Vermont Legislature SmartTranscripts:

[Marc Mihaly]: Welcome everybody to House General In Housing. Today is Friday, thank goodness, March 20, and we're going to today do three things. We're continuing our exploration of institutional real estate investors' purchase of single family residences, and we are then going to do take a quick look at an amendment to H seven seventy two, which is the rental agreement legislation, and then we are going to have a little bit of testimony about a senate bill, which is an Fair Employment Practices bill, but there are possibilities that we'll add to it, and we'll take a look at that. Our first, returning to our first witness is 8,607. Chris, I'm Marc Mihaly. I'm going to have the committee introduce itself to you, and why don't we start there? Debbie, you want to take it away?

[Deborah "Debbie" Dolgin]: Debbie Dolgin, I represent St. Johnsbury, Concord and Kirby.

[Martin "Marty" LaLonde]: Hi, I'm Tom Charlton, Athens Chester, Drafton and Windham. Joe Parsons, Thompson, Giratin and Newbury.

[Ashley Bartley]: Hi, Chris. Ashley Bartley, Fairfax in Georgia.

[Marc Mihaly]: Chris, I'm Marc Mihaly. I represent Caledonia, Plainfield and Marshfield, and I'm the chair.

[Emilie Krasnow]: Emilie Krasnow, South Burlington, Chittenden 9. Hello.

[Martin "Marty" LaLonde]: Hello.

[Saudia LaMont]: Saudia LaMont, the Royal Washington District. Gayle Pezzo, Chittenden twenty,

[Marc Mihaly]: Colchester. So, Chris, I'm going to have you introduce yourself in a minute and tell us about yourself, just to set the stage. So, we we've taken up a bill that we've had here for a while but haven't acted on or haven't had any testimony on, and it's it relates, to private equity and institutional investment in the purchase of single and two family residences. But we've taken a good bit of testimony. Some of it is focused on the problem, some of the bad things that can happen and have happened in other cities. I think that we realize that it's not as big a problem here yet as it is elsewhere, but it seems to be growing. And so rather than wait till the cow's out of the barn, we thought we'd take it up earlier. At the same time, our concern is that we really need we know we need investment in Vermont. We need capital in Vermont to build houses, build rental units, etcetera, So, we're trying to figure out how to regulate without being, if I might use a technical term, stupid. So, that's why we were kind of looking around for people who do development, and your name came up, and that's how we got to you. So, that as a background, you want to tell us who you are and, give us a little about yourself and tell us any thoughts you have.

[Chris Snyder]: Yep, absolutely. So, my name is Chris Snyder, I'm the president and owner of Snyder Homes. I'm a second generation homebuilder. My parents started the business in 1976, so we are in our fiftieth year of work.

[Marc Mihaly]: Congratulations.

[Chris Snyder]: Yep. And I took I had worked for a large home building company for a number of years but returned to Vermont in 2000. I have been managing our company since 2004 and purchased the company from my parents in 2014. So for the last twelve years, I've been owning and managing the business. Our goal as a company is to build approximately 30 homes per year in about 120 apartments per year. So we are somewhat providing housing for about 150 people or families per year, which is a relatively high number of units on an annual basis over the last well really since 2014 I'd say we've been achieving that that result. In the last several years we have increased our construction of apartment buildings as we partnered with UVM and with the University of Vermont Medical Center, providing employee housing or graduate student or staff housing for the college. I have been personally involved both on the for sale and on rental side for this period of time, but also been involved with larger entities, institutions on housing. We generally build within we

[Cameron Wood]: sort

[Chris Snyder]: of joke but twenty minutes of our office which is in Shelburne. So, if if the piece, the property is within twenty, twenty five minutes of here, we'll consider the the potential opportunity but further afield not as motivated to work outside of our specific area. Know, thinking and when I was asked to testify about this, I kind of started thinking about, like, okay. Do we have I even what's going on with investment in homes or apartments in Chittenden County? And I'm going to speak specifically more to where where my knowledge is and we do sell probably two homes a year that are to an investor. Generally, it's a person or a couple that are buying They have some investment that has generated some return and they say, I want to go put my money into a rental property. And so they do that. And they see it as, like, an investment opportunity for them for the long term. I have not seen or heard or talked to anybody who wants to come in and buy more than one unit at a time. And it's very I just couldn't envision. I mean, I've never been asked, and I don't think it makes a lot of sense for a large group to come in and buy like an entire neighborhood, one of our houses or 20 of our homes because the the the individual investor is doing this and so I look at it and I say, okay, well, what are they going to rent that house for? Or that townhouse for? And they basically are breaking even. It's only about the long term ownership piece that they're paying down the mortgage on that property and they're getting principal. So there is some return on their investment but it's not drastic. And that's because the cost of the house, if if we were building a home that was at 300,000 in the rent allowed for it to be $3.00 a month, that would be one thing but we're they're buying a $600.00 townhouse in renting it for $3 and so therefore there's not a return substantial return on their investment and I I would say that that would be the case even for an institutional investor or private equity investor and going buying single homes here is the rents would not actually allow for that entity to make money on an annual basis. It's more of this long term ownership hold. So, I hear the concern about we don't really have that problem here but it could, it's happening in other places and I go, yes, that is true and I do hear about that and I understand the federal government is also participating in some discussions on this but I don't see how our housing prices are going to come down drastically enough to be able to attract private equity investors to who would be able to get a return on their investments in, you know, in the current state.

[Marc Mihaly]: Here's a couple of questions just right off the top. Do you think that, you know, you said you sell maybe one a year, two a year. Are those people I'm just curious. Are they coming in because they're they're often looking they're facing they're looking for an exchange? In other

[Chris Snyder]: So words we see some we we saw one doing a $10.31 exchange. The one had an investment that paid out that they all of a sudden had these additional funds and they had a choice. They could either go invest it in the stock market or they could go buy a house and then rent it.

[Marc Mihaly]: Yeah. Gayle? What's a ten thirty one? It's it's when you sell real estate. Let's say you're a private party and you have an investment, a rental unit, and you sell it, and you might let's say you bought it twenty years ago for a song, and now it's worth a lot, and you won't don't wanna pay a huge capital gain. One way out of that is to just buy another unit. You plow it back into another unit. That is not a detailed script. But

[Chris Snyder]: kind of the you're taking your gain and putting it into 100% of that game needs to go into the next next deal. So, it does happen but it's somebody who doesn't necessarily need the gain, the funds from the gain for a day to day but in this case, like, the person got to $10.31, it was enough funds to pay for the house. Well, now, they're gonna get rent paid on a monthly basis and so they're they're not necessarily going to get a return on their investment. They're just going to get a, you know, a rent payment.

[Marc Mihaly]: Right. A long term. It's a long term investment. Yes. Another question. How do I explain this? So, the kinds of behaviors that we're seeing in other cities involve people buying up usually existing homes in poor communities, and then there's a really elevated rate of enshakment, know, of throwing the tenants out, well, all of a sudden, and then they re rent, and all of a sudden, what was a home ownership community turns into a so anyway, into into a renter community and the homes aren't kept up, etcetera. But so as people struggle to define what their target is, what they wanna stop as legislators do that, they tend to focus on they tend to focus on trying to define what private equity is. Mhmm. One of our concerns is that we not capture the wrong thing. So if I might ask you, and feel free to generalize or not answer if you don't want to, where do you get the capital? I mean, obviously, you have some debt in your projects, but where does the equity come from?

[Chris Snyder]: Me.

[Marc Mihaly]: Okay. So you guys use your own accumulated equity? Yes. Right. And do you when you build a project, is that your own I assume each of your projects is is its own corporation. Right?

[Chris Snyder]: Yeah. They're separate LLCs.

[Marc Mihaly]: They're separate LLCs. Yeah. But Right.

[Chris Snyder]: Go ahead.

[Emilie Krasnow]: I was just gonna say, but are you buying single family homes as well? I know developing, but do you buy them as well? No. No. So he's not buying.

[Marc Mihaly]: Right. He's not buying. Right.

[Chris Snyder]: Okay. Mean, we, like, we bought a we bought a a property that we were are developing, and it has a single family house on it.

[Emilie Krasnow]: And thank you.

[Chris Snyder]: But like there's one house on it that will stay. Actually it's gonna go away. In this case it's going away. But in some cases we have seen where that single house on a larger parcel will stay in the rest of the parcel is is is developed. And so that does happen where you might own that house and own it for a long period of time. But we're we're not out buying a single family house to go rent.

[Emilie Krasnow]: Well, thank you, Chris. I have the good fortune of not in the district I represent, but in South Burlington of driving by a lot of the work that you've done. And I think you're owed a great deal of gratitude for I know there's a lot of things the legislature we're not here to discuss all the things the legislature could do that would be more helpful to people like you that you deserve. But thank you so much for all your development and sticking with us. And since you aren't one of the people that, you know, would be captured in a bill like this, and really my intent, like our chair said, is to, you know, your testimony is helpful, though, that someone in your position has not seen these actors come into at least your projects to buy up many of them at a time, etcetera. So it's still very most of the testimony we've heard, I'm really struggling to find these people. So if you do happen to meet anyone that does meet this criteria and they're willing to talk to me or to the committee, know, would you know, please let me know, but it's really helpful to hear at least that you haven't experienced it and you do understand the intent of the bill. But I, again, just so much gratitude for all the housing that you've produced in South Burlington.

[Chris Snyder]: Yeah, thank you. Yeah. It's been a long time coming. And and, you know, people say, oh, you know, South Burlington really came together and really came up quickly. I have to remind them, I started working on a project in 2012. So, you know, it's not that quick in my world. It's quick quick in the building world, but not necessarily quick in there in in the life cycle of the world.

[Marc Mihaly]: Is, do I do you guys hold houses, or do you just you build them in units and then try to sell them quickly? So And or do you hold?

[Chris Snyder]: So so Snyder Homes is a a a build and sell company. I am also a member, and owner of in a number of LLCs that builds and holds. And where I would say is, you know, the so I'll use UVM Medical Center as an example. They are in a partner of ours in South Burlington City Center. If this bill was worked through the way that I I I have read that then or understand it, then they're an investor. And even though we're developing new, would they get trapped into this and that we have to offer it for sale because they're of a group that has more than $30,000,000 in assets and they also are an investor in more than 10 homes. And so when I read that, I was like, if if that investment piece for the medical center was, you know, if if if they trip that, that would be a downside to, you know, helping them create workforce housing.

[Emilie Krasnow]: So two things. Yes, that would be a bad unintentional consequence, but they would not meet the definition under this bill because, well, two reasons. One, the investments that they make right now, like Catamount Run and the other places like that, are not single family homes. Two, they're a nonprofit organization.

[Chris Snyder]: Yep. They're But what if they but if it what if that hospital wasn't a nonprofit?

[Emilie Krasnow]: So a hospital outside of Vermont wanted to buy up single family homes?

[Chris Snyder]: Yeah. I mean, maybe what if what if the world change what if the world changes and these hospitals become privatized?

[Emilie Krasnow]: Yeah, yeah, absolutely. It is a good flag. I'm just using the UBM Medical Center as

[Marc Mihaly]: an

[Emilie Krasnow]: example, they would not trip or be caught up in this bill. But yes, if our UBM Medical Center became privatized and wanted to buy up single family homes in South Burlington. Yeah, sure.

[Marc Mihaly]: See, this is an interesting thing.

[Emilie Krasnow]: But I personally would probably, I think that would kind of be a problem for me if that was something that happened. If a private hospital came in and wanted to buy up a bunch of single family homes, I believe it would work for us housing, but there also has to be housing for people.

[Marc Mihaly]: See, this is an area we're really going have to think about hard because Well, first of all, I agree. I don't think it matters that they're a nonprofit because there could easily be for profit partners in these kinds of things, who are building new housing, which we want.

[Emilie Krasnow]: They can build it, though.

[Marc Mihaly]: Yeah, and building new housing, and their model is to build and hold. But the but what I'm hearing you say is at the moment, at least, in Burlington, that's multifamily housing. Is that right?

[Chris Snyder]: Yeah. Because that's what people can afford from so so the workforce and the the employees and the staff can afford that level. I think if the if they and our overall rent, you know, if you look at the numbers, right, it's about what can they afford, but also what can we build for that price. Right. If we could go build 200 single family homes and we could and they could and those staff or employees could rent a house versus an apartment, I think we would do that. It's just they can't like we can't build that house for the right price to make that work.

[Emilie Krasnow]: And I would love if we could build that housing and if UVM Clinical Center could buy that for people and rent to them. I would love that.

[Martin "Marty" LaLonde]: Yeah.

[Emilie Krasnow]: So I think that I really, you know, I introduced this bill so that we could start a discussion and learn more. I really appreciate you weighing in. You know, now that we all have the connection with you, if as we continue as the housing committee to discuss other things, I hope we might call again to testify on other things. And believe me, I know that there are a lot more important things the legislature could be doing right now that might help people in your position. Our committee doesn't do land use policy in our jurisdiction. But we often have developers and builders telling us how we can do better. So I hope that please let us know if there are things that our committee could be helpful to folks like you as you continue to be a housing provider.

[Marc Mihaly]: Absolutely. Thank you. Absolutely. Thank you so much, Chris. Yeah. Stay watchful of what we're doing and see if you think we're screwing up.

[Chris Snyder]: Alright. Sounds good. Alright.

[Emilie Krasnow]: Thank you so much. Thank

[Chris Snyder]: you. Yep. Bye.

[Marc Mihaly]: Bye. We're still in session and we're waiting for Marc Lamoille, the chair of the judiciary committee to come. So but I don't think it's worth our going offline.

[Martin "Marty" LaLonde]: He just ran into his committee real quick.

[Emilie Krasnow]: Maybe he was getting his paper.

[Marc Mihaly]: Oh, okay.

[Emilie Krasnow]: Oh, that's what I said. I know well enough. I know Martin. South Bronx can die. We got Snyder, me, Marc.

[Marc Mihaly]: Chittenden County, you know? Yeah, I think so. Because if we grow bigger, we'll miss people.

[Emilie Krasnow]: Oh yeah, just single family.

[Marc Mihaly]: It makes it a problem. We're waiting for Marc, but the girls are not gonna be

[Deborah "Debbie" Dolgin]: here anymore.

[Emilie Krasnow]: No, but I would love to we're online to chat. I would love to also Saudia was just saying about workforce housing. I think that's something that, at some point, I'd love to really talk more about, too.

[Marc Mihaly]: Marc, you're welcome. We are online. We're just waiting for you here.

[Martin "Marty" LaLonde]: Oh, I'm sorry, did not wait?

[Marc Mihaly]: No, we just finished up with The Last Witness. So, we're back at this point. What we're on is A-seven 72, which is residential rental agreements and procedures, etcetera. And just to remind the committee and anyone watching, seven seventy two passed out of this committee, and at the same time, and it went through ways and means, but and it's now in appropriations. Am I right? Did it go to ways and means? No, it didn't go to It's ways and in appropriations. At the same time, because it involves so much in the way of judicial proceedings, we asked the judiciary committee to take a look at it, and they've done it on a flyby, and in fact, quite a bit of testimony. Really, not quite as much as us, but from the major actors, and I really appreciate that. Thank you very much for taking substantial amount of time with Judge Zone and Terry Korsons, and as a result, they produced a text of an amendment which would be offered as an amendment to our bill on the floor, and their chair is here to talk to us about that. So, Marty, take it away.

[Martin "Marty" LaLonde]: Yeah, and I'll kind of give you the higher level, and I'll mention a few of the provisions and what we tried to do, and definitely you should have Cameron do an actual walk through of the language because I could have missed something and he won't say anything. I want to, we really went into this not really looking to weigh the interest of tenants versus the interests of landlords, that wasn't really our charge. It was to make sure that the court process could work and also make in a couple ways, the actual process is something the court could do, but also look at the resources of the court. Because I understood pretty early when I received the bill of draft 4.1 was at the time. And after I did an amendment, I then just started taking into consideration some of the concerns that I, that the court initially talked about, is I then had somebody come in and Terry Korsons in particular explaining the pretty significant resource issues that were involved in the bill as it was then. And that we were either facing a situation by prioritizing these cases that we would get further behind on the rest of the civil docket that the courts have, or we would have to put a lot more resources into the court system. So we were trying to work to resolve that issue. We also looked at places where it seemed that the discretion of the court was being taken away. You know, we have to look at that kind of thing very carefully as well. So what we did is there's a few main things that we did in this. As far as court process, we looked at the show cause component of this. Let me

[Marc Mihaly]: interrupt, you guys all remember the show cause part was getting at the problem of the tenant that's causing, know, endangering or could continue to endanger the health and safety. Okay. Sorry.

[Martin "Marty" LaLonde]: No, no, that's fine. Yeah. So, replaced that whole process with something that's already in law, though we tweaked it a bit, for unlawful occupants. We already have a process for expediting an ejectment of somebody who's an unlawful occupant. We made this whole process work for somebody who is their continuing occupancy of a unit would threaten the health and safety the other tenants or people in the unit. So somebody would have to file a case, or would have to have a termination based on that health or safety issue. They would file a case and when they file the case at the same time they're filing their complaint, they could file a motion for this expedited process. Which is, as I saw it works, because it's a core process they already have and is the same, essentially the same timeline, if not actually a little quicker than what the show cause language was in there. So that was an important change. Yeah, you have

[Marc Mihaly]: any questions in there. Just my own impression, and please tell me if I've got it right. The difference, as far as I can tell, is from what we have, is besides being judicially better, is it's a little faster. And also, do you remember there were some testimony, some concern we heard that we had to be very careful not to create a situation where a landlord would just assert that somebody is posing a danger because of a one time event that they're may that may not be occurring the way they say it is or something like that. And that by I think they've improved it here in a way that isn't really a problem for landlords, and that it's not a one time thing. You have to say that they're acting in such a way that their continuing presence would be a danger to the health and safety. And I don't think that for the kinds of things we're worried about, we've heard about, which is tenants who are selling drugs and being literally damaging units or stuff like that, I think that that's a change that isn't gonna make it more difficult.

[Martin "Marty" LaLonde]: Right, and if there's an instance of damage in the past or perhaps could have been an instance of violence in the past, but there's not any indication that this is an ongoing threat if the person continues to be in the unit, then that expedited process is not available and they would be in the process that is now ninety days instead of sixty days. That's one of the other changes that we made to accommodate the court, and for them to be able to really get this done, having a reasonable deadline. So any event, so that was one of the other places where we had some changes. Where there were places where it said that the court had to issue rulings in three days or five days, we changed that to promptly because and the issue there is actually even a separation of powers issue. We're getting a little too close to the core functioning of court telling them when they have to rule on something. When they have to rule. When they actually have to rule. As opposed to when they

[Marc Mihaly]: have to set a hearing.

[Martin "Marty" LaLonde]: And that cross the line, it's my understanding.

[Marc Mihaly]: Go ahead.

[Emilie Krasnow]: And, Cherry, now that I've spent so much time in your committee this year, I learned a lot about how that worked with the animal cruelty bill, about directing courts and is at whether some folks may like to have certain timelines and other things, but what is realistic for the court? And they advocate for that. And so I learned during the animal cruelty discussions that that's how it works. Whereas we may want something, but the courts, the legislature can't just say x y I mean, can, but it's not feasible.

[Marc Mihaly]: My impression was that we only did that. Mostly we took, the most important thing was when they had to set it here. But I guess, we inadvertently, at one point, tell them when they had to rule?

[Martin "Marty" LaLonde]: Oh yeah, there were a couple of cases still in the bill, but we changed that

[Deborah "Debbie" Dolgin]: to promptly. Thank you.

[Emilie Krasnow]: That's why I did

[Martin "Marty" LaLonde]: the last one.

[Deborah "Debbie" Dolgin]: Yeah, go ahead. Well, just had a question about the ninety days. It's no later than ninety days. So it could be sixty days or maybe even thirty, depending on when that court is I know our court system has certain days already set that can be filled with these kinds of situations. So you're saying it can't be any longer than ninety?

[Martin "Marty" LaLonde]: Unless there's good cause and I'll just give you an example of good cause. So the ninety days runs from the date of the complaint, there's also needs to be service of that complaint And if a landlord, you know, they filed a complaint, but they don't serve them for sixty days, I could see that the tenant would say, hey, I need more time. I'm supposed to be getting ninety days and I don't, didn't throw up the complaint until sixty days after it was filed. So that's just an example of that there are instances where the court can extend that from good cause. There's a concern, I'm gonna state a

[Marc Mihaly]: concern which sounds a little like bad faith, but I think I might as well get it out in the open. I know there's a concern that when you put words like good cause in, that you've just created infinite wiggle room, but I'm under the impression that the courts wouldn't treat it

[Martin "Marty" LaLonde]: that way. From the testimony that Chief Superior Judge, more than one occasion said that it's important to try to get these deadlines workable because he takes them seriously. And we're not gonna just use a good cause to get of meeting these deadlines. So that's another reason to not put it on, is to listen to what they think they can do, and that's what we did. And it still is significantly expedited for the breaches of a rental agreement for non payment and then a separate path if it really is an ongoing risk. We did a couple other things in the court process and I'll talk about confidentiality in a minute. So as far as partial payment, this is one of the areas where we felt that just saying you shall only put into escrow the full payment really took away distraction from the court. And there are instances where a landlord and tenant can agree that a lower payment should be lower or that it would actually help to have lower payment. But what we did instead is we still have the court has to initially order only full payment, but a tenant can make a motion and have to show and convince the court that they have a good reason why a partial payment into escrow should be allowed. So that's one of those areas where we're really trying to preserve some of the discretion and the flexibility that we try to have to handle individual cases. The one other change is with respect to that is really didn't see from our perspective a reason to take out the ability to cure up until time where there would be the writ of possession. So we took out language because it's actually, it would have been an inconsistency with an other provision in the statutes. So that's kind of the, I probably missed a few things here and there. I think one place where there was, other I'll mention right now is there was a change for when an answer has to be filed to fourteen days, and we put it back to what is provided under civil rules. To have one exception for one kind of case is not a good idea, so it's just following civil rules, there would be confusion for attorneys who are doing this because they're always used to twenty one days is what you have for filing an answer.

[Marc Mihaly]: So on the That was just a consistency issue. Correct. It would be confusing or

[Martin "Marty" LaLonde]: Yes, there would be cases that would be filed after fourteen days and would have to have additional court time to sort out why they did that. It's twenty one days, people know, they're very familiar with that. So there was quite a few pages related to confidentiality of the the whole court process and records, and our testimony from the court and really explaining how that would or wouldn't work is that it really would be difficult logistically to accomplish the way it was laid out. And would take and that's where one of the places where significant additional resources would be needed to have made that confidentiality part work. So we had a lot of discussions and really decided that a kind of a compromise that would still get at some of what the legal aid and others wanted was to do sealing of the case. And I'll explain that, that it would be at the end of a case and before a writ of, or unless a writ of possession was actually issued, that after the case is concluded, it would be sealed. In other words, it wouldn't be available to anybody except the parties and such. But both input from the legal aid, input from others was that that wasn't a very workable solution yet. It needed more work. We need to do probably a petition process. We weren't quite covering the various scenarios of when it should be sealed or not. And the bottom line is that it needs more work. We didn't have enough time to do it. So we've taken out the confidentiality part, committed to continue to work on the sealing part. In fact, I put in my first build rafting request for next year if we'll have to be back. I don't know about that. Maybe I can even have to see H1.

[Marc Mihaly]: I made other promises for H1. So

[Martin "Marty" LaLonde]: anyway, I'm committed to continuing because I think there's a path there, we just ran out of time to get that right. So at this point, we suggested just taking out the confidentiality part because that really was one of the biggest problems of the court, on being able to do that. So I think I covered most, but Cameron will correct me in walking through the details, unless you have any other questions for why

[Marc Mihaly]: This is the man, ask him questions. Don't let him get away.

[Emilie Krasnow]: No. Don't.

[Saudia LaMont]: No. I oh, I have a quick question. Have to have the appointment. Is the version because I just printed it out, so I'm gonna grab on the printer my way out. Is the version that we have of this amendment what it would look like? Is it just an amendment like a regular amendment? Or is it what seven seventy two would look like with your proposed changes? It's an amendment. It's a separate amendment. It's like not a

[Martin "Marty" LaLonde]: strike call. It does strike some separate sections and replaces sections.

[Saudia LaMont]: Just so I can have reference. Right.

[Marc Mihaly]: Okay.

[Martin "Marty" LaLonde]: Thank you. So one thing I did miss is in the trespass of a third party who's not on the lease and such, that there was an appeal process for small claims court and that just doesn't work. And we took that out and generally speaking, there's already can be just a normal process for taking this case out of. So that was eliminated as well, forgot to mention

[Marc Mihaly]: Debbie, I'm sorry, Debbie and then Gayle.

[Deborah "Debbie" Dolgin]: Do we like the burning about the ribbon possession shall, you know, blah blah blah, no earlier than fourteen days after the writ is served? That's on line four on page eight. I felt like we spent a lot of time on that wording. On page eight, like, four.

[Marc Mihaly]: Yeah,

[Martin "Marty" LaLonde]: I don't think that's language that we changed. That's the language So I came you'll see there's not all this language is our new language. So that, yeah, we didn't touch that language. Okay.

[Marc Mihaly]: Yeah, is that, you mean after the process, process, it's just dealing with the process after judgment. This is when you get an Yeah, there's been a certain amount of confusion about this. Do you remember?

[Deborah "Debbie" Dolgin]: I remember the confusion. Okay.

[Marc Mihaly]: Alright. Want to take us through as high a level as you can. You wouldn't submit. Oh,

[Martin "Marty" LaLonde]: the appeal. Just the appeal. The trespass is in there, it still could be a third party, can have a trespass from the landlord, And if they do trespass, it goes into the criminal justice system and there are appeal rights within that.

[Deborah "Debbie" Dolgin]: You said that's all.

[Marc Mihaly]: Yeah, my question, my question.

[Ashley Bartley]: Sorry, I should have said this earlier. I just wanna thank you as a chair. This has not been an easy topic in our committee, and I'm sure just having chairs that are willing to come to a compromise, think, is really great. And so just thank you for your time. Know

[Marc Mihaly]: you've great.

[Martin "Marty" LaLonde]: For good the work you guys have done as well. And just to real quickly, Representative Vice Chair Bert is also co sponsoring this with me, and our vote was seven zero four.

[Marc Mihaly]: Good to know.

[Martin "Marty" LaLonde]: And I would imagine that most of those other four, maybe not one, I imagine it could have been a nine, two, or ten, one, oh. But any event, I'll stick around for a bit

[Marc Mihaly]: if you're very unfamiliar. Yes, thank you. I'm glad. That way we can keep asking the questions. Sure. Good

[Cameron Wood]: afternoon. Cameron Wood, Office of Legislative Counsel. I'm going to be quick in walking through the exact language of the changes that you have. So the amendment is draft 7.1. And as was just mentioned, it's sponsored by the chair and the vice chair of the judiciary committee. So the first change is going to be here on this first instance of amendment, which proposes to strike out section two of the bill. Section two of the bill was when alternate service of process is issued in a civil case. So think about TAC orders as how this has been described most frequently. If the individual can't serve the other party and they ask the court to receive an alternate service of process, the section had language that would make that alternate service of process last throughout the entirety of the proceeding. That section would apply not just to ejectment cases, but to all civil cases. And there was a lot of concern from the judiciary about that because A, again, it would apply to every civil case, not just an ejectment, but it would also, their concern was there may be reasons to have an alternate service of process at one point in a case, but not have alternate service of process at a later point in the case. So they took out that first subsection which required the alternate service to last throughout the entirety of the proceeding. So they kept the second half of that proposal from this committee which requires the court to rule on the motion, and this is where the chair mentioned it was three days, but it has been changed too

[Marc Mihaly]: promptly. That's one area I just want to say, I'm sounding like I've been around here too long. This is a first cut. This whole bill is a first cut. We've learned a lot, and judiciary has learned a lot about landlord tenant law. And so I think, to the extent I at least am interested in continuing this effort next term, and one area I'm interested in looking at hard is this whole service problem, because it is it can be a significant problem for landlords, and one that I don't think I think we could improve on and I'm just not sure the best way to do it, but we will. Anyway, go ahead.

[Cameron Wood]: Okay. There's another piece of language that is not in this amendment. You won't see it because the second instance of amendment is striking out your entire section three, which was an amendment to the entire chapter 169. So there was a corresponding technical change associated with the alternate service of process language that because the committee is removing the alternate service that I just walked through, because that's being removed, the further technical change was So no longer I'm

[Martin "Marty" LaLonde]: not gonna pull it up and walk through it.

[Cameron Wood]: The next change is as the chair mentioned was about the partial payment of rent. So when you get here to the bottom of page two, you can see this is section where the landlord can file a motion to have rent paid into court during the the ejectment proceedings. Subsection D, so there's still the strike through there on lines 15. So the court would obligate initially the tenant to pay full payment into court. The change is going to be on page three, where you all in this committee recommended striking subsection G, which is where a tenant can file a motion, the defendant can file a motion to request a reduction in the amount paid. And so that was struck in your version. It's being unstruck here.

[Marc Mihaly]: So this is me. So both of you, Martin, is the effect of this essentially that the default now is full payment, but it's full payment unless the tenant, who's presumably represented, files a motion and has an affidavit that explains why. So it's kind of up to the tenant to show the need to do this. But the That's my understanding. The presumption is full payment. Yes. That is correct. Okay. Alright.

[Cameron Wood]: There's an addition of this new subsection I which simply states that the parties can come to an agreement at any point and file their own motion to reduce the payment. Okay. The next change, so we get into property of the tenant remaining, all of this language is the same. The next change that it's going to be from your version. We're moving into the subchapter four where you have the new ejectment process for a termination brought under nine VSA 04/1967 or You all remember 04/1967 is termination because of nonpayment of rent. 67B is termination because of some sort of breach of the terms from the tenant. So all of this language remains the same up until you get to the top of page five. So this is section, this new 4,862, this is the complaint being filed by the landlord or now the plaintiff. And if you all remember, you added language in to say that if a tenant is being terminated for breach of material terms, which could include some sort of activity that's threatening other people, you require that the actual notice of the termination include an affidavit that sets forth the facts that document the reasoning behind the termination. Well, was just a question or not about whether that document has to be included with the complaint. And so you can see this language right there on pages lines four and five stating that the complaint that's filed has to include a copy of the rental agreement if there is one, the notice to terminate and include the affidavit that's required. So more of a technical change there than a substantive. And then the next real change is regarding the answer period. As the chair walked through and mentioned, you all have the answer being required in fourteen days. Rules of civil procedure have it at twenty one days. This change would remove the requirement that the answer be filed in fourteen. So it would default to the rules of civil procedure,

[Martin "Marty" LaLonde]: which is going be twenty one.

[Cameron Wood]: The removal of the cure period so it's not language that I can point to on this page. I can pull it up if

[Martin "Marty" LaLonde]: that would be helpful.

[Cameron Wood]: But in the instance of in the trying to be quick with my walkthrough, there was period about you can cure up to the answer date that's been removed. So the parties can come to an agreement about how to cure and dismiss the action at any point during the case. The next change is going to be here on B1. This is the under this new sub chapter or these ejectments, this is the standard time frame of when the hearing needs to be held. And as was mentioned, they're on line 15. The hearing must be held ninety days after the filing of the complaint. Not later then. Correct, your report had it at sixty days after service of the complaint. So different timeframe, different point of reference in time. So it's just a slight alteration of when the hearing needs to be held. The last thing I will comment, two more things I will comment on this section. The subdivision two here on line 16 was added, which states that the timeframe doesn't apply when the plaintiff has possession of the lands or tenements or has received the writ of possession. So there could be a case that is being filed where the landlord already has possession or receives possession between the complaint being filed and when the hearing happens, or they've already received a writ of possession but there are other remaining items that need to be resolved, or the landlord has brought the case under multiple different termination notices that were provided. And so this is simply saying we're not going to have this expedited requirement if the person already has possession of the property. The next change, this default language was just cleaned up by the committee. So I don't know I need to pull up the other language. I don't think there was any necessarily significant change other than the motion here. Again, court ruling on the motion promptly on the default. So if an individual doesn't file an answer, then the individual can file a motion under a rule that currently exists. And the judiciary committee just wanted to make sure that language was reflective of the rule accurately and required the court to rule in the motion properly. Now you get to this 4,865. So as you all remember and you've somewhat discussed already, you had this show cause hearing. Show cause hearing is gone. In its place is this expedited hearing, which is based on an expedited hearing for an unlawful occupant, which already exists in the current subchapter for ejectment. So most of this language is just modeling it off the current language that exists in statute. Two things that I would highlight in this section for you is the language here on line seven. My lines and my page is messed up. Line seven, a landlord can only ask for this expedited hearing if the defendant's continued occupation of the lands or tenements is threatening the health or safety of others. So as Mr. Chair, I believe it was you mentioned earlier, if you think back to the termination language in the residential rental agreement chapter, you don't need there to be an ongoing threat to terminate the rental agreement. It could be based on one instance, one act of violence, or one act of damaging the unit that threatens other people. You can terminate the rental agreement upon that. What the expedited hearing would require is that there be an ongoing threat if the defendant remains in the building. So that is a difference, And so just making sure you understand that distinction. If there's an ongoing threat because of the defendant's continued occupation of the dwelling unit, then the landlord could bring under this and there would be an expedited hearing. And the other change or difference, I should say, is that this hearing would have to be within twenty one days after the motion is filed. So pretty quick turnaround that's different from what you all had in regards to the show cause hearing. The next change I'll bring you to is going be on page seven at the bottom, section 4,866. This is just for costs and getting a judgment if the court finds the plaintiff is entitled to possession. And then there was some language right there after the word possession that said either by default or writ of possession. And it was limiting and unnecessary, so it was removed. So if the court finds the plaintiff is entitled to possession, regardless of when that occurs, whether it's the default motion that's filed or whether it's upon the expedited hearing, etcetera, the plaintiff shall have a judgment for possession of rent's due. The next change is the bottom of page eight. So the rest of this language all remains the same. As mentioned, none of this changes. In regards to fourteen days, not earlier than fourteen days, that mirrors what currently exists in statute regarding the writ of possession. So that's consistent. So then we get to the third instance of amendment right here on line 17, removing the appeal process from trespass. So if you all remember, you've added trespass language to allow the landlord to issue an order against trespass under certain circumstances. There was appeal language there. As the chair mentioned, it didn't really fit with small claims. And there's no appeal rights under a normal trespass order. You as a landlord issue a trespass order or I should say if you as a property owner issue a no trespass order against someone, that person doesn't have appeal rights to that. Just to remove that potential issue for the judiciary and I don't mean the judiciary committee, I mean the judiciary itself as a branch, that was

[Deborah "Debbie" Dolgin]: removed. I just want to I'm gonna go back to the TAC order, I'm

[Martin "Marty" LaLonde]: just gonna So use TAC

[Deborah "Debbie" Dolgin]: we could ask, we could make a motion for, to have a TAC order and make a motion for it to follow throughout the whole case Yes. And a judge could decide to Absolutely. Bring

[Marc Mihaly]: And in fact, I've had several conversations that in in certain the experience of certain landlord attorneys, those are always granted. In others, it depends. But it isn't automatic here. Do you happen to know, is it either of you happen to know whether or not under current rules before Martin, do you happen to know whether under current rules, before attack order is granted, does there have to be a certain number of attempts by the sheriff to serve that are unsuccessful? Or is that just judge made law?

[Martin "Marty" LaLonde]: I think it's rule civil procedure number four, I think. Mean there's, I don't remember exactly what the

[Marc Mihaly]: But there is something here.

[Martin "Marty" LaLonde]: There is, but there's also some room there to do something different than what's in civil rights.

[Marc Mihaly]: Right, okay. I mean this is what

[Martin "Marty" LaLonde]: we did in Representative Krasnow's bill. We did something a little bit different with respect to the

[Marc Mihaly]: tax court.

[Emilie Krasnow]: Yep, I'm a real judiciary veteran now.

[Marc Mihaly]: I think that this is an area to work on, that's my feeling.

[Cameron Wood]: Yeah. And then the last change, I'm not going to bring the bill back up, because the last change is just removing the confidential records piece as the chair mentioned, and that is all of the amendments.

[Marc Mihaly]: Let's take a short break, and then we'll come back, and just I'll ask you guys to give me a sense of where you are on this amendment. We're not talking about the bill, we're talking about the amendment.

[Emilie Krasnow]: The judiciary amendment.

[Marc Mihaly]: The judiciary amendment, because remember, I'll get asked, where's the committee,