HOUSE BILL NO. 4538
A bill to amend 1972 PA 348, entitled
"An act to regulate relationships between landlords and tenants relative to rental agreements for rental units; to regulate the payment, repayment, use and investment of security deposits; to provide for commencement and termination inventories of rental units; to provide for termination arrangements relative to rental units; to provide for legal remedies; and to provide penalties,"
by amending the title and section 1 (MCL 554.601), as amended by 2024 PA 179, and by adding section 1e.
the people of the state of michigan enact:
An act to regulate relationships between landlords and tenants relative to rental agreements for rental units; to regulate the payment, repayment, use and investment of security deposits; to provide for commencement and termination inventories of rental units; to provide for termination arrangements relative to rental units; to prohibit the use of certain rent pricing devices; to provide for legal remedies; and to provide penalties.
(a) "Algorithmic pricing device" means a device that uses 1 or more algorithms to perform calculations of data, including data concerning local or statewide rent amounts being charged to tenants by landlords, for the purpose of advising a landlord of the amount of rent that the landlord may consider charging a prospective tenant or tenant. Algorithmic pricing device includes a service or product that incorporates an algorithmic pricing device. Algorithmic pricing device does not include any of the following:
(i) Any report published periodically, but not more frequently than monthly, by a trade association that receives tenant data and publishes it in an aggregated and anonymous manner.
(ii) A product used for establishing rent or income limits in accordance with the affordable housing program guidelines of a local government, this state, the United States government, or a political subdivision of this state.
(b) (a) "Landlord" means any of the following:
(i) The owner, lessor, or sublessor of a rental unit or the property of which it is a part.
(ii) A person authorized to exercise any aspect of the management of the premises, including a person that, directly or indirectly, acts as a rental agent or receives rent, other than as a bona fide purchaser, and that has no obligation to deliver the receipts to another person.
(c) "Nonpublic competitor data" means information that is not widely available or easily accessible to the public, including information about actual rent prices, occupancy rates, rental agreement start and end dates, or similar data, regardless of whether the data is attributable to a specific competitor or is anonymous, and that is derived from or otherwise provided by another person that competes in the same market as a person or a related market.
(d) "Prospective tenant" means an individual who makes a request to a landlord to rent or lease a rental unit.
(e) (b) "Rental agreement" means an agreement that establishes or modifies the terms, conditions, rules, regulations, or any other provisions concerning the use and occupancy of a rental unit.
(f) (c) "Rental unit" means a structure or part of a structure used as a home, residence, or sleeping unit by a single person or household unit, or any grounds, or other facilities or area promised for the use of a residential tenant. Rental unit includes, but is not limited to, apartment units, boarding houses, rooming houses, mobile home spaces, and single and 2-family dwellings.
(g) (d) "Security deposit" means a deposit, in any amount, paid by the tenant to the landlord or the landlord's agent to be held for the term of the rental agreement, or any part of the term, and includes any required prepayment of rent other than the first full rental period of the lease agreement; any sum required to be paid as rent in any rental period in excess of the average rent for the term; and any other amount of money or property returnable to the tenant on condition of return of the rental unit by the tenant in condition as required by the rental agreement. Security deposit does not include either of the following:
(i) An amount paid for an option to purchase, pursuant to a lease with an option to purchase, unless it is shown the intent was to evade this act.
(ii) An amount paid as a subscription for or purchase of a membership in a cooperative housing association incorporated under the laws of this state. As used in this subparagraph, "cooperative housing association" means a consumer cooperative that provides dwelling units to its members.
(h) (e) "Senior citizen housing" means housing for individuals 62 years of age or older that is subsidized in whole or in part under any local, state, or federal program.
(i) (f) "Source of income" includes benefits or subsidy programs including housing assistance, housing choice vouchers provided under 42 USC 1437f, public assistance, veterans' benefits, Social Security, supplemental security income or other retirement programs, and other programs administered by any federal, state, local, or nonprofit entity. Source of income does not include either of the following:
(i) Income that a prospective tenant cannot demonstrate is derived from sources and activities permitted by law and is provided on an ongoing basis.
(ii) Housing assistance that is not approved by the appropriate agency within 30 days after the landlord provides all information required as a condition of the agency's approval, including evidence that all repairs required before occupancy have been completed.
(j) (g) "Tenant" means an individual who occupies a rental unit for residential purposes with the landlord's consent for an agreed upon consideration.
Sec. 1e. (1) A landlord shall not use, incorporate, or train an algorithmic pricing device with nonpublic competitor data to do any of the following for the purpose of advising the landlord of the amount of rent to charge a tenant or prospective tenant for the occupancy of a rental unit:
(a) Coordinate price, supply, or other rental housing information among 2 or more landlords.
(b) Enter into an agreement or contract with other landlords in restraint of the rental housing market.
(2) A violation of subsection (1) constitutes a violation of the Michigan antitrust reform act, 1984 PA 274, MCL 445.771 to 445.788.