SRC-TBR H.B. 2803 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 2803
By: Uresti (Van de Putte)
Business & Commerce
5/11/2001
Engrossed


DIGEST AND PURPOSE 

Security deposit handling requirements have been established for landlords
and tenants of residential rental property. However, under current law, no
liability exists for a commercial landlord that does not release a security
deposit. House Bill 2803 establishes similar security deposit handling
requirements for landlords and tenants of commercial rental property. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

H.B. 2803 amends the Property Code to establish provisions for the handling
of a security deposit intended primarily to secure performance under a
lease of commercial rental property equivalent to existing provisions
established for residential rental property.  The bill provides that a
person who no longer owns an interest in the rental premises remains liable
for a security deposit received while the person was the owner until the
new owner delivers to the tenant a signed statement acknowledging that the
new owner has received and is responsible for the tenant's security deposit
and specifying the exact dollar amount of the deposit.  The amount of the
security deposit is the greater of: 

the amount provided in the tenant's lease; or

the amount provided in an estoppel certificate prepared by the owner at the
time the lease was executed or prepared by the new owner at the time the
commercial property is transferred.  

EFFECTIVE DATE September 1, 2001.