Senate Substitute 1 for Senate Bill 167

This Act seeks to increase the supply of homes available to rent for low-income individuals and families by providing incentives to landlords who participate in a government-sponsored rental assistance program. To that end, this Act creates a Landlord Mitigation Fund, administered by the Delaware State Housing Authority (“DSHA”), to provide payment for certain types of claims for payment or reimbursement for certain expenses incurred by participating landlords. The Act provides that the DSHA shall set the maximum amount that a landlord may recover from the Landlord Mitigation Fund, per claim and per tenancy. In addition, the Act provides that the DSHA has sole discretion to determine payment from the Landlord Mitigation Fund. Payment is subject to the availability of funds in the Landlord Mitigation Fund. A landlord who has received payment from the Landlord Mitigation Fund is prohibited from taking legal action against, or pursuing collection from, a tenant for damages attributable to the same tenancy, except to the extent the landlord seeks damages in excess of the amounts received from the Landlord Mitigation Fund. The Act is a substitute for and differs from Senate Bill No. 167 by eliminating claims for payment of a security deposit from the types of claims for which reimbursement from the Landlord Mitigation Fund may be sought. In addition, this Act removes dollar limitations on reimbursement from the Landlord Mitigation Fund and instead authorizes the DSHA to determine such limitations. The Act further eliminates the requirement that the DSHA create and maintain a waitlist, in the event that funds do not exist in the Landlord Mitigation Fund to pay eligible claims. The Act also creates exceptions to the limits on remedies for landlords receiving a payment from the Landlord Mitigation Fund. Finally, the Act eliminates the requirement that a tenant repay to the DSHA amounts paid to a landlord for a claim pursuant to subsection (b)(3) or (b)(4).