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Committee rejects charity rental-agreement bill, citing ordering and oversight concerns
Summary
House Bill 1615, which would change requirements for rental agreements or leases related to certain charity operations, received a committee "do not pass" recommendation after members said the bill's sequence of approvals, terminology and oversight provisions needed substantial reworking.
The House Judiciary Committee voted 8-4 to recommend a "do not pass" on House Bill 1615 after members said the draft is unworkable as written and needs reordering and clearer oversight language.
Representative Olson and several members cited testimony from Deb McDaniel and Stephanie Dasinger (counsel for the League of Cities) that the bill places local governments at the wrong point in the approval process by allowing organizations to secure a lease before obtaining site approval. Committee members said the usual sequence is site approval first, then lease or rental agreement.
Members also discussed terminology and oversight. Committee members urged replacing the word "lease" with the statutory term "rental agreement" and debated whether the Attorney General's Office must review or approve such agreements; the AG's office currently reviews and audits related arrangements, witnesses said. Representative Olson said the AG's involvement appears to stem from audit and review functions rather than a statutory approval requirement.
There was also discussion of the bill's financial provisions for small communities, including a cited provision that would allow up to 62% of funds to cover expenses rather than charitable purpose; one member said that could leave a disproportionately small share for a charity's mission. Representative Wolff moved a recommendation of "do not pass," seconded by Representative Twyte. The committee recorded the recommendation as 8 yes, 4 no with two members not voting.
Committee members suggested the bill could be reworked to (1) reorder steps so local approval occurs before any lease or rental agreement is executed, (2) adopt the statutory term "rental agreement" throughout, and (3) clarify whether AG review is required or whether audit/review after the fact is sufficient.
Ending: With the committee recommendation of do not pass, proponents may decide to return with reworked language addressing procedure, terminology and oversight concerns in a future session.
