The final California 2022 Budget Act significantly expanded the impact of the Higher Education Student Housing Grant Program (Program), created in 2021, by dramatically increasing funding for the Program. The Program supports one-time grants to either construct student housing, or acquire and renovate commercial properties, to provide affordable, low-cost housing options for students attending the University of California, California State University, and the California Community Colleges. The Program requires 50% of grant funding to be available to community colleges.
The 2022 Budget appropriated $1.4 billion to grants under the Program, and almost $18 million to specific community college districts for the purpose of exploring whether it is feasible to offer affordable student rental housing.
Currently, few community college districts offer on-campus student housing. However, with the massive influx of funds, student housing on many community college campuses is set to expand dramatically in the next few years. Any community college district receiving funds under the Program should consider and prepare for a host of challenging legal issues regarding risk mitigation and compliance that arise when educational institutions offer housing to their students.
One way to manage risk associated with offering student housing is to ensure that a comprehensive student housing agreement is in place. This agreement should include rules and expectations of the resident students and provisions needed to protect the district. The following bullets highlight some key issues to consider when preparing these agreements.
- License Agreement: Student housing agreements should be prepared as license agreements, not lease agreements, and include a provision stating that the relationship between the district and student is one of the licensor-licensee and not that of the landlord-tenant. A license gives the student permission to use the student housing under certain terms and conditions, but no property interest in it.
- Term: Districts should include a commencement date and an end date for the license agreement to ensure the resident students are fully aware of the date they must vacate the property.
- Compliance with District Policies and Student Conduct Regulations: Student Housing Agreements should require students to abide by all District policies and student conduct regulations, and any applicable California statutes or regulations governing student conduct. Districts should also develop specific student housing policies that set standards for student conduct in student housing, including setting student expectations for privacy in student housing. The student housing agreement should require students to acknowledge and abide by these policies.
- Fees and Payment Plans: Districts should include provisions identifying the amounts students must pay for student housing. They should consider providing options for payment in full, or installment plan payment terms, and include provisions regarding penalties for failure to timely pay fees.
- Occupancy/Guests: Many community college students have spouses, partners, or children, and may seek housing not just for the student, but also for others. Districts should consider occupancy limits, in light of applicable laws and regulations, including anti-discrimination laws. Districts should also consider including policies and limitations on guests, including requiring district approvals for guests who will stay for extended periods.
- Maintenance: Student housing agreements should identify what furnishings (i.e. bed, desk, dresser) the District will provide, and potentially what furnishings students should or must provide. The agreements should also allocate responsibility for maintaining individual student housing and any common areas or shared premises. Typically, districts will be responsible for ordinary wear and tear, but students should be responsible for any damage to student housing premises caused by their or their guest’s negligence or specified misconduct.
- Smoking/Alcohol/Drugs: Districts should include their policies and expectations for smoking, alcohol use, and drug use on the premises.
- Meal plans: Some student housing agreements also include the terms and conditions governing any meal plan for dining options offered within the student housing complex. Districts that intend to offer dining options associated with student housing should develop meal plan programs, which address meal plan terms and conditions, including meal plan options, fees, dining hall access, and student identification and meal tracking, as part of the student housing agreement.
- Security: Districts must consider and evaluate their legal obligations with respect to student security in student housing. Agreements should include provisions that address the security of student housing premises, such as provisions regarding sign-in or key cards, and visitors and guests in student housing spaces.
- Right of Entry: Districts should reserve the right to enter the student housing space for any lawful purpose, including emergency, health safety maintenance, or management of applicable rules and regulations.
- Cancellation/Revocation: Districts should consider the terms by which they or the students may cancel the student housing agreements, including notice requirements and any payment obligation following cancellation. The student housing agreement must make clear that the District may revoke the license to use student housing upon the occurrence of certain events. Typical reasons to revoke a student housing license include failure to comply with student conduct policies, or the terms of the student housing agreement, failure to maintain minimum enrollment requirements, or dismissal from the college. The agreement should also include provisions governing the right to, and amount of, any refund in the event of revocation.
- Checkout Requirements: Districts should also consider and include provisions regarding when students must vacate assigned housing, including checkout procedures to assess cleanliness and damage, and specific fees for damage to the premises.
- Insurance and Responsibility for Damaged or Lost Property: Agreements should note, where applicable, that the district does not have insurance to cover personal property damage, and recommend students obtain insurance to cover personal property damage.
In addition to preparing comprehensive student housing agreements, Districts offering student housing will have to consider their obligations under applicable fair housing laws, such as California’s Fair Employment and Housing Act (FEHA), which generally provide that all individuals have the right to housing free from discrimination on the basis of certain protected classes, such as age, race, national origin, religion, disability, sex, gender identity, gender expression, and marital status.
Districts must also evaluate their compliance obligations under Title II of the Americans with Disabilities Act and other federal, state, or local laws that regulate accessible design in connection with providing housing for disabled students, such as those who use wheelchairs and other mobility aids. Similarly, Districts must consider their obligation to provide reasonable accommodations upon request to persons with disabilities under applicable laws protecting people with disabilities. Examples of reasonable accommodations include permitting emotional support or assistance animals for certain students even if the district has a no pets policy, or a special room type or location, such as a room on the first floor.
LCW’s Business and Facilities Practice group have a deep bench of experienced legal professionals in addressing student housing issues, including preparing student housing agreements, student housing-related policies, and navigating the challenging legal and operational issues with respect to student housing.
