The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Community Affairs
BILL: CS/SB 884
INTRODUCER: Judiciary Committee and Senator Boyd
SUBJECT: Fees in Lieu of Security Deposits
DATE: January 31, 2022
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Ravelo Cibula JU Fav/CS
2. Hackett Ryon CA Pre-meeting
3. RC
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Technical Changes
I. Summary:
CS/SB 884 amends the Florida Residential Landlord and Tenant Act to expressly authorize and
regulate agreements between a residential landlord and a tenant for the payment of a monthly fee
in lieu of a security deposit.
By expressly authorizing the use of a fee in lieu of a security deposit, the bill may facilitate the
use of security deposit insurance. This insurance product insures a landlord against losses that
would otherwise be covered by a security deposit or advance rent.
The bill takes effect July 1, 2022.
II. Present Situation:
Security Deposits and the Florida Residential Landlord and Tenant Act
The Florida Residential Landlord and Tenant Act regulates residential rental agreements. The
Act provides that when money is deposited or advanced by a tenant as security or advance rent,
the landlord is required to:
Hold the total amount of such money in a separate non-interest-bearing account in a Florida
banking institution for the benefit of the tenant or tenants. The landlord may not commingle
the funds with any other funds of the landlord or hypothecate, pledge, or in any other way
make use of the funds until they are actually due the landlord;
REVISED: BILL: CS/SB 884 Page 2
Hold the total amount of the funds in a separate interest-bearing account in a Florida banking
institution for the benefit of the tenant or tenants, in which case the tenant must receive and
collect interest in an amount of at least 75 percent of the annualized average interest rate
payable on the account or interest at the rate of 5 percent per year, simple interest, whichever
the landlord elects. The landlord may not commingle the funds with any other funds of the
landlord or hypothecate, pledge, or in any other way make use of the funds until the funds are
actually due the landlord; or
Post a surety bond, executed by the landlord as principal and a surety company authorized
and licensed to do business in the state as surety, with the clerk of the circuit court in the
county in which the dwelling unit is located in the total amount of the security deposits and
advance rent he or she holds on behalf of the tenants or $50,000, whichever is less. In
addition to posting the surety bond, the landlord must pay to the tenant interest at the rate of
5 percent per year, simple interest.
1
A landlord must, in the lease agreement or within 30 days after receipt of advance rent or a
security deposit, give written notice to the tenant which includes disclosures relating to the
advance rent or security deposit.
2
The written notice must:
3
Be given in person or by mail to the tenant;
State the name and address of the depository where the advance rent or security deposit is
being held or state that the landlord has posted a surety bond as provided by law;
State whether the tenant is entitled to interest on the deposit; and
Contain the following disclosure:
YOUR LEASE REQUIRES PAYMENT OF CERTAIN DEPOSITS. THE
LANDLORD MAY TRANSFER ADVANCE RENTS TO THE
LANDLORD’S ACCOUNT AS THEY ARE DUE AND WITHOUT
NOTICE. WHEN YOU MOVE OUT, YOU MUST GIVE THE
LANDLORD YOUR NEW ADDRESS SO THAT THE LANDLORD
CAN SEND YOU NOTICES REGARDING YOUR DEPOSIT. THE
LANDLORD MUST MAIL YOU NOTICE, WITHIN 30 DAYS AFTER
YOU MOVE OUT, OF THE LANDLORD’S INTENT TO IMPOSE A
CLAIM AGAINST THE DEPOSIT. IF YOU DO NOT REPLY TO THE
LANDLORD STATING YOUR OBJECTION TO THE CLAIM WITHIN
15 DAYS AFTER RECEIPT OF THE LANDLORD’S NOTICE, THE
LANDLORD WILL COLLECT THE CLAIM AND MUST MAIL YOU
THE REMAINING DEPOSIT, IF ANY.
IF THE LANDLORD FAILS TO TIMELY MAIL YOU NOTICE, THE
LANDLORD MUST RETURN THE DEPOSIT BUT MAY LATER FILE
A LAWSUIT AGAINST YOU FOR DAMAGES. IF YOU FAIL TO
TIMELY OBJECT TO A CLAIM, THE LANDLORD MAY COLLECT
1
Section 83.49(1), F.S.
2
Section 83.49(2), F.S. Additionally, if the landlord changes the manner or location in which he or she is holding the advance
rent or security deposit, he or she must notify the tenant within 30 days after the change.
3
Section 83.49(2)(a-d), F.S. BILL: CS/SB 884 Page 3
FROM THE DEPOSIT, BUT YOU MAY LATER FILE A LAWSUIT
CLAIMING A REFUND.
YOU SHOULD ATTEMPT TO INFORMALLY RESOLVE ANY
DISPUTE BEFORE FILING A LAWSUIT. GENERALLY, THE PARTY
IN WHOSE FAVOR A JUDGMENT IS RENDERED WILL BE
AWARDED COSTS AND ATTORNEY FEES PAYABLE BY THE
LOSING PARTY.
THIS DISCLOSURE IS BASIC. PLEASE REFER TO PART II OF
CHAPTER 83, FLORIDA STATUTES, TO DETERMINE YOUR LE GAL
RIGHTS AND OBLIGATIONS.
If the landlord does not intend to impose a claim on the security deposit, the landlord has 15 days
to return the security deposit together with interest.
4
If the landlord intends to impose a claim on
the deposit, such as for damage to the unit, the landlord has 30 days to give the tenant written
notice by certified mail of the landlord’s intention to impose a claim on the deposit along with
the reason. The notice must contain a statement in substantially the following form:
This is a notice of my intention to impose a claim for damages in the amount
of _____ upon your security deposit, due to _____. It is sent to you as
required by s. 83.49(3), Florida Statutes. You are hereby notified that you
must object in writing to this deduction from your security deposit within
15 days from the time you receive this notice or I will be authorized to
deduct my claim from your security deposit. Your objection must be sent
to (landlord’s address).
5
The landlord may then deduct the amount of his or her claim and must remit the balance of the
deposit to the tenant within 30 days after the date of the notice of intention to impose a claim for
damages. If the landlord fails to give the required notice within 30 days, the landlord forfeits the
right to impose a claim upon the security deposit. The failure of the tenant to make a timely
objection does not waive any rights of the tenant to seek damages in a separate action.
6
Security Deposit Insurance
Florida law does not specifically require any sort of security deposit for a residential lease. It is
generally up to the landlord and tenant to set up the lease agreement consistent with the
provisions in the Florida Residential Landlord and Tenant Act under ch. 83, F.S. Likewise,
Florida law does not address the issue of “security deposit insurance” for residential leases. This
insurance product, which has been called “lease insurance,” “rent insurance,” “tenant insurance,”
or “landlord insurance,” generally protects the landlord from damage to the property or loss of
rent.
7
Different insurance providers offer different levels of coverage. At least one company,
4
Section 83.49(3)(a), F.S.
5
Id.
6
Section 83.49(3)(b), F.S.
7
One company operating in Florida provides the following explanation of its security deposit insurance: BILL: CS/SB 884 Page 4
provides both security deposit insurance as well as the ability to sign a lease as the tenant’s
guarantor.
8
Another company operating in Florida offers personal property, security deposit, and
flexible rent payment insurance.
9
Generally, security deposit insurance protects the landlord and are distinct from the more
commonly used “renter’s insurance,” which often provides personal liability and personal
property protection for the tenant. Additionally, many security deposit insurance policies operate
under surety bonds,
10
and allow the insurance provider to recoup from the tenant any insurance
claim paid out to the landlord.
III. Effect of Proposed Changes:
The bill states that if a rental agreement requires a security deposit, the landlord may instead
offer a tenant the option to pay a fee in the lieu of the security deposit. This option, if provided,
must be provided to the tenant in writing and state:
That the tenant has the option to pay a security deposit instead of a fee;
The tenant at any time may terminate the agreement to pay a security deposit in the amount
that is otherwise offered to new tenants for a substantially similar dwelling unit on the date
that the tenant terminates the agreement; and
Whether any additional charges apply for either of the above circumstances.
The landlord has sole discretion as to whether to offer tenants the option to pay a fee in lieu of a
security deposit. If a tenant decides to pay a fee in lieu of a security deposit, a written agreement
to collect the fee must be signed by the landlord, or the landlord’s agent, and the tenant. The
Jetty Deposit is a deposit alternative product that replaces a traditional cash deposit with either a one-time, non-refundable
premium or a low, non-refundable monthly premium. Instead of paying a cash security deposit, Jetty Deposit gives you the
option to pay a fraction of the amount, which serves as a Jetty-backed guarantee to your property that they’ll be protected in
the event that you fail to pay for damage or skipped rent. Keep in mind that if you purchase Jetty Deposit, you’re agreeing to
pay your rent in full, not to cause damage beyond standard wear and tear on your rental home, and you remain responsible for
keeping it in good condition. And if you do cause excessive damage and fail to pay, Jetty assumes the responsibility of
recovering the cost from you. (Emphasis added).
Jetty Frequently Asked Questions, What is Jetty Deposit and how does it work?(Aug. 2021), https://jetty.zendesk.com/hc/en-
us/articles/4405193685911-What-is-Jetty-Deposit-and-how-does-it-work (last visited Jan. 13, 2022)
8
Rhino Frequently Asked Questions, What is Rhino Guarantor Coverage? (Mar. 2021), https://support.sayrhino.com/hc/en-
us/articles/360061185252-What-is-Rhino-guarantor-coverage (last visited Jan. 13, 2022).
9
Jetty Introduces New Flexible Rent Payment Product and Raises $23M, PRNewswire, (Sept. 8, 2021),
https://www.prnewswire.com/news-releases/jetty-introduces-new-flexible-rent-payment-product-and-raises-23m-
301372540.html (last visited Jan. 13, 2022).
10
“Sometimes, when a party owes others legal duties, the party posts a surety bond to guarantee their performance. The
surety bond is like a security deposit, with the party promising to do something as the renter and person they owe obligations
to, or obligee, is like the landlord. Thus, if the party that made the promise fails to perform their duty, the obligee is
compensated out of the bond.” See Legal Information Institute, Surety Bond, available at
https://www.law.cornell.edu/wex/surety_bond). One insurance provider provides the following explanation of surety bonds:
Surety bonds—like Rhino’s security deposit insurance—share a common purpose with traditional cash security deposits: to
reimburse property owners for unpaid rent and excessive damage to the home. However, surety bonds are less expensive than
traditional security deposits. Surety bonds also have transparency built into their insurance model. Instead of paying a cash
security deposit and wondering if you’ll ever see it again or if you’ll get it back in its entirety, renters pay for incidents (if
they happen) through Rhino directly.
Rhino Blog, What renters need to know about surety bonds, (Apr. 30, 2021), https://www.sayrhino.com/blog/posts/surety-
bonds-for-renting (last visited Jan. 13, 2022). BILL: CS/SB 884 Page 5
written agreement must specify the amount of the fee and how and when the fee is to be
collected. Additionally, written agreement must include the following disclosure:
THIS AGREEMENT HAS BEEN ENTERED INTO VOLUNTARILY BY
BOTH PARTIES AND THE TENANT AGREES TO PAY THE
LANDLORD A FEE IN LIEU OF A SECURITY DEPOSIT AS
AUTHORIZED UNDER SECTION 83.491, FLORIDA STATUTES.
THIS FEE IS NOT A SECURITY DEPOSIT AND PAYMENT OF THE
FEE DOES NOT ABSOLVE THE TENANT OF ANY OBLIGATIONS
UNDER THE RENTAL AGREEMENT, INCLUDING THE
OBLIGATION TO PAY RENT A S IT BECOMES DUE AND ANY
COSTS AND DAMAGES BEYOND NORMAL WEAR AND TEAR
THAT THE TENANT OR HIS OR HER GUESTS MAY CAUSE. THE
TENANT MAY TERMINATE THIS AGREEMENT AT ANY TIME
AND STOP PAYING THE FEE AND INSTEAD PAY A SECURITY
DEPOSIT AS PROVIDED IN SECTION 83.491, FLORIDA STATUTES.
THIS DISCLOSURE IS BASIC. PLEASE REFER TO PART II OF
CHAPTER 83, FLORIDA STATUTES, TO DETERMINE YOUR LEGAL
RIGHTS AND OBLIGATIONS.
The bill provides that a fee in lieu of a security deposit may be a recurring monthly fee, payable
on the same date that the rent payment is due under the rental agreement; or payable upon a
schedule that the landlord and tenant choose as specified in the written agreement.
If a landlord offers a tenant the option to pay a fee in lieu of a security deposit, the landlord must
also offer all new tenants renting a dwelling unit on the same premises the option to pay a fee in
lieu of a security deposit, unless the landlord chooses to terminate the fee option for all tenants.
The bill provides that this section applies to rental agreements entered into or renewed on or after
July 1, 2022.
The bill provides an effective date of July 1, 2022.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
None.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None. BILL: CS/SB 884 Page 6
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None identified.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
If implemented by landlords, a monthly fee in lieu of a security deposit may benefit
certain tenants who may otherwise be unable to afford a large security deposit.
CS/SB 884 may positively impact insurance providers that offer security deposit
insurance.
C. Government Sector Impact:
None.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill creates section 83.491, Florida Statutes.
IX. Additional Information:
A. Committee Substitute – Statement of Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
CS by Judiciary on January 18, 2022:
The CS specifies that a landlord has the sole discretion to determine whether to
accept a fee in lieu of a security deposit.
B. Amendments:
None. BILL: CS/SB 884 Page 7
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.