S1245

An Act concerning the rental of residential property and amending and supplementing P.L.1993, c.127.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 4 of P.L.1993, c.127 (C.40:48-2.12q) is amended to read as follows:

4. An ordinance adopted under authority of this section shall provide:

a. If in any twelve-month period [a specified number, which shall not be less than] two[, of] complaints, on separate occasions, of disorderly, indecent, tumultuous or riotous conduct upon or in proximity to any rental premises, and attributable to the acts or incitements of any of the tenants of those premises, have been substantiated by prosecution and conviction in any court of competent jurisdiction, the municipal governing body or any officer or employee of the municipality designated by the governing body for the purpose, may institute proceedings to require the landlord of those premises to post a bond against the consequences of future incidents of the same character.

b. (1) In the event a tenant is convicted of any of the conduct described in subsection a. of this section, the governing body, or the officer or employee designated pursuant to subsection a. of this section, shall cause notice advising that the conduct specified has occurred to be served on the landlord, in person or by registered mail, at the address appearing on the tax records of the municipality.

(2) The governing body or person designated pursuant to subsection a. of this section shall cause to be served upon the landlord, in person or by registered mail to the address appearing on the tax records of the municipality, notice advising of the institution of such proceedings, together with particulars of the substantiated complaints upon which those proceedings are based, and of the time and place at which a hearing will be held in the matter, which shall be in the municipal building, municipal court or other public place within the municipality, and which shall be no sooner than 30 days from the date upon which the notice is served or mailed.

c. At the hearing convened pursuant to subsection b. of this section, the hearing officer shall give full hearing to both the complaint of the municipality and to any evidence in contradiction or mitigation that the landlord, if present or represented and offering such evidence, may present. At the conclusion of the hearing the hearing officer shall determine whether the landlord shall be required to post a bond in accordance with the terms of the ordinance.

d. Any bond required to be posted shall be in accordance with the judgment of the hearing officer, in light of the nature and extent of the offenses indicated in the substantiated complaints upon which the proceedings are based, to be adequate in the case of subsequent offenses to make reparation for (1) damages likely to be caused to public or private property and damages consequent upon disruption of affected residents' rights of fair use and quiet possession of their premises, (2) securing the payment of fines and penalties likely to be levied for such offenses, and (3) compensating the municipality for the costs of repressing and prosecuting such incidents of disorderly behavior; but no such bond shall be in an amount less than $500 or more than $5,000. The municipality may enforce the bond thus required by action in the Superior Court, and shall be entitled to an injunction prohibiting the landlord from making or renewing any lease of the affected premises for residential purposes until that bond or equivalent security, in satisfactory form and amount, has been deposited with the municipality.

e. A bond or other security deposited in compliance with subsection d. of this section shall remain in force for a period specified pursuant to the ordinance, which shall be not less than two or more than four years. Upon the lapse of the specified period the landlord shall be entitled to the discharge thereof, unless prior thereto further proceedings leading to a forfeiture or partial forfeiture of the bond or other security shall have been had under section 5 of P.L.1993, c.127 (C.40:48-2.12r), in which case the security shall be renewed, in an amount and for a period that shall be specified by the hearing officer.

f. If the hearing officer finds that the landlord has not taken action to mitigate the behavior described in subsection a. of this section that is within the power of the landlord to take including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $2,000, which may be enforced pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10).

(cf: P.L.2009, c.170, s.4)

2. (New section) Upon a third complaint, as described pursuant to section 4 of P.L.1993, c.127 (C.40:48-2.12q), a bond may be required pursuant to subsection d. of that section in an amount of up to $15,000.

If the hearing officer finds that the landlord has not taken action to mitigate the behavior described in subsection a. of section 4 of P.L.1993, c.127 (C.40:48-2.12q) that is within the power of the landlord to take including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $5,000, which may be enforced pursuant to the "Penalty Enforcement Law," P.L.1999, c.274 (C.2A:58-10).

3. (New section) Upon a fourth complaint, as described pursuant to section 4 of P.L.1993, c.127 (C.40:48-2.12q), a bond may be required pursuant to subsection d. of that section in an amount of up to $25,000.

If the hearing officer finds that the landlord has not taken action to mitigate the behavior described in subsection a. of section 4 of P.L.1993, c.127 (C.40:48-2.12q) that is within the power of the landlord to take including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $10,000, which may be enforced pursuant to the "Penalty Enforcement Law,"P.L.1999, c.274 (C.2A:58-10).

4. This act shall take effect immediately.

STATEMENT

This bill would amend the law which allows municipal governing bodies to adopt ordinances under which, when a rental property has become the source of at least two "substantiated complaints" in one year, the municipality may institute an administrative proceeding to require the landlord to post a bond or equivalent security to compensate for any future damage or expense the municipality or its residents may suffer from future repetitions of such conduct.

Under the bill, with respect to two substantiated complaints, if the hearing officer finds that the landlord has not taken action that is within the power of the landlord to take, to mitigate the behavior that is the subject of the substantiated complaints including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $2,000.

The bill would also authorize municipalities to require a landlord to post a bond, and pay a penalty, upon third and fourth complaints in the same 12-month period concerning the same rental property Upon a third complaint, a bond may be required in an amount of up to $15,000; and, if the hearing officer finds that the landlord has not taken action to mitigate the problematic behavior that is within the power of the landlord to take including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $5,000. Upon a fourth complaint, a bond may be required in an amount of up to $25,000; and, if the hearing officer finds that the landlord has not taken action to mitigate the problematic behavior that is within the power of the landlord to take including, but not limited to, the initiation of eviction proceedings as permitted by law, the hearing officer may assess a penalty which may not exceed $10,000.