HomeMy WebLinkAboutORD 3366� mended by Ord 4351, 4963
CITY OF RENTON, WASHINGTON
ORDINANCE NO. 3366
AN ORDINANCE, relating to housing and
regulating the conversion of residential
rental units to condominiums or coop-
eratives; providing protections for tenants
and purchasers in converted buildings;
adopting measures to mitigate the adverse
effects of conversion displacement; and
providing penalties for violations.
WHEREAS, the vacancy rate for rental units in the City is between one and
two percent and has been steadily declining and projections indicate no increase in the
rental vacancy rate in the foreseeable future; and
WHEREAS, an increasing percentage of residential rental units are being
converted into condominiums and this conversion process is reducing the number of
rental units in the city thereby worsening an already critical rental housing shortage;
and
WHEREAS, tenants displaced by condominium conversions, frequently on short
notice, and sometimes immediately after commencement of the tenancy, have been
unable to find comparable housing and are increasingly unable to find any decent, safe,
and sanitary rental housing; and
WHEREAS, conversions are imposing severe hardships upon all displaced tenants;
and
WHEREAS, prospective purchasers of condominiums are often without knowledge
of the unique concepts of ownership involved or of the obligations they incur in
purchasing a condominium; and
WHEREAS, in view of the increased danger of loss to the homeowner due to
fire as the result of the occupancy of the building by other owners; and
WHEREAS, condominium sellers frequently do not provide prospective purchasers
sufficient information about the nature of condominium ownership generally, or about
specific building conditions and operation costs to enable purchasers to make informed
decisions; Now, Therefor,
THE CITY COUNCIL OF THE CITY OF RENTON DO ORDAIN AS FOLLOWS:
Section 1. Title: This ordinance may be cited as the "Condominium Conversion
Ordinance".
Section 2. Definitions: The following words and phrases used in this Ordinance
shall have the meanings set forth below:
(1) Acceptance of Offer of Sale: A written commitment for the purchase
of a condominium unit or interest in a cooperative at a specific price and on specific
terms.
(2) Agent: Any person, firm, partnership, association, joint venture, corpora-
tion or any other entity or combination of entities who represents or acts for or on
behalf of a developer in selling or offering to sell any condominium or cooperative
unit or interest in a cooperative.
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(3) Building: Any existing structure containing one or more dwelling units
and any grouping of such structures which were operated as rental units as converted
buildings are the subject of a single declaration or simultaneous declarations filed
pursuant to the Horizontal Property Regimes Act (RCW Chapter 64.32).
(4) Condominium: Any existing structure containing three or more dwelling
units as defined in the Housing Code: a) which is the subject of a declaration filed
pursuant to the Horizontal Property Regimes Act (RCW Chapter 64.32); or b) in which
there is private ownership of individual units and common ownership of common areas.
(5) Condominium Unit: Any dwelling unit in a condominium.
(6) Cooperative: Any existing structure, including surrounding land and
improvements, which contains one or more dwelling units and which: a) is owned by
an association organized pursuant to the Cooperative Association Act (RCW Chapter
23.86); or b) is owned by an association with resident shareholder who are granted
renewable leasehold interests in housing units in the building.
(7) Cooperative Unit: Any dwelling unit in a cooperative.
(8) Conversion of Condominiums: The filing of a declaration pursuant to
the Horizontal Property Regimes Act or the sale by a developer of condominium units
that were previously rental units.
(9) Conversion of Cooperatives: The execution of a lease agreement by a
member of a cooperative association.
(10) Converted Building: Any condominium or cooperative which formerly
contained rental dwelling units.
(11) Developer: Any person, firm, partnership association, joint venture or
corporation or any other entity or combination of entities or successors thereto who,
a) undertakes to convert, sell, or offer for sale condominium units; or b) undertakes
to convert rental units to cooperative units or sell cooperative shares in an existing
building which contains housing units or lease units, to a cooperative association's
shareholders. The term developer shall include the developer's agent and any other
person acting on behalf of the developer.
(12) Eviction: Any effort by a developer to remove a tenant from the
premises or terminate a tenancy by lawful or unlawful means.
(13) Housing Code: The Renton Housing Code as codified in Title 4, Chapter
9, Code of General Ordinances of the City of Renton, as amended.
(14) Offer of Sale to Tenant: A written offer to sell a condominium or
cooprative unit to the tenant in possession of that unit at a specific price and on
specific terms.
(15) Offer for Sale to Public: Any advertisement, inducement, solicitation,
or attempt by a developer to encourage any person other than a tenant to purchase
a condominium or cooperative unit.
(16) Owner's Association: The association formed by owners of units in a
condominium or cooperative for the purpose of managing the condominium or coop-
erative.
(17) Person: Any individual, corporation, partnership, association, trustee or
other legal entity-
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(18) Rental Unit: Any dwelling unit, other than a detached single family
residential dwelling, which is occupied pursuant to a lawful rental agreement, oral or
written, express or implied, which was not owned as a condominium unit or cooperative
unit on the effective date of this Ordinance. A dwelling unit in a converted building
for which there has been no acceptance of an offer of sale on the effective date of
this Ordinance shall be considered a rental unit.
(19) Subtenant: A person in possession of a rental unit through the tenant
with the knowledge and consent, express or implied, of the owner.
(20) Tenant: Any person who occupies or has a leasehold interest in a rental
unit under a lawful rental agreement whether oral or written, express or implied.
Section 3. Application of Ordinance:
(1) Application to Conversion of Condominiums and Cooperatives: This
Ordinance shall apply only to the conversion and sale of rental units that have not
yet been converted to condominium or cooperative units, and to those units in converted
buildings that are not subject to a binding purchase commitment or have not been sold
on the effective date of this Ordinance. This Ordinance shall not apply to condominium
or cooperative units that are vacant on - October 24 �, 1979 and which have been
offered for sale prior to that date; Provided, That any tenant who takes possession of
the unit after October 24 , 1979 shall be provided the disclosures required by
Section 4 of this Ordinance and shall be entitled to the benefits of that section if the
required disclosures are not given.
(2) Application to Tenants: This Ordinance shall apply only to those tenants
and subtenants who occupy rental units in converted buildings at the time the notices,
offers, and disclosures provided by this Ordinance are required to be delivered. This
ordinance shall not apply to tenants who take possession of a unit vacated by a tenant
who has received the notices and other benefits provided by this Ordinance; Provided,
that developers shall disclose in writing to all tenants who take possession after service
of the notice required by Section 4 of this Ordinance, that the unit has been sold or
will be offered for sale as a condominium or cooperative. This disclosure shall be
made prior to the execution of any written rental agreement or prior to the tenant's
taking possession, whichever occurs earlier. A developer's failure to disclose, within
the time specified above, that the unit has been sold or offered for sale shall entitle
the tenant to all the protections and benefits of this Ordinance.
Section 4. Tenant Protections:
(1) Notice to Tenants of Filing of Conversion Declaration: Within seven (7)
days of the filing of a condominium conversion declaration as provided by the Horizontal
Property Regimes Act (RCW Chapter 64.32) the developer shall:
(a) Send to each tenant in the converted building, by registered or
certified mail, return receipt requested, written notice of the filing. A tenant's refusal
to accept delivery shall be deemed adequate service.
(b) File notice of the filing of such declaration with the City Clerk,
giving the date of filing, file or recording number, office where filed, location and
address of the structure and number of dwelling units contained within the structure,
and the name, address and phone numbers of the owner(s), managers and persons
responsible for the management of the structure.
(2) Notice to all Tenants Prior to
as a Condominium or Cooperative Unit: At
condominium
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Unit for Sale to the Public
developer shall deliver to each tenant in the building written notice of his intention
to sell the unit or units. The notice shall specify the individual units to be sold and
the sale price of each unit. This notice shall be in addition to and not in lieu of the
notices required for eviction by RCW 59.12 and 59.18, and shall be delivered as provided
in Section 4(1)(a) of this Ordinance. With the notice the developer shall also deliver
to the tenant a statement, in a format to be provided by the Building Department,
of the tenant's rights under this ordinance.
(3) Purchase Rights of Tenant in Possession: With the notice provided in
Section 4 above, the developer shall deliver to each tenant whose unit is to be offered
for sale, a firm offer of sale of the unit that the tenant occupies. In the event that
more than one tenant occupies a single unit, the developer shall deliver the offer to
all tenants jointly or separately. For 120 days from the date of delivery of the offer
the tenant shall have the exclusive right to purchase his or her unit on the terms
offered.
(4) Purchase Rights of Tenants Whose Units are Offered for Sale Prior to
Effective Date of Ordinance: Tenants of rental units which were offered for sale as
condominium or cooperative units prior to the effective date of this Ordinance but
for which offers there have been no acceptances, shall be entitled to the rights and
benefits of this Ordinance except that those rights provided by Section 4(6) of this
Ordinance shall terminate 60 days from the offer of sale of the unit to the tenant.
(5) Subtenant's Purchase Rights: Should
a tenant
reject an offer of sale,
the subtenant in possession at the
time the notice
provided in Section 4 is delivered,
shall be offered the unit on the same terms as those offered
the tenant. For 30 days
following that offer or until the
expiration of the
tenants'
120 day option period as
provided in Section 4, whichever
occurs later, the
subtenant
shall have the exclusive
right to purchase the unit on the
terms offered to
the tenant.
(6) Rights of Tenants in Converted Buildings to Purchase Other Units in the
Buildings: Should both the tenant and subtenant reject the offer or sale or fail to
notify of acceptance of the offer within the time periods set forth in Sections 4(3)
and 4(5) or vacate, the unit shall be made available for purchase to other tenants and
subtenants in the building. The right to purchase another unit in the building by
tenants and subtenants shall extend to the end of the 120 day notice period provided
the tenant in possession of that unit under Section 4(3). Whenever all tenants and
subtenants in a building have indicated in writing their intention not to purchase a
unit or the 120 day notice period has expired and that unit is or becomes vacant then
the developer may offer for sale and sell the unit to the public.
(7) No Subsequent Sale on Better Terms: For a period of one year following
the date of the offers provided in Sections 4 3 , 4 5 and 4(6), no offer shall be extended
by the developer on terms more favorable in any respect than the offer previously
extended to the tenant and/or subtenant unless the more favorable offer is first
extended to the tenant and/or subtenant as required by Sections 4(3), 4(5) and 4(6) for
a period of not less than 30 days.
(8) Evictions Only for Good Cause During Notice Period: No condominium
or cooperative unit shall be sold or offered for public sale if, in the 120 day period
immediately preceding the sale or offer for public sale, any tenant has been evicted
without good cause. For the purposes of this Ordinance good cause shall mean: 1)
failure to pay rent after service of a three day notice to pay rent or vacate as
provided in RCW 59.12.030(3); 2) failure to comply with a term or terms of the tenancy
after service of a ten day notice to comply or vacate as provided in RCW 59.12.030(4);
and 3) the commission or permission of a waste or the maintenance of a nuisance on
the premises and failure to vacate after service of a three day notice as provided in
RCW 59.12.030(5).
(9) Tenant's Right to Vacate: Tenants who receive 120 day notices of sale
may terminate their tenancies at any time during such period in the manner provided
by RCW 59.18.200 and RCW 59.18.220, but will forfeit all rights to purchase a unit.
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Section 5.�
' (1)
Consumer Protections:
Housine Code InsDE
and Repair; Notice to Buvers and
Tenants: Prior to delivery of the 120 day notice described in paragraph 4 2 above,
developers shall, at .their expense, request an inspection of the entire building by the
Building Department for compliance with the Housing and Fire Code. The inspection
shall be completed within 45 days of a developer's request unless the developer fails
to provide or refuses access to Building and/or Fire Department personnel. The --
developer shall be required to install an approved fire alarm and smoke detector system
in accordance with Title 7, and Title 4, Chapter 32, of the Code of General Ordinances
of the City of Renton. The installation of the fire alarm system and all violations
of the Housing Code revealed by the inspection must be completed and corrected at
least 7 days prior to the closing of the sale of the first unit or by the compliance
date on the inspection report, whichever is sooner. A follow-up inspection for compliance
shall be completed within 7 days of a developer's request. A copy of the building
inspection report and certification of repairs shall be provided by the developer to
each prospective purchaser at least 3 days before the signing of any earnest money
agreement or other binding purchase commitment. Copies of the inspection report
shall be delivered to tenants in the converted building by the developer with the notice
of sale as provided in Section 4(2). An inspection fee of $100.00 for the first unit
and $15:00 per unit thereafter shall be paid by the developer whenever an inspection
is requested as required herein.
(2) Certification of Repairs: For the protection of the general public, the
Building Department shall inspect the repairs of defective conditions identified in the
inspection report and certify that the violations have been corrected. The certification
shall state that only those defects discovered by the Housing Code inspection and listed
on the inspection report have been corrected and that the certification does not
guarantee that all Housing Code violations have been corrected. Prior to the acceptance
of any offer, the developer shall deliver a copy of the certificate to the purchaser.
No developer, however, shall use the Building Officials certification in any advertising
for the purpose of inducing a person to purchase a condominium or cooperative unit.
(3) Disclosure Requirements: In addition, to the disclosures required by
previous sections of this Ordinance, the developer shall make available at a place on
the premises convenient to the tenants during normal working hours the following
information to prospective purchasers at least 3 days before any purchase commitment
is signed, or, in the case of existing tenants, with the 120 day notice provided in
paragraph 4(2) above: 1) copies of all documents filed with any governmental agency
pursuant to the Horizontal Property Regimes Act (Chapter 64.32 RCW); 2) an itemization
of the specific repairs and improvements made to the entire building during the six
months immediately preceeding the offer for sale; 3) an itemization of the repairs and
improvements to be completed before, close of sale; 4) 'a statement of the services
and expenses which are being paid for by the developer but which will in the future
be terminated, or transferred to the purchaser, or transferred to the owners' association;
5) an accurate estimate of the useful life of the building's major components and
mechanical systems (foundation,' exterior walls, exterior wall coverings other than paint
or similar protective coating, exterior stairs, floors and floor supports, carpeting in
common areas, roof cover; chimneys, plumbing system, heating system, water heating
appliances, mechanical ventilation system, and elevator equipment) and an estimate of
the cost of repairing any component whose useful life- will terminate in less than five
years from the date of this disclosure. For each system and component whose expected
life cannot be accurately estimated, the developer shall provide a detailed description
of its present condition and an explanation of why no estimate is possible. In addition,
the developer shall provide an itemized statement in budget form of the monthly costs
of owning the unit that the purchaser intends to buy. The itemization shall include
but shall not be limited to: ' a) payments on purchase loan; b) taxes; c) insurance; d)
utilities (which shall be listed individually); e) homeowner's assessments; f) the projected
monthly assessment nee'ded:.for replacing building components and systems whose life
expectancy is less than five years; and g) a statement of the budget assumptions
concerning occupancy and inflation factors.
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(4) Warranty of Repairs; Set Aside for Repairs: Each developer shall warrant
for one _year from the. date of completion all improvements and repairs disclosed
pursuant to Section 5(3) of this Ordinance.
(5) Unlawful Representations: It shall be unlawful for any developer, agent,
or person to make or cause to be made in any disclosure or other document required
by this Ordinance, any statement or representation that is knowingly false or misleading.
It shall also be unlawful for any developer, agent, or other person to make, or cause
to be made, to any prospective purchaser, including a tenant, any oral representation
which differs from the statements made in the disclosures and other documents required
to be provided tenants and purchasers by this Ordinance.
(6) , Purchaser's Right to Rescind:,Any purchaser who does not receive the
notices, disclosures; and documents required y this Ordinance may, at any time prior
to closing of the sale, rescind, in writing, any binding purchase agreement without any
liability on the purchaser's part and the purchaser shall thereupon be entitled to the
.return of any deposits made on account of the agreement.
(7) Delivery of Notice . and Other Documents: Unless otherwise provided,
all notices, contracts, disclosures, documents and other writings required by this
Ordinance shall be delivered by registered or certified mail, return receipt requested.
The refusal of registered or certified mail by the addressee shall be ,considered adequate
delivery. All documents shall be delivered to tenants at the address specified on the
lease or, rental agreement between the tenant and the developer or landlord. If there
is no written lease or rental agreement then documents shall be delivered to the
tenants' address at the converted building or. the last known address of the tenant, if
other than the. address at the converted building. In any sublet unit all documents shall
be delivered to the tenant at his current address, if known, and to the subtenant in
possession. If the tenant's current address is unknown, then two copies of all documents
shall be delivered to the subtenant, one addressed to the tenant and the other addressed
to the subtenant. Delivery of the 120 day ' notice of intention to sell' required by
Section 4(2) of the Ordinance, the developer's offer to sell, and all disclosure documents
shall be delivered to the tenants in a converted building at a meeting between the
developer and the tenants. The meeting shall. be arranged by the developer at a time
and place, convenient to the tenants. At the meeting the developer shall discuss with
the tenants the effect that the conversion will have upon the tenants. Should any
tenant refuse to acknowledge 'acceptance of the notice, offer and disclosures the
developer shall deliver the documents in the manner prescribed in this paragraph.
(8) Acceptance of Offers: Acceptance by tenants or other beneficiaries of
offers provided pursuant to this Ordinance, shall be in writing and delivered to the
developer by registered or certified mail, return receipt requested, postmarked on or
before the expiration date of the offer.
Section 6. Administration - Penalties Severability:
(1) Administration: The Building Department is charged with the admin-
istration and enforcement- of this Ordinance and is authorized and directed to adopt,
promulgate, amend and rescind administrative rules consistent with the provisions of
this Ordinance and necessary to carry out the duties of the Building Official hereunder.
(2) Complaints: Any person subjected to any unlawful practice as set forth
in this Ordinance may file a complaint in writing with the Building Department. The
Building Department is hereby authorized and directed to receive complaints and conduct
such investigations as are deemed necessary. Whenever it is determined that there
has been a violation of this Ordinance the Building Department is authorized, at its
discretion, to follow one or more of the following procedures:
(a) Attempt to conciliate the matter by conference or otherwise and
secure a written conciliation agreement..
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(b) Refer the matter to the City Attorney for appropriate civil
remedies or criminal prosecution.
(3) Hardship Relief - Waiver: The City Council is authorized to waive strict
compliance with this Ordinance, in specific individual instances where the developer
can show with clear, cogent and convincing evidence that: 1) the financial burden
required to comply would greatly outweigh the benefits and would create an unreasonable
hardship upon the developer; or 2) the units have been offered for sale .as condominium
units prior to the effective date of this Ordinance and the developer has incurred
significant financial obligations with the, intention of meeting such obligations with the
proceeds of the sale of such units, and the provisions of this Ordinance. will prevent
meeting such obligation.
(4) Penalties: Any person who violates any provision of this Ordinance, fails
to comply with the provisions of this Ordinance or who deliberately attempts to 'avoid
the application of this Ordinance may, upon conviction thereof, be punished by a fine
not exceeding $500. Each day's violation shall constitute a separate offense.
(5) Severability: If any section, subsection, sentence, clause, phrase or
portion of this Ordinance is for any reason held invalid or unconstitutional by any
court of competent jurisdiction, such portion shall be deemed a separate, distinct and
an independent provision and such decision shall not affect. the validity of the remaining
portions thereof.
(6) Effective Date: This Ordinance shall take effect and be in force five
(5) days after the date of its publication in the manner provided by law.
PASSED BY THE CITY COUNCIL this 15th day of October , 1979
Awed
elores A. Mead, Cit Clerk
APPROVED BY- THE MAYOR his , 15th day of October , 1979
Charles J. Maurerfti, Mayor
Approved as to form:
4_K ,l
Lawrence J. Warr6d, City Attorney
Date of Publication: October 19, 1979
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