The Delaware General Assembly has passed Senate No. 1, a legislative measure that amends Title 25 of the Delaware Code, specifically addressing the Residential Landlord-Tenant Code. This Act introduces a provision by granting eligible tenants the right to legal representation in eviction or other landlord-tenant actions.
The Act establishes a Right to Representation Coordinator who will oversee the implementation of the program and provide legal representation in covered proceedings. Alongside their team, the Coordinator will conduct outreach and education initiatives to ensure tenants are aware of their right to legal representation.
Another significant provision of the Act is the creation of a residential eviction diversion program, which aims to facilitate dispute resolution between landlords and tenants, ultimately preventing unnecessary evictions. The gradual implementation and administration of this program will be carried out by the Justice of the Peace Court, aligning with the expected return of eviction cases to pre-pandemic levels.
Prior to the COVID-19 pandemic, around 18,000 eviction filings and related matters were filed annually in Delaware. It is estimated that 68.7% of those cases, or approximately 12,366 cases, would be income-eligible for legal representation under this Act. Out of the eligible cases, it is projected that 4,000 tenants, or 32.35%, will accept legal representation each year. Additionally, it is assumed that 75% of those tenants meet the income eligibility criteria and live in a rental unit with more than three units, as defined in the Act.
The financial costs associated with implementing and administering the program have been considered. The Justice of the Peace Court has provided cost estimates for personnel expenses, lease and utility expenses, programming updates, and one-time startup costs. Projections span a three-year period and take into account a 2% inflation cost for salary, health insurance, OECs (Other Employment Costs), and lease and utility expenses in future years.
In the first fiscal year (2024), the estimated costs include one-time startup costs of $171,210 and recurring costs totaling $1,122,699. In the second fiscal year (2025), one-time costs are projected to be $27,897, with recurring costs amounting to $2,284,868. The third fiscal year (2026) estimates recurring costs of $3,928,912. These projections demonstrate a phased approach to allow for the gradual startup of the program and account for the expected increase in cases as outreach and education efforts regarding the right to representation take place in subsequent years.
The Act outlines the need for a legal services contract among designated organizations to provide representation for covered individuals. Although the exact terms of the contract are uncertain, using an average of $1,000 per case and an estimated annual caseload of 3,000 cases, the yearly contract could be approximately $3,000,000 upon full implementation.
Funding for the Coordinator’s office to administer the program is expected to be included as part of the executed contract(s). It is assumed that up to 10% of the amount appropriated for the program may be used for the Coordinator’s costs, not exceeding $200,000 once the program is fully operational.