AN ACT TO AMEND TITLE 25 OF THE DELAWARE CODE RELATING TO THE RESIDENTIAL LANDLORD-TENANT CODE.

This Act is a substitute for Senate Bill No. 101. Like Senate Bill No. 101, this Substitute creates a right to counsel for tenants in evictions and other landlord-tenant actions. Approximately 18,000 eviction cases are filed each year in the State of Delaware, and while 86% of landlords are represented by an attorney, agent, or business manager, only 2% of tenants have representation. The disruptive displacement that accompanies eviction proceedings create significant costs for state and local government related to shelter funding, education funding, health care provided in hospitals instead of community-based providers, transportation costs for homeless youth, and foster care. Evictions and disruptive displacement also have significant, well-documented, and long-lasting effects on the lives of individuals and families, including poorer physical and mental health, increased risk of homelessness, increased risk of employment loss, loss of personal property, damage to credit standing, and relocation into substandard housing. Further, evictions fall disproportionately on Black and Latinx families, who have also been the hardest hit by the COVID-19 crisis. Section 1 of this Act establishes a right to counsel for covered individuals with household income below 200% of the federal poverty guideline for evictions and other landlord-tenant actions. A Coordinator for the program will be appointed by the Attorney General. The Coordinator will contract with legal services providers for the provision of representation in proceedings covered by this Act. Section 1 also requires the Coordinator to work with community organizations to do outreach and education regarding the right to counsel. And, landlords must provide notice of the right to counsel at periodic designated intervals in the tenancy and in eviction proceedings. Section 2 of this Act creates a monetary floor for initiation of eviction proceedings for nonpayment of rent – no action may be filed where the amount of rent owed is 1-month’s rent or less than $500, whichever is greater. It also provides that a landlord may not initiate or continue eviction proceedings for nonpayment of rent if the tenant pays and the landlord accepts all rent due. Finally, it creates a right of redemption for a tenant who pays all back rent, costs, and fees before eviction. Section 3 of this Act authorizes the creation of a residential eviction diversion program modeled after the Residential Mortgage Foreclosure Mediation Program. Section 4 of this Act provides COVID-19-specific relief in an action where execution was stayed based on a finding that the stay was required in the interests of justice. Section 5 of this Act is a severability clause. This Substitute differs from Senate Bill No. 101 as it does all of the following: (1) Includes representation by non-attorneys in the definition of “legal representation”, if the Rules of the Supreme Court are amended to permit the representation. (2) Removes the provision for representation in proceedings related to the reduction of a housing subsidy. (3) Makes clear that legal representation is provided as it is available and that an individual does not have a cause of action if it is not available. (4) Provides examples of circumstances in which a designated organization may decline representation. (5) Provides that the Right to Counsel Coordinator (“Coordinator”), with appropriate funding from the General Assembly, shall contract with designated organizations to provide the services required under the Act. (6) Requires the Coordinator to include the Justice of the Peace Court’s experience with the Act in the Coordinator’s annual report. (7) Removes events that require a landlord to provide a tenant with a brochure about legal representation available to tenants. (8) Makes technical changes to make clear that an action for possession based on unpaid rent may not be brought if the amount of rent owed is less than 1-month’s rent or less than $500, whichever is greater. (9) Changes the time for the application of the tenant’s right of redemption to before the writ of possession is posted. (10) Changes one of the possible deadlines for implementing the residential eviction diversion program to 270 days after the effective date of the Act. (11) Provides that the Residential Eviction Diversion Program is to be established and implemented by the Justice of the Peace Court or the Court’s designee, which may be the Right to Counsel Coordinator. (12) Expands the exemption to participation in the residential eviction diversion program to include when threats of substantial or irreparable harm to the landlord’s or other tenant’s person or property and cites the appropriate provisions of the Delaware Code relating to proceedings based on irreparable harm. (13) Changes what a landlord is required to do once the Twenty-Seventh Modification of the Declaration of a State of Emergency for the State of Delaware Due to a Public Health Threat expires or is not renewed. (14) Makes Sections 1, 2, 4, 5, and 8 of this Act effective 120 days after the Act’s enactment and makes the effective date of Section 3 of the Act (regarding the residential eviction diversion program) contingent on funding. (15) Requires the Coordinator to provide the General Assembly with a copy of the first annual report to determine if additional funding is needed to address the fiscal impact of the Act on the Justice of the Peace Court.