As of August 01, 2024, Kansas City landlords are required to comply with the newly introduced Ordinance 231019, which focuses on eliminating housing discrimination based on source of income, rental history, credit score, and criminal history. This ordinance seeks to create fairer housing opportunities for prospective tenants but presents several implications for property owners and managers. In this blog, we’ll break down the key provisions of the ordinance, its compliance requirements, and how landlords can adjust their practices to mitigate risks while maintaining high rental standards.
Key Provisions of Ordinance 231019
The ordinance brings significant changes to how rental applications are processed. Here are some of the most impactful provisions:
- Source of Income Protection: Landlords must now consider all lawful sources of income for rental applications, including wages, government assistance (such as vouchers), child support, and more. It’s important to note that landlords can no longer deny tenants solely based on their source of income.
- Elimination of Pre-Screening: Landlords can no longer share their rental screening criteria with prospective tenants before a written application is submitted. This means advertising based on tenant qualifications, such as credit score or employment history, is prohibited.
- Prohibited Criteria for Denying Tenancy: Landlords cannot deny tenancy based solely on adverse credit history, evictions that occurred more than a year ago, or prior criminal convictions. Instead, landlords must consider mitigating circumstances, such as efforts to resolve financial issues or proof of rehabilitation.
- Rent-to-Income Ratio: The rent-to-income ratio must consider only the portion of rent covered by a tenant’s government voucher. This ensures that tenants who rely on rental assistance are not unfairly penalized in the application process.
Compliance Requirements for Landlords
Adhering to Ordinance 231019 requires several important changes in daily operations. Some of the key compliance measures include:
- Update Rental Advertisements and Applications: Ensure that property ads only describe the property itself and do not suggest criteria for prospective tenants. All rental applications must now include a non-discrimination statement affirming that source of income will not be a basis for rejection.
- Non-Discriminatory Screening Policies: Update your rental screening process to eliminate any policies that could be seen as discriminatory, especially those related to credit history, criminal convictions, or government assistance.
- Record-Keeping: Landlords must keep detailed records of all rental applications, denials, and income sources for a minimum of three years. Maintaining these records helps demonstrate compliance and provides protection in case of audits or complaints.
- Staff Training: Ensure your property management team is fully trained on the ordinance, including how to handle tenant inquiries and rental applications without pre-screening. Employees should also be aware of the new non-discrimination policies and the importance of consistent documentation.
Strategic Approaches for Landlords
Although the ordinance introduces stricter guidelines, landlords can adopt strategies to remain compliant while safeguarding their properties:
- Holistic Tenant Evaluations: While adverse credit or past evictions cannot be the sole basis for rejection, landlords can evaluate these factors in combination with other criteria, such as personal references, recency of financial issues, and the overall rental history of the tenant.
- Consistency in Screening: Apply the same standards to all applicants, regardless of their income source or background, and document your decisions thoroughly. This ensures fairness and reduces the risk of discrimination claims.
- Utilize the Landlord Risk Mitigation Fund: Ordinance 231019 establishes a $1 million fund to help landlords offset potential risks when accepting higher-risk tenants. This fund can help cover damages or other losses, making it easier to accommodate tenants who may otherwise pose a financial risk.
The Consequences of Non-Compliance
Failure to comply with Ordinance 231019 can result in severe penalties, including:
- Fines up to $1,000 per violation: These fines can accumulate quickly, particularly if non-compliance is widespread across a landlord’s properties.
- Probationary Status: Landlords with multiple violations may be placed on probation, requiring corrective action plans and heightened oversight.
- Legal Action: Persistent non-compliance may result in legal actions, including possible jail time of up to 180 days for severe or repeat offenders.
Take Action Now
Understanding and implementing the requirements of Ordinance 231019 is crucial for any Kansas City property owner. At Alpine Property Management, we specialize in navigating local regulations while providing comprehensive property management services that protect your investments and ensure compliance with all legal requirements. Let us help you stay ahead of the curve while maintaining high standards for tenant screening and property upkeep.
Contact us today to learn more about how Alpine Property Management can help you manage your Kansas City properties in compliance with this new ordinance. We offer tailored solutions that meet the unique needs of property owners while maximizing rental income and ensuring tenant satisfaction.