HOUSE BILL NO. 6565

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,"

(MCL 554.601 to 554.616) by adding section 6a.

the people of the state of michigan enact:

Sec. 6a. (1) A rental agreement must contain a right to renew provision. A right to renew provision incorporated into a rental agreement pursuant to this section must do both of the following:

(a) State as follows, "You, ___________ [name of tenant], have statutory rights to receive a lease renewal notice from me, __________ [name of landlord], before the end of this lease that gives you, _____________ [name of tenant], the option to renew your lease. I, ___________ [name of landlord], certify that this right to renew provision complies with MCL 554.606a.".

(b) Incorporate the requirements of subsection (2).

(2) A landlord of a rental premises shall send a lease renewal notice to a tenant within a reasonable time before the end of the tenant's lease. A landlord must send the lease renewal notice to the tenant and receive the tenant's response as described under subsection (4) before advertising an opening for the rental unit, showing the rental unit to a prospective tenant, or offering the rental unit for lease to any person. A lease renewal notice must do both of the following:

(a) Give the tenant the option to renew the rental unit on the same, or substantially the same, terms and conditions as the expiring lease. This subdivision does not apply to rental payments.

(b) Include a rental payment that complies with any of the following:

(i) Is the same as the expiring lease.

(ii) Is an increase to the rental payment in the expiring lease. A rental payment included under this subparagraph must not be an increase that is more than 5% of the expiring lease's rental payment.

(3) A landlord of a rental premises must comply with subsections (1) and (2).

(4) A tenant who receives a lease renewal notice under this section shall send a written response to the landlord that either accepts or rejects the landlord lease renewal offer. The written response required under this subsection must be sent to the landlord not more than the following days after receipt of the landlord's lease renewal notice and in accordance with the type of tenancy:

(a) For a fixed tenancy, 30 days.

(b) For a periodic tenancy or tenancy at will, 14 days.

(5) This section applies only to leases entered into, renewed, or renegotiated after the effective date of the amendatory act that added this section, in accordance with the constitutional prohibition against impairment of contracts provided by section 10 of article I of the state constitution of 1963.