Answer. What follows is a complicated answer to a simple question.
ORS 90.302 (Fees allowed for certain landlord expenses), Subsection (3) (b) (A) authorizes the assessment of a “fee” for noncompliance with written rules or policies governing, among other things, “(t)he late payment of a utility or service charge that the tenant owes the landlord as described in ORS 90.315” (Utility or service payments).
But that statute provides that the written rental agreement must expressly permit this fee. If it’s not in the agreement, ORS 90.302 (9) permits park owners to unilaterally amend it to impose noncompliance fees. A 90-day written notice must first be sent to the tenant.
But as occasionally occurs with legislation written by committees composed of disparate stakeholders, the sausage bill that results can become almost incomprehensible. That is the case with ORS 90.302(3) which describes a complicated implementation process, at best.[1]
If the above discussion isn’t sufficient in discouraging park landlords assessing fees for delinquent water charges, the information below should cinch the deal.
First, remember that the Oregon landlord-tenant law, ORS Chapter 90, is divided into two parts, (a) the non-manufactured housing side, and (b) the manufactured housing side. The latter side commences at ORS 90.505.[2]
Secondly, there is nothing in the manufactured housing utility billing statutes (ORS 90.560 – 90.584) which authorizes the assessment of a late fee for overdue utility charge payments. On the non-manufactured housing side, ORS 90.302 (3) (b) (A) does authorize the assessment of fees for late utility charge payments “… that the tenant owes the landlord as described in ORS 90.315.” (for utility or service charges).
Here is the conundrum: Does ORS 90.302 (3) (b) (A) refer to the utility charges described in ORS 90.315 or the obligation to pay the landlord as described in 90.315?
In ORS 90.560 (the definitions of utilities and services for the manufactured housing side of Chapter 90) it says that the term “utility or service” has the meaning given in ORS 90.315 (i.e., on the non-manufacturing housing side of ORS Chapter 90). The problem with this cross-reference is that the process for charging utility and service charges for manufactured homes and nonmanufactured homes are not the same – in fact, they are quite different.
For example, the procedure for billing utilities to an apartment tenant is described in ORS 90.315 (4) expressly does not apply to manufactured home tenancies. And the procedure for billing utilities to tenants in manufactured housing communities is set out in 90.562 (3) and (4).
Confused? Frustrated? Join the club! The best solution would be a legislative one, i.e., amend 90.302 (3) (b) (A) to include an express cross-reference to ORS 90.562 which would clarify the legislative intent to include both manufactured and non-manufactured housing.
Until then, there is room for disagreement on late fees for unpaid utility charges in manufactured housing communities; and disagreement can lead to litigation – something you don’t want. In the past I have seen park tenants bring claims against landlords for (allegedly) improperly imposed charges, fees, etc. The result is not pretty since each space may have a claim against the landlord for reimbursement of the past twelve months[3]of improperly assessed charges – plus attorney fees.
So, the short answer to your seemingly simple question, is that you do not want to risk assessing fees to residents for overdue payments of their water charges until the legislature clears up the confusion.
This is not to say you are without a remedy, but assessing a fee is not one I would recommend until the legislation clears up. Nonpayment of a utility or service charge is grounds for termination for cause under ORS 90.630. But beware, a landlord may not give a notice of termination under that statute for nonpayment of a utility or service charge sooner than the eighth day (including the first day it is due), after the landlord gives the tenant the written notice stating the amount of the utility or service charge.
Many thanks to John Van Landingham for his assistance in helping me detangle these statutes and their legislative history. Nobody has better institutional knowledge, perspective and understanding of Oregon’s landlord-tenant laws than John.
[1] “A landlord may charge a tenant a fee under this subsection for a second noncompliance or for a subsequent noncompliance with written rules or policies that describe the prohibited conduct and the fee for a second noncompliance, and for any third or subsequent noncompliance, which occurs within one year after a written warning notice described in subparagraph (A) of this paragraph. Except as provided in paragraph (b)(G) or (H) of this subsection, the fee may not exceed $50 for the second noncompliance within one year after the warning notice for the same or a similar noncompliance or $50 plus five percent of the rent payment for the current rental period for a third or subsequent noncompliance within one year after the warning notice for the same or a similar noncompliance.” The “Warning Notice” contains a similar list of conditions. Deciphering these rules is akin to decoding the Rosetta Stone; a skill better suited to archeologists than lawyers.
[2] Note: There is a fair amount of overlap, i.e., some statutes found in the nonmanufactured housing side, also apply to the manufactured housing side. So, the prudent landlord or manager should become familiar with both sides.
[3] The statute of limitations to bring claims under ORS Chapter 90 is one year.
