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AB-3260 Tenancy: security deposit.(2019-2020)

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Date Published: 05/05/2020 09:00 PM
AB3260:v96#DOCUMENT

Amended  IN  Assembly  May 05, 2020
Amended  IN  Assembly  May 04, 2020
Amended  IN  Assembly  March 12, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 3260


Introduced by Assembly Member Wicks

February 21, 2020


An act to add Section 1950.4 to the Civil Code, relating to tenancy.


LEGISLATIVE COUNSEL'S DIGEST


AB 3260, as amended, Wicks. Tenancy: security deposit.
Existing law regulates the terms and conditions of residential tenancies and authorizes a landlord to demand security at the beginning of a tenancy to be used to reimburse the landlord for costs associated with processing a new tenant, as an advance payment of rent, or for specified other purpose, including compensating a landlord for a tenant’s default in the payment of rent.
This bill would require a landlord to authorize a tenant, as an alternative to paying the full amount of a security deposit before taking possession of the premises, to satisfy security by either obtaining and maintaining rental security insurance coverage or a surety bond or paying the amount of the security in monthly installments, subject to specified requirements.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 1950.4 is added to the Civil Code, to read:

1950.4.
 As an alternative to requiring a tenant to pay the full amount of a security deposit required pursuant to Section 1950.5 before taking possession of the premises, a landlord shall authorize a tenant to satisfy security by doing one of the following, at the tenant’s discretion:
(a) Obtaining and maintaining rental security insurance coverage or a surety bond from an insurance provider selected by the landlord that meets the following requirements:
(1) The insurance provider shall be an approved carrier licensed by, and in good standing with, the Department of Insurance.
(2) The insurance provider shall permit the payment of premiums on a monthly basis. basis or as a one-time fee.
(3) The insurance coverage or surety bond shall be effective upon the date the tenant takes possession of the premises and shall remain in effect for the entire term of the tenancy.
(4) The amount of coverage or bonding shall be no less than the full amount of the security deposit. However, a landlord shall not require a tenant to provide additional security security, surety, or insurance in excess of the full amount of the security deposit.
(b) Paying the amount of the security in monthly installments over a period of not less than six months, unless the term of the lease is for less than nine months, in which case the number of monthly installments shall be by written agreement of the landlord and tenant. The security installment payments shall be due on the same day as the tenant’s rent payment is due and may be paid with the rent as a single payment.