Subject
title
Chapter 18 Code Update (Rental Facilities and Landlord-Tenant Relations) - Work Session
end
Department
Housing and Community Development
Recommendation
Staff recommend that the Mayor and Council receive the presentation, discuss, and provide direction on updates to City Code Chapter 18, Rental Facilities and Landlord-Tenant Relations. The feedback received from the Mayor and Council will guide staff’s draft of the updated code. Do you agree with staff’s recommendations for:
1. Background check restrictions
2. Relocation assistance
3. Penalties
4. Programmatic actions and future code amendments
Discussion
PURPOSE
The purpose of this work session is to provide the Mayor and Council with an overview of the changes to City Code Chapter 18, Rental Facilities and Landlord-Tenant Relations under consideration by staff. Changes include minor alterations to the current code and significant, new city policies. This is the final work session on Chapter 18. Following this work session, staff will present a draft of the rewritten code, based on Mayor and Council’s feedback, for review and approval.
BACKGROUND
In Fall 2024, a comprehensive rewrite of Chapter 18 was identified as a key action in the city’s Housing Strategies Work Plan. Research and engagement for the rewrite commenced in Spring 2025. The goals for the rewrite are as follows:
• Provide clarity on existing code elements.
• Consider alignment with surrounding jurisdictions’ codes.
• Improve housing stability and opportunities for tenant agency.
• Require greater transparency for tenants.
• Ensure alignment with the state of Maryland law.
• Review local and national best practices.
• Better connect data collection and city goals.
FOLLOW-UP RESEARCH
During the previous Mayor and Council work session on Chapter 18, members of the body asked staff for additional research on fees, two-year lease terms, and eviction assistance.
Fee Restrictions
As discussed in the previous work session, staff recommend prescribing what types of fees are allowed to be charged and, in certain cases, setting maximum amounts that may be charged. Members of the body asked for a jurisdictional comparison on the effect of capping fees. Unfortunately, there are no studies investigating the effect of fee caps on jurisdictions locally nor nationally.
That said, it is generally thought that fee caps could have similar drawbacks to rent caps by limiting a landlord’s ability to generate revenue and thus pay for services they must provide. However, fee caps as proposed are generally limited to the actual cost to the landlord. Staff also propose the ability for landlords to levy optional fees that must be consented to by the tenant, providing additional flexibility.
If a landlord in Rockville currently generates a significant amount of revenue from fees that are then made illegal through the Chapter 18 update, the landlord may decide to raise units’ base monthly rent to cover the lost fee revenue. Ultimately, staff believe that any short-term adjustments in the rental market will be worthwhile to have a fairer rental fee regime that is easy for both landlords and tenants to understand.
Two-Year Lease Terms
In the previous work session, staff recommended requiring landlords to offer tenants two-year lease term, rather than one year as it is currently. There was discussion regarding a need for certain exceptions to this requirement, particularly for small landlords. However, staff have determined that the current code language regarding reasonable cause for the landlord not offering a one-year term is sufficient to address Mayor and Council’s concerns.
Current code language states that all tenants must be offered an initial term of one year, unless a “reasonable cause” exists of offering an initial term of other than one year. “Reasonable cause” is defined as “those situations which would create undue hardship or expense for a landlord to enter into a one-year lease.” The code continues: “When the landlord claims such a cause, a statement citing the reasonable cause and advising the prospective tenant of his right to challenge the statement by filing a complaint with the City Manager shall be included as an addendum to the lease, signed and dated by the parties and a copy given to the prospective tenant.”
Furthermore, members of the body requested additional research into the effects of two-year versus one-year lease terms, including possible unintended consequences. The breadth of research around this question is almost non-existent. However, research from the Brookings Institution found that about half of renters stay in the same place for more than two years. They also cite that National Multifamily Housing Council found that “about one-third of current renters would prefer a lease term lasting more than one year” and note that “residential leases lasting for several years are fairly common in Germany and Japan.”
Renter occupancy data for Rockville shows most tenants (46.4%) have only been at their current place of residence for one year, as shown in Figure 1. Nearly 36% have been in the same place for two to four years and 15.5% have been in their home for between five and 14 years. This indicates that there is a large percentage of Rockville renters who could potentially benefit from a two-year lease term.
Figure 1. Length of Tenancy for Renter-Occupied Households in City of Rockville (2024)
Source: U.S. Census, 2024 American Community Survey 1-Year Estimates S2502
Table 1 provides a summary of benefits and risks of longer lease terms to both tenants and landlords.
Table 1. Benefits and Risks of Longer Lease Terms
|
|
Landlords |
Tenants |
|
Benefits |
• Stable income stream • Lower risk of vacancy and associated costs from tenant turnover • Lower administrative burden • Stronger relationship with tenant • Insurance against declining market rents |
• More stable living situation • Stable housing costs, for the length of the lease • Reduced moving costs • Increased negotiation power to ask for property improvements or alterations • Stronger relationship with landlord |
|
Risks |
• Unable to keep up with market rents since would not be able to raise rent as frequently • More significant turnover costs due to longer tenancy causing more wear and tear • Risk of a problematic tenant that is more difficult to sever ties with • Less flexibility to sell property or for future building owner |
• Less flexibility to relocate • Increased likelihood of needing to break lease and uphold lease break terms (e.g., early termination fees) • Potentially high lease-to-lease rent increases since increases would not be spread out from year-to-year • Risk of a problematic landlord that is more difficult to sever ties with • Cannot take advantage of decreases in market rents • Longer exposure to poor quality apartment |
To address consumer protection concerns in offering longer leases, Brookings recommends 1) requiring more consistency and transparency of leases, which staff has already recommended, 2) allowing renters to “shop” for leases independently from apartments, and 3) increased resources for enforcing fair housing laws.
Finally, it should be noted that although this requirement would ensure that landlords provided the option of a two-year lease term, landlords may offer better rates for other lease term lengths.
Eviction Assistance
A member of the body requested additional information on how to help households facing eviction. There are five key strategies to prevent evictions, all of which the city either currently offers, is working to enhance, or is exploring.
1. Emergency rental assistance: The primary function of the Rockville Emergency Assistance Program (REAP) is to pay off households’ rental arrears so that they can avoid eviction. Households in need can also combine funds from Montgomery County and other emergency assistance providers to pay off significant amounts of rent debt and avoid eviction. Over the past two years, demand for REAP has grown exponentially. As federal cuts to social services and affordability challenges persist, demand is expected to remain high. More households face eviction every year and Montgomery County has the region’s fastest growing homeless population. REAP is the city’s premiere program for preventing homelessness and will continue to be a vital program to support residents experiencing financial emergencies.
2. Security deposit assistance: Sometimes the best decision for households facing eviction is to move to a more affordable property. In this case, households frequently need help paying for the initial security deposit. In certain circumstances, REAP allows households to receive security deposit assistance. REAP staff will continue to work with clients to assess this as an option.
3. Access to legal counsel: When tenants are provided legal counsel, they are two to three times more likely to stay in their homes.16 One of the stability actions in Rockville Housing Strategies is to supplement the state’s access to legal counsel for evictions program. Currently, tenants earning 50% of the state’s median income are provided access to legal representation in eviction and subsidy termination cases. There may be an opportunity for the City of Rockville to supplement the state’s program by providing funding to serve residents making 50% of the city’s median income (rather than the state’s median income) and to serve residents earning beyond 50% of the state and city’s median incomes. Staff will continue to explore this as a part of Rockville Housing Strategies.
4. Investments in affordable housing: Rents in Rockville are among the highest in the region, which is a key predictor in high rates of homelessness. Cities can help create more affordable housing opportunities through investments in affordable housing preservation and construction, as well as ongoing rental supplement programs. Rockville does not currently offer the latter, but helps navigate struggling clients to the county’s ongoing rental assistance program. DHCD is taking steps to deploy the Housing Opportunities Fund in a way that will enhance affordable housing options throughout the city.
5. Investments in preventative programs: Residents face eviction due to financial emergencies and ongoing struggles with poverty. The household income of the median REAP recipient is $20,800. Investments in job training, financial empowerment programs like Bank On Rockville, service navigation, and other social services can help households to achieve financial stability and upward mobility so that they are able to weather emergencies more easily and stay current on rent. DHCD staff have taken steps to expand this type of programming by providing service navigation and restarting the city’s Bank On coalition.
NEW POLICIES
Background Check Restrictions
Background
Eviction and incarceration operate as twin, compounding systems of exclusion. With the Fair Housing Act in 1968, the government hoped to eliminate discrimination by landlords against individuals based on race, gender, religion, national origin, and disability. Despite this, these same obstacles to housing continue to exist today based on structural inequalities, such as through exclusionary zoning practices and urban renewal, there emerged gaps that negatively impacted individuals in certain racial and socioeconomic groups. These economic disparities can then spiral into poor credit histories and inequities that lead to disproportionate rates of incarceration and eviction for those same groups.
After release, many men face steep barriers to employment and formal residential leases because a criminal record limits job prospects and makes “proof of income” harder to produce. At the same time, women, especially mothers, are more likely to become the tenant of record because they are more connected to children’s schooling and benefits systems and are less likely to rely on informal work that cannot be documented on an application. Yet women leaseholders are often economically worse off than men in the same communities due to persistent wage gaps, caregiving demands, and the need for larger (and more expensive) units. Those realities combine to make women, particularly Black women with children, disproportionately vulnerable to eviction and its cascading harms.
Background checks are a tool for landlords to screen potential tenants on their rental, criminal, and credit histories prior to renting out their homes. Ideally, these checks provide protection for landlords against high-risk tenants. The results of these checks, however, can prove to be a barrier to securing housing for individuals with red flags on their record. Significant portions of the population both locally and nationally could have a record show up on background checks that creates a barrier to housing.
Even in cases where evictions are dismissed, withdrawn, or won, having an eviction case on file can lead to negative consequences for renters if the case comes up in tenant screening reports, according to a study from the University of Michigan. Sixty-five percent of renters who moved following an eviction filing that did not end in removal said a prospective landlord asked about their record and over half had been explicitly denied because of it.
Many jurisdictions have acknowledged the toll that criminal records can have on housing and employment opportunities and have looked to enact “clean slate” legislation. Places like Washington, D.C.; Atlanta, GA; and California have all proposed or enacted legislation to treat individuals with a criminal record as a protected class. In fact, California has proposed a law in which criminal records would automatically be sealed four years following their sentence provided they are not convicted again. There are also proposals among public housing agencies to limit screening to only consider criminal charges that might endanger the health and safety of staff and residents. The massive swell in policy across the country shows a recognition of the barriers to long-term housing for individuals with a criminal history while demonstrating a commitment to not forcing those individuals to suffer the lasting impacts of the past.
Reducing discrimination based on criminal and eviction history in a live conversation at the Maryland General Assembly. In 2025, Maryland considered HB 1077, which would have prevented landlords from requesting information regarding criminal history in the initial screening. Following the initial screening, the landlord would also only be able to screen for the most serious criminal offenses. This bill did not pass, but Maryland’s 2024 eviction-record reform recognizes that an eviction filing can function like a lifelong “scarlet letter,” even when a tenant is never actually removed, and it takes a first step toward limiting that damage. For Failure to Pay Rent cases filed on or after October 1, 2024, the District Court must automatically shield the case record within 60 days of final resolution if the case did not result in a judgment of possession, meaning the filing should not remain broadly visible on public case-search systems or to many screening databases when the outcome was not displacement. Even where a judgment of possession occurred, tenants may petition to shield the record if they paid to stay (right of redemption) and at least 12 months have passed since the case’s final resolution, or if the court finds good cause.
Montgomery County has a Ban the Box law that was recently expanded upon with new legislation. In 2021, the Housing Justice Act passed the Council with the intention of preventing landlords from inquiring into misdemeanors when considering applicants for housing. The newest iteration of the Housing Justice Act reinforced the original law by requiring landlords to post information regarding tenant’s rights as well as adding new county housing staff to ensure compliance.
Additionally, Montgomery County repurposed the Office of Human Rights to hear complaints regarding violations of the Housing Justice Act as a means of providing enforcement. In addition to providing education on tenant rights under the new law, the Office of Human Rights conducts quarterly inspections of rental properties to assess compliance. Furthermore, landlords are required communicate these rights to their prospective tenants during the leasing process. The code also gives the County Executive flexibility to enact additional methods of enforcement.
Recommendation
Staff recommend adopting code provisions to reduce discrimination based on both criminal and eviction history. Compliance would be assessed during the rental license renewal process by collecting standard applications.
First, staff recommend adopting the Montgomery County Housing Justice Act as laid out in Section 27-15A of Chapter 27, which specifically gives attention to the following components:
• Ban the Box: Prevents housing providers from asking about criminal records in an application or conducting a background check prior to a conditional housing offer.
• Anti-discrimination: Prohibits housing providers from factoring in arrest records that did not result in a conviction as well as diminishing the impact of misdemeanors that are more than two years old.
To implement the Ban the Box policy, Montgomery County has required increased transparency by compelling landlords to disclose the process providers use in their screening as well as what their requirements are when screening tenants. These requirements have also been broken down into what information can and cannot be requested at various stages of the screening process. During the preliminary screening a provider cannot: ask an applicant to disclose their arrest/conviction record or conduct a criminal record check. Additionally, at no point during an application can a provider consider information regarding an arrest that did not result in conviction or arrest/conviction for the following charges:
• Trespass
• Theft under misdemeanor
• A refusal to leave public areas
• Indecent exposure
• Public urination
• Open container violations
• Possession of marijuana as a misdemeanor
• First conviction of disturbing the peace
• A vehicle law violation
• Any misdemeanor that more than two years have passed since the conviction or end of incarceration period
The landlord cannot also base a decision of tenancy on any of the above information. However, the landlord can make decisions about tenancy on a very specific set of factors including conviction of sex crime and presence on a sex offender registry.
Following the conditional offer, if the provider chooses to conduct a criminal check while excluding the appropriate misdemeanors, they do have an option to rescind an offer in writing. However, if they do so they must provide a copy of the record, notify the applicant as to the revocation, and the reason why. The provider must delay the revocation by seven days to provide the applicant with an opportunity to assess the accuracy of the report.
Second, to reduce the lasting harms of eviction, Rockville should prohibit landlords from asking about eviction history on rental applications, similar in spirit to “fair chance” approaches used in employment. This reform recognizes that housing access should be based on current ability to sustain tenancy - not on a past court filing that can permanently lock households out of safe, stable housing long after a temporary crisis has passed. Eliminating eviction history questions would help keep households connected to safe housing, reduce repeat displacement, and protect children from the destabilizing effects of frequent moves, all while advancing equity by curbing a practice that disproportionately burdens low-income renters, women with children, and Black communities.
Eviction Filing
More and more frequently, staff encounter tenants facing eviction due to extremely high balances over $10,000. With balances of this size, there are rarely enough resources between Montgomery County, the city, and non-profit organizations to pay off the tenant’s balance and prevent the eviction. Despite many property management companies having policies that require filing after a single missed payment, tenants with months of rental arrears continue to apply for emergency rental assistance.
Both the city and county require tenants to have an active court summons or judgement in order to be eligible for assistance. This requirement is important for prioritizing limited funds for the households most at-risk of eviction and homelessness. However, this means that landlords need to file for eviction before tenants can receive help. Staff are concerned that some landlords may act in bad faith by intentionally not filing for eviction until the tenant’s rental arrears are too large to be paid off by the public and non-profit sector, making it easier for the landlord to evict the tenant in question.
Staff do not have a recommendation at this time, but want to raise the issue for discussion and feedback.
Relocation Assistance
Background
Finding a new place to live can be a financial challenge. There are times when a tenant may need to move for reasons outside of their control and is left paying for moving and other relocation expenses. For this reason, localities across the country have passed ordinances requiring landlords to pay for temporary and/or permanent relocation expenses in certain situations where the landlord is found to be responsible for the tenant’s displacement.
Local Case Studies
• Montgomery County, MD: In 2020, Montgomery County enacted Bill 18-19, which requires landlords to pay relocation payments if rental housing is condemned as unfit for human habitation. It covers both temporary and permanent displacement, with the former being defined as 30 days or less, and provides displaced tenants with a right to reoccupy the property, once habitable.
• City of Takoma Park, MD: Takoma Park’s tenant displacement and relocation expenses code addresses both temporary and permanent displacement in cases wherein the rental housing is condemned as unfit for human habitation. For permanent displacement, the landlord must return the tenant’s security deposit and pay two months of the tenant’s rent. For temporary displacement, the landlord must pay for comparable housing, storage, and moving costs.
• Washington, D.C.: Landlords in D.C. must provide relocation assistance in cases of substantial rehabilitation, demolishment, or discontinuation. The amount of assistance is determined by the mayor or otherwise based on the number of rooms. Additionally, the city has a relocation assistance office which provides relocation advisory services.
• Arlington and Fairfax Counties, VA: In Virigina, both Arlington and Fairfax Counties provide guidelines regarding tenant displacement. Arlington’s applies to any rental property proposed for demolition, rehabilitation, or conversion. Fairfax’s guidelines are expanded to include opportunities to return, but only applies for properties which are both 1) proposed for demolition, redevelopment, rehabilitation, acquisition, or condominium conversion and 2) subject to the county’s Affordable Housing Preservation Policy Administrative Guidelines, or has financing provided by the county’s redevelopment authority. In both jurisdictions, owners are encouraged to develop a relocation plan and provide tenants with payments based on the displaced household’s income and unit size.
National Case Studies
• Minneapolis, MN: In Minneapolis, landlords must provide relocation assistance when tenants are displaced due to an issue that resulted from the landlord’s actions, inactions, or negligence, and impacts the entire unit. If the landlord does not pay the tenant by the required date, funds are issued by the city and the recouped from the landlord. Minneapolis city staff report that the quickest timeline for collection is approximately two years. Over three years, the city gave $170,523 to tenants and only $43,390.38 (about a quarter) was recovered by the city. The city is considering creating a grant funded by the city for short-term displacement when neither the landlord nor tenant is at fault.
• Portland, OR: Portland’s Mandatory Rent Relocation Assistance policy applies in situations of permanent displacement where a landlord has given the tenant certain termination notices, proposes to increase rent by 10% or more, or did not renew lease on substantially similar terms. Payments range from $2,900 for a studio apartment to $4,500 for apartments with three or more bedrooms.
• Seattle, WA: Seattle’s Tenant Relocation Assistance Ordinance applies in circumstances when tenants are being displaced due to redevelopment or substantial renovation, use changed from an apartment, or if affordability covenants expire. When those cases apply, property owners must get a Tenant Relocation license and low-income tenants receive $5,354, half paid by the landlord and the other half paid by the city.
• State of California: Under the State of California’s 2019 Tenant Protection Act, landlords statewide are required to provide relocation assistance in the amount of one-month’s rent for no-fault evictions. Additionally, the Housing Crisis Act of 2019 (amended in 2021) includes provisions for relocation assistance, primarily for low-income tenants displaced due to redevelopment, and California Health and Safety Code requires landlords or property owners to provide relocation assistance to tenants displaced by the demolition, conversion, or significant rehabilitation of affordable housing. “It specifies the calculation of relocation assistance, which includes moving expenses and temporary housing costs, which varies depending on the tenant’s income and household size.”
Many cities in California have built upon state law. Santa Monica stands out for the breadth of situations in which tenants are entitled to permanent relocation assistance, and largely served as a model for staff’s recommendations. Their policy applies in situations where:
• The tenant must move out due to a no-fault eviction.
• The tenant decides to move out after receiving a large rent increase after their formerly rent controlled apartment home is exempted from rent control.
• The tenant elects to relinquish a tenancy following rent increase of more than 5% plus inflation, or 10%, whichever is lower.
• The tenant elects to relinquish a tenancy after a temporary relocation lasting at least six months.
• Code Enforcement determines that the tenant has been forced out by landlord misconduct.
• The Building Officer determines that health and safety conditions in the unit exist and cannot be fixed.
• The tenant elects to relinquish the tenancy in a bootleg unit that cannot be permitted for residential use.
Recommendation - General
Staff recommend establishing a requirement for landlords to provide tenants with temporary and permanent relocation assistance in certain circumstances, as further described in the following sections. Assistance would be provided on a per household basis, not a per tenant basis. Timing of payments and notice requirements will be further fleshed out once code language is drafted.
Recommendation - Temporary Relocation Assistance
Temporary relocation assistance would be required when the city has deemed that a rental housing unit cannot be occupied.
Landlords would not have to pay for temporary relocation benefits if the tenant is in a week-to-week lease or if the displacement is caused by a natural disaster or other incident not directly caused by the landlord, such as vehicle accident, criminal activity, public utility failure, or adjacent building failure. When an incident that happens off the property results in the displacement of the tenant, the person responsible for the incident would be held responsible for providing the temporary relocation benefits.
In addition, if a tenant were to remain in their unit following an order directing temporary relocation or if the tenant interferes, obstructs, or delays a landlord’s ability to conduct necessary repairs to restore the unit to habitable status, the landlord’s obligation to provide relocation benefits may be lifted by the city.
The landlord would be required to provide temporary relocation assistance as long as the tenant is required to stay out of the unit. Temporary relocation benefits would end when either 1) the tenant returns to the unit or 2) the tenancy is legally terminated. This would work in coordination with another proposal from the December work session to allow tenants to terminate their lease early, with proper notice, in situations where:
• The unit is deemed unable to be occupied for a certain number of days;
• The landlord’s rental license is revoked for reasons related to the tenant’s units; or
• The landlord is failing to make certain repairs required to correct a violation of applicable law that affects the health and safety of the tenant.
Should the relocation order come from the city, city staff would estimate the length of assistance required at the time of the displacement and given to both parties in a written notice. Extensions may be approved. If the landlord relocates the tenant on their own, the landlord must provide the tenant written notice of how long the relocation is expected to be. Assistance would be required based on the amount of time that the displacement is expected to occur:
• If 30 days or less, the tenant may be temporarily placed in a safe and sanitary hotel/motel, receive per diem money for temporary housing and expenses, or alternate comparable housing, plus all reasonable moving and storage costs.
• If 31 days or more, the tenant receives per diem money or alternate comparable housing, plus all reasonable moving and storage costs.
Comparable housing must be similar in location and have a similar number of bedrooms, accessibility, and pet allowance (if the tenant has pets). Landlords and tenants would be allowed to reach their own agreement about how the tenant will be temporarily housing that is different from what the code says, as long as the tenant is first informed, in writing, of what is required by law before entering into such an agreement.
Per diem payments would be due daily if relocation is less than 30 days and pre-paid weekly if more than 30 days. Staff recommend that the Mayor and Council set per diem amounts via an annual resolution. The resolution would address the amount of the per diem payments for a hotel or motel, meal expenses (if the temporary accommodation lacks cooking facilities), laundry (if the rental property included laundry facilities), and pet accommodations (if the temporary relocation does not accept pets). If the tenant rejects the accommodation provided by the landlord, they would not be entitled to the per diem payments.
A landlord may require a tenant to use their renters insurance, if any, but is responsible for covering any costs that are required by code but not covered by renters insurance and the cost of alternative housing after the expiration of such benefits.
The tenant would remain responsible for paying rent during the displacement period but not for any fees for amenities or services which the tenant is unable to use or access. In cases where the tenant is behind on rent, the relocation assistance requirement would still apply, but the landlord would be in their right to move forward with eviction proceedings for Failure to Pay Rent.
Finally, once repairs are completed and the unit is deemed safe to inhabit, the tenant would have the first right to return to their home.
Recommendation - Permanent Relocation Assistance
For tenants in a six-month or longer lease, permanent relocation assistance would be required when:
• A rental license is suspended or revoked. Currently, when a rental license is suspended or revoked in Rockville, the landlord must provide the impacted tenant with 60 days’ notice to relocate. This policy would remain the same, but the landlord would also be responsible for providing relocation assistance, should the tenant relinquish the tenancy.
• The city issues an order for permanent relocation based on the determination that the rental housing unit is not habitable and cannot be made habitable or based on the tenant's election to relinquish a tenancy in a rental housing unit that is not permitted for residential use and cannot or will not be permitted for residential use.
• The tenant elects to relinquish tenancy following a period of temporary tenant relocation that has lasted for at least six months, but before the tenant has returned to the rental unit.
• The unit will be demolished, redeveloped, substantially renovated, or changed in use, requiring a tenant household earning less than 50% of the area median income to move.
The relocation assistance payment would include:
• A full refund of security deposit with accumulated interest;
• Pro rata rent for the remainder of the month;
• The cash equivalent of three-month median market rate rent for a similar-sized apartment; and
• All actual reasonable moving costs.
For example, with a $2,000 per month apartment for a tenant who has lived in an apartment for five years and must vacate in the middle of the month, the payment would be estimated at $2,282 for the security deposit with accumulated interest over five years, $1,000 for the pro rata rent, $6,000 for the cash equivalent of three-month median market rent, and $500 in moving costs, for a total of $9,782. If the tenant owes rent, the owed rent would be subtracted from the relocation assistance payment. If the tenant is formally evicted in court, the landlord would not have to pay relocation assistance.
Staff also recommend requiring the landlord to provide an additional sum for households where one tenant is over 62 years of age, handicapped, disabled, or a legally dependent child, given the additional burden of displacement. This amount could be set via the annual resolution for per diem temporary relocation assistance payments.
Finally, the policy would include a right to return provision stating that should the property be able to operate as rental housing again in the future, the displaced tenant must be provided the first right to reoccupy the property.
Penalties
Background
To hold landlords and tenants accountable for following the requirements of code and disincentivize code violations, there need to be appropriate consequences set in place. There are multiple forms of penalties that can include: municipal infractions, lawsuits, and license penalties. Of these, the most commonly employed method across the nation is the imposition of fines via municipal infractions. Currently in Rockville, the maximum fine that can be levied against landlords for a violation of Chapter 18 is $100.
In Washington, D.C., the minimum fine for violations of their landlord-tenant chapter is $100, but that can go up to $5,000 per violation. Similarly, as of October 2025, Maryland increased the maximum penalty for municipal infractions from $1,000 to $5,000. Virginia considers each day that passes a separate infraction and meaning penalties could stack up quickly, even though the maximum penalty for such occurrences initially is only $2,500. The Virginia code also goes a step further in stating that a third offense in 10 years, where the previous two were convicted, could lead to a maximum penalty of $10,000. Suffice to say, Rockville’s current standard remains significantly below these marks and as such does not provide as much of an incentive to dissuade potential bad actors compared to neighboring jurisdictions.
Recommendation
Staff recommend amending the fee resolution to allow for a range of fees up to $5,000, with varying fees depending on the violation.
PROGRAMMTIC ACTIONS AND FUTURE CODE AMENDMENTS
Staff recognize that creating a healthy ecosystem for both landlords and tenants goes beyond what can be covered in Chapter 18 alone. As such, the following recommendations are outside of the scope of the current chapter rewrite, but are nonetheless important to consider when aiming to achieve the goals of housing stability, transparency, and tenant agency.
1. Increase landlord and tenant education.
Following the adoption of the Chapter 18 update, staff intend to create a Landlord-Tenant Handbook and other educational materials that will allow both parties to clearly understand their rights and responsibilities as well as city resources. Examples of educational materials include updating the Rockville lease addendum for landlords to use to ensure compliance with city code and providing a fee schedule template. In addition, staff intend to host regular city-wide landlord and tenant events to build community, share resources, and receive feedback.
2. Support tenant outreach and organizing.
Staff recommend taking additional steps to further empower tenants to exercise their rights and connect each other with resources. The city could provide grants to existing or nascent tenant organizations to assist them in paying for food, printing materials, events, or other needs. Another option could be to contract with non-profit organizations who specialize in tenant outreach and can provide guidance on how to establish a tenant organization.
3. Continue and expand support for tenants facing eviction.
Eviction is the ultimate example of housing instability. As Rockville faces an upward trend in evictions, the city should continue to support tenants through REAP. As discussed earlier, there are other strategies the city can take to further prevent and mitigate evictions, such as by expanding the right to legal counsel for evictions.
4. Consider amendments to other chapters of city code.
In the future, Mayor and Council could consider code amendments addressing the following policies:
• Tenant Opportunity to Purchase (TOPA) - City code currently provides an opportunity for tenants renting condominiums to purchase the unit if it goes on the market. Additionally, state law requires “landlords who plan to sell a property with three or fewer residential rental units must provide the current tenant(s) the first opportunity to make an offer to purchase the property.” This leaves out tenants in buildings with four or more units who may want to purchase the property or designate their right of first refusal to a non-profit or mission-driven owner. This can be a strategy for affordable housing preservation and homeownership.
• Cooling requirements - City Code Chapter 5, Building and Property Maintenance Regulations incorporates the 2021 International Property Maintenance Code (IPMC), which includes heating but not cooling requirements. If a rental property already provides air conditioning, the IPMC requires the system to be maintained in safe working condition and capable of its intended function. Montgomery County is the only locality in the D.C. region with cooling requirements, which state that rental facilities must be capable of maintaining a temperature of 80°F or less from June 1 to September 30. Recognizing the extreme heat experienced in the region and its harmful effects on health, staff recommend considering a similar requirement to Montgomery County.
• Protections for commercial landlords and tenants - Chapter 18 focuses on residential rental facilities but does not cover commercial rental facilities. The Maryland Consumer Protection Act provides some protection for commercial tenants, but generally commercial leases are thought to be between two parties with a high degree of knowledge to protect their interests in lease negotiations. While this may be true, the University of Maryland’s Small Business Anti-Displacement Network identifies that small businesses, especially immigrant-owned small businesses, might be at-risk of being taken advantage of due to exploitative or unclear lease terms. As such, staff recommend this as a future area of research and potential action for the Mayor and Council.
• Consumer protections for senior living facilities - Tenants of senior living facilities are considered month-to-month tenants and are afforded protections under Chapter 18 as such. The State of Maryland provides the Office of Health Care Quality, which monitors the quality of care in Maryland’s health care facilities, investigates complaints, and can fine nursing homes or assisted living facilities. There is also a Long-Term Care Ombudsman who helps residents in long-term care facilities maintain their legal rights, control their care, and retain their personal dignity. However, there may be additional opportunities for enhanced consumer protection of seniors given their unique situation.
Mayor and Council History
Housing is one of the Mayor and Council’s five focus areas. In June 2024, a high-level briefing was presented outlining the city’s housing crisis and policy landscape. Later in 2024, there were three work sessions on the city’s housing strategies, during which updating City Code Chapter 18, Rental Facilities and Landlord-Tenant Relations was approved by the Mayor and Council as one of the strategies.
The following work sessions related to Chapter 18 were held previously:
• June 16, 2025 - An initial work session specifically related to transparency. During that work session, staff presented preliminary recommendations on data collection and reporting requirements, lease requirements, and other posting requirements. Mayor and Council feedback was incorporated into
• November 10, 2025 - During a work session on rental licensing inspections, staff recommended enhancements to the programs that will be codified in the updated chapter.
• December 8, 2025 - Staff presented proposed changes to current code as well as new policies related to algorithmic rent pricing, court costs and legal fees, fee transparency and restrictions, guarantor requirements, and repair and deduct.
Feedback from previous work sessions was incorporated into this work session and will be reflected in staff’s proposed draft of Chapter 18.
Public Notification and Engagement
Staff hosted two virtual input meetings: one with landlords on May 20, 2025 and one with tenants on May 27, 2025. During these meetings, participants received a presentation about the landlord-tenant code update project, answered polling questions, and participated in breakout rooms where staff members facilitated discussion with preset questions. Additionally, staff held interviews with and received feedback from stakeholder organizations.
Since the spring, staff have also solicited feedback through the project’s Engage Rockville webpage. The webpage includes project information, a survey, comment form, and question portal. An email sharing information about the December 8, 2025 Mayor and Council work session on the landlord-tenant code rewrite was sent out on November 24, 2025 to those who had registered to receive updates about the project.
Feedback from meetings, interviews, emails, and the Engage Rockville tools has been thoroughly reviewed and taken into consideration in forming staff’s recommendations for the Chapter 18 rewrite. Below is a summary of the feedback received:
Tenant concerns primarily included:
• Rising rents and desire for rent stabilization.
• New fees, including but not limited to technology, amenity, application, hold, court, eviction, and month-to-month fees.
• Discrepancies between the city and county can be confusing and result in fewer protections for tenants.
• Lack of information, including but not limited to rental license status, code infractions, landlord contact information, and past rent increases.
• Desire for a relocation assistance policy, but recognition that the county’s policy has had implementation challenges.
• Neglected or untimely maintenance.
• Protection against retaliation.
• Lack of an air conditioning requirement.
Landlord concerns primarily included:
• Increasing costs, including but not limited to taxes, fees, and HOA/condo payments.
• Length and difficulty of eviction proceedings.
• Difficulty of applying for a rental license, particularly when compared with Montgomery County.
• Responsiveness of city staff and lack of clear points of contact.
• Keeping up with and adhering to code requirements, especially when differentiating between Montgomery County and City of Rockville.
• Confusion around Voluntary Rent Guidelines.
Next Steps
The feedback received from the Mayor and Council will be incorporated into staff’s final recommendations for the comprehensive update to City Code Chapter 18, Rental Facilities and Landlord-Tenant Relations. The updated chapter is tentatively scheduled for May 18, 2026, for consideration and adoption.
Staff will conduct additional outreach and engagement to receive feedback from landlords, tenants, and other community stakeholders on the initial draft of the new chapter. Staff will then be able to make appropriate changes to the draft code language prior to its consideration and adoption at the May 18 Mayor and Council meeting. At that time, the Mayor and Council will also receive a summary of public feedback collected during the additional outreach and engagement period.