New Pet Regulations Going into Effect
HB23-1068 goes into effect as of 1/1/24. The Act limits the amount of additional security deposit that a landlord can demand as a condition of permitting the tenant’s pet to reside at the property to no more than $300. Many landlords currently charge pet fees to tenants who plan to reside in a rental unit with a pet. This is still okay, as long as the amount is $300.00 or less. HOWEVER, the additional pet deposit must be refundable to the tenant. The amount must be treated as a security deposit and must be returned or accounted for at the end of the tenant’s term. A non-refundable fee is no longer acceptable as it relates to pets.
Further, the amount of additional rent that can be charged as a condition of permitting the tenant’s pet to reside at the property cannot exceed the greater of: (i) $35 per month, or (ii) 1.5% of the monthly rent amount. It is unclear under the statute whether the maximum pet deposit is per pet or per household with pets. Given the purpose of a deposit, a reasonable interpretation is that it would apply per pet. The same application may apply with the allowance of additional rent (per pet, rather than per household with pets).
This Act also prohibits insurance companies from refusing to issue, cancelling, refusing to renew, or increasing premiums or rates for a homeowner’s insurance policy or a dwelling fire insurance policy based on the breed or mixture of breeds of dog that is kept at the dwelling. Although this was already the law with regard to assistance animals based on fair housing law, this is now the law regardless of the purpose of the dog. However, these prohibitions do not apply if a particular dog kept at the dwelling is known to be dangerous or has been declared to be dangerous and the decision is “based on sound underwriting and actuarial principles.”
To avoid having your “pet fee” provision rendered inapplicable, we recommend that you immediately revise the “pet fee” provision of your lease to be a refundable “pet deposit” so that it complies with the statute. If you need assistance in revising your lease, our team of real estate lawyers will be happy to assist you.
By, Annie Murphy