A BILL IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
Councilmember Jim Graham introduced the following bill, which
was referred to the Committee on Committee on Government Operations.
To provide that a rental housing accommodation may be placed
in receivership when the Department of Consumer and Regulatory Affairs finds that there is
a threat to the health, safety, or security of the tenants, and for other purposes.
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That
this act may be cited as the "Rental Housing Receivership Act of 2000".
Sec. 2. Purpose of the appointment of a receiver. The purpose
of the appointment of a receiver under this act shall be to safeguard the health, safety,
and security of the tenants of a rental housing accommodation when there exists a
violation or violations of District or Federal law which seriously threaten the tenant's
health, safety, or security. The receiver shall not take actions inconsistent with these
purposes, nor take actions outside of those necessary and proper to the maintenance of the
rental housing accommodation. Nothing in this act shall be construed to limit or abrogate
any other common law or statutory right to petition for receivership.
Sec. 3. Grounds for appointment of a receiver. A receiver may
be appointed on either of the following grounds:
(a) The housing accommodation has been cited by the Department
of Consumer and Regulatory Affairs for violations of 14 DCMR chapters 1 through 16, or
their equivalents, that pose a serious threat to the health, safety, or security of the
tenants, and the owner, agent, lessor, or manager has been notified of these violations
and has failed to comply with notices to abate these violations; or
(b) The majority of the tenants of the building have
petitioned the owner, agent, lessor, or manager in writing for the abatement of conditions
equivalent to those in subsection (a) and the owner, agent, lessor, or manager has failed
to abate these conditions within 60 days. A copy of this petition must be provided to the
Department of Consumer and Regulatory Affairs within one week of the time the petition is
delivered to the owner, agent, lessor, or manager. If the petition is not delivered to the
Department of Consumer and Regulatory Affairs within one week of the delivery to the
owner, agent, lessor, or manager, the 60 days shall not run until such time as the
petition is delivered to the Department of Consumer and Regulatory Affairs.
Sec. 4. Petitions for Receivership.
(a) Notwithstanding the availability of any other remedy, the
Mayor or the Mayor's designee may, in the name of the District of Columbia and based on
either of the grounds listed in section 3, petition the court for the appointment of a
receiver of the rents or payments for use and occupancy for the affected apartment
(b) Notwithstanding the availability of any other remedy, any
tenant, tenant's representative, or advocate representing the interests of a rental
housing accommodation's tenants, may, based on the grounds listed in section 3(1) or 3(2),
petition the court for the appointment of a receiver of the rents or payments for use and
occupancy for the affected apartment building or submit a written request to the Mayor or
the Mayor's designee to petition the court for the appointment of a receiver of the rents
or payments for use and occupancy for the affected apartment building.
(c) Except as provided in section (5)(b), the Court shall set
a date for a hearing on the petition no later than 30 days after the filing of the
Sec. 5. Notice and hearing requirements.
(a)(1) After a petition has been filed pursuant to section 4,
the Chief Judge of the Superior Court or such Judge's designee shall immediately issue an
order requiring the owner, agent, lessor, or manager, as respondent, to show cause why a
receiver should not be appointed.
(2) The order of the Court, along with a copy of the petition,
shall be served on the owner, agent, lessor, or manager at his or her last known address
or by such other method as the Court may direct and shall be posted in a conspicuous place
upon the apartment house in question.
(3)(A) If the petitioner is not the Mayor or the Mayor's
designee the order of the Court along with a copy of the petition shall be served on the
Mayor or the Mayor's designee.
(B) No later than 5 days, excluding Saturdays, Sundays, and
legal holidays, after receiving a copy of the petition under paragraph (A) of this
subsection, the Department of Consumer and Regulatory Affairs shall make available to the
petitioner for his use in the proceedings certified copies of all licensure and housing
inspection reports in the custody of the District government that document conditions in
the rental housing accommodation within the previous 2 years.
(b)(1) If, upon filing of a petition, the court finds probable
cause to believe a condition or practice in the affected rental housing accommodation
poses an immediate danger to the health, safety, or security of the tenants, it may, ex
parte, issue an order of not more than 14 days duration appointing a receiver and direct
that the order be served along with the notice required by this section; provided that a
hearing be commenced prior to the expiration of the order.
(2) In the event of any ex parte appointment pursuant to
paragraph 1 of this subsection, the petitioner shall ensure that the owner, agent, lessor,
or manager of the rental housing accommodation is served with notice of the hearing date
and a copy of the petition, any supporting affidavits, and the order of appointment:
(A) By personal service within 72 hours after the appointment;
(B) By notice conspicuously posted inside or on the front door
of the rental housing accommodation within 96 hours of the appointment, if the petitioner
files with the court a sworn statement setting forth in detail his diligent effort to
serve notice pursuant to paragraph (A) of this subsection. Additionally, the petitioner
shall serve the order of the Court along with a copy of the petition on the owner, agent,
lessor, or manager at his or her last known address.
(c) A receiver appointed under subsection (b) of this section
shall have the power to immediately collect all rents or payments for use and occupancy of
the affected rental accommodation and to alleviate the conditions cited by the Court in
the order appointing the receiver.
Sec. 6. Appointment of a receiver; continuation of ex parte
(a) After a hearing the court may appoint a receiver for a
rental housing accommodation or continue the appointment of a receiver made ex parte if it
fords that the petitioner has proven, by a preponderance evidence, the existence of either
or both of the grounds for receivership in section 3 of this act.
(b) Except as provided in subsection (c) of this section, the
court may appoint as a receiver any person or entity who has demonstrated to the court his
or her capacity and expertise to develop and supervise a viable financial and construction
plan for the satisfactory rehabilitation of the building.
(c) The court shall not appoint as a receiver:
(1) An employee of a District of Columbia government agency
that licenses or provides a financial payment the type of housing accommodation being
placed in receivership;
(2) Any person who has a financial interest in any other real
property in common with the owner of the property being placed under receivership.
(3) A parent, child grandchild, spouse, sibling, first cousin,
aunt, or uncle of the owner of the property being placed under receivership or any tenant
of the property being placed under receivership, whether the relationship arises by blood,
marriage, or adoption.
Sec. 7. Powers and duties of a receiver.
(a) A receiver shall:
(1) Take charge of the operation and management of the housing
accommodation and assume all rights to possess and use the building, fixture, furnishings,
records, and other related property and goods that the owner or property manager would
have if the receiver had not appointed;
(2) Give notice of the receivership, in accordance with
subsection (b) of this section, to the housing facility's tenants and employees, all
providers of public utilities for which the owner was responsible to pay prior to the
appointment of the receiver, any mortgage company holding a lien against the property, and
any other person whom the court orders should receive notice;
(3)(a) Have the power to collect all rents and payments for
use and occupancy
(b) The owner, agent, manager, or lessor shall be enjoined
from collecting rents and payments for use and occupancy for the duration of the
(4) Report to the court within 30 days following the issuance
of the order of appointment a plan for the rehabilitation of the rental accommodation,
including a timeline indicating when all causes giving rise to the appointment will be
abated and a financial accounting indicating how the rehabilitation will be paid for;
(5) Report to the court every 6 months after the filing of the
report required under paragraph (4) of this subsection reporting on the progress made in
abating the conditions giving rise to the appointment, updating the financial accounting
of the rehabilitation, and reporting to the court any changes in the conditions of the
building that may change the timetable submitted under paragraph (4) of this subsection;
(6) Preserve all property and records with which he or she has
been entrusted; and
(7) Carry out any other duties established by the court.
(b) The notice required by subsection (a)(2) of this section
shah include at a minimum the following information in not less than 12-point type:
(1) The reasons for the receivership;
(2) The identity of the receiver, his or her address and
(3) The receiver's responsibilities and duties; and
(4) The anticipated duration of the receivership.
(c) The receiver shall collect all private and third-party
payments to the housing facility and, based on their total for a calendar month, make
payments prioritized by the following provisions:
(1) Payments to abate housing code violations when such
abatement is required within 24 or 48 hours of service. These payments may take up to 50%
of the total payments received under subsection (c) of this section;
(2)(A) Payments to abate housing code violations when such
abatement is required within 7 days of service; and
(B) Payments to reduce overdue accounts payable to all public
utility providers, when such payments are overdue by more than one year.
(C) The payments required under (2)(A) and (2)(B) of this
subsection shall be paid on a pro-rata basis and may take up to 60% of the balance
remaining from payments received by the receiver after payments made under paragraph (1)
of this subsection
(3)(A) Payments to abate housing code violations when such
abatement is required within 30 days of service; and
(B) Payments to reduce overdue accounts payable to all public
utility providers, when such payments are overdue by one year or less.
(C) The payments required under (3)(A) and (3)(B) of this
subsection shall be paid on a pro-rata basis and may take up to 50% of the balance
remaining from payments received by the receiver after payments made under paragraph (2)
of this subsection.
(4) Payments to the receiver as determined by the court in the
order appointing the receiver as compensation. Payments made under this paragraph may take
up to 33 and 1/3 % of the balance remaining from payments received by the receiver after
payments made under paragraph (2) of this subsection.
(5) The funds remaining after paragraphs (1), (2), (3), and
(4) of this subsection shall be used for all other payments reasonable and prudent for the
maintenance and upkeep, both physical and financial, of the housing facility.
(d) The receiver shall not have the power to make any
improvements to the property except those necessary to abate housing code violations.
(e) The receiver shall not have the power to enter into any
contract that would affect the property rights of the owner, except those contracts that
are within the ordinary course of business of the property.
(f) The receiver shall be personally liable only for his or
her acts of gross negligence or intentional wrongdoing in carrying out the receivership.
(g) A receiver shall be entitled to a reasonable fee
established by the court and payable from the revenues of the housing facility.
See. 8. Termination of receivership.
(a)(1) Except as provided in subsection (b) of this-section, a
receivership shall terminate when:
The person who will assume control of the building has been
granted a current license by the Mayor, and
(A) The time period specified in the order appointing the
receiver lapses and is not extended; or
(B) The court determines that the receivership is no longer
necessary because the grounds on which the appointment of the receiver was based no longer
exist, and that the receiver has received proper compensation for the services provided,
and that the city has been reimbursed for all expenses related to the appointment of the
(2) The court determines on recommendation from the receiver
that the violations giving rise to the appointment of the receiver cannot be abated. The
building shall be closed under the guidelines listed in DCMR 14-115. Disposition of the
property under this paragraph does not abrogate any tenancy rights the tenants have under
other District of Columbia and Federal laws.
(b)(1) Notwithstanding subsection (a) of this section, a
receivership of a housing accommodation shall not be terminated in favor of any person who
was the owner of the accommodation or his representative at the time the petition was
filed pursuant to section 4, or, in the discretion of the court, any person who is or was
an affiliate of the owner, agent, lessor, or manager, unless he or she first reimburses
the District government, within 6 months of the establishment of the receivership, for the
administrative costs incurred by reason of the receivership.
(2) The court may in addition require that, before a person
specified in paragraph (1) of this subsection resumes control of a housing accommodation,
he or she post bond in an amount the court deems appropriate as security against
noncompliance with the law. If the receivership is not reinstated under subsection (c) of
this section the bond money shall be returned with all applicable interest.
(3) Any owner recovering a housing accommodation pursuant to
this section may not deduct any of the expenses incurred thereby from his or her District
(c) Should it appear that, within two years after a
receivership is terminated in favor of a person specified in subsection (b)(1) of this
section, that person is not maintaining the housing accommodation in substantial
compliance with all applicable laws, and should the court so find after granting notice
and a hearing to all parties to the earlier receivership proceeding, the previous order
appointing a receiver may be reinstated. A receiver thus reappointed may use all or part
of any bond posted pursuant to subsection (a)(2) of this section to remedy the
Sec. 9. Failure to recover housing facility from receivership
(a) If any person specified in section (8)(b)(1) of this act
fails to recover the housing accommodation from receivership by meeting the conditions
specified in section (8)(b)(1) of this act, he or she forfeits all right to the property.
The property shall be offered as a cooperative to the present tenants under the following
(1) Notice by receiver. - The receiver shall provide each
tenant and the Mayor a written request for a tenant election by first class mail and post
the request for an election in conspicuous places in common areas of the housing
accommodation. The written request shall include, at a minimum, a summary of tenant rights
and obligations, a list of tenant voter qualifications and disqualifications, and sources
of technical assistance as published in the D.C. Register by the Mayor. If Spanish is the
primary language of a head of household, the owner shall provide a Spanish translation of
the request to the head of household. An owner shall also provide the Mayor with a list of
tenants residing in the housing accommodation.
(2) Notice by tenant organization. -- Within 30 days of
receipt of the receiver's request for an election, the tenants may establish a single
tenant organization, if one does not exist, and if a tenant organization exists or is
established, it shall provide each tenant, the receiver, and the Mayor with written notice
of the election by first class mail and by conspicuous posting in common areas of the
housing accommodation. Notice includes, at a minimum, the date, time and place of the
election, and a summary of tenant rights, obligations, a list of tenant voter
qualifications and disqualifications, and sources of technical assistance as published in
the D.C. Register by the Mayor, if published.
(3) Conduct of election. -- Within 60 days of receipt of a
receiver's request for an election, a tenant organization, if one exists or is
established, shall conduct an election. If notice of an election is not provided as
required by this section, upon the request of a tenant or the receiver, the Mayor shall
provide notice and conduct an election within 60 days of receipt of the receiver's
original request for an election.
(4) Qualified voter. -- A head of household residing in each
rental unit of the housing accommodation is qualified to vote unless no member of the
household has resided in the accommodation for at least 90 days before the election, or
unless a member of the household is or has been an employee of the owner within 120 days
prior to the date of application for eligibility, or unless he or she is a head of
household whose continued right to remain a tenant is required by this chapter. The Mayor
shall determine the eligibility of voters prior to the election and shall devise such
forms and procedures as may be necessary to verify eligibility under this subsection.
(5) Absentee ballot. -- A head of household unable to attend
the election may submit to the Mayor or tenant organization, prior to the election, a
signed absentee ballot or sworn statement of agreement or disagreement with the
(6) Notification of election results. -- The tenant
organization shall notify the receiver, the court, and the Mayor of the results of the
election within 3 days. If the Mayor conducts the election, the Mayor shall notify the
receiver and the court of the results of the election within 3 days.
(7) Election audit. -- The Mayor may monitor an election and
take measures to preserve the integrity of the election process and result.
(8) Coercion prohibited. - The receiver, tenant organization,
or third party purchaser shall not coerce a household in order to influence the head of
household's vote. Coercion includes, but is not limited to, the knowing circulation of
inaccurate information; frequent visits or calls over the objection of that household;
threat of retaliatory action; an act or threat not otherwise permitted by law which seeks
to recover possession of a rental unit, increase rent, decrease services, increase the
obligation of a tenant or cause undue or unavoidable inconvenience, harass or violate the
privacy of the household; refusal to honor a lease provision; refusal to renew a lease or
rental agreement; or other form of threat or coercion.
(9) Compliance approved. -- If over 50% of the qualified
voters vote in approval of conversion, or if an election is not held within 60 days of
receipt of a receiver's request pursuant to subsection (a) of this section or within such
reasonable extension of time as the Mayor may consider necessary to hold an election in
accordance with the procedural requirements of this chapter, the Mayor shall certify
compliance with this section for purposes of conversion.
(10) Compliance not approved. -- If 50% or less of the
qualified voters vote in approval of conversion, or if an election is invalidated by the
Mayor because of fraud or coercion in favor of conversion, the Mayor shall not certify
compliance with this section for purposes of conversion, and the receiver shall petition
the court to have property disposed of pursuant to subsections (b) of this section.
(11) New election. -- If an election is invalidated by the
Mayor because of fraud or coercion on the part of the tenant organization, the Mayor shall
conduct a new election within 30 days of the invalidation.
(b) If the tenants defuse to exercise their right of
conversion under subsection (a) of this section then the receiver shall petition the court
to dispose of the property. The court shall, in its sole discretion, either
(1) have the property put on the market, with the proceeds of
the sale being used to satisfy all outstanding debts and expenses, including any
administrative costs incurred by the District, incurred as a result of the receivership,
with any excess amount to be paid to the owner; or
(2) have the property revert to the District of Columbia,
which shall offer it as part of the District's homestead program.
Sec. 10. Final accounting.
Within 30 calendar days after termination of a receivership,
the receiver shall give the court a complete accounting of al property with which he or
she has been entrusted, all funds collected, and all expenses incurred.
Sec. 11. Fiscal impact statement.
The Council adopts the fiscal impact statement in the
Committee Report as the fiscal impact statement required by section 602(c)(3) of the
District of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Code
Sec. 12. Effective date.
This act shall take effect following approval by the Mayoral
(or in the even of a veto by the Mayor, action by the Council to override the veto),
approval by the Financial Responsibility and Management Assistance Authority as provided
in section 203(a) of the District of Columbia Financial Responsibility and Management
Assistance Act of 1995, approved April 17, 1995 (109 Stat. 116; D.C. Code §47-392.3(x)),
a 30-day period of Congressional review as provided in section 602(c)(1) of the District
of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Code
§1-233(c)(1)), and publication in the District of Columbia Register.