Rental ordinance results uncertain

By Emily Le Coz/NEMS Daily Journal

TUPELO – When the city tried to pass a new rental ordinance as part of a sweeping revitalization plan this spring, landlords erupted in protest.
It’s too costly, it’s too cumbersome, it’s too heavy-handed, they argued.
City leaders listened and backed down. But on Tuesday, they overwhelmingly approved a modified version of the rental ordinance that raises annual fees on landlords anywhere from $15 to $15,000 and up.
No one appeared at City Hall to oppose the new measure, and it will take effect Jan. 1.
But its outcome is far from certain. Aside from higher fees and stiffer penalties for landlords who repeatedly fail housing inspections, some argue it falls short of the necessary overhaul needed to transform Tupelo’s ailing housing sector.
“We need to put a major emphasis on code enforcement of all properties, not just rental properties,” said Ward 1 Councilman Markel Whittington, the only one of his colleagues to vote against the measure. “I just don’t see how anything will change with this program except adding a bigger burden to landlords.”
The new ordinance requires rental property owners to pay an annual $25-per-unit registration fee and submit to housing inspections every two years. Landlords who keep utilities in their own name will get inspected every six months.
Each of the first two inspections are free, but owners who repeatedly fail them must pay $100 to $400 for subsequent visits. After the fifth consecutive failure, landlords will be brought to court.
Inspections also will be required anytime a unit changes tenants.
The program aims to clean up blighted rental property – which accounts for about one-third of all housing in Tupelo – and improve the general health of all neighborhoods. Proponents also hope it will decrease the overall percentage of rental units and encourage more home ownership, which stabilizes a community.
It’s the second version of the original program launched in January 2007. That version charged landlords $10 a year if they owned one to three units, $30 annually for four to 10 units, and $100 annually if they owned more than 10.
But that effort fell short of the desired result. It took the city’s understaffed Planning Department – now called the Development Services Department – four years to inspect each of the city’s rental properties. And it raised a meager $15,000 per year – less than $3 for each of Tupelo’s roughly 5,100 rental units.
It also increased the code-enforcement division’s workload by 1,400 percent. Yet, the mayor and City Council in current and previous administrations repeatedly have denied the department’s requests for more staff.
Development Services currently has two full-time code-enforcement officers who inspect not only rental units, but also patrol for general code violations like unkempt lawns and junk vehicles in the yard. And they’re responsible for inspecting new construction, too.
Thanks to the increased fees associated with the new rental program – it will generate about $127,000 annually – the department will be able to hire one additional code-enforcement officer. It costs about $60,000 for one position; the rest of the money will go into Tupelo’s general fund.
But it falls short of the ideal staffing level of one code-enforcement staffer for each of Tupelo’s seven wards.
“All I will say is that we’ll do the best job we can,” said Development Services Director BJ Teal, who has asked for additional officers since coming on board in 2008.
Even landlords said the city needs more code-enforcement personnel.
“If you have two doing that job now, with as many rental units as we have in Tupelo, and just code enforcement in general, I think it’s pretty obvious it’s not enough,” said landlord Wilson Coleman. “It will be difficult for them to do the job, and do it well, with two. Whether a third will help, I don’t know.”
Coleman owns and manages hundreds of rental properties in Tupelo. Under the current program, he pays a total of $100 annually and gets unlimited free inspections. The new program will raise his annual fees by “thousands of dollars.” And if he fails more than two, consecutive inspections per unit, he’ll face even higher fees.
Yet his biggest concern isn’t the additional cost, it’s whether or not the city can implement the program fairly and consistently across the board. He said code-enforcement officers might penalize one landlord for the same violation he or she had ignored in a previous rental unit. Or it might skip properties entirely to focus more intensely on others.
“Just be fair,” he said. “Do it right.”
The city will strive for consistency with the new program, Teal said, while defending the original effort for paving the way.
“We have gotten, over the past four years, to all the rental units that we know of and have gotten a great many of them in good condition,” Teal said, “so that lessens the impact to some extent of what we’re doing.”
Also lessening the impact will be a self-inspection process coinciding with the new rental program. Landlords can sign up for an 18-month, city-led course to learn about the housing code and maintenance techniques.
Those who pass the course can inspect their own properties, alleviating the workload for city staff. But Tupelo can conduct its own inspection at the first hint of trouble, Teal said.
Mayor Jack Reed Jr. lauded the new rental ordinance as a good step toward revitalizing Tupelo. Combined with a recently approved $600,000 set aside for other neighborhood improvements this year, it will improve the city and attract more families, he said.
Boosting neighborhood vitality has been one of Reed’s key goals since the 2010 Census revealed a less than 1 percent population growth here the past decade.
And while some landlords said they’ve been made the scapegoat for the city’s shortcomings, others say it’s just part of doing business.
“It wasn’t exactly what we wanted, but we knew they were going to do something,” said Billy Daniels, who owns about one dozen rental units. “We’re just afraid it will open to the door to them deciding the next year they want to go up to $35 and then the next year go up to $50.”
emily.lecoz@journalinc.com

Landlord Fees
TUPELO’S NEW RENTAL ORDINANCE requires landlords to pay an annual $25-per-unit registration fee. That’s versus the previous ordinance, which charged between $10 to a $100 maximum.