Vermont § 4461 - Security deposits

§ 4461. Security deposits

• (a) A security deposit is any advance, deposit, or prepaid rent, however named, which
  is refundable to the tenant at the termination or expiration of the tenancy. The
  function of a security deposit is to secure the performance of a tenant’s obligations
  to pay rent and to maintain a dwelling unit. (b) The landlord may retain all or a portion of the security deposit for: (1) nonpayment of rent; (2) damage to property of the landlord, unless the damage is the result of normal wear
  and tear or the result of actions or events beyond the control of the tenant; (3) nonpayment of utility or other charges that the tenant was required to pay directly
  to the landlord or to a utility; and (4) expenses required to remove from the rental unit articles abandoned by the tenant. (c) A landlord shall return the security deposit along with a written statement itemizing
  any deductions to a tenant within 14 days from the date on which the landlord discovers
  that the tenant vacated or abandoned the dwelling unit or the date the tenant vacated
  the dwelling unit, provided the landlord received notice from the tenant of that date.
  In the case of the seasonal occupancy and rental of a dwelling unit not intended as
  a primary residence, the security deposit and written statement shall be returned
  within 60 days. (d) The landlord shall comply with this section by hand-delivering or mailing the statement
  and any payment required to the last known address of the tenant. (e) If a landlord fails to return the security deposit with a statement within 14 days,
  the landlord forfeits the right to withhold any portion of the security deposit.
  If the failure is willful, the landlord shall be liable for double the amount wrongfully
  withheld, plus reasonable attorney’s fees and costs. (f) Upon termination of the landlord’s interest in the dwelling unit, the security deposit
  shall be transferred to the new landlord. The new landlord shall give the tenant
  actual notice of the new landlord’s name and address with a statement that the security
  deposit has been transferred to the new landlord. (g) A town or municipality may adopt an ordinance governing security deposits on dwellings.
  The ordinance shall be supplemental to and not inconsistent with the minimum protections
  of the provisions of this section. The ordinance may not limit how a security deposit
  is held. The ordinance may authorize the payment of interest on a security deposit.
  The ordinance may provide that a housing board of review constituted pursuant to 24 V.S.A. § 5005 may hear and decide disputes related to security deposits upon request for a hearing
  by a landlord or tenant. The board’s actions shall be reviewable under 24 V.S.A. § 5006. (Added 1985, No. 175 (Adj. Sess.), § 1; amended 1987, No. 116, § 2; 1991, No. 229 (Adj. Sess.), § 1; 2007, No. 176 (Adj. Sess.), § 45.)