Over 3000 bills were introduced during the 2020 Virginia General Assembly Session. The Richmond Association of REALTORS® Government Affairs team, along with our local and state counterparts, reviewed every bill that would impact real estate.
Below you will find a brief summary of each successful piece of legislation that could affect your business. If you would like to review the legislation in depth, each bill number links to the full text as it is enacted into law. All bills are effective July 1, 2020 unless otherwise noted. For more information on these or other legislative items, contact Joh Gehlbach at firstname.lastname@example.org.
1. Business Issues
1.1. Waiving business license requirements (HB 466)
This bill allows localities with a population greater than 50,000 to waive license requirements for businesses with gross receipts of $200,000 or less. Previously, such waivers had been limited to businesses with gross receipts of less than $100,000.
1.2. Handheld communication devices while driving (HB 874/SB 160)
This bill prohibits any person from holding a handheld personal communications device while driving a motor vehicle. Current law prohibits (i) the reading of any email or text message and manually entering letters or text in such a device as a means of communicating and (ii) holding a personal communications device while driving in a work zone. The bill expands the exemptions to include handheld personal communications devices that are being held and used (a) as an amateur radio or a citizens band radio or (b) for official Department of Transportation or traffic incident management services. Effective January 1, 2021.
1.3. Virginia telephone privacy protection act (HB 1244/SB 812)
This bill provides that for the purposes of the Virginia Telephone Privacy Act (the Act), “telephone solicitation call” includes any text message sent to any wireless telephone with a Virginia area code, or to a wireless telephone registered to any natural person who is a resident of the Commonwealth, for the purpose of offering or advertising any property, goods, or services for sale, lease, license, or investment, including offering or advertising an extension of credit or for the purpose of fraudulent activity. The bill prohibits a telephone solicitor from engaging in any conduct that results in the display of false or misleading caller identification information on the called party’s telephone. The bill increases the amount of damages and the amount of the civil penalty for violations of the Act from $500 for each such violation to $500 for a first violation, $1,000 for a second violation, and $5,000 for each subsequent violation and increases to $5,000 the maximum civil penalty the court may impose for a willful first or second violation.
2. Common Interest Communities
2.1. Property Owners Association and the Condo Association Acts Right of rescission (HB 176/SB 672)
This bill provides for a limited extension of the right of cancellation for up to seven days where such extension is provided for in a ratified real estate contract.
2.2. Display of political signs (HB 720)
This bill requires the association disclosure packet to contain a statement of any restrictions on the size, place, duration, and manner of placement or display of political signs by a lot owner on his lot.
3. Deeds and Covenants
3.1. Restrictive covenants (HB 788)
This bill prohibits a deed containing any restrictive covenant and any related reversionary interest, purporting to restrict occupancy or ownership of property on the basis of race, color, religion, national origin, sex, elderliness, familial status, or handicap, whether heretofore or hereafter included in an instrument affecting the title to real or leasehold property from being recorded on or after July 1, 2020, and provides the form for a Certificate of Release of Certain Prohibited Covenants to be recorded to remove any such restrictive covenant.
4.1. Private stormwater management facility (HB 859)
This bill directs the State Water Control Board to adopt regulations requiring the owner of residential property on which is located a privately owned stormwater management facility serving one or more residential properties to record the long-term maintenance and inspection requirements for such stormwater management facility with the deed for the owner’s property. The bill requires an owner of residential real property who has actual knowledge of a privately owned stormwater management facility located on the property to disclose to a purchaser of the property the long-term maintenance and inspection requirements of the facility.
4.2. Radon gas added to buyer beware (HB 175)
This bill adds to the disclosure statement required to be furnished to the buyer by the owner of residential real property that the buyer beware and exercise necessary due diligence they deem necessary to determine whether the property is located in Zone 1 or Zone 2 by the US Environmental Protection Agency’s Map of Radon Zones.
4.3. Lead pipes, defective drywall added to buyer beware (HB 1342)
This bill adds to the disclosure statement required to be furnished to the buyer by the owner of residential real property that the buyer beware and exercise necessary due diligence (i) with respect to whether the property contains any pipe, pipe or plumbing fitting, fixture, solder, or flux that does not meet the federal Safe Drinking Water Act definition of “lead free” and (ii) with respect to the existence of defective drywall on the property.
4.4. Impounding structures or dams added to buyer beware (HB 1569/SB 343)
This bill directs the Real Estate Board to include in the residential property disclosure statement provided on its website a disclosure relating to the condition or regulatory status of any impounding structure or dam on the owner’s property or under the ownership of a common interest community that the owner of the property is required to join.
4.5. Marine clay added to buyer beware (H174B )
This bill provides that the owner of residential property makes no representations with respect to whether the property is located on or near deposits of marine clays (marumsco soils). The bill also advises purchasers to exercise whatever due diligence is deemed necessary in accordance with terms and conditions as may be contained in the real estate purchase contract, including consulting public resources regarding local soil conditions and having the soil and structural conditions of the property analyzed by a qualified professional.
4.6. Residential energy analysis added to buyer beware (HB 518/SB 628)
This bill adds obtaining a residential building energy analysis to the disclosure statement furnished to the buyer by the owner of residential real property that the buyer beware and exercise necessary due diligence with respect to determining the condition of real property or any improvements thereon. This bill is a recommendation of the Virginia Housing Commission.
4.7. Disclosure advisement statement (HB 838)
This bill requires the residential property disclosure statement form developed by the Real Estate Board and maintained on its website to include a statement signed by the parties acknowledging that the purchaser has been advised of the disclosures listed on the residential property disclosure statement. Previously, such form only required an acknowledgment that the purchaser has been advised to review the residential property disclosure statement.
5.1. Expungement of unlawful detainer (SB 640)
This bill creates a process by which unlawful detainer actions filed in a general district court that have been dismissed or nonsuited may be expunged upon request of the defendant to such action. Effective January 1, 2022.
6. Fair Housing
6.1. Source of income (HB 6)
This bill adds discrimination on the basis of a person’s source of income to the list of unlawful discriminatory housing practices. The bill defines “source of income” as any source that lawfully provides funds to or on behalf of a renter or buyer of housing, including any assistance, benefit, or subsidy program, whether such program is administered by a governmental or nongovernmental entity.
6.2. Sexual orientation and gender identity (HB 1049)
This bill prohibits discrimination in employment, public accommodation, public contracting, apprenticeship programs, housing, banking, and insurance on the basis of sexual orientation or gender identity. The bill also adds discrimination based on sexual orientation or gender identity to the list of unlawful discriminatory housing practices.
6.3. Sexual orientation, gender identity, status as a veteran (SB 868)
The bill prohibits discrimination in public and private employment on the basis of sexual orientation and gender identity. The bill also codifies for state and local government employment the current prohibitions on discrimination in employment on the basis of race, color, religion, national origin, sex, pregnancy, childbirth or related medical conditions, age, marital status, disability, or status as a veteran. Additionally, the bill (a) prohibits discrimination in public accommodations on the basis of sexual orientation, gender identity, or status as a veteran; (b) prohibits discrimination in credit on the basis of sexual orientation, gender identity, pregnancy, childbirth or related medical conditions, disability, and status as a veteran; and (c) adds discrimination on the basis of an individual’s sexual orientation, gender identity, or status as a veteran as an unlawful housing practice.
6.4. Victim of family abuse (HB 99)
This bill allows an applicant for a lease to recover actual damages, including all amounts paid to the landlord as an application fee, application deposit, or reimbursement for any of the landlord’s out-of-pocket expenses that were charged to the applicant, along with attorney fees, if the landlord does not consider evidence of the applicant’s status as a victim of family abuse to mitigate any adverse effect of the otherwise qualified applicant’s low credit score.
7.1. Septic system inspectors (HB 1266)
This bill requires any individual performing a septic inspection in connection with a real estate transaction to hold a valid onsite sewage system operator, onsite sewage system installer, or onsite soil evaluator license pursuant to Chapter 23 (Waterworks and Wastewater Works Operators) of Title 54.1. This includes refinancings.
7.2. Real estate settlements, kickbacks and other payments (HB 819)
This bill relocates from Chapter 9 (Real Estate Settlements) to Chapter 10 (Real Estate Settlement Agents) within Title 55.1 the existing provision that prohibits persons from paying or receiving a kickback, rebate, commission, thing of value, or other payment pursuant to an agreement to refer business incident to a settlement. This relocation authorizes the State Corporation Commission to impose penalties, issue injunctions, and require restitution in cases where a person who does not hold a license from the appropriate licensing authority has violated the provision. The measure also adds to Chapter 10 of Title 55.1 provisions that (i) authorize a court to assess civil penalties of not more than $5,000 per violation of the chapter and (ii) authorize the recovery of costs and reasonable expenses and attorney fees.
7.3. Government declared emergencies and furlough protections (HB 340)
Similar to the 2019 Act that provided relief for tenants, landlords, and homeowners who were impacted by the government shutdown, this bill provides protections to tenants, landlords of tenants, or homeowners who are furloughed or impacted by a closure of the United States government. A tenant who is impacted by a shutdown and is facing an unlawful detainer, can provide written proof that he is furloughed or otherwise is not receiving wages due to the shutdown, and receive a 60 day continuance of the unlawful detainer. A homeowners who is furloughed or impacted by a shut down, has defaulted on the note and is subject to a foreclosure proceeding, will receive a 30 day stay on the proceeding after providing proof that he was furloughed or not receiving pay. A homeowner who rents to a tenant who was furloughed or did not receive pay qualifies for the same 30 day stay. Furthermore, the Governor amended this bill in April 2020 to extend similar protections to individuals impacted by the COVID-19 pandemic, unless the individual is protected under another federal, state, or local law or regulation enacted in response to the pandemic or the declared State of Emergency related to the pandemic. The protections provided under the COVID-19 expansion expire 90 days after the end of the state of emergency declared by the Governor in response to COVID-19. Effective April 22, 2020.
7.4. Flood plain ordinances (HB 998)
This bill provides that any locality may by ordinance regulate the activity on, use of, or development of a flood plain in a manner consistent with any state or federal flood plain management programs and requirements.
8.1. Death or disability of a broker (HB 513)
This bill clarifies that upon the death or disability of a licensed real estate broker who was the only licensed broker in a business entity, the Real Estate Board shall grant approval to certain persons enumerated by law to carry on the business of such broker for 180 days following the death or disability of the broker solely for the purpose of concluding the business of the broker. Previously, the law only addressed the death or disability of the sole licensed broker in a corporation or partnership.
9. Property Management
9.1. Rent into escrow (SB 653)
This bill provides that in the event of foreclosure of real property, all rent moneys, regardless of when received, shall be deposited in an escrow account by the end of the fifth business banking day following receipt, unless otherwise agreed to in writing by the principals to a lease transaction.
9.2. Charge for late payment of rent (HB 1420)
This bill provides that a landlord shall not charge a tenant for late payment of rent unless such charge is provided for in the written rental agreement, and that no such late charge shall exceed the lesser of 10 percent of the periodic rent or 10 percent of the remaining balance due and owed by the tenant. Effective April 22, 2020.
9.3. Tenant rights and responsibilities (HB 393/SB 707)
This bill requires the Director of the Department of Housing and Community Development to develop a statement of tenant rights and responsibilities explaining in plain language the rights and responsibilities of tenants under the Virginia Residential Landlord and Tenant Act (§ 55.1-1200 et seq.) and maintain such statement on the Department’s website along with a form to be signed by the parties to a rental agreement. The bill requires that the statement be provided to any prospective tenant and that the form developed by the Department be signed by the parties to the rental agreement. The bill prohibits a landlord from filing or maintaining an action against a tenant in a court of law for any alleged lease violation until he has provided the tenant with the statement of tenant rights and responsibilities.
9.4. Damage insurance in lieu of security deposit (HB 1333)
This bill provides that a landlord may permit a tenant to provide damage insurance coverage meeting certain criteria in lieu of the payment of a security deposit. The bill also caps the total amount of any combination of security deposit and rental insurance coverage required by the landlord to twice the amount of the periodic rent payment and provides that a tenant who initially opts to provide damage insurance in lieu of a security deposit may, at any time without consent of the landlord, opt to pay the full security deposit to the landlord in lieu of maintaining a damage insurance policy.
9.5. Ex parte order to recover possession for unlawful ouster (HB 1401)
This bill provides that, upon receipt of a petition for an order to recover possession or restore essential services alleging a tenant’s unlawful ouster from the rental premises and a finding that the petitioner has attempted to provide the landlord with actual notice of the hearing on the petition, the judge of the general district court may issue such order ex parte upon a finding of good cause to do so. The bill further provides that an ex parte order shall be a preliminary order that specifies a date for a full hearing on the merits of the petition, to be held within five days of the issuance of the ex parte order.
9.6. Notice of termination to contain legal aid information (HB 519/SB 115)
This bill provides that no notice of termination of tenancy served upon a tenant receiving tenant-based rental assistance through (i) the Housing Choice Voucher Program, 42 U.S.C. § 1437f(o), or (ii) any other federal, state, or local program by a private landlord is effective unless it contains on its first page, in type no smaller or less legible than that otherwise used in the body of the notice, the statewide legal aid telephone number and website address.
9.7. Return of security deposit (HB 594/SB 388)
This bill requires the landlord to return the tenant’s security deposit, minus any deductions or charges, within 45 days of the termination of the tenancy or the date the tenant vacates the dwelling unit, whichever occurs last. Under current law, the 45-day period to return the security deposit begins on the date of the termination of the tenancy.
9.8. Tenant’s remedy by repair (SB 905)
This bill permits a tenant, under certain circumstances, to have a condition that constitutes a material noncompliance by the landlord with the rental agreement or with provisions of law, or that if not promptly corrected will constitute a fire hazard or serious threat to the life, health, or safety of occupants of the premises, remedied by a third-party licensed contractor or a licensed pesticide business. The bill provides that, unless the tenant has been reimbursed by the landlord, the tenant may deduct from rent the actual costs incurred, not to exceed the greater of one month’s rent or $1,500, after submitting to the landlord an itemized statement accompanied by receipts for purchased items and third-party contractor or pest control services.
9.9. Disclosure of lead plumbing to prospective tenants by licensee (HB 1161)
This bill requires any licensee who is engaged by a landlord and who has actual knowledge of the existence of any pipe, pipe or plumbing fitting, fixture, solder, or flux that does not meet the federal Safe Drinking Water Act definition of “lead free” to disclose such information to a prospective tenant.
10. Worker Misclassification
10.1. Right to sue (HB 984/SB 894)
This bill authorizes an individual who has not been properly classified as an employee to bring a civil action for damages against his employer for failing to properly classify the employee if the employer had knowledge of the individual’s misclassification. The court may award damages in the amount of any wages, salary, employment benefits, including expenses incurred by the employee that would otherwise have been covered by insurance, or other compensation lost to the individual, a reasonable attorney fee, and the costs incurred by the employee in bringing the action. The measure provides that an individual who performs services for a person for remuneration shall be presumed to be an employee unless it is shown that the individual is an independent contractor as determined under the Internal Revenue Service guidelines.
10.2 Worker misclassification investigation (HB 1407)
This bill prohibits an employer from classifying an individual as an independent contractor if he is an employee. An individual shall be considered an employee of the party that pays the remuneration for purposes of Titles 40.1 (Labor and Employment), 58.1 (Taxation), 60.2 (Unemployment Compensation), and 65.2 (Workers’ Compensation) unless it is demonstrated that such individual is an independent contractor. The Department of Taxation shall determine whether an individual is an independent contractor by applying Internal Revenue Service guidelines. Violators are subject to civil penalties and debarment from public contracts. Effective January 1, 2021.