Senate Study Bill 3113 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON STATE GOVERNMENT BILL BY CHAIRPERSON SMITH) A BILL FOR An Act relating to utility service cost disclosures in 1 connection with certain rental properties, providing civil 2 penalties, and including effective date provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5600XC (5) 89 es/rn
S.F. _____ Section 1. Section 476.1C, subsection 1, paragraph a, Code 1 2022, is amended to read as follows: 2 a. Are not subject to the regulation authority of 3 the utilities board under this chapter unless otherwise 4 specifically provided. Sections 476.10 , 476.20 , 476.21 , and 5 476.51 , and 476.56 apply to such gas utilities. 6 Sec. 2. Section 476.56, Code 2022, is amended to read as 7 follows: 8 476.56 Energy costs provided. 9 A gas or electric public utility shall provide, upon the 10 request of a person who states in writing that the person is an 11 owner of real property, or an interested prospective purchaser 12 or renter of the property, which is or has been receiving gas 13 or electric service from the public utility, the annual gas 14 or electric energy costs for the property. In addition, a 15 gas or electric public utility and, notwithstanding section 16 476.1, subsection 4, a public utility furnishing water or sewer 17 service, shall comply with the utility service cost disclosure 18 provisions of section 562A.13A, subsection 4. 19 Sec. 3. NEW SECTION . 562A.13A Utility service cost 20 disclosure —— penalty. 21 1. For purposes of this section, unless the context 22 otherwise requires: 23 a. “Applicable public utility” means a public utility which 24 furnishes electric, gas, water, or sewer service to a rental 25 property. 26 b. “Landlord” means a landlord as defined in section 562A.6, 27 or any other person authorized to enter into a rental agreement 28 on behalf of the landlord with respect to a rental property. 29 c. (1) “Rental property” means a residential rental 30 building in the state with twelve or more dwelling units. 31 (2) “Rental property” does not include a residential rental 32 building which uses a master meter. 33 d. “Utility service” means electric, gas, water, and sewer 34 service. 35 -1- LSB 5600XC (5) 89 es/rn 1/ 8
S.F. _____ 2. In addition to the required disclosure provisions of 1 section 562A.13, a landlord of rental property shall disclose 2 to a prospective tenant in writing a utility service cost 3 disclosure statement in accordance with this section. At 4 least one adult prospective tenant entering into the tenancy 5 shall sign an acknowledgment form stating that the prospective 6 tenant received the disclosure statement upon completing the 7 rental application or before signing the lease, whichever 8 occurs first. Proof by the landlord that at least one adult 9 prospective tenant signed a valid acknowledgment form shall be 10 a defense to any claim or action brought under subsection 6. 11 The landlord may include the disclosure statement in the rental 12 application, lease, or in a separate disclosure document. 13 3. a. The cost information included in a utility service 14 cost disclosure statement shall indicate the average annual 15 or periodic costs for utility service for dwelling units in 16 the rental property with the same number of bedrooms. If a 17 landlord charges tenants for utility services using a ratio 18 utility billing system, or a billing method which allocates the 19 rental property’s actual utility bill to tenants based on an 20 occupant factor, square footage factor, or any other factor, 21 the cost information shall include the average charges for 22 utility service in the previous twelve-month period, including 23 any fees, for dwelling units in the rental property with the 24 same number of bedrooms. If a landlord has authority over more 25 than one rental property within two hundred miles of similar 26 construction, and such rental properties have the same utility 27 service payment structure with the same applicable public 28 utility, the disclosure statement may indicate the average 29 annual costs for utility service for dwelling units in all 30 such rental properties with the same number of bedrooms. For 31 purposes of this paragraph, “of similar construction” means 32 sharing common construction details, including but not limited 33 to comparable building envelope designs or structural features, 34 comparable arrangements for access to hallways, dwelling units, 35 -2- LSB 5600XC (5) 89 es/rn 2/ 8
S.F. _____ common areas, and washers or dryers, and comparable functions 1 of utility services. 2 b. The cost information included in a disclosure statement 3 shall be computed by April 1 each year pursuant to subsection 4 4 and shall be valid and included in any disclosure statement 5 provided by the landlord until the last day of March of the 6 following year. In the event that a rental property was 7 acquired by the landlord within the previous twelve-month 8 period, disclosure statements shall be provided by the landlord 9 to prospective tenants beginning ninety days after the date of 10 closing. 11 4. a. The landlord shall obtain the cost information 12 required in subsection 3 from the applicable public utility 13 by sending a written request to the utility between January 1 14 and February 1 of each year. The written request shall, at a 15 minimum, include the following information: 16 (1) The name, address, and telephone number of the landlord. 17 (2) The number of bedrooms in each dwelling unit in the 18 rental property. 19 (3) If cost information is to be computed for more than 20 one rental property, a description of the applicable rental 21 properties and the number of bedrooms in each dwelling unit in 22 all such rental properties. 23 (4) Any other information deemed necessary by the 24 applicable public utility to compute the cost information. 25 b. The applicable public utility shall compute the cost 26 information for the landlord at no charge and shall provide 27 such information to the landlord within thirty days of 28 receiving the landlord’s written request, unless the parties 29 otherwise agree in writing to extend the time. The applicable 30 public utility may use any methodology to compute the cost 31 information, provided that the average costs are based on 32 dwelling units with the same number of bedrooms, and the 33 methodology used to compute the cost information is disclosed 34 to the landlord in writing. 35 -3- LSB 5600XC (5) 89 es/rn 3/ 8
S.F. _____ c. If the applicable public utility does not provide budget 1 billing information, if the rental property is new construction 2 or was renovated in the previous twelve-month period where 3 the total cost of the renovation was greater than twenty-five 4 percent of the assessed value of the rental property, or if 5 subsection 7 is applicable, the landlord shall include, in lieu 6 of the cost information required in subsection 3, any of the 7 following in the utility service cost disclosure statement: 8 (1) An estimate of anticipated annual utility service costs 9 provided by the applicable public utility. 10 (2) An estimate of anticipated annual utility service costs 11 provided by a licensed, registered, or certified professional 12 with expertise in computing utility service costs. 13 (3) An estimate of anticipated annual utility service costs 14 consistent with the United States department of housing and 15 urban development section 8 guidelines. 16 5. The landlord shall retain and preserve all records 17 relating to cost information obtained pursuant to subsection 4 18 for a period of not less than one year. On reasonable notice, 19 a tenant may inspect and copy any such records during regular 20 business hours. 21 6. A landlord of rental property who enters into a rental 22 agreement with a tenant without providing a utility service 23 cost disclosure statement in violation of this section shall 24 pay the tenant liquidated damages in the amount of one hundred 25 dollars. If the landlord fails to pay the tenant such amount 26 within thirty days of receiving a written request for payment 27 from the tenant, the tenant may bring a civil action in small 28 claims court. If a final judgment is entered against the 29 landlord, the tenant shall recover damages in the amount of one 30 hundred dollars, as well as court costs and reasonable attorney 31 fees incurred by the tenant in bringing the action. The 32 landlord shall also be subject to a civil penalty in the amount 33 of five hundred dollars. Such civil penalty shall be remitted 34 to the division of community action agencies of the department 35 -4- LSB 5600XC (5) 89 es/rn 4/ 8
S.F. _____ of human rights, to be used only for the low income home energy 1 assistance program and the weatherization assistance program. 2 7. This section shall not apply to a rural electric 3 cooperative or a municipal utility which does not provide 4 budget billing to customers, or a billing system in which 5 customers are charged a set amount each month over a specific 6 time period. 7 Sec. 4. EFFECTIVE DATE. This Act takes effect July 1, 2023. 8 EXPLANATION 9 The inclusion of this explanation does not constitute agreement with 10 the explanation’s substance by the members of the general assembly. 11 This bill establishes new Code section 562A.13A within the 12 uniform residential landlord and tenant law provisions of Code 13 chapter 562A, relating to utility service cost disclosure 14 requirements for certain rental properties. 15 The bill defines “applicable public utility” to mean a 16 public utility which furnishes electric, gas, water, or sewer 17 service to a rental property. “Landlord” is defined as a 18 landlord as defined in Code section 562A.6, or any other person 19 authorized to enter into a rental agreement on behalf of the 20 landlord with respect to a rental property. “Rental property” 21 is defined as a residential rental building in Iowa with 12 or 22 more dwelling units, but does not include a residential rental 23 building which uses a master meter. “Utility service” is 24 defined as electric, gas, water, and sewer service. 25 The bill requires a landlord of rental property to disclose 26 to a prospective tenant a utility service cost disclosure 27 statement in writing in accordance with the bill. At least 28 one adult prospective tenant entering into the tenancy shall 29 sign an acknowledgment form stating that the tenant received 30 the disclosure statement upon completing the rental application 31 or before signing the lease, whichever occurs first, which 32 shall be a defense to any claim that the landlord violated the 33 disclosure provisions. The landlord may include the disclosure 34 statement in the rental application, lease, or in a separate 35 -5- LSB 5600XC (5) 89 es/rn 5/ 8
S.F. _____ disclosure document. 1 The bill provides that the disclosure statement shall 2 indicate the average annual or periodic costs for utility 3 service for dwelling units in the rental property with the 4 same number of bedrooms. If a landlord charges tenants using 5 a ratio utility billing system, as described in the bill, the 6 cost information shall include the average charges for utility 7 service in the previous year, including any fees, for dwelling 8 units in the property with the same number of bedrooms. If a 9 landlord has more than one rental property within 200 miles 10 of similar construction, as defined in the bill, and with the 11 same utility service payment structure for the same applicable 12 public utility, the disclosure statement may indicate the 13 average annual costs for dwelling units in all such rental 14 properties with the same number of bedrooms. 15 The bill provides that cost information shall be computed 16 by April 1 each year, which shall be valid and included in any 17 disclosure statement provided until the last day of March of 18 the following year. If the rental property was acquired by the 19 landlord within the previous year, disclosure statements shall 20 be provided by the landlord beginning 90 days after the date 21 of closing. 22 The bill provides that the landlord shall obtain the cost 23 information included in a disclosure statement from the 24 applicable public utility by sending a written request to the 25 utility between January 1 and February 1 of each year, with 26 information described in the bill. The utility shall compute 27 and provide such information to the landlord at no charge 28 within 30 days of receiving such request, unless otherwise 29 agreed to by the parties in writing. The utility may use 30 any methodology to compute the cost information, provided 31 that average costs are based on dwelling units with the same 32 number of bedrooms and the methodology used is disclosed to the 33 landlord in writing. 34 The bill provides that if the applicable public utility does 35 -6- LSB 5600XC (5) 89 es/rn 6/ 8
S.F. _____ not provide budget billing information, the rental property is 1 new construction or was renovated in the previous year where 2 the total cost of the renovation was greater than 25 percent 3 of the assessed property value, or if the utility disclosure 4 provisions do not apply to the applicable public utility as 5 specified in the bill, the landlord shall include in the 6 disclosure statement an estimate of anticipated annual utility 7 service costs as described in the bill. 8 The bill provides that a landlord shall retain all records 9 relating to cost information for a period of not less than one 10 year. A tenant may inspect and copy such records on reasonable 11 notice and during regular business hours. 12 The bill provides that a landlord of rental property who 13 enters into a rental agreement with a tenant without providing 14 a utility service cost disclosure statement in violation of 15 the bill shall pay the tenant liquidated damages in the sum 16 of $100. If the landlord fails to pay the tenant such amount 17 within 30 days of receiving a written request from the tenant 18 to do so, the tenant may bring a civil action in small claims 19 court. If a final judgment is entered against the landlord, 20 the tenant shall recover $100 in damages, as well as court 21 costs and reasonable attorney fees. The landlord shall also 22 be subject to a civil penalty of $500, to be remitted to the 23 division of community action agencies of the department of 24 human rights, and used only for specified purposes. 25 The bill provides that Code section 562A.13A shall not apply 26 to a rural electric cooperative or a municipal utility which 27 does not provide budget billing to customers, as described in 28 the bill. 29 The bill modifies Code section 476.56, relating to the 30 provision of energy costs by gas or electric utilities, 31 by requiring gas and electric utilities, as well as public 32 utilities furnishing water or sewer service, to comply with the 33 utility service cost disclosure provisions of the bill. The 34 bill also makes Code section 476.56 applicable to gas public 35 -7- LSB 5600XC (5) 89 es/rn 7/ 8
S.F. _____ utilities with less than 2,000 customers. 1 Current law provides that a public utility which, after 2 written notice from the Iowa utilities board of a specified 3 violation of a provision in Code chapter 476, violates the 4 same provision is subject to a civil penalty of at least $100 5 but not more than $2,500 per violation. If the violation is 6 willful, the civil penalty increases to at least $1,000 but not 7 more than $10,000 per violation. 8 The bill takes effect July 1, 2023. 9 -8- LSB 5600XC (5) 89 es/rn 8/ 8