reduction in rent shall be considered a rent increase for the purposes of the Code chapter.
   Division IV of the bill takes effect upon enactment.
   Division V of the bill amends Code section 16.45, which creates the manufactured housing program fund for the purpose of providing funding to financial institutions or other lenders to finance the purchase by an individual of a compliant manufactured home. The bill strikes language providing that the manufactured housing program fund is designed exclusively for manufactured homes sited on leased land.
   Division VI of the bill amends Code section 562B.25 relating to actions by a landlord for noncompliance with a rental agreement by a tenant or failure to pay rent. The bill establishes authority and procedures similar to those under Code section 562A.24 (uniform residential landlord and tenant Act) where in the case of a landlord’s action for possession based upon nonpayment of the rent or in an action for rent where the tenant is in possession, the tenant may counterclaim for an amount which the tenant may recover under the rental agreement or Code chapter 562B. In the event of such a counterclaim, the court from time to time may order the tenant to pay into court all or part of the rent accrued and thereafter accruing, and shall determine the amount due to each party. The party to whom a net amount is owed shall be paid first from the money paid into court, and the balance by the other party. If rent does not remain due after application of the Code section, judgment shall be entered for the tenant in the action for possession. If the defense or counterclaim by the tenant is without merit and is not raised in good faith, the landlord may recover reasonable attorney fees. Additionally, in an action for rent where the tenant is not in possession, the tenant may counterclaim but is not required to pay any rent into court.
   Division VI of the bill takes effect upon enactment and applies to actions for possession filed on or after the effective date of the division of the bill.
   Division VII provides that if a landlord obtains a utility service from a utility provider and furnishes that utility to the tenant and the utility provider increases the charge or rate to the landlord, the landlord may increase the charge or rate to the tenant after providing the tenant a 30-day written notice. If the landlord does not receive a 60-day prior notice of a rate increase from the utility provider, the landlord is not required to provide the tenant with a written notice of the rate increase to be effective.
   Division VIII of the bill provides that water service furnished by a mobile home park that does not sell water service is exempt from the sales tax if all of the following apply: the water is not provided to tenants for a separately itemized price, the water service is not otherwise identifiable from an invoice, bill, catalogue, price list, rate card, receipt, agreement, or other similar document, or the water service, and the water service is incidental to the rental of real property. Division VIII of the bill defines “mobile home park” to mean the same as defined in Code section 562B.7.
   Division VIII of the bill provides exemptions to Code chapter 423G (water service tax), which include the sales price from transactions exempt from state sales tax under Code section 423.3. However, sales exempt pursuant to Code section 423.3(103) are not exempt except as provided for in Code section 423G.4(2) or (3). Code section 423G.4(2) provides the sales price from the sale or furnishing of water by a mobile home provider to a tenant is exempt if all of the following apply: the water was obtained from a water utility, a tax was imposed by Code chapter 423 on the sales price from the sale or furnishing of water by a water utility to the mobile home park, and the tenant is not charged for water by the mobile home park in an amount that is more than the rate the tenant would be charged for consuming or using water from the water utility, plus the administration fee not to exceed $5 per month. Code section 423G.4(3) provides that water furnished by a mobile home park that does not engage in the sale of the water service is exempt if the water service is not furnished to tenants for a separately itemized price, the water service is not otherwise identifiable from an invoice, bill, catalogue, price list, rate card, receipt, agreement, or other similar document, and the water is incidental to the rental of real property.
   Division VIII of the bill provides that a mobile home park shall not be considered a public water supply system if the mobile home park sells or furnishes water to a tenant and that the water was obtained from a water utility prior to selling or furnishing the water to a tenant and the tenant is not charged more than the rate the tenant would be charged for consuming or using water from the water utility, plus an administrative fee not to exceed $5 a month.
   Division VIII of the bill provides that a landlord that is responsible for payment of utilities being provided to the tenant shall not charge to the tenant an amount in excess of the actual cost of the utility and the failure of a tenant to pay utility charges that exceed the actual cost of the utility provided shall not be considered noncompliance with the rental agreement. In addition to the actual cost of the utility, the bill authorizes a landlord that is responsible for the payment of one or more utilities being provided to the tenant to impose a monthly utility administration fee to each tenant not to exceed $5 per month. The amount of the utility administration fee may not exceed $5 per month regardless of the number of utilities being provided or the actual cost of the utilities being provided.
   Division IX of the bill amends Code section 562B.24 relating to a tenant’s remedies for a landlord’s unlawful ouster or exclusion or diminution of services. The bill adds reasonable attorney fees to the list of recoverable damages and provides that if the rental agreement is terminated, the landlord shall return all prepaid rent and security.
   Division IX of the bill takes effect upon enactment and applies to actions under Code section 562B.24 filed on or after the effective date of the division of the bill.
   Division X of the bill provides that if contrary to the rental agreement or Code section 562B.16 the landlord deliberately or negligently fails to supply running water or other essential services, the tenant may give written notice to the landlord specifying the breach and may do one of the following: (1) procure reasonable amounts of water or the essential service during the period of the landlord’s noncompliance and deduct the actual and reasonable cost from the rent; (2) recover damages based upon the diminution in the fair market value of the mobile home or mobile home space; or (3) recover any rent already paid for the period of the landlord’s noncompliance which shall be reimbursed on a pro rata basis.
   Division X of the bill takes effect upon enactment and applies to actions under Code section 562B.23A filed on or after the effective date of the division of the bill.
   Code section 562B.19(3)(a) prohibits a landlord from denying rental unless the tenant or prospective tenant cannot conform to manufactured home community or park rules and regulations. Division XI requires any such decision to conform to recognized principles, rules, and standards generally accepted by the professional manufactured home community or park industry to ensure the commercially reasonable safety and financial security of comparable manufactured home communities or parks. Division XI also requires a landlord to deliver the decision in writing to the tenant or prospective tenant as soon as commercially feasible and shall provide the basis for a denial in writing to the tenant or prospective tenant at the time of the decision.
   Code section 562B.19(3)(c) prohibits a landlord from denying any resident of a manufactured home community or mobile home park the right to sell that person’s mobile home at a price of the person’s own choosing, but provides that the landlord has the right to approve the purchaser of such mobile home as a tenant but such permission may not be unreasonably withheld. Division XI allows such permission to be withheld only for a legitimate business reason within the recognized principles, rules, and standards accepted by the industry. If the landlord refuses to approve the purchaser of the mobile home as a tenant, a legitimate business reason for the refusal shall be provided in writing to the resident who is selling the mobile home.
   Division XII of the bill adds to the list of prohibited rental agreement provisions in Code section 562B.11 a provision requiring agreement to modify the physical characteristics or equipment of the mobile home, manufactured home, or modular home if such modification impairs the ability of the tenant to move the home, unless otherwise required by law or local ordinance.
   Division XIII of the bill prohibits rental agreements under Code chapter 562B from providing that the tenant or landlord does any of the following: (1) authorizing a person to confess judgment on a claim arising out of the rental agreement; (2) authorizing imposition of fines, penalties, or fees solely as a punishment or in amounts in excess of actual damages or costs incurred; and (3) authorizing prohibitions, limitations, additional deposits, or other restrictive policies that are not based on ordinary wear and tear expected to occur during a tenancy or that are not based on community safety standards.
   Division XIII also amends language relating to the consequences and damages for using a rental agreement containing provisions known to be prohibited by Code chapter 562B.
   Division XIV of the bill provides that any sale of a mobile home located in a manufactured home community or mobile home park by a landlord or landlord’s agent shall be by written agreement and the landlord must produce and assign the current certificate of title obtained from the department of transportation. The agreement shall state the basic terms of sale, including the total cost of the mobile home, finance charges, annual percentage rate, and the frequency and amount of each installment payment. Any such agreement shall also comply with Code section 103A.58(1), relating to maximum finance charges. The bill also authorizes a buyer to void any such sale that does not comply with the requirements, to collect specified damage amounts, and to combine such an action with a forcible entry and detainer action under Code chapter 648.
   Division XV of the bill prohibits the use of nonjudicial foreclosure proceedings initiated under Code section 654.18 or Code chapter 655A against property consisting of a mobile home, as defined in Code section 562B.7, on or after July 1, 2021.
   Division XV of the bill takes effect upon enactment.
   Division XVI of the bill provides that if a landlord offers for sale all or a portion of the manufactured home community or mobile home park, each current tenant shall be given notice of the sale by certified mail at least 90 days prior to the sale. The notice must include the name, business address, and contact information of the proposed buyer, the proposed date of the sale, and a summary of each tenant’s rights, which are that following a sale of, all or a portion of, the manufactured home community or mobile home park and upon renewal or extension of a tenancy in the manufactured home community or mobile home park in effect at the time of the sale, the landlord shall not change a term of a rental agreement, excluding a rent increase for the renewed or extended term of the tenancy, unless the tenant is notified in writing of the proposed change at least 90 days prior to the effective date of the change and the notice includes a summary of the tenant’s rights.
   Division XVI of the bill applies to the sale of manufactured home communities and mobile home parks occurring on or after July 1, 2021.