S 2973Real Estate

Property - Residential Landlord and Tenant Act

Allows landlords to deduct cleaning fees from deposits and requires large landlords to pay tenants interest on held deposits.

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Introduced Mar 4, 2026Committee Senate Judiciary

Plain-English Summary

This legislation amends the Residential Landlord and Tenant Act regarding security deposits. It explicitly allows landlords to deduct "reasonable cleaning expenses" and "reasonable trash disposal expenses" from a tenant's security deposit upon termination of the lease, in addition to unpaid rent and physical damages. Additionally, the bill mandates that landlords who own six or more dwelling units must hold security deposits in a federally insured, interest-bearing account. Any interest accrued on these deposits becomes the property of the tenant and must be returned to them along with the deposit balance.

For younger readers

When someone rents an apartment, they give the owner extra money called a "security deposit" to keep safe. This new rule changes how that money is handled. First, if the renter leaves the apartment messy or leaves trash behind, the owner can now take money out of the deposit to pay for cleaning it. Second, if the owner rents out many apartments (six or more), they must put the security money in a bank account that earns extra money called "interest." When the renter moves out, the owner must give them the deposit back plus that extra interest money.

Who & Where It Applies

Impacted groups

TenantsLandlordsProperty Management CompaniesReal Estate InvestorsBanking Institutions

Impacted communities

All

Constitutional & Fiscal Check

None Likely

Estimated cost

None

Estimated revenue

None

Bill Analysis

Both viewpoints

For Progressives

Mandates that landlords with six or more units place security deposits in interest-bearing accounts, ensuring that tenants, rather than property owners, benefit from the wealth generated by their own capital.
Prevents large-scale landlords from utilizing tenant funds as interest-free loans to bolster their own businesses, promoting a fairer economic balance between renters and corporate housing providers.
Codifies the right of tenants to receive accrued interest upon lease termination, providing a small but necessary financial protection for renters who often have limited resources.
Introduces subjective deductions for "reasonable cleaning" and "trash disposal" expenses, which could be exploited by predatory landlords to wrongfully withhold security deposits from vulnerable tenants.
Places a financial burden on low-income tenants to legally dispute vague cleaning charges, potentially resulting in the loss of funds simply because they cannot afford to fight the landlord's assessment.
Shifts the costs of standard unit turnover and maintenance—typically considered a cost of doing business—onto the tenant, effectively raising the cost of housing.

For Conservatives

Protects property rights by explicitly allowing landlords to recover costs for cleaning and trash removal, ensuring owners are not financially penalized for a tenant's lack of cleanliness.
Encourages personal responsibility among tenants by creating a direct financial incentive to leave the rental property clean and free of debris upon vacating.
Clarifies the specific types of deductions allowed from security deposits, which may reduce legal ambiguity and protect landlords from frivolous lawsuits regarding deduction validity.
Imposes significant regulatory burdens on owners of six or more units by mandating specific banking arrangements and interest calculations, increasing administrative overhead and government interference in business operations.
Interferes with the freedom of contract by dictating that interest on deposits belongs to the tenant, preventing landlords and tenants from negotiating their own terms regarding the holding of funds.
Expands government oversight into the private rental market, which could discourage investment in multi-unit housing due to increased compliance costs and red tape.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 17 additions

SECTION 1. Section 34-18-19 of the General Laws in Chapter 34-18 entitled "Residential Landlord and Tenant Act" is hereby amended to read as follows: 34-18-19. Security deposits.

(a) A landlord may not demand or receive a security deposit, however denominated, in an amount or value in excess of one month’s periodic rent.

(b) Upon termination of the tenancy, the amount of security deposit due to the tenant shall be the entire amount given by the tenant as a security deposit, minus any amount of unpaid accrued rent, the amount due, if any, for reasonable cleaning expenses, the amount due, if any, for reasonable trash disposal expenses and the amount of physical damages to the premises, other than ordinary wear and tear, that the landlord has suffered by reason of the tenant’s noncompliance with § 34-18-24, all as itemized by the landlord in a written notice delivered to the tenant. The landlord shall deliver the notice, together with the amount of the security deposit due to the tenant, within twenty (20) days after the later of either termination of the tenancy, delivery of possession, or the tenant’s providing the landlord with a forwarding address for the purpose of receiving the security deposit.

(1) All security deposits received by a landlord of six (6) or more dwelling units shall be deposited into federally insured deposit accounts earning interest at a rate not less than the prevailing market rate of interest for regular savings accounts as established in § 19-9-2 or another standard adopted by the department of business regulation in concurrence with the department of housing. All interest accrued shall be the property of the tenant.

(2) Upon termination of the tenancy, the amount of security deposit due to the tenant shall be the entire amount given by the tenant as a security deposit, plus all interest accrued, minus any amount of unpaid accrued rent, the amount due, if any, for reasonable cleaning expenses, the amount due, if any, for reasonable trash disposal expenses and the amount of physical damages to the premises, other than ordinary wear and tear, that the landlord has suffered by reason of the tenant's noncompliance with § 34-18-24, all as itemized by the landlord in a written notice delivered to the tenant.

(3) The landlord shall deliver the notice, together with the amount of the security deposit due to the tenant, within twenty (20) days after the latter of either termination of the tenancy, delivery of possession, or the tenant's providing the landlord with a forwarding address for the purpose of receiving the security deposit.

(c) If the landlord fails to comply with subsection (b), the tenant may recover the amount due him or her, together with damages in an amount equal to twice the amount wrongfully withheld, and reasonable attorney fees.

(d) This section does not preclude the landlord or tenant from recovering other damages to which he or she may be entitled under this chapter.

(e) This section does not preclude any landlord who rents a furnished apartment from demanding or receiving a furniture security deposit if the replacement value of the furniture being furnished by the landlord valued at the time the lease is executed is five thousand dollars ($5,000) or greater, in which instance the landlord may charge a separate furniture security deposit of up to one month’s periodic rent.

(f) Upon termination of the tenancy, the amount of furniture security deposit due to the tenant shall be the entire amount given by the tenant as a furniture security deposit, minus the amount due, if any, for reasonable cleaning expenses and repair and the amount of physical damages to the furniture, other than ordinary wear and tear. The landlord shall deliver the notice, together with the amount of the furniture security deposit due to the tenant, within twenty (20) days after the later of either termination of the tenancy, delivery of possession, or the tenant’s providing the landlord with a forwarding address for the purpose of receiving the furniture security deposit.

(g) In the event the landlord transfers his or her interest in the premises, the holder of the landlord’s interest in the premises at the time of the termination of the tenancy is bound by this section.

(h) No rental agreement shall contain any waiver of the provisions of this section.

SECTION 2. This act shall take effect upon passage.