Bill Text: MI SB0846 | 2019-2020 | 100th Legislature | Introduced
Bill Title: Housing: public accommodations; excessively increased pricing in hotel and lodging industry during a declared state of emergency; prohibit. Creates new act.
Spectrum: Slight Partisan Bill (Democrat 12-6)
Status: (Introduced - Dead) 2020-03-17 - Referred To Committee On Economic And Small Business Development [SB0846 Detail]
Download: Michigan-2019-SB0846-Introduced.html
SENATE BILL NO. 846
March 17, 2020, Introduced by Senators MOSS,
JOHNSON, SANTANA, WOJNO, CHANG, POLEHANKI, BAYER, GEISS, MCMORROW, IRWIN,
LUCIDO, MACDONALD, BRINKS, BULLOCK, LASATA, VANDERWALL, HORN and HOLLIER
and referred to the Committee on Economic and Small Business Development.
the people of the state of michigan enact:
Sec. 1. This act shall be known and may be cited as the "hotel and lodging pricing protection act".
(a) "Declaration of emergency" means a declaration of a state of emergency.
(b) "Excessively increased price" means a price that demonstrates an unjustified disparity between the price of lodging advertised, or offered for sale or rent, for the market where the lodging is located, immediately before a declaration of emergency and the price of lodging advertised, or offered for sale or rent, in that market during or reasonably after a declaration of emergency. As used in this subdivision, an unjustified disparity is a disparity of more than 10% unless the person offering, selling, or renting lodging can demonstrate that the increase in price is attributable to an increase in the cost of the goods or labor used in its business or to a seasonal adjustment in rates that is regularly scheduled.
(c) "Lodging" means a building or structure kept, used, maintained as, or held out to the public to be an inn, hotel, or public lodging house. Lodging includes, but is not limited to, all of the following:
(i) A full-service hotel, limited-service hotel, resort, conference center, extended-stay hotel, vacation ownership, or convention hotel offering permanent or temporary stays.
(ii) A bed and breakfast.
(iii) Rental housing not rented or advertised for rent prior to a declaration of emergency.
(iv) A space rented in a mobile home park or campground.
(d) "Rental price" means any of the following:
(i) For housing with a rental period that began not more than 1 year prior to a declaration of emergency, and that is being rented by a tenant at the time of the declaration, the current rental price paid by the tenant. Rental price under this subparagraph includes the rental price for housing advertised, offered, or charged, at a daily rate at the time of a declaration of emergency, if the housing continues to be advertised, offered, or charged, at a daily rate.
(ii) For housing with a rental period that began, or was offered for rent, not more than 1 year prior to a declaration of emergency, and that is not being rented by a tenant at the time of the declaration, the most recent rental price offered before the declaration of emergency. Rental price under this subparagraph includes the rental price for housing advertised, offered, or charged on a daily basis at the time of the declaration of emergency, if the housing is advertised, offered, or charged on a periodic lease agreement after the declaration of emergency.
(iii) For housing that is being rented by a tenant at the time of a declaration of emergency but that becomes vacant while the declaration remains in effect and that is subject to any ordinance, rule, regulation, or initiative measure adopted by a local governmental entity that establishes a maximum amount that a landlord may charge a tenant for rent, the actual rental price paid by the previous tenant or the amount specified in subparagraph (iv), whichever is greater. This amount may be increased by 5% if the housing was previously rented or offered for rent unfurnished and it is being offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.
(iv) For housing that is not being rented by a tenant and has not been offered for rent within the 1-year period immediately preceding a declaration of emergency, 160% of the fair market rent for the market where the housing is located as established by the United States Department of Housing and Urban Development. This amount may be increased by 5% if the housing is offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.
(v) For mobile home spaces rented to existing tenants at the time of a declaration of emergency and subject to a local rent control ordinance, the amount authorized under the local rent control ordinance. For new tenants who enter into a rental agreement for a mobile home space that is subject to rent control but was not rented at the time of a declaration of emergency, the amount of rent last charged for a space in the same mobile home park. For mobile home spaces not subject to a local rent control ordinance and not rented at the time of a declaration of emergency, the amount of rent last charged for the space.
(e) "State of emergency" means a natural or man-made disaster or emergency resulting from a tornado, earthquake, flood, fire, riot, storm, act of war, threat of war, military action, or period of instability following a terrorist attack, or a threat to the public health, for which a state of emergency is declared by the governor or for which any of the following are in effect:
(i) An imminent alert issued in the "National Terrorism Advisory System Bulletin" published by the United States Department of Homeland Security.
(ii) A severe weather warning issued by the National Weather Service.
(iii) A public emergency as declared by a federal agency.
(iv) A state of emergency or state of disaster as declared by the governor under the emergency management act, 1976 PA 390, MCL 30.401 to 30.421, or a state of emergency declared by the governor under 1945 PA 302, MCL 10.31 to 10.33.
Sec. 3. (1) During or reasonably after a declaration of emergency, a person engaged in the business of offering, selling, or renting lodging shall not do any of the following:
(a) Charge a price that is grossly in excess of the price at which similar lodging is advertised, offered, or sold.
(b) Charge an excessively increased price for lodging.
(c) Offer lodging for sale or rent at an excessively increased price.
(2) In the event of a declaration of emergency and for a period of 30 days following the termination of the declaration, a person shall not increase a rental price that was advertised, offered, or charged for housing to an existing or prospective tenant before the declaration of emergency, by more than 10%, unless that person can demonstrate that the increase is directly attributable to additional costs for repairs or additions beyond normal maintenance that have been amortized over the rental term, causing the rent to be increased by greater than 5%, or that an increase was contractually agreed to by the tenant prior to the declaration of emergency. It is not a defense to a prosecution under this subsection that an increase in rental price was based on the length of the rental term, the inclusion of additional goods or services, except as provided in section 2(d) with respect to furniture, or the rent being offered by, or paid by, an insurance company, or other third party, on behalf of a tenant. This subsection does not authorize a landlord to charge a price greater than the amount authorized by a local rent control ordinance.
(3) Following a declaration of emergency, and for a period of 30 days following the termination of that declaration, or any period by which the emergency declaration is extended by the applicable authority, a person shall not evict a residential tenant of residential housing and rent or offer to rent to another prospective tenant the housing from which the previous tenant was evicted at a rental price greater than the price that the evicted tenant could be charged under this section. It is not a violation of this subsection for a person to do either of the following:
(a) Continue an eviction process that was lawfully started prior to the declaration of emergency.
(b) Commence an eviction process if the lodging has become uninhabitable due to the conditions leading to the declaration of emergency or as a consequence of the state of emergency.
Sec. 4. (1) If the attorney general or a local prosecuting attorney has reasonable cause to believe that an individual has information or is in possession, custody, or control of any document or other tangible object relevant to an investigation for a violation of this act, the attorney general or prosecuting attorney may serve upon the individual a written demand to appear and be examined under oath, and to produce the documents or object for inspection and copying. The demand must meet all of the following:
(a) Be served upon the individual in the manner prescribed for service of process under the law of this state.
(b) Describe the nature of the conduct constituting the violation under investigation.
(c) Describe the document or object with sufficient definiteness to permit it to be fairly identified.
(d) If requested, contain a copy of the written interrogatories.
(e) Prescribe a reasonable time at which the individual must appear to testify and within which the individual must answer the written interrogatories and the document or object must be produced.
(f) Advise the individual that objections to or reasons for not complying with the demand may be filed with the attorney general or prosecuting attorney on or before the time described in subdivision (e).
(g) Specify a place for the taking of testimony, or for production, and designate the individual who is to be the custodian of the document or object.
(h) Contain a copy of the language provided in subsection (2) with appropriate citation.
(2) If an individual fails to comply with the written demand served under subsection (1), the attorney general or a local prosecuting attorney may file an action to enforce the demand. Notice of hearing and a copy of the pleadings and other relevant papers must be served upon the individual, who may appear in opposition. If the court finds that the demand is proper, the court shall order the individual to comply with the demand, subject to modification as the court may prescribe. Upon motion by the individual and for good cause shown, the court may make any further order in the proceedings that justice requires to protect the individual from unreasonable burden or expense.
(3) An action filed under subsection (2) must be filed in the circuit court of the county in which the individual resides or in which the individual maintains a principal place of business within this state, or in the circuit court for the county of Ingham.
(4) The fact that an investigative demand has been issued is not confidential, but the testimony taken and material produced during the investigation shall be kept confidential unless an enforcement action is brought against a person for violation of this act. Once the action is filed, the investigative material may be disclosed in the course of discovery, pursuant to a protective order if the court deems appropriate, and in support of or opposition to the claims and defenses raised in the action, but in all other respects remains confidential.
Sec. 5. (1) The attorney general may bring a class action on behalf of persons residing in or injured in this state for the actual damages caused by conduct prohibited under section 3 to recover actual damages or $100.00, whichever is greater.
(2) On motion of the attorney general and without bond in an action brought under this section, the court may make an appropriate order to do any of the following:
(a) Reimburse persons who have suffered damages.
(b) Carry out a transaction in accordance with the aggrieved persons' reasonable expectations.
(c) Strike or limit the application of unconscionable clauses of contracts to avoid an unconscionable result.
(d) Grant other appropriate relief.
(3) The court after a hearing may appoint a receiver or order sequestration of the defendant's assets if it appears to the satisfaction of the court that the defendant threatens or is about to remove, conceal, or dispose of his or her assets to the detriment of members of the class.
(4) If at any stage of the proceedings under this section the court requires that notice be sent to the class, the attorney general may petition the court to require the defendant to bear the cost of the notice. In determining whether to impose the cost on the defendant, the court shall consider the probability that the attorney general will succeed on the merits of the action.
(5) If the defendant shows by a preponderance of the evidence that a violation of this act resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adopted to avoid the error, the amount of recovery shall be limited to actual damages.
(6) The attorney general shall not bring an action under this section more than 6 years after the occurrence of the method, act, or practice that is the subject of the action and not more than 1 year after the last payment in a transaction involving the method, act, or practice that is the subject of the action, whichever period of time ends on a later date.
Sec. 6. (1) The attorney general may bring an action for appropriate injunctive or other equitable relief and civil penalties in the name of the people of this state for a violation of this act. The court may impose a civil fine for each violation of this act. For an individual, the civil fine shall not be more than $10,000.00 per violation. For a person other than an individual, the civil fine shall not be more than $1,000,000.00 per violation.
(2) The state, a political subdivision, or a public agency injured directly or indirectly by a violation of this act may bring an action for appropriate injunctive or other equitable relief, actual damages sustained by reason of a violation of this act and, as determined by the court, interest on those damages from the date of the complaint, and taxable costs. If the trier of fact finds that the violation is flagrant, it may increase recovery to an amount not to exceed 3 times the actual damages sustained by reason of the violation.
Sec. 7. A person that violates section 3 with the intent to accomplish a result prohibited by this act is guilty of a misdemeanor punishable by imprisonment for not more than 2 years or a fine of not more than $10,000.00, or both, if an individual, or a fine of not more than $1,000,000.00 if a person other than an individual.
Sec. 8. The remedies provided in this act are cumulative.
Sec. 9. If a witness has been or may be called to testify or provide other information at a proceeding under or related to this act, the circuit court for the county in which the proceeding is or may be held may issue, upon application of the attorney general, asserting that in his or her judgment the testimony or other information may be necessary to the public interest and that the witness has refused or is likely to refuse to testify, an order requiring the witness to give testimony or provide other information that the witness refuses to give or provide on the basis of the privilege against self-incrimination, if the court provides in its order that the witness shall not be prosecuted or subjected to any penalty or forfeiture for, or on account of, any transaction, occurrence, matter, or thing to which the witness testifies or provides other information or evidence, documentary or otherwise, and that the testimony, information, or evidence shall not be used against the witness in any criminal investigation, proceeding, or trial, except a prosecution for perjury for giving a false statement or for otherwise failing to comply with the order.
Sec. 10. This act does not exempt, limit, or impair the attorney general's ability to investigate, determine, or impose liability under the Michigan consumer protection act, 1976 PA 331, MCL 445.901 to 445.922, or any other law of this state.
Sec. 11. This act does not prohibit an owner from evicting a tenant for a lawful reason.
Enacting section 1. This act does not take effect unless all of the following bills of the 100th Legislature are enacted into law:
(a) Senate Bill No. 847.
(b) Senate Bill No. 848.
