Colorado State Archives
Executive Orders from the Administration of Governor Bill Owens 1999-2005
May 4, 2005
The Honorable Colorado House of Representatives
Sixty-Fifth General Assembly
First Regular Session
State Capitol
Denver, CO 80203
Ladies and Gentlemen:
I am returning House Bill 05-1061, "Concerning Landlord and Tenant Relations," to the Colorado House of Representatives. I vetoed this bill as of 2:45 p.m. today and this letter sets forth my reasons for doing so.
House Bill 1061 is designed to increase protections for tenants, but does so unfairly without adequately considering the interests of private property owners. While the legislation has some good aspects, overall, the bill does not have the type of moderation, balance and fairness that is needed to earn my signature.
HB 1061 caps late fees at 2 percent per day, up to a maximum of 15 percent of monthly rent. For example, if a tenant pays $500 per month in rent, this cap would allow no more than $10 per day up to a maximum of $75. At this rate, a tenant with financial difficulties would be more likely to pay his or her delinquent credit card bill before paying rent, precisely because this bill significantly diminishes the economic incentive to have tenants pay back rent.
The bill also ignores the fact that limiting a property owner's ability to collect back rent does not eliminate the owner's legal responsibility to make mortgage payments - payments that are derived, in part, from a tenant's rent.
Another concern is that HB 1061 injects the state government unnecessarily into the lease negotiations between property owners and prospective tenants. The bill prohibits property owners and tenants from waiving any statutory rights in the lease. A property lease is a contract, mutually entered into by both sides and where the waiver of statutory rights would presumably be undertaken for the mutual benefit of both parties. For example, a tenant who might offer to repair a unit in exchange for reduced rent. While it is the property owner's statutory responsibility to maintain the unit (Title 38, Article 12, Part 104, C.R.S), should the tenant wish to waive that right in order to pay less rent, he or she should be able to do so. Thus, a tenant trying to make ends meet gets a break on rent, and the landlord gets someone who is putting "sweat equity" into an apartment. I do not understand why the State of Colorado, under HB 1061, should make such an agreement illegal.
Although the proponents intended to prevent landlords from waiving the provisions of House Bill 1061, this argument could be made for nearly any bill. It is unnecessary and unwise for the General Assembly to place such provisions in legislation.
House Bill 1061 creates disincentives for tenants to pay on time and limits the ability of tenants with limited economic means to negotiate a more favorable lease. The bill is unfair to property owners and would result in unintended, negative consequences.
Accordingly, I have vetoed this bill.
Sincerely,
Bill Owens
Governor
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