| 1 | 1 | | 1.1 A bill for an act |
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| 2 | 2 | | 1.2 relating to housing; prohibiting the use of tenant screening software that uses |
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| 3 | 3 | | 1.3 nonpublic competitor data to set rent; prohibiting the use of tenant screening |
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| 4 | 4 | | 1.4 software that is biased against protected classes; amending Minnesota Statutes |
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| 5 | 5 | | 1.5 2024, section 504B.245; proposing coding for new law in Minnesota Statutes, |
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| 6 | 6 | | 1.6 chapter 504B. |
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| 7 | 7 | | 1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: |
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| 8 | 8 | | 1.8 Section 1. [504B.242] SCREENING ALGORITHMS. |
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| 9 | 9 | | 1.9 Subdivision 1.Price fixing prohibition.(a) A landlord shall not employ, use, or rely |
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| 10 | 10 | | 1.10on or cause another person to employ, use, or rely on, an algorithmic device that uses, |
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| 11 | 11 | | 1.11incorporates, or was trained on nonpublic competitor data to set the amount of rent to be |
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| 12 | 12 | | 1.12charged to a tenant for a residential rental unit. |
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| 13 | 13 | | 1.13 (b) For the purposes of this section, an "algorithmic device" means a device that uses |
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| 14 | 14 | | 1.14one or more algorithms to perform calculations of data, including data concerning local or |
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| 15 | 15 | | 1.15statewide rent amounts being charged to tenants by landlords for the purpose of advising a |
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| 16 | 16 | | 1.16landlord on the amount of rent the landlord may want to consider charging a tenant, including |
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| 17 | 17 | | 1.17devices and software more commonly known as revenue management software. An |
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| 18 | 18 | | 1.18algorithmic device includes a product that incorporates an algorithmic device, but does not |
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| 19 | 19 | | 1.19include a report by a trade association that publishes renter data in the aggregate and |
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| 20 | 20 | | 1.20anonymous manner, nor does it include a product that establishes rent or income limits in |
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| 21 | 21 | | 1.21accordance with the affordable housing program guidelines of a local government, the state, |
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| 22 | 22 | | 1.22or a federal government law or program. |
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| 23 | 23 | | 1.23 (c) For the purposes of this section, "nonpublic competitor data" means information that |
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| 24 | 24 | | 1.24is not widely available or easily accessed by the public, including information about actual |
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| 25 | 25 | | 1Section 1. |
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| 26 | 26 | | 25-02044 as introduced01/16/25 REVISOR XX/AC |
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| 27 | 27 | | SENATE |
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| 28 | 28 | | STATE OF MINNESOTA |
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| 29 | 29 | | S.F. No. 2087NINETY-FOURTH SESSION |
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| 30 | 30 | | (SENATE AUTHORS: MAYE QUADE, Abeler, Port, Boldon and Housley) |
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| 31 | 31 | | OFFICIAL STATUSD-PGDATE |
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| 32 | 32 | | Introduction and first reading03/03/2025 |
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| 33 | 33 | | Referred to Judiciary and Public Safety 2.1rent prices, occupancy rates, lease start and end dates, and similar data, regardless of whether |
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| 34 | 34 | | 2.2the data are attributable to a specific competitor or anonymized, when the data are derived |
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| 35 | 35 | | 2.3from or otherwise provided by another person that competes in the same housing market |
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| 36 | 36 | | 2.4or in a related housing or rental market. |
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| 37 | 37 | | 2.5 Subd. 2.Bias algorithms prohibited.The use of an algorithm or artificial intelligence |
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| 38 | 38 | | 2.6software for background screening is prohibited when the screening tool software is likely |
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| 39 | 39 | | 2.7or known to have a disproportionate and arbitrary effect on a protected class listed in section |
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| 40 | 40 | | 2.8363A.09, subdivision 1. A landlord who makes a residential rental determination using a |
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| 41 | 41 | | 2.9background screening tool that violates this section is liable under section 504B.245. For |
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| 42 | 42 | | 2.10the purposes of this subdivision, "algorithm" means a computational process, including one |
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| 43 | 43 | | 2.11derived from machine learning, statistics, or other data processing or artificial intelligence |
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| 44 | 44 | | 2.12techniques that makes decisions; and "artificial intelligence" means a technology system |
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| 45 | 45 | | 2.13that can learn, adapt, and make decisions based on data, often using complex algorithms. |
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| 46 | 46 | | 2.14 EFFECTIVE DATE.This section is effective August 1, 2025, and applies to actions |
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| 47 | 47 | | 2.15taken on or after that date. |
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| 48 | 48 | | 2.16 Sec. 2. Minnesota Statutes 2024, section 504B.245, is amended to read: |
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| 49 | 49 | | 2.17 504B.245 TENANT REPORT; REMEDIES. |
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| 50 | 50 | | 2.18 In addition to the remedies otherwise provided by law, any person injured by a violation |
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| 51 | 51 | | 2.19of section 504B.241 or 504B.242 may bring a civil action against a residential tenant |
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| 52 | 52 | | 2.20screening service or landlord and recover the greater of $1,000 or actual damages, together |
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| 53 | 53 | | 2.21with costs and disbursements, including costs of investigation and reasonable attorney fees, |
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| 54 | 54 | | 2.22and receive other equitable relief as determined by the court. The attorney general has the |
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| 55 | 55 | | 2.23authority to investigate and prosecute violations of section 504B.241. |
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| 56 | 56 | | 2Sec. 2. |
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| 57 | 57 | | 25-02044 as introduced01/16/25 REVISOR XX/AC |
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