[Mpls] app fees law -- send all tenants that plan ahead out of MPLS!

[Gregory Luce]

[Bill Cullen]:

I don't have a problem with the ordinance as written except for the part
that ties the receipt of application fees to "available units."

* * * *

What should landlords do for the applicant that plans ahead?  Most rentals
are on a 30 day notice period. Therefore, landlords don't know what units
are available until 30 days before the move in date.

State law allows me to accept application fees unless I KNOW that "no rental
unit is available."  If I attempt to look into the future, say 1-Feb-05, I
am not sure what units are available.  However, given the size and history
of my buildings, it would be extremely unusual to not have a unit available
on 1-Feb-05.  Therefore, I believe that taking an application fee for
1-Feb-05 is legal under state law.

However, under this MPLS law, I must tie applications to "available units".

[Me]:

I appreciate Bill's concerns and we've had some good offlist discussions
about them.  But, I disagree with his conclusion.  The newly enacted
ordinance kicks in only after the state law says it's OK to charge a fee.
In other words, state law sets the standard as to WHEN a landlord may charge
a fee, while the ordinance sets forth additional requirements as to HOW a
fee is collected and managed.

In Bill's scenario, state law does not allow a landlord to charge a fee when
no unit is available and the landlord does not know when one may be
available.  The standard is this:  a landlord "may not charge an applicant a
screening fee when the landlord knows or should have known that no rental
unit is available at that time or will be available within a reasonable
future time."  Thus, the landlord must KNOW that a unit will be available
within a reasonable future time.  Predicting or guessing or surmising that
one will be available is not sufficient to allow charging of a fee.  A
classic example of a unit that is NOT presently available but will be
available within reasonable future time is when the landlord receives a
notice to vacate from one of his/her tenants.

Now, I acknowledge that there may be a shade of gray in what is meant by
'available within a reasonable future time' and that Bill may be working
within that gray area, but I interpret that shade of gray differently than
Bill.  I believe that a landlord must know that a unit will be available in
a reasonable future time before accepting a fee. Thus, our disagreement.

A practical solution to allow tenants to 'plan ahead' is to take an
application but no fee in advance.  Once a unit is available (or will be
available, for example, based on a notice to vacate received by the
landlord), then you can ask for and collect the fee and process the
application.  That allows a clear record as to who was first in applying,
and it also complies with state law and the new ordinance.

Gregory Luce
St. Paul