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When you drive through a "pure mobile home park" and then drive through a park with a lot of RV tenants you can feel the difference in overall quality. The overall value of a MHP with "Permanent RV" tenants mixed in with Mobile Home tenants is lower than a MHP which is completely filled with Mobile Homes. RV's are not really permanent homes so MHP buyers and banks see RV occupancy as more risky than Mobile Home occupancy. The appraised value is lower, the interest rate that the bank charges can be higher and the pool of interested buyers is smaller. There are a number of MHPs in Oregon which have RV tenants who have been tenants in the same space for over 15 years, but even if you prove this to a bank, they can still be hesitant to lend on the park. Many buyers will simply not look at MHPs with a high percentage of RV tenants. One advantage of having RV tenants to fill spaces is that you can give them a 60 day no cause notice to move out. This can be beneficial for two reasons. Firstly, if the tenant turns out to be a problem tenant who does not adhere to the rules, it is easy to replace them with a good tenant. This also allows a MHP owner to temporarily fill spaces with RV tenants but replace them with Mobile Homes when they find one to put into that space. Of course, it is always a good idea to inform an RV tenant that this is your intention before they move in and expect to live there for years.

Not only does the park income rise when spaces are full, but the overall feeling of full occupancy is good for tenants, management and once full, parks with 100% full lots tend to stay that way for a very long time. Vacant spaces can make a Mobile Home Park feel old, neglected, and undesirable even if it is well maintained otherwise. Also, we all know that it is expensive to bring even a used Mobile Home into a park. The purchase of the house, moving expenses, set up, and final touch up will generally run at least $17,000 for a single wide and anywhere from $35,000 - $60,000+ for a double wide home. Other items to consider are the sales commissions for the Mobile Home Dealer and it can prove to be difficult to get both a house, and a tenant to both qualify for bank financing. Having the park buy and set up mobile homes can be a risk but may be worth it. There is really no calculation or standard that determines what the reduction in value of a MHP with RV tenants is but it certainly is the case that the demand is lower and lending is more difficult.

By using a good Mobile Home Dealer who can find used mobile homes to fill spaces, arrange them to be moved and set up and then sell them is a win-win situation. There are a number of highly reputable licensed dealers who can seamlessly fill vacant spaces and in the end the cost is usually worth it when you calculate the improvement made to the park. If you are thinking about selling your MHP, and even if you are not expecting to, it makes sense to improve your property for long term value.

On the other hand, simply having RV tenants pull their RV into a space has many short term benefits for both the tenant and the MHP. The screening criteria is still the same so the RV tenants make up a very good pool of possible tenants. All in all a pure MHP is more desirable but RV tenants can be as long term as Mobile Home tenants and with the trend heading in the direction of very small living spaces, RV living may be considered a luxury before long.

Kim Berry, Principal Broker

Rundle CRE - Mobile Home Brokers

5319 SW Westgate Dr. Suite 232

Portland, OR 97221

503-980-3512

CELL: 503-807-2568

FAX: 360-935-3512

Q: What happens after I give them the financial information?

A: The tenants committee must (1) form a corporate entity that is legally capable of purchasing property or associate with a nonprofit corporation or housing authority that is legally capable of purchasing real property or that is advising the tenants about purchasing the park in which the tenants reside; and (2) submit a written offer to purchase the park, in the form of a proposed purchase and sale agreement, and either a copy of the articles of incorporation of the newly formed entity .

Q: Do I have to accept the offer?

A: No. You may accept, reject or submit a counteroffer. You should view the tenants (and negotiate with them) as you would a potential purchaser. If the offer is far off, reject the offer and explain why it's far off (e.g. unreasonable financing terms, not enough cash, long closing date). If the offer is close to the mark, counter with terms. The key is to deal with the tenants committee as you would any bona fide purchaser. don't treat them differently just because they are tenants.

Q: What happens if the tenants don't respond within the 10 days or don't respond within the 15 days of me providing financial information?

A: You have no further duties under the statute.

Q: What do I do if I think this process is only being invoked to harass me?

A: Call your lawyer. The parties (including the tenants) arerequired to act in a commercially reasonable manner. Depending on the conduct (and the ability to establish the conduct and motive) your attorney should be able to develop a strategy to combat poor behavior.

Q: I've entered into a purchase and sale agreement with a separate buyer and I haven'tfollowed the process. What should I do?

A: Call your lawyer. It may be fixable, but failing to follow this process allows affected tenants to obtain injunctive relief to prevent a sale to a third-party purchaser (which could cause you to be in breach with that third party purchaser) and to recover the greater of actual damages or 2 times the monthly rent. Bottom line is be aware of your responsibilities and follow the statute.

Q: What do I do after I've completed the process?

A: You must file an affidavit certifying that you've complied with the process and that you have not entered into a contract for the sale or transfer of the park to an entity formed by or associated with the tenants. The purpose of this affidavit is to preserve the marketability of title to parks.

Q: Who are you and why are you talking to me?

A: I serve as the Partner in Charge of the Portland office of Davis Wright Tremaine. DWT is a full service law firm with 500 attorneys on both coasts and in Shanghai, China. The Portland office consists of approximately 80 attorneys and over 80 staff. I work with my clients to resolve their legal problems through pre-litigation counseling, litigation, and mediation. I try cases in state and federal courts and through private arbitration. My experience includes defending and prosecuting business torts; breach of contract claims; disputes between and among members of limited liability companies; residential and commercial real estate matters, including landlord-tenant, title, lien, and timber trespass disputes; and probate and trust cases. I speak often at MHCO seminars and conferences. You can reach me here: http://www.dwt.com/people/WilliamDMiner/

Bill Miner is currently Partner in Charge of the Portland office of Davis Wright Tremaine. DWT is a full service law firm with 500 attorneys on both coasts and in Shanghai, China. The Portland office consists of approximately 80 attorneys and over 80 staff. He works with clients to resolve their legal problems through pre-litigation counseling, litigation, and mediation. He tries cases in state and federal courts and through private arbitration. His experience includes defending and prosecuting business torts; breach of contract claims; disputes between and among members of limited liability companies; residential and commercial real estate matters, including landlord-tenant, title, lien, and timber trespass disputes; and probate and trust cases. He is a frequent and popular speaker at MHCO seminars and conferences. You can reach Bill at: http://www.dwt.com/people/WilliamDMiner/

Bill Miner | Davis Wright Tremaine LLP
1300 SW Fifth Avenue, Suite 2300 | Portland, OR 97201
Tel: (503) 778-5477 | Fax: (503) 778-5299
Email: billminer@dwt.com | Website: www.dwt.com

Answer. Admittedly, this area of Oregon landlord-tenant law is not my strong suit. But here is what I understand. For more detail, go to this excellent article by Sybil Hebb, of the Oregon Law Center, here.

The Housing Choice Act of 2013 (HB 2639) went into effect on July 1, 2014. While the law says that landlords are not required to accept Section 8 tenants, landlords may not refuse to rent because their source of income is a Section 8 voucher, or any other local, state, or federal housing assistance program. However, an applicant's (a) past conduct or (b) inability to pay rent, may be taken into consideration, so long as the landlord's screening protocols are consistent with local, state and federal laws. Landlords must include the value of the applicant's housing assistance when evaluating their ability to pay rent. See, ORS 659A.421(2)(a)

The Section 8 voucher program is a federally program available throughout Oregon. According to Sybil's article above:

'_the program is not achieving its goals: too many tenants struggle to find places where their vouchers will be accepted, and fear of administrative issues causes landlord reluctance to participate. As a result, families have fewer choices and face barriers to success. When vouchers are not accepted, the important public purpose of the housing assistance program is undermined, and the stability of low-income families is threatened. HB 2639 is intended to balance and meet the needs of vulnerable tenants and communities, landlords, and housing authorities."

According to the Fair Housing Counsel of Oregon, '_low-income Oregonians may apply to their local public housing authority or agency for a Section 8 voucher." The local housing authority does perform an inspection of the residence.

As for any required repairs, Sybil's above article includes the following discussion by Jim Straub, Legislative Director for Oregon Rental Housing Association:

"Do you have the right to refuse to make repairs without running afoul of the new law? Clearly we are not talking about minor repairs here. If Section 8 requires you to change a broken light bulb or replace a broken switch cover, no reasonable person would see that as a reason to refuse to move forward with the tenancy. Likewise, this isn'tyour opportunity to object to the entire law and simply decide ahead of time you aren'tgoing to make any repairs, then refuse to rent to the otherwise-qualified applicant after the Section 8 inspection. If you did that, the applicant could sue you under the law and, frankly, most any judge will see that as a transparent attempt to use your refusal as a tool for non-participation in the Section 8 process. I'm thinking more of a landlord who, based on Section 8's exterior paint standards, is asked to repaint their entire property prior to renting to the Section 8 applicant. For some landlords on a budget, especially if we're talking about pre-1978 paint that requires lead-based paint remediation methods, this Section 8 requirement could be entirely cost prohibitive. What happens then? That's a good question, and no one really knows the answer right now. What I will say is that if you have an otherwise-qualified Section 8 applicant who you decide NOT to rent to based on a refusal to comply with Section 8's inspection requirements, be sure you have valid reasons for not making the repairs and moving forward with the tenancy. If you are sued, you will stand in front of a judge and have to justify your decision. If you choose this route, make sure you can defend your reasons for refusing to make the repairs. "I didn'tthink I should have to" is probably not going to

Probably the biggest thing you want to look for when Section 8 makes inspection repair requirements is whether the recommendation is a habitability issue.[1] You, of course, don't ever want to refuse to repair a problem that is a habitability concern. Worse, however, would be to have a habitability problem "on the record" for your property that you refuse to repair and then proceed to rent the property to someone else. If injury or damage is caused to those new tenants by the habitability problem, they will be able to make the case that you knew of the problem and rented the property anyway. I can't think of a faster way to lose a lawsuit than this."

Conclusion. Here is the take=away from my perspective: It does not appear that the local Section 8 housing authority will require you to perform repairs that would not otherwise be imposed upon you by Oregon's habitability requirements. That appears to be the litmus test, according to Mr. Straub.

[1] Note that Oregon landlord-tenant law specifically identifies specific habitability requirements at ORS 90.320. ~PCQ

WHY SHOULD YOU CARE SO MUCH ABOUT R&Rs: ASSET VALUE - Firstly, a SIGNIFICANT part of your community's real estate value is based on how well Residents adhere to the R&Rs which YOU as an Owner/Manager must enforce! CASH FLOW - Second, because rule violations, with the exception of non-payment of rent issues, are the number one reason Residents get evicted, we cannot emphasize enough, how important it is to keep your rules up to date, so that you prevail when spending money in the legal process... .got your attention???? Read on:

ORS 90.510 requires that the Rules and Regulations and a copy of your rental agreement be handed out as attachments to the Statement of Policy (SOP) to prospective and existing Tenants. When giving these documents to prospective Tenants, you should have them sign a receipt for Statement of Policy. All too often we have heard Tenants state in court that they never signed or received a copy of the Rules and are therefore not bound by them. By producing a copy of the signed receipt for Statement of Policy, the presumption is that they did receive the rules even if they never read them.

As mentioned above, it's extremely important to keep your rules updated. In MHCs that we've managed, we have discovered rules that are 2 pages and we've seen some that are 30 pages... .some Community Owners have not revised this IMPORTANT governing document since the 1970s! Many of these older and/or shorter sets of rules do not even mention many of the issues relevant today. So if you want to change or update your rules, know that there are two methods to accomplish this.

First is a general rule change that affects all of the Residents: ORS 90.610 sets out the requirements for the notice of proposed change in Rule or Regulations. The statutory time-line for the Residents to OBJECT to the change(s) is 30 days after receiving the written change(s.) If 51% of the eligible spaces object in writing to the proposed change, the new rule(s) do not go into effect. If less than 51% object in writing within the 30 day window, the new rule(s) go into effect for all Residents 60 days after the notice was mailed.

The second method to changing rules is through attrition. There is nothing in the statute that prevents an Owner/Manager from creating a second and more comprehensive set of rules and handing them out with the SOP to new prospective Residents. The new rules will only be enforceable on the new Residents; since all homes change ownership eventually, once you have enough new Residents on the new rules, you can always go for a general rule change effecting everyone. Many or most Residents would already be subject to the new rules, the mathematical probability of having 51% object to the rule is greatly diminished. Remember to keep a copy of whatever generation of R&Rs the Resident agreed to in their resident file. You do not want to try to enforce a new rule on an old Resident who is subject to a previous version of the rules.

Our next article will deal with R&R enforcement, so stay tuned!

Answer. There is nothing in the Oregon landlord-tenant laws that addresses this subject. This is not like an adult who wants to be approved as a resident and move in to an existing home. In that case, I can see that you would want to run him through the fully battery of checks.

But in this case, what would you learn? You would not be able to get any juvenile records. He probably has no credit to speak of, and his income is not necessary for establishing that his parents can afford to live in the community. It strikes me that going forward, you retain the same control over him as any other adults in the park. He has to obey the rules, etc., and if he doesn'tyou could issue a 30-day notice to the parents about his conduct.

If you wanted to add him as a Temporary Occupant, you could do that. If he violated rules, etc., you could terminate his right to be a Temporary Occupant, and require that he vacate. However, in this case, it does not seem that there is cause for concern.

If he had been a problem child, and now had grown into a problem adult, I would strongly recommend that you use a Temporary Occupancy Agreement. Your options in requiring that he vacate upon breach of the rules, are much swifter, although you cannot terminate without cause.

Although I don't believe I've seen this issue addressed in park rules, it's not a bad idea to have something in place. You could say that all children remaining in the park after their 18th birthday, must do X, Y, and Z. That way, when it happens, you will not be accused of picking on one particular tenant's son or daughter.

Lastly, I've often seen a similar situation, where the child moves away after his or her 18th birthday, and then returns a year or so later. Some landlords treat this as they would any other third party wanting to move into an existing resident's home. While it would be nice if the situation was addressed in the community rules, I have not seen this. I believe I would treat any adult wanting to share space with other residents, even parents, the same way I would treat unrelated parties; they must at least pass a background check. The rule should be the same for two residents who have been approved, then one leaves and comes back a year or so later.

In all cases, you can use the Occupancy Agreement, assuming the person passes their background check. If there is ever any doubt about the boomerang child, or former tenant coming back into the community, your best alternative (other than saying "No" based upon the background check) is to use the Temporary Occupancy Agreement.[1] However, never let the Temporary Occupancy Agreement be perpetual; be sure to have an expiration date on the term. You can always renew it if they behave.

[1] The statute is here. Note that you cannot qualify the Temporary Occupant based upon finances, since it is presumed their income is not necessary for the existing tenant(s) to pay the monthly space rent.

Answer: You are right that it can't continue - this is your business and you need to treat it as a business. However, there is a chance that you can give this tenant an opportunity to redeem himself, yet still protect your interests as well.

The first step is to give the tenant a 72-hour rent nonpayment notice. Use MHCO Form 82, fill it in following the directions on the form, and serve it on the tenant. If the tenant pays the rent by the 72-hour notice deadline, then life goes on and the tenancy continues. If not, you should file an eviction case at your county courthouse.

The court clerk will have several "check the box" forms that you can use to file an eviction - but be sure to bring along several copies of the 72-hour notice that you will need to attach to the eviction complaint. After you file the paperwork and pay the filing fee, you can then have the sheriff serve the eviction summons and complaint. The court clerk will be able to show you to the sheriff's office to have them serve the paperwork.

The court clerk will set a "1st court appearance hearing" when you file the eviction complaint. Both sides need to show up at this hearing. If the tenant doesn'tappear, then you win automatically and get a judgment entitling you to an eviction by the sheriff. The court clerk can give you the paperwork to finish that process.

If the tenant does show up, you will get a chance to negotiate a "stay and pay" agreement that the court will sign off on as an enforceable court order. (Most courts will have a form that you can use for this agreement.) Under Oregon law, the payment agreement can and should include: (1) All past-due rent; (2) late fees; (3) unpaid utilities; (4) court costs; (5) attorney fees (if any); and, (6) any other unpaid charges. The payment agreement can extend for up to six months, with payments made at monthly intervals or any other schedule that both sides agree on. The agreement can also include the next three regular monthly rent payments, sort of a "probationary period" to make sure the tenant gets back on track.

If the tenant complies with the payment terms, the tenancy continues and the court will automatically dismiss the eviction case after the payment agreement expires. If the tenant misses any payment, then you will file a "declaration of noncompliance" with the court and finish the eviction process.

These "stay and pay" agreements are very useful to my landlord clients and I use them regularly. They give you an opportunity to keep good tenants that may have temporarily fallen on hard times, but also keep open your eviction options.

As the landlord, you will also need to appear in court unless you have an attorney or other agent (such as a property manager) appear in court at the "1st appearance hearing." This hearing is usually set 8 days after the FED is filed. The purpose of the hearing is to see whether the parties can work out a payment plan, move-out agreement, or other arrangement. If not, the case will be set for trial.

If you are unable to settle the case at the first appearance hearing, by law the trial must be scheduled within 15 days from the 1st appearance hearing. Sometimes, the parties or the court will delay the trial beyond this time frame, but most cases move quickly. This leaves little time for preparation, meaning it is important to have your witnesses, exhibits, and trial arguments ready to go.

You do not necessarily need an attorney for court appearances, but you will increase your chance of success if you do. The eviction statutes are very technical, and most people aren't familiar with courtroom procedures. You will especially be at a disadvantage if the RV tenant has an attorney. If your case gets to the point of a trial, it is usually worth it to hire an attorney.

Answer. ORS 90.322(1)(f) says the landlord must give '_at least 24 hours actual notice of the intent of the landlord to enter and the landlord or landlord's agent may enter only at reasonable times... ." (Italics mine.)

The statute does not say the landlord has to give the exact date and the exact time. It has been judicially construed in Oregon that a notice such as yours is sufficient, since it exceeds the 24 minimum requirement. See, Resources Northwest, Inc. v. William Rau, 173 Or. App. 500 (2001).

This is just for access to the space - not the home - so I don't seen anything unreasonable about access in this fashion. It's not disruptive. Of course, even with a proper notice, a tenant can deny access if the requested time is unreasonable. (See, ORS 90.322(1)(e)(ii)).

I had this occur at a park several years ago, and the tenants ended up staying on the higher base rent which was not reduced as it was for those who permitted access for the submetering. The noon-cooperative tenants soon saw the error of their ways, as their neighbors had lower rent and were able to control their water bills by reduced use.

Tenants should know that ORS 90.322(7) provides that: "If the tenant refuses to allow lawful access, the landlord may obtain injunctive relief to compel access or may terminate the rental agreement under ORS 90.392 (Termination of rental agreement by landlord for cause) and take possession as provided in ORS 105.105 (Entry to be lawful and peaceable only) . In addition, the landlord may recover actual damages." (Italics mine.)

I suspect a landlord denied access would suffer financial damage if their submetering schedule was interrupted, so the tenants could be looking at damage claims by denying access. There would also be a right of attorney fees under ORS 90.255.

Supply and Demand

The primary drivers of this sales activity are the usual suspects: supply and demand. In the past couple decades, the cost to develop new manufactured home communities in Oregon (and most of the U.S.) has risen to the point that it is impossible to generate a compelling financial return with a newly constructed park. Add to that the number of parks that are closed, or redeveloped to other uses, and it's clear that we operate in a market with a very restricted current supply - and no future new supply.

Meanwhile, demand for parks is climbing.

According to United Van Lines, Oregon is the most-moved-to destination in the United States for the past two years. If you are buying or selling real estate in Oregon, you likely already know this! People really want to live here.

The Multifamily NW Apartment Report released this spring shows falling vacancy rates in every Oregon/SE Washington market it surveys. Vacancy in Portland/Vancouver, Salem, and Eugene averages just under 3%. Bend is seeing 1.5% vacancy rate... and dropping!

Another recent factor driving demand is the influence of Wall Street and investment fund managers. In 2003, Berkshire Hathaway purchased Clayton Homes and inserted its influence in a big way; designing, building, selling, and financing manufactured homes. This single event began to alter the perception of investing in manufactured home communities.

Fast forward to now: the largest private equity group in the U.S. -- the Carlyle Group - is investing in mobile home parks; Sam Zell, the billionaire American business magnate, is the largest owner of mobile home parks in this country; and Clayton is still crushing it as the largest source of new modular and manufactured homes in the nation.

We've seen out-of-state interest surge right here in our market: At Western Equities, we've closed on $11,000,000 of mobile home park sales in the past year - with just one of our buyers! This buyer is a private equity fund manager, and he has another $10,000,000 committed in offers or pending sales with us. High-power investors like this have, collectively, a tangible effect the mobile home park sales market.

Effect on the Market

Not surprisingly, the limited supply and growing demand for parks has pushed sale prices up, and Cap Rates down. Prices up, and Cap Rates down? That's a seller's market!

"Cap Rate" is short for Capitalization Rate, which is the rate of return if an investor were to pay cash for the purchase price. Cap Rate is the most important initial indicator of the return on investment a property will produce. The formula to determine Cap Rate of a property is Net Operating Income (NOI) divided by Purchase Price.

Cap Rates vary widely with the unique nature of mobile home parks - and reliable cap rate data is available for only about half of the parks sold on the market. Investors and brokers in today's market are seeing steady cap rate compression in a majority of Oregon markets. For healthy parks in strong locations, the Cap Rate range in 2010 was typically between 7-8 _ %. Today, those parks tend to sell at 6 to 7% Cap Rate, or even lower.

One recent sale really affects the 2015 YTD Oregon Cap Rate and price per space averages: Songbrook, a 140-space, award-winning manufactured home community sold on June 10th for $13,800,000 - a stunning $98,571 per space, and a 5.0% Cap Rate! Songbrook was developed and sold by Troy Brost, a noted industry expert who has been a past board member and president of MHCO.

Large parks tend to be well-capitalized, in larger towns or cities, with very low vacancy, less collection loss, fewer deferred maintenance issues, and a significant management operation. Essentially, there is lower investor risk, so the returns are smaller.

Nationally, big funds managers and institutional investors are looking to 'park' multiple millions of dollars, and because of low returns in other investment options, that money is increasingly used to invest in manufactured home communities. Even private investors are rolling large into Oregon parks - i.e., the reported buyer of Songbrook. This demand is significant in driving prices up, and pushing returns down.

The value of smaller parks is increasing as well. Currently in Oregon, there are about 15 smaller (less than 100 spaces) parks listed for sale, with Cap Rates that are advertised between 6-12%. This wide range indicates the diverse nature of smaller parks, which are often very different from each other.

Price Per Space is another interesting indicator when looking at property values, but there is such huge discrepancy when comparing parks - especially smaller ones - that Price Per Space is generally a secondary calculation. Currently, there is an RV park on the market at $6,000 per space, compared with nearly $100,000 per space in the Songbrook sale.

Both of these are extreme examples; a more 'typical' Price Per Space range is $30-60k, and is influenced by many factors singular to that property.

Pricing your park correctly is critical to selling promptly. There are several parks on the market that have been available for multiple years - clearly priced incorrectly for their market.

Consult an experienced park broker. It's our job to know the many parks and markets that exist, and to personally know many of the sellers, buyers, brokers, lenders, vendors, and other industry people that collectively affect the value of Oregon parks. There is a ton of activity right now, and not all of it is apparent to investors without deep connections in the mobile home park industry. There are a lot of interesting and very relevant histories out there that inform our opinion and strategy when selling parks!

Keep an eye out for my next article: "Buying and Selling MH Parks in a Hot Market".

Ty Downing is a licensed real estate broker at Western Equities, and a mobile home park investor. Ty and principal broker Randy Smith own a combined total of nearly 400 spaces in 8 parks, and specialize in mobile home park sales across the western United States. Contact Ty at 503-653-3887.

Ty Downing
Associate Broker

W
Western Equities

Multifamily and Mobile Home Park Investing
3215 SE Raymond St.
Portland, OR 97202

Tel: 503-242-0033
Fax: 503-281-4054
Cell: 503-653-3887

tydowning@westernequities.com

Answer. ORS 90.531 - 90.543 consists of a series of statutes that permit landlords to convert utility charges from base rent to a program passing them on directly to residents. ORS 90.533 expressly permits garbage collection costs to be converted to a pass-through program. In summary, it provides as follows:

1. Unilateral Amendment. You must first unilaterally amend your rental or lease agreements to remove the cost of garbage collection from your base rent and have it billed to residents by your garbage provider. You do not need tenant consent to make this amendment.

1. 180-Day Notice. You must give not less than 180 days' written notice to each resident, before converting to a garbage pass-through billing program.

1. Reduction of Rent. You are required to reduce your base rent at the time of the first billing under the new program. The rent reduction may not be less than an amount reasonably comparable to the amount of the rent previously allocated to the garbage services averaged over at least the preceding twelve (12) months. Landlords may not convert to this program sooner than one year after giving notice of a rent increase, unless the rent increase is an automatic increase provided for in a fixed term rental agreement (i.e. a lease) entered into one year or more before the conversion.

1. Twelve Months' Garbage Billing Records. Before you may first bill the residents under the new program, you must provide them with written documentation from the garbage provider showing your cost for the service during at least the twelve (12) preceding months.

1. Prohibition on Subsequent Rent Raises. During the six months following your conversion to a garbage pass-through billing program, you may not raise the rent to recover any costs of conversion to the program.

1. Common Areas. At the same time you convert to the pass-through program, you may also unilaterally convert the billing for common areas to a pro rata method that divides the cost based on the number of occupied spaces in the facility. don't forget to address this in the unilateral amendment!

Answer. ORS 90.531 - 90.543 consists of a series of statutes that permit landlords to convert utility charges from base rent to a program passing them on directly to residents. ORS 90.533 expressly permits garbage collection costs to be converted to a pass-through program. In summary, it provides as follows:

1. Unilateral Amendment. You must first unilaterally amend your rental or lease agreements to remove the cost of garbage collection from your base rent and have it billed to residents by your garbage provider. You do not need tenant consent to make this amendment.

1. 180-Day Notice. You must give not less than 180 days' written notice to each resident, before converting to a garbage pass-through billing program.

1. Reduction of Rent. You are required to reduce your base rent at the time of the first billing under the new program. The rent reduction may not be less than an amount reasonably comparable to the amount of the rent previously allocated to the garbage services averaged over at least the preceding twelve (12) months. Landlords may not convert to this program sooner than one year after giving notice of a rent increase, unless the rent increase is an automatic increase provided for in a fixed term rental agreement (i.e. a lease) entered into one year or more before the conversion.

1. Twelve Months' Garbage Billing Records. Before you may first bill the residents under the new program, you must provide them with written documentation from the garbage provider showing your cost for the service during at least the twelve (12) preceding months.

1. Prohibition on Subsequent Rent Raises. During the six months following your conversion to a garbage pass-through billing program, you may not raise the rent to recover any costs of conversion to the program.

1. Common Areas. At the same time you convert to the pass-through program, you may also unilaterally convert the billing for common areas to a pro rata method that divides the cost based on the number of occupied spaces in the facility. don't forget to address this in the unilateral amendment!