Tuesday, February 4, 2014

Mayor's Rental Health and Safety Proposal Inadequate

On January 27th the Bellingham City Council again took up the issue of rental health and safety during a Committee of the Whole meeting.  The decision was made to hold, yet again, Planning Committee sessions on the topic as was done last year by committee chairman, Jack Weiss.  

[You can review the committee meeting of January 27th by going to the city website here and forwarding to counter number 127.20.  The discussion at the evening council session can be found here at counter number 108.14.]

Last year the discussion turned on the outline of a proposal developed by Jack Weiss and the Planning Committee (read more about that proposal here).   The Planning Committee voted then to take the discussion into 2014 and ask the mayor to place the issue on the work plan of the Planning Department.   In response, the Planning Director, Jeff Thomas produced a memo that presented the administration’s notion of a framework for rental registration.  You can read that memo here.   Unfortunately, it outlines an inadequate plan for ensuring the health and safety of the tens of thousands of tenants in Bellingham.

The memo speaks to a system of registration rather than licensing.  The city, it seems, does not want to get into the business of licensing rentals so it is proposing to merely register them.  As Council Member Lilliquist pointed out, mere registration may not allow the city to withdraw a landlord’s privilege to operate rentals.   Registration is not necessarily a license to operate.  This issue must be resolved to ensure the city has the capability to take action against landlords who do not meet standards by withdrawing some sort of authorization to rent.

The memo also speaks to a program that is “performance based”.  It is not altogether clear what that means.  Are we speaking of the city’s performance, the landlord’s performance, tenant performance?  And what is being measured?  

There is a stated “focus on public outreach and education”, which can be part of the program but the main focus ought to be on inspection of units.  More on that later.

Among the more troubling aspects of this memo is the watering down of the focus by “improving the current code program for all violations, not just rental related as these types of violations comprise les than 10% of the total.”   First of all, the focus must be on health and safety of tenants of dwelling units not commercial establishments where nobody actually lives.  If the city wants to launch a program for that aspect of code compliance, it can surely do so but it ought not be conflated with rental safety and health with its thousands of providers, that is landlords.  Second, the reference to the current complaint statistics is grossly misleading and tends to minimize the extent of the problem that tenants experience.  The 10% figure is based only on the last two years of the present complaint only system that is severely limited by the ability and the willingness of tenants to complain. Furthermore, one must ask “10% of what?” and that is missing in the memo.  I have asked the Planning Director, who authored the memo, to provide backup numbers for the complaint figures.  As of the writing of this blog entry, he has only referred me to the testimony of Mr. Tinner, one of the city’s code inspectors. Before the council’s Planning Committee on 22 April 2013  [you can watch his testimony here at 92.45 on the video counter] That testimony is as vague as the information provided in the memo and does not answer the question regarding the data that was used for the conclusions presented by Mr. Tinner. The city council would be wise not to base any decisions on rental health and safety on these meager statistics. 

There are many reasons for which a tenant does not complain, not the least of which is ignorance of an existing problem.  Tenants are not code inspectors and, for that matter, neither are landlords.  No amount of education by the city will provide enough information to either party to make a judgment about the condition of a rental property.   Asking a tenant to inspect a unit for safety violations prior to occupancy is nonsensical.  Some severe problems only become apparent after having lived in the unit for a period of time. Who among the tens of thousands of tenants in Bellingham can even begin to determine if housing has issues with wiring, structural integrity, fire safety, noxious gases, etc.  Tenants may also hesitate to report obvious issues for fear of retaliation by the landlord.  We hear this from student renters regularly.  Even the use of a “confidential” hotline is extremely problematic as any landlord with an ounce of savvy will know that his tenant has complained.

Among the “guiding principles” outlined in the memo is that of “least cost”.   The real and overriding guiding principle ought to be “tenant safety and health” upon which the program is built to ensure that the principle is upheld.   Similarly, the use of existing resources unnecessarily limits the program from the outset and is inconsistent with the city’s call for tenants to be more forthcoming with their complaints.   More complaints require more assets for response. Even now responses to code infractions regarding rentals are handled in an ad hoc manner with the problem not receiving attention for several days at which time an inspector can work it into his schedule.  The Planning Committee at one point asked how many inspectors there were at present, however, that question was sidestepped by the Planning Director and Mr. Tinner.     

Additionally, the call for inspecting a small sample (½ of 1%) of the city’s 17,000-18,000 rental units each year is completely inadequate, especially if the choice of units to inspect (supposedly at random) is based on the complaints received the previous year.   As I indicated earlier, the complaint based system (the one we have at present) has already proved to be grossly inadequate.   Why base a “new” program on a system that has already failed?   And what will the inspection of a mere 85-100 scattered units tell the city about the overall condition of the entire rental stock?  Such a paltry number is de facto unrepresentative and one cannot reliably extrapolate from that point.

Last is the Planning Director’s list of Next Steps, most of which are reasonable and applicable to almost any project.  The exception is the step that reads “The compilation of a list of third party, qualified inspectors.”   This flows from the city’s desire to operate a program of “rental inspections-lite” without adding inspectors who are city employees. True, the law allows landlords to choose to have inspections done by a state qualified private inspector.  However, the city does not have to rely on such private inspectors to flesh out its program.  I explained this in my blog entry of last July that you can access here.  

Last July I also wrote to the mayor and the city council about inspection of rentals.  The mayor did not respond but Jack Weiss did by saying to me and the mayor, “Dick's concerns about this approach [relying on private inspectors] are similar to mine.  I agree with all of his points.”  Here are the points I made to the mayor in the email to which Jack Weiss was referring:

“I gave some more thought to your position that the inspections of rentals ought be done by private inspectors at the expense of the landlords  who will still have to pay a fee to register their units.  If I am mischaracterizing your position as you formulated it to me …, please let me know. Here are my thoughts: 

1.  A problem with relying primarily on private inspectors for periodic inspections is that the city neither gains nor retains any institutional knowledge of the city’s rental units.  Paper reports from private inspectors are no substitutes for the experience of a city inspector whose employment is, for all intents and purposes, long term.  You and the Planning Director will have no group of Jim Tinners [a city code inspector] to whom you can go for experiential knowledge. 

2.  Yes, the use of private inspectors is allowed under law.  In fact, this was one of the challenges to the Pasco ordinance [in the late 90s], that city inspectors would be the sole inspectors.  As I understand, the landlords wanted the option to hire their own.  They have that option now and [that] is written into the state law passed a few years ago.  I am not sure how that serves the landlords since a properly structured program with a revenue neutral fee system (the program fees will pay for the program) will spread the cost of inspections over all landlords and result in much lower per inspection costs.  I think you and the city council are underestimating the capability of a small team of city inspectors over time.   Again, I bring up Pasco.  They have the institutional experience of these inspections that are based on an inspection checklist that we can easily adopt without re-inventing the wheel.  I am sure they also have cost data and performance data regarding the time necessary for an inspection of a unit.  If my memory serves me correctly, the Code Inspector in Pasco told me that one inspector could do 8-10 inspections per day.  For more info see my blog entry here.  If you have not already done so, you may want to read the study prepared by Mark Gardner in 2008 entitled  “Options for a Rental Housing Licensing and Quality Inspection Program in Bellingham”  [Click here to read that excellent 27 pg. study]

3.  Reliance primarily on private inspectors for the verification of our rental units is a de facto privatization of an inherently governmental function, that of health and safety. (Fire departments were once a private sector function and we know how that worked out.)  Such a reliance invites collusion between the inspector and the inspected while depriving all landlords of a well supervised and even-handed inspection regime whose inspectors are accountable as city employees.”

I would also add today that using private inspectors in lieu of several specialized city inspectors will virtually assure a variety of results that will be unfair to some rental owners and by default, their tenants. A city program provides consistency and fairness in the application of a list of critical health and safety standards.  It provides certainty for the rental industry.  In addition the city would not have to train, license, audit and/or supervise this wide collection of private inspectors, presumably, at city expense.

Jack Weiss continued in his reply to my email to the mayor:  “The proposal brought to Council in 2011 was not made in a vacuum.  It was the result of three years of work at the Council and staff levels, paying attention to the comments received of a low cost program that targets, in a fair and effective way, critical violations in health and safety while registering all qualified rentals.  I used my own career experience in the rental industry to feel that this approach was correctly measured and appropriate.”  

Unfortunately, the memorandum from Jeff Thomas to the mayor outlining the administration's proposal on rental health and safety misses the mark by a wide margin.  The council needs to be much more demanding to ensure a rental health and safety program in Bellingham will result in a rental stock in good condition through regularly scheduled inspections by city employee inspectors.

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