As of August 1, 2024, Kansas City landlords must comply with Ordinance 231019, a regulation designed to eliminate housing discrimination based on factors such as source of income, rental history, credit score, and criminal history. While the ordinance aims to promote fair housing opportunities, it introduces significant changes to tenant screening processes.This guide provides an overview of the ordinance’s key provisions, compliance requirements, and strategies for landlords to adapt effectively.​

Key Provisions of Ordinance 231019

Ordinance 231019 introduces several critical changes to the tenant screening and application process:​

• Source of Income Protection: Landlords must consider all lawful, verifiable sources of income when evaluating rental applications. This includes wages, government assistance (such as Section 8 vouchers), child support, and other legal income streams. Refusing to rent solely based on a tenant’s source of income is prohibited. ​

• Elimination of Pre-Screening: Landlords are no longer permitted to advertise or disclose their rental screening criteria before receiving a written application from a prospective tenant. This measure aims to prevent potential discrimination during the initial stages of tenant selection. ​

• Prohibited Criteria for Denying Tenancy: Denying tenancy based solely on adverse credit history, evictions older than one year, or prior criminal convictions is forbidden. Landlords must consider mitigating factors, such as efforts to resolve financial issues or evidence of rehabilitation, before making a decision. ​

• Rent-to-Income Ratio Adjustments: When calculating rent-to-income ratios, landlords must include all lawful income sources. For tenants utilizing government vouchers, the ratio should apply only to the tenant’s portion of the rent, ensuring equitable assessment of financial capability. ​

Compliance Requirements for Landlords

To adhere to Ordinance 231019, landlords should implement the following measures:

• Update Rental Advertisements and Applications: Ensure that property advertisements focus solely on the property’s features without specifying tenant qualifications. All rental applications must include the non-discrimination statement: “The landlord does not discriminate based on source of income.” ​

• Develop Non-Discriminatory Screening Policies: Revise existing screening policies to eliminate any practices that could be deemed discriminatory under the new ordinance. This includes standardizing income verification procedures and ensuring consistent application of criteria across all applicants. ​clerk.kcmo.gov

• Maintain Detailed Records: Keep comprehensive records of all rental applications, including income sources and reasons for acceptance or denial, for at least three years. This documentation is crucial for demonstrating compliance and protecting against potential legal challenges. ​

• Provide Staff Training: Educate property management staff on the requirements of Ordinance 231019, emphasizing the importance of non-discriminatory practices and proper documentation. Training should cover recognizing and preventing discriminatory behaviors and implementing fair screening processes. ​

Strategic Approaches for Landlords

While the ordinance imposes new restrictions, landlords can adopt strategies to remain compliant while safeguarding their properties:

• Holistic Tenant Evaluations: Assess applicants by considering multiple factors, such as credit history, rental history, and personal references. For example, while an adverse credit history alone cannot justify denial, combining it with other concerns like a pattern of late payments or insufficient rental references may provide legitimate grounds for rejection. ​

• Consistent Application of Screening Criteria: Apply uniform screening standards to all applicants, ensuring fairness and reducing the risk of discrimination claims. Document each evaluation thoroughly to demonstrate adherence to consistent practices. ​

• Utilize the Landlord Risk Mitigation Fund: The ordinance establishes a $1 million Landlord Risk Mitigation Fund to cover potential damages or losses associated with renting to higher-risk tenants. Leveraging this fund can mitigate financial exposure and encourage compliance with the ordinance’s provisions. ​MAREI

Consequences of Non-Compliance

Failure to comply with Ordinance 231019 can result in significant penalties:

• Fines and Penalties: Violations can lead to fines of up to $1,000 per instance, which can accumulate quickly and result in substantial financial burdens. ​

• Probationary Status: Landlords with multiple violations within a twelve-month period may be placed on Special Probationary Status, requiring the completion of a corrective action plan and subjecting them to increased oversight. ​

• Legal Action: Persistent non-compliance can lead to legal proceedings, including potential imprisonment of up to 180 days, further escalating financial and reputational risks. ​

Conclusion

Navigating the complexities of Ordinance 231019 is essential for Kansas City landlords to ensure compliance and maintain successful property management practices. By updating policies, providing staff training, and adopting strategic approaches to tenant screening, landlords can align with the ordinance’s objectives while protecting their investments.​

For personalized assistance in managing your rental properties and ensuring compliance with local regulations, contact Alpine Property Management Kansas City. Our expertise can help you adapt to these changes seamlessly and continue to thrive in the evolving housing market.