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Bill

SD 3318

An Act to establish tenant escrow savings accounts

194th Legislature (2025-2026) Introduced by Lydia Edwards

Voluntary Tenant Escrow Program lets eligible renters contribute 10% of monthly rent into an EOHLC escrow, with a 20% state match to fund first-home purchases or emergency rent.

Referred to the committee on Housing
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Bill Summary · SD 3318

Summary of Senate Bill 3318 (SD 3318) — An Act to establish tenant escrow savings accounts

Purpose and intent

  • Establish a voluntary Tenant Escrow Program under the Executive Office of Housing and Livable Communities (EOHLC) to help eligible tenants save for purchasing their first home.
  • Create a framework for tenant contributions, state matching funds, and eligible uses of escrow withdrawals, with oversight and protections for both tenants and landlords.

Key provisions

  • Definitions

    • Eligible tenant: an occupant of real property (or part) for at least 12 months, owned by an individual landlord.
    • Eligible landlord: owner-operator of up to five rental units, responsible for maintenance, rent collection, and lease management; must be registered with and approved by EOHLC.

  • Tenant Escrow Program

    • Participation is voluntary. Eligible tenants, with landlord agreement, may contribute 10% of monthly rent into a secure escrow account held by EOHLC.
    • Funds in the escrow may be used for:
    • Down payment or closing costs on the tenant’s first primary residence.
    • Emergency rent payments if the tenant cannot pay full rent and has a Notice to Quit or eviction notice.
    • Withdrawals for emergencies reduce that month’s 10% contribution accordingly.

  • State Matching

    • The Commonwealth will match tenant contributions at 20% of the final escrow total, upon withdrawal approval.

  • Landlord Tax Provisions

    • Landlords may deduct 1.5 times the tenant’s annual contribution from the landlord’s taxable income derived from the tenant’s lease.
    • Municipalities may offer an additional deduction up to 10% of the landlord’s annual taxable income from that lease.
    • Cities/towns may enact a local option to provide up to a 10% additional deduction for participating landlords, subject to reporting and verification requirements.
    • Deductions apply to state taxes; municipalities must provide annual reporting on participation and deductions.

  • Tenant Escrow Fund

    • Establishment of a separate Tenant Escrow Fund, administered by EOHLC, to receive tenant contributions and state matching funds.
    • Fund not subject to certain General Laws; state matching funds appropriated in the annual budget.

  • Program Design and Regulations

    • EOHLC to promulgate regulations on eligibility, account administration, permitted uses, and compliance.
    • Safeguards against rent increases offsetting contributions; consumer protections for transparency and access.
    • Regulations to be shared with the Joint Committee on Housing and Ways and Means at least 30 days before adoption.

Who is affected

  • Tenants in eligible rental arrangements (limited to 12-month occupancy and up to first-time home purchase).
  • Small landlords (up to five units) participating in the program.
  • Municipalities (through potential local tax deductions and reporting obligations).
  • The state via budget-appropriated matching funds and regulatory oversight by EOHLC.

Timeline and status

  • Introduced: October 27, 2025.
  • Referred to the committee on Housing; Rules suspended on October 30, 2025 (and concurrently to Rules).
  • Status indicates ongoing consideration with regulatory development by EOHLC.

Potential impact

  • Aims to increase homeownership access for renters by building dedicated savings, with a state match and tax incentives for landlords.
  • Includes protections to prevent rent increases from offsetting contributions and to ensure transparency in fund management.

Compiled from official sources — confirm details with the bill’s official record.

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