SB0267

SENATE BILL 267

57th legislature - STATE OF NEW MEXICO - first session, 2025

INTRODUCED BY

Carrie Hamblen and Heather Berghmans and Leo Jaramillo

and Linda M. Trujillo

AN ACT

RELATING TO HOUSING; REQUIRING OWNERS TO PROVIDE NOTICE TO DWELLING UNIT APPLICANTS OF FEES RELATED TO APPLICANT SCREENING; REQUIRING OWNERS TO RETURN AN APPLICANT SCREENING FEE IN CERTAIN CIRCUMSTANCES; REQUIRING OWNERS TO PROVIDE NOTICE OF FEE INCREASES; EXTENDING THE NOTICE PERIOD FOR RENT INCREASES; REDUCING THE LIMIT ON LATE FEES; EXPANDING PRIVATE REMEDIES; PRESCRIBING CIVIL PENALTIES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 47-8-3 NMSA 1978 (being Laws 1975, Chapter 38, Section 3, as amended) is amended to read:

"47-8-3. DEFINITIONS.--As used in the Uniform Owner-Resident Relations Act:

A. "abandonment" means absence of the resident from the dwelling, without notice to the owner, in excess of seven continuous days; providing such absence occurs only after rent for the dwelling unit is delinquent;

B. "action" includes recoupment, counterclaim, set-off, suit in equity and any other proceeding in which rights are determined, including an action for possession;

C. "amenity" means a facility appurtenance or area supplied by the owner and the absence of which would not materially affect the health and safety of the resident or the habitability of the dwelling unit;

D. "applicant" means a person who makes a request to rent a dwelling unit to the owner and who agrees to act as a guarantor or cosigner on a rental agreement;

[D.] E. "codes" includes building codes, housing codes, health and safety codes, sanitation codes and any law, ordinance or governmental regulation concerning fitness for habitation or the construction, maintenance, operation, occupancy or use of a dwelling unit;

[E.] F. "deposit" means an amount of currency or instrument delivered to the owner by the resident as a pledge to abide by terms and conditions of the rental agreement;

[F.] G. "dwelling unit" means a structure, mobile home or the part of a structure, including a hotel or motel, that is used as a home, residence or sleeping place by one person who maintains a household or by two or more persons who maintain a common household and includes a parcel of land leased by its owner for use as a site for the parking of a mobile home;

[G.] H. "eviction" means any action initiated by the owner to regain possession of a dwelling unit and use of the premises [under] pursuant to the terms of the Uniform Owner-Resident Relations Act;

[H.] I. "fair rental value" is that value that is comparable to the value established in the market place;

[I.] J. "good faith" means honesty in fact in the conduct of the transaction concerned as evidenced by all surrounding circumstances;

[J.] K. "normal wear and tear" means deterioration that occurs based upon the use for which the rental unit is intended, without negligence, carelessness, accident, abuse or intentional damage of the premises, equipment or chattels of the owner by the residents or by any other person in the dwelling unit or on the premises with the resident's consent; however, uncleanliness does not constitute normal wear and tear;

[K.] L. "organization" includes a corporation, government, governmental subdivision or agency thereof, business trust, estate, trust, partnership or association, two or more persons having a joint or common interest or any other legal or commercial entity;

[L.] M. "owner" means one or more persons, jointly or severally, in whom is vested:

(1) all or part of the legal title to property, but shall not include the limited partner in an association regulated [under] pursuant to the Uniform Limited Partnership Act; or

(2) all or part of the beneficial ownership and a right to present use and enjoyment of the premises and agents thereof and includes a mortgagee in possession and the lessors, but shall not include a person or persons, jointly or severally, who as owner leases the entire premises to a lessee of vacant land for apartment use;

[M.] N. "person" includes an individual, corporation, entity or organization;

[N.] O. "premises" means facilities, facilities and appurtenances, areas and other facilities held out for use of the resident or whose use is promised to the resident coincidental with occupancy of a dwelling unit;

[O.] P. "rent" means payments in currency or in-kind [under] pursuant to terms and conditions of the rental agreement for use of a dwelling unit or premises, to be made to the owner by the resident, [but] and does not include deposits, fees or utilities;

[P.] Q. "rental agreement" means all agreements between an owner and resident and valid rules and regulations adopted under Section 47-8-23 NMSA 1978 embodying the terms and conditions concerning the use and occupancy of a dwelling unit or premises;

[Q.] R. "resident" means a person entitled [under] pursuant to a rental agreement to occupy a dwelling unit in peaceful possession to the exclusion of others and includes the owner of a mobile home renting premises, other than a lot or parcel in a mobile home park, for use as a site for the location of the mobile home;

[R.] S. "roomer" means a person occupying a dwelling unit that lacks a major bathroom or kitchen facility in a structure where one or more major facilities are used in common by occupants of the dwelling units. As referred to in this subsection, "major facility", in the case of a bathroom, means toilet and either a bath or shower and, in the case of a kitchen, means refrigerator, stove or sink;

T. "screening fee" means a one-time charge that is charged to an applicant by an owner to recoup the owner's cost of purchasing a consumer credit report or reference check or the assistance of a screening service to validate, review or otherwise process an application for renting a dwelling unit;

[S.] U. "single family residence" means a structure maintained and used as a single dwelling unit. Notwithstanding that a dwelling unit shares one or more walls with another dwelling unit, it is a single family residence if it has direct access to a street or thoroughfare and shares neither heating facilities, hot water equipment nor any other essential facility or service with any other dwelling unit;

[T.] V. "substantial violation" means a violation of the rental agreement or rules and regulations by the resident or occurring with the resident's consent that occurs in the dwelling unit, on the premises or within three hundred feet of the premises and that includes the following conduct, which shall be the sole grounds for a substantial violation:

(1) possession, use, sale, distribution or manufacture of a controlled substance, excluding misdemeanor possession and use;

(2) unlawful use of a deadly weapon;

(3) unlawful action causing serious physical harm to another person;

(4) sexual assault or sexual molestation of another person;

(5) entry into the dwelling unit or vehicle of another person without that person's permission and with intent to commit theft or assault;

(6) theft or attempted theft of the property of another person by use or threatened use of force; or

(7) intentional or reckless damage to property in excess of one thousand dollars ($1,000);

[U.] W. "term" is the period of occupancy specified in the rental agreement; and

[V.] X. "transient occupancy" means occupancy of a dwelling unit for which rent is paid on less than a weekly basis or where the resident has not manifested an intent to make the dwelling unit a residence or household."

SECTION 2. A new section of the Uniform Owner-Resident Relations Act is enacted to read:

"[NEW MATERIAL] OWNER DISCLOSURE TO APPLICANTS.--An owner shall disclose to applicants all terms of a rental agreement in a published listing of the dwelling unit, including the base rent that will be assessed and a description of all fees or charges that will be assessed during the residency, which shall be itemized and readily identifiable in the listing."

SECTION 3. A new section of the Uniform Owner-Resident Relations Act is enacted to read:

"[NEW MATERIAL] DWELLING UNIT APPLICANT SCREENING FEE--PROHIBITED FEES.--

A. An owner may charge an applicant a screening fee that shall not exceed fifty dollars ($50.00) to cover the cost of obtaining information about the applicant, including the cost of a consumer credit report, a reference check or a screening service; provided that the owner:

(1) provides the applicant with written notice of the screening fee and the applicant agrees in writing to pay the screening fee;

(2) shall not charge the applicant a screening fee when the owner knows or should know that a dwelling unit is not available for rent at that time or will not be available at the beginning of the residency;

(3) provides the applicant with a written receipt for the screening fee paid by the applicant;

(4) shall not use, cash or deposit an applicant's screening fee until all prior applicants have either been screened and rejected or offered the dwelling unit and declined to enter into a rental agreement; and

(5) aside from a screening fee, shall not charge other fees to process an application.

B. An owner shall return the screening fee to an applicant if:

(1) a prior applicant is offered the dwelling unit and agrees to enter into a rental agreement; or

(2) the owner does not:

(a) obtain a consumer credit report;

(b) perform a reference check; or

C. A screening fee that is returned as provided in Subsection B of this section shall be:

(1) returned by mail;

(2) destroyed upon the applicant's request if paid by check; or

(3) made available for the applicant to retrieve.

D. An owner shall not assess a fee for:

(1) processing, reviewing or accepting rental applications; or

(2) move-in prior to the start of a residency that is not a security deposit or screening fee."

SECTION 4. A new section of the Uniform Owner-Resident Relations Act is enacted to read:

"[NEW MATERIAL] BACKGROUND CHECKS.--

A. An owner may require a background check of an applicant before entering a rental agreement; provided that a resident may provide the resident's own background check or credit report to an owner if the reports were obtained ninety days prior to the application. An owner shall provide the resident with a copy of any reports used to screen the applicant.

B. An owner shall not charge an applicant for reports for applicant screening if the applicant can provide the reports. An owner that charges for reports for applicant screening shall provide copies of all reports to the applicant. The screening fee shall be refunded if the application is not processed."

SECTION 5. A new section of the Uniform Owner-Resident Relations Act is enacted to read:

"[NEW MATERIAL] NOTICE OF FEE CHANGES REQUIRED.--An owner may increase a fee that is provided pursuant to the terms of a rental agreement by providing written notice at least sixty days prior to the periodic rental date specified in the rental agreement or at least sixty days prior to the end of the term of a fixed term residency. In the case of a periodic residency of less than one month, written notice shall be provided at least one rental period in advance of the first fee payment to be increased."

SECTION 6. Section 47-8-15 NMSA 1978 (being Laws 1975, Chapter 38, Section 15, as amended) is amended to read:

"47-8-15. PAYMENT OF RENT.--

A. The resident shall pay rent in accordance with the rental agreement. In the absence of an agreement, the resident shall pay as rent the fair rental value for the use of the premises and occupancy of the dwelling unit.

B. Rent is payable without demand or notice at the time and place agreed upon by the parties. Unless otherwise agreed, rent is payable at the dwelling unit. Unless otherwise agreed, periodic rent is payable at the beginning of any term of one month or less and otherwise in equal monthly installments at the beginning of each monthly period. The date of one month to the same date of the following month shall constitute a term of one month.

C. Unless the rental agreement fixes a definite term, the residency is week-to-week in the case of a person who pays weekly rent and in all other cases month-to-month.

D. If the rental agreement provides for the charging of a late fee and if the resident does not pay rent in accordance with the rental agreement, the owner may charge the resident a late fee in an amount not to exceed [ten] five percent of the [total rent payment] rent for each rental period that the resident is in default. Late fees shall be calculated only based on rent. To assess a late fee, the owner shall provide notice of the late fee charged no later than the last day of the next rental period immediately following the period in which the default occurred.

E. An owner may not assess a fee from the resident for occupancy of the dwelling unit by a reasonable number of guests for a reasonable length of time. This shall not preclude charges for use of premises or facilities other than the dwelling unit by guests.

F. An owner may increase the rent payable by the resident in a month-to-month residency by providing written notice to the resident of the proposed increase at least thirty days prior to the periodic rental date specified in the rental agreement or, in the case of a fixed term residency, at least thirty days prior to the end of the term. In the case of a periodic residency of less than one month, written notice shall be provided at least one rental period in advance of the first rental payment to be increased.

G. Unless agreed upon in writing by the owner and the resident, a resident's payment of rent may not be allocated to any deposits or damages."

SECTION 7. Section 47-8-48 NMSA 1978 (being Laws 1975, Chapter 38, Section 48, as amended) is amended to read:

"47-8-48. PREVAILING PARTY RIGHTS IN [LAW SUIT] LAWSUIT--[CIVIL PENALTIES] PRIVATE ENFORCEMENT.--

A. If suit is brought by an applicant or any party to the rental agreement to enforce the terms and conditions of the rental agreement or to enforce any provisions of the Uniform Owner-Resident Relations Act, the prevailing party shall be entitled to reasonable attorneys' fees and court costs to be assessed by the court.

B. An owner who charges an unauthorized screening fee shall be liable for two hundred fifty dollars ($250) and shall return all fees paid by the applicant.

[B. Any] C. An owner who violates a provision of Section 47-8-36 or 47-8-39 NMSA 1978 shall be [subject to a civil penalty equal to] liable for two times the amount of the monthly rent.

[C. Any] D. A resident who intentionally violates a provision of Subsection F of Section 47-8-22 NMSA 1978 shall be [subject to a civil penalty equal to] liable for two times the amount of the monthly rent."

SECTION 8. A new section of the Uniform Owner-Resident Relations Act is enacted to read:

"[NEW MATERIAL] CIVIL PENALTIES--ENFORCEMENT.--

A. It is an unfair or deceptive trade practice pursuant to the Unfair Practices Act for an owner to charge a fee from an applicant that is not a screening fee or deposit or that was not published in a listing for rental of a dwelling unit in violation of the Uniform Owner-Resident Relations Act. The attorney general may bring an action pursuant to the Unfair Practices Act against an owner regarding this practice.

B. It is an unfair or deceptive trade practice pursuant to the Unfair Practices Act for an owner to charge rent or fees that are not included in the rental agreement in violation of the Uniform Owner-Resident Relations Act. The attorney general may bring an action pursuant to the Unfair Practices Act against an owner regarding this practice."

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