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| 4 | 4 | | |
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| 5 | 5 | | 2025 -- S 0489 |
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| 6 | 6 | | ======== |
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| 7 | 7 | | LC001380 |
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| 8 | 8 | | ======== |
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| 9 | 9 | | S T A T E O F R H O D E I S L A N D |
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| 10 | 10 | | IN GENERAL ASSEMBLY |
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| 11 | 11 | | JANUARY SESSION, A.D. 2025 |
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| 12 | 12 | | ____________ |
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| 13 | 13 | | |
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| 14 | 14 | | A N A C T |
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| 15 | 15 | | RELATING TO PROPERTY -- CAPACITY TO HOLD REAL ESTATE |
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| 16 | 16 | | Introduced By: Senators Kallman, Britto, Mack, Bell, and Gu |
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| 17 | 17 | | Date Introduced: February 26, 2025 |
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| 18 | 18 | | Referred To: Senate Housing & Municipal Government |
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| 19 | 19 | | |
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| 20 | 20 | | |
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| 21 | 21 | | It is enacted by the General Assembly as follows: |
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| 22 | 22 | | SECTION 1. Chapter 34-2 of the General Laws entitled "Capacity to Hold Real Estate" is 1 |
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| 23 | 23 | | hereby amended by adding thereto the following section: 2 |
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| 24 | 24 | | 34-2-2. Ownership of single-family dwelling, and certain multi-family dwellings by 3 |
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| 25 | 25 | | entities that are not individuals. 4 |
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| 26 | 26 | | (a) As used in this section, the following terms shall have the following meanings: 5 |
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| 27 | 27 | | (1) “Multi-family dwelling” means a residential property containing two (2) to four (4) 6 |
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| 28 | 28 | | dwelling units. 7 |
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| 29 | 29 | | (2) “Single-family dwelling” means a residential property containing no more than a single 8 |
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| 30 | 30 | | dwelling unit. 9 |
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| 31 | 31 | | (b) If a legal entity that is not an individual possesses, controls, or otherwise claims legal 10 |
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| 32 | 32 | | title to assets in real property whose aggregate value exceeds twenty-five million dollars 11 |
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| 33 | 33 | | ($25,000,000), then such an entity shall be prohibited from owning single-family dwellings, or 12 |
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| 34 | 34 | | multi-family dwellings. For the purposes of this section, legal entities owned by the same 13 |
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| 35 | 35 | | individual, or group of individuals shall be considered a single entity for the purposes of calculating 14 |
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| 36 | 36 | | the aggregate value of real property. 15 |
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| 37 | 37 | | (c) Legal entities that possess, control, or otherwise claim legal title to assets in real 16 |
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| 38 | 38 | | property whose aggregate value exceeds twenty-five million dollars ($25,000,000) prior to the 17 |
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| 39 | 39 | | effective date of this section, shall divest from assets consisting of single-family dwellings, and/or 18 |
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| 40 | 40 | | multi-family dwellings over a period of ten (10) years, until the total aggregate value held by such 19 |
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| 41 | 41 | | |
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| 42 | 42 | | |
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| 43 | 43 | | LC001380 - Page 2 of 7 |
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| 44 | 44 | | an entity is less than or equal to twenty-five million dollars ($25,000,000). 1 |
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| 45 | 45 | | (d) Applicable entities affected by this section shall divest from single-family dwellings, 2 |
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| 46 | 46 | | and/or multi-family dwellings according to the following schedule: 3 |
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| 47 | 47 | | (1) In the first full taxable year beginning after the effective date of this section, entities 4 |
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| 48 | 48 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 5 |
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| 49 | 49 | | dwellings shall divest from their holdings in these dwellings by ten percent (10%) of the aggregate 6 |
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| 50 | 50 | | total over twenty-five million dollars ($25,000,000) as of the effective date of this section. 7 |
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| 51 | 51 | | (2) In the second full taxable year beginning after the effective date of this section, entities 8 |
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| 52 | 52 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 9 |
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| 53 | 53 | | dwellings shall divest from their holdings in these dwellings by twenty percent (20%) of the 10 |
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| 54 | 54 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 11 |
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| 55 | 55 | | section. 12 |
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| 56 | 56 | | (3) In the third full taxable year beginning after the effective date of this section, entities 13 |
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| 57 | 57 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 14 |
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| 58 | 58 | | dwellings shall divest from their holdings in these dwellings by thirty percent (30%) of the 15 |
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| 59 | 59 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 16 |
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| 60 | 60 | | section. 17 |
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| 61 | 61 | | (4) In the fourth full taxable year beginning after the effective date of this section, entities 18 |
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| 62 | 62 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 19 |
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| 63 | 63 | | dwellings shall divest from their holdings in these dwellings by forty percent (40%) of the aggregate 20 |
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| 64 | 64 | | total over twenty-five million dollars ($25,000,000) as of the effective date of this section. 21 |
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| 65 | 65 | | (5) In the fifth full taxable year beginning after the effective date of this section, entities 22 |
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| 66 | 66 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 23 |
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| 67 | 67 | | dwellings shall divest from their holdings in these dwellings by fifty percent (50%) of the aggregate 24 |
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| 68 | 68 | | total over twenty-five million dollars ($25,000,000) as of the effective date of this section. 25 |
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| 69 | 69 | | (6) In the sixth full taxable year beginning after the effective date of this section, entities 26 |
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| 70 | 70 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 27 |
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| 71 | 71 | | dwellings shall divest from their holdings in these dwellings by sixty percent (60%) of the aggregate 28 |
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| 72 | 72 | | total over twenty-five million dollars ($25,000,000) as of the effective date of this section. 29 |
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| 73 | 73 | | (7) In the seventh full taxable year beginning after the effective date of this section, entities 30 |
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| 74 | 74 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 31 |
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| 75 | 75 | | dwellings shall divest from their holdings in these dwellings by seventy percent (70%) of the 32 |
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| 76 | 76 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 33 |
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| 77 | 77 | | section. 34 |
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| 78 | 78 | | |
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| 79 | 79 | | |
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| 80 | 80 | | LC001380 - Page 3 of 7 |
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| 81 | 81 | | (8) In the eighth full taxable year beginning after the effective date of this section, entities 1 |
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| 82 | 82 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 2 |
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| 83 | 83 | | dwellings shall divest from their holdings in these dwellings by eighty percent (80%) of the 3 |
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| 84 | 84 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 4 |
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| 85 | 85 | | section. 5 |
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| 86 | 86 | | (9) In the ninth full taxable year beginning after the effective date of this section, entities 6 |
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| 87 | 87 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 7 |
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| 88 | 88 | | dwellings shall divest from their holdings in these dwellings by ninety percent (90%) of the 8 |
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| 89 | 89 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 9 |
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| 90 | 90 | | section. 10 |
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| 91 | 91 | | (10) In the tenth full taxable year beginning after the effective date of this section, entities 11 |
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| 92 | 92 | | that possess, control, or otherwise claim legal title to single-family dwellings, or multi-family 12 |
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| 93 | 93 | | dwellings shall divest from their holdings in these dwellings by one hundred percent (100%) of the 13 |
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| 94 | 94 | | aggregate total over twenty-five million dollars ($25,000,000) as of the effective date of this 14 |
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| 95 | 95 | | section. 15 |
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| 96 | 96 | | (e) The value of single-family homes and multi-family homes for the purposes of 16 |
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| 97 | 97 | | calculating an entity’s aggregate total value shall be equal to the assessed value of the property used 17 |
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| 98 | 98 | | for the purposes of determining municipal real estate tax, as published by the entity pursuant to § 18 |
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| 99 | 99 | | 34-18-58(a)(7). 19 |
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| 100 | 100 | | (f) Beginning January 1, 2027 and each year thereafter, the maximum allowable aggregate 20 |
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| 101 | 101 | | total of real property as established in subsection (b) of this section, shall be adjusted for inflation 21 |
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| 102 | 102 | | using the most recent Consumer Price Index (CPI) report as published by the United States Bureau 22 |
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| 103 | 103 | | of Labor and Statistics. 23 |
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| 104 | 104 | | (g) Should the aggregate total value of real property held by an entity exceed twenty-five 24 |
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| 105 | 105 | | million dollars ($25,000,000) due to increased valuation of said property, then the entity shall have 25 |
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| 106 | 106 | | one year from the date of reevaluation to divest such real property that causes the aggregate total 26 |
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| 107 | 107 | | valuation to exceed twenty-five million dollars ($25,000,000). 27 |
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| 108 | 108 | | (g) Entities found in violation of this section after a hearing pursuant to chapter 35 of title 28 |
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| 109 | 109 | | 42 (“administrative procedures”) shall be subjected to fines up to, but not exceeding, ten thousand 29 |
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| 110 | 110 | | dollars ($10,000) for each violation. The secretary of the department of housing shall be responsible 30 |
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| 111 | 111 | | for enforcing the provisions of this section by promulgating rules and regulations necessary to 31 |
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| 112 | 112 | | implement the provisions of this section. 32 |
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| 113 | 113 | | SECTION 2. Section 34-18-58 of the General Laws in Chapter 34-18 entitled "Residential 33 |
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| 114 | 114 | | Landlord and Tenant Act" is hereby amended to read as follows: 34 |
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| 115 | 115 | | |
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| 116 | 116 | | |
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| 117 | 117 | | LC001380 - Page 4 of 7 |
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| 118 | 118 | | 34-18-58. Statewide mandatory rental registry. 1 |
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| 119 | 119 | | (a) All landlords shall register the following information with the department of health: 2 |
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| 120 | 120 | | (1) Names of individual landlords or any business entity responsible for leasing to a tenant 3 |
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| 121 | 121 | | under this chapter; 4 |
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| 122 | 122 | | (2) An active business address, PO box, or home address; 5 |
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| 123 | 123 | | (3) An active email address; 6 |
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| 124 | 124 | | (4) An active telephone number that would reasonably facilitate communications with the 7 |
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| 125 | 125 | | tenant of each dwelling unit; 8 |
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| 126 | 126 | | (5) Any property manager, management company, or agent for service of the property, 9 |
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| 127 | 127 | | along with the business address, PO box, or home address of the property manager, management 10 |
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| 128 | 128 | | company, or agent and including: 11 |
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| 129 | 129 | | (i) An active email address; and 12 |
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| 130 | 130 | | (ii) An active telephone number, for each such person or legal entity, if applicable, for each 13 |
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| 131 | 131 | | dwelling unit; and 14 |
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| 132 | 132 | | (6) Information necessary to identify each dwelling unit; and 15 |
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| 133 | 133 | | (7) The assessed value of each property as used for the purposes of calculating municipal 16 |
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| 134 | 134 | | property taxes as well as the aggregate value of all properties owned by the individual landlords or 17 |
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| 135 | 135 | | any business entity. 18 |
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| 136 | 136 | | (b) All landlords who lease a residential property constructed prior to 1978 and that is not 19 |
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| 137 | 137 | | exempt from the requirements of chapter 128.1 of title 42 (“lead hazard mitigation”) shall, in 20 |
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| 138 | 138 | | addition to the requirements of subsection (a) of this section, for each dwelling unit, provide the 21 |
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| 139 | 139 | | department of health with a valid certificate of conformance in accordance with chapter 128.1 of 22 |
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| 140 | 140 | | title 42 (“lead hazard mitigation”) and regulations derived therefrom, or evidence sufficient to 23 |
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| 141 | 141 | | demonstrate that they are exempt from the requirement to obtain a certificate of conformance. 24 |
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| 142 | 142 | | (c) Contingent upon available funding, the department of health, or designee, shall create 25 |
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| 143 | 143 | | a publicly accessible online database containing the information obtained in accordance with 26 |
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| 144 | 144 | | subsections (a) and (b) of this section, no later than nine (9) months following the effective date of 27 |
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| 145 | 145 | | this section [June 20, 2023]. 28 |
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| 146 | 146 | | (d) All landlords subject to the requirements of subsections (a) and (b) of this section as of 29 |
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| 147 | 147 | | September 1, 2024, shall register the information required by those subsections no later than 30 |
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| 148 | 148 | | October 1, 2024. 31 |
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| 149 | 149 | | A landlord who acquires a rental property, or begins leasing a rental property to a new 32 |
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| 150 | 150 | | tenant, after September 1, 2024, shall register the information required by subsections (a) and (b) 33 |
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| 151 | 151 | | of this section within thirty (30) days after the acquisition or lease to a tenant, whichever date is 34 |
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| 152 | 152 | | |
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| 153 | 153 | | |
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| 154 | 154 | | LC001380 - Page 5 of 7 |
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| 155 | 155 | | earlier. All landlords subject to the requirements of subsections (a) and (b) of this section shall, 1 |
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| 156 | 156 | | following initial registration, re-register by October 1 of each year in order to update any 2 |
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| 157 | 157 | | information required to comply with subsections (a) and (b) of this section, or to confirm that the 3 |
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| 158 | 158 | | information already supplied remains accurate. 4 |
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| 159 | 159 | | (e) Any person or entity subject to subsections (a) and (b) of this section who fails to 5 |
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| 160 | 160 | | comply with the registration provision in subsection (d) of this section, shall be subject to a civil 6 |
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| 161 | 161 | | fine of at least fifty dollars ($50.00) per month for failure to register the information required by 7 |
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| 162 | 162 | | subsection (a) of this section, or at least one hundred and twenty-five dollars ($125) per month, for 8 |
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| 163 | 163 | | failure to register the information required by subsection (b) of this section. 9 |
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| 164 | 164 | | (f) All civil penalties imposed pursuant to subsection (e) of this section shall be payable to 10 |
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| 165 | 165 | | the department of health. There is to be established a restricted receipt account to be known as the 11 |
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| 166 | 166 | | “rental registry account” which shall be a separate account within the department of health. 12 |
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| 167 | 167 | | Penalties received by the department pursuant to the terms of this section shall be deposited into 13 |
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| 168 | 168 | | the account. Monies deposited into the account shall be transferred to the department of health and 14 |
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| 169 | 169 | | shall be expended for the purpose of administering the provisions of this section or lead hazard 15 |
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| 170 | 170 | | mitigation, abatement, enforcement, or poisoning prevention. No penalties shall be levied under 16 |
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| 171 | 171 | | this section prior to October 1, 2024. 17 |
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| 172 | 172 | | (g) Notwithstanding the provisions of § 34-18-35, a landlord or any agent of a landlord 18 |
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| 173 | 173 | | may not commence an action to evict for nonpayment of rent in any court of competent jurisdiction, 19 |
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| 174 | 174 | | unless, at the time the action is commenced, the landlord is in compliance with the requirements of 20 |
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| 175 | 175 | | subsections (a), (b), and (d) of this section. A landlord must present the court with evidence of 21 |
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| 176 | 176 | | compliance with subsections (a), (b), and (d) of this section at the time of filing an action to evict 22 |
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| 177 | 177 | | for nonpayment of rent in order to proceed with the civil action. 23 |
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| 178 | 178 | | (h) The department of health may commence an action for injunctive relief and additional 24 |
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| 179 | 179 | | civil penalties of up to fifty dollars ($50.00) per violation against any landlord who repeatedly fails 25 |
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| 180 | 180 | | to comply with subsection (a) of this section. The attorney general may commence an action for 26 |
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| 181 | 181 | | injunctive relief and additional civil penalties of up to one thousand dollars ($1,000) per violation 27 |
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| 182 | 182 | | against any landlord who repeatedly fails to comply with subsection (b) of this section. Any 28 |
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| 183 | 183 | | penalties obtained pursuant to this subsection shall be used for the purposes of lead hazard 29 |
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| 184 | 184 | | mitigation, abatement, enforcement, or poisoning prevention, or for the purpose of administering 30 |
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| 185 | 185 | | the provisions of this section. No penalties shall be levied under this section prior to October 1, 31 |
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| 186 | 186 | | 2024. 32 |
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| 187 | 187 | | |
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| 188 | 188 | | |
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| 189 | 189 | | LC001380 - Page 6 of 7 |
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| 190 | 190 | | 1 |
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| 191 | 191 | | SECTION 3. This act shall take effect on January 1, 2026. 2 |
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| 192 | 192 | | ======== |
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| 193 | 193 | | LC001380 |
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| 195 | 195 | | |
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| 196 | 196 | | |
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| 197 | 197 | | LC001380 - Page 7 of 7 |
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| 198 | 198 | | EXPLANATION |
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| 199 | 199 | | BY THE LEGISLATIVE COUNCIL |
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| 200 | 200 | | OF |
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| 201 | 201 | | A N A C T |
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| 202 | 202 | | RELATING TO PROPERTY -- CAPACITY TO HOLD REAL ESTATE |
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| 203 | 203 | | *** |
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| 204 | 204 | | This act would preclude any legal entity from possessing, controlling or otherwise claiming 1 |
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| 205 | 205 | | legal title to real property exceeding an aggregate value of twenty-five million dollars 2 |
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| 206 | 206 | | ($25,000,000) in single-family dwellings or multi-family dwellings. Any legal entity that 3 |
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| 207 | 207 | | possesses, controls or otherwise claims legal title to real property exceeding an aggregate value of 4 |
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| 208 | 208 | | twenty-five million dollars ($25,000,000) in single-family dwellings or multi-family dwellings, 5 |
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| 209 | 209 | | would be forced to divest a graduated yearly amount from assets consisting of single-family 6 |
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| 210 | 210 | | dwellings or multi-family dwellings over the next ten (10) years, until the total aggregate value 7 |
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| 211 | 211 | | held by that legal entity is less than or equal to twenty-five million dollars ($25,000,000). 8 |
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| 212 | 212 | | This act would take effect on January 1, 2026. 9 |
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| 214 | 214 | | LC001380 |
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