Loading...
Memo - Ordinance 2002-890 Rental Licenses . ... City ofHopkim: Inspections Division Memorandum To: Mayor Eugene J. Maxwell and Members of the City Council From: Rick Davidson, Building Official Date: April 16, 2003 Re: Discussion of Ordinance 2002-890 . Ordinance 2002-890 seeks to revise the licensing ordinance to address a number of issues related to rental properties. However, the major thrust of the amendment is the matter of tenant conduct and holding the landlord accountable for the conduct of their tenants. In the nearly four months that have passed since the first reading of the rental licensing ordinance, staff members have met three times with the Hopkins Apartment Managers Association (H.A.M.A.) and once with the Apartment Owners Association. In addition to approximately five hours of meetings with these groups, we have also received numerous written and verbal communications from them or agents for their associations. A number of suggestions were received from all of the parties involved and many were incorporated into the ordinance. ' With one exception, I feel that the managers and owners are comfortable with the ordinance as it is proposed to you. We have received a number of favorable comments from both groups regarding the revised ordinance. To aid comparison of the ordinance presented at the first reading and the one presented on April 1 , I have assembled them side-by-side so that any differences are more readily apparent. I have also included a brief explanation of why the change was made. This comparison has also been provided to members of H.A.M.A. I think that you will find much of the chang~ involves standardizing language, editorial corrections, and revisions for simplification. Most of the changes came from H.A.M.A., the Apartment Owners Association, or City Attorney Wynn Curtiss. A number of staff members will be at the work session to answer any questions you may have. 1 , .," ,~ '. .. City of Hopkins Inspections Division Memorandum To: Mayor Maxwell and Members of the Hopkins City Council From: Rick Davidson, Building Official Date: April 16, 2003 Re: Rental Licensing Fees Another matter that must be addressed coincidental with the Rental Licensing Ordinance is that of rental licensing fees. I am looking for direction from the Council in regards to proposed revisions to this fee schedule. Our current fee schedule generates slightly over $21,000 per year. Attached you will find a survey conducted by the City of Columbia Heights in November 2001. Hopkins was a part of that survey. Based on that survey, the fees charged by the City of Hopkins for rental licensing places it 13th to 15th out of 16 cities with variations depending on the number of rental dwelling units in the building. We feel it is appropriate that the fee schedule be raised so that the fees cover the cost of administration and inspections yet not place the City out of sync with similar cities in the area. The annual cost to administer registration of the nearly 5000 rental dwelling units in the City is about $6000. This includes personnel, postage, paper, etc. These costs consume about 30% of the revenue generated by the fees. It is estimated that the total cost of the registration and inspection program is $40,000 to $45,000 per year. Following is a comparison of the current fees to six suggested fee schedules, the cost of a license for various sizes of rental buildings based on those schedules, how Hopkins would rank against the other cities if that fee schedule were adopted, and the revenue that can be generated by each of the schedules. . For example, if the fee schedule were raised to $20 for the first two units plus $4 for each unit over two, it would cost $36 to license a four unit apartment building for one year, Hopkins would rank 13th out of 16 for revenue generated in the survey, and that schedule would generate about $38,532 per year in revenue. Inspections Page 1 4/16/2003 -. COMPARISON OF RENTAL LICENSING FEES - HOPKINS VS FIFTEEN METRO CITIES AND IMPACT OF VARIOUS PROPOSED FEES 1 Unit 2 Units 4 Units 11 Units 35 Units Revenue Generated $10 and 13" 14 15 '~,1"5<i:;; 15: ":.:, $21,170 $2.50/unit1 $10 $10 $20 $37.50 $97.50 $15 and 12 14 15 15 15 $28,899 $3.00/unit $15 $15 $27 $48 $120 $20 and 11 13 14 15 15 $34,724 $3.00/unit $20 $20 $32 $53 $125 $20 and 11 ~~"~,, "'13<f 13 /~ 14 13 $38,532 $4.00/unit $20 $20 $36 $64 $160 $20 and 11 ' ' './ 14" 13 ""13 11 " $42,340 $5.00/unit $20 $20 $40 $75 $195 $25 and 11 13 13 ' ~/ /, . 15 15 ,/ $40,549 $3.00/unit $25 $25 $37 $58 $130 $25 and 11 13 13 14 13 r $44,357 $4.00/unit $25 $25 $41 $69 $165 1. This is the current fee charged by the City of Hopkins - $10 plus $2.50 per unit for buildings containing. more than two units. 2. Hopkins rank out of 16 cities in the Columbia Heights survey Note: The ran kings indicated are based on the October 2001 survey conducted by the City of Columbia Heights and do not reflect increases in fees that may have been instituted by the cities in the survey since that time (October 2001). Because of some inequities in the fee schedule, it was revised in 2000 and the fee for one and two unit dwellings was actually reduced from $20 per year to $10 per year. We believe it appropriate to raise the starting fee at least to its previous level. . Even if the highest of the proposed fee schedules were adopted, Hopkins fee for a 35-unit apartment building would be $165 per year. This compares with Minneapolis at $530, Robbinsdale at $225, and New Hope at $180. That increase would amount to about 16 cents per unit per month. We would still rank 13 out of 16 in the survey. The three proposed schedules at the bottom of the table would all raise fees that would cover or nearly cover the cost of the program. The difference in the schedules is that two of them place a greater burden on one and two-unit buildings while the other places a greater burden on the larger multi-family buildings. I would propose to bring forth a resolution very soon to adjust the fees based on your recommendation. . Attachments: Survey from City of Columbia Heights Inspections Page 2 4/16/2003 . . "' Survey on Rental Licensing/Inspection Programs October, 2001 (Corrected copy - November 26, 2001) This survey was sent to 29 communities having staff that is a member of the Minnesota Association of Housing Code Officials (MAHCO). Replies were received from 22 of these communities, for a response rate of 75.9%. Partial results from two other communities are included based upon the author's knowledge of those communities. Appropriate responses for the City of Columbia Heights are listed in italics. 1. Does your city license and/or inspect rental property on a regular basis? 79.2% Both License and Inspect City of Columbia Heights does both. 4.2% License only-no inspections 0% Inspections only-no license requirement 12.5% Neither licenses or inspects Respondents that license rental property were asked to complete auestions 2-6. 2. What is your current license fee structure for rental property? Responses varied significantly. Table below compares responses based on various building sizes in terms of annual cost to the landlord. The highest and lowest fee for each column is shown in grey. City 1-unit 2 units 4 units 11 units 35 units Metropolitan Area Blaine $34.00 $38.00 $46.00 $74.00 $170.00 Brooklyn Center 75!~ 00 150.00 95.00 130.00 250.00 Brooklyn Park 75;.00 75.00 165.0Q. 165.00 385.00 Columbia Heights 15.00 30.00 50.00 85.00 205.00 Coon Rapids 6.25 6.25 5.00 13.75 43.75 Fridley 27.50 55.00 110.00 148.50 280.50 HastinQs 25.00 50.00 52.00 73.00 145.00 Hopkins 10.00 10.00 20.00 37.50 97.50 Maple Grove 40.00 40.00 50.00 85.00 205.00 Minneapolis 20.00 35.00 65.00 170.00 530.00 Mounds View 30.00 30.00 30:00 55.00 175.00 New Hope 44.00 48.00 56.00 84.00 180.00 Plymouth 47.75 52.50 62.00 95.75 209.25 Robbinsdale 32.50 50.00 110.00 110.00 225.00 St. Louis Park Not licensed Not licensed 83.00 97.00 145.00 Woodbury 8.00 16.00 32.00 88.00 280.00 Greater Minnesota Bemidji $12.00 $12.00 $12.00 $12.00 $12.00 Duluth 61.00 63.67 69.00 87.67 151.67 Rochester 25.00 35.00 60.00 135.00 375.00 81. Cloud 49.00 58.00 76.00 139.00 355.00 ~. . As can be seen from the table on the previous page, there is significant disparity among the communities surveyed. There is also considerable variety in the fee structures used to arrive at the rental license costs listed, however a common theme appears. Most communities use a base fee regardless of building size and increase license cost based on the number of total units in the building. 3. How long is the license good for? 68.4% 15.8% 15.8% 1 year Columbia Heights licenses for 1 year. 2 years other (4 years, 3 years, 3 years) 4. When the license is renewed, is the fee the same as in #2 above? 100.0% Yes, same fee paid each time license is renewed 0% No, license renewal fee is different 5. When was your last fee increase? 29.4% This year (2001) 17.6% Either 1999 or 2000 Columbia Heights' last increase 52.9% jMore than 3 years ago 6. Are you planning a fee increase for 2002? 27.8% Yes Columbia Heights is planning an increase 44.4% No 27.8% Don't know yet Cities that conduct inspections of rental properties were asked to complete Questions 7- 13. 7. What code(s) does your city apply to rental property? (Check all that apply) 47.4% Minnesota Uniform Fire Code (3 units or more) CH uses 42.1 % Uniform Building Code 26.3% International Property Maintenance Code 68.4% City's own property maintenance code CH uses 21.1% Other (1993 BOCA National Property Maintenance Code [2]; Uniform Mechanical code; MN Department of Health Swimming Pool rules; Uniform Housing Code) .~ > '" Do you inspect according to a schedule, or do you inspect only if a complaint is received? 94.7% Use a schedule 10.5% Respond only to complaints (Author's note: I had assumed that all communities that inspected would inspect at least when a complaint is received. The intent of this question was to determine if communities had some type of plan or schedule they followed for their inspections, or if they inspected properties only when a complaint was received from the public. Several respondents misunderstood this intent, indicating that the question was poorly worded.) . 8. The City of Columbia Heights inspects according to a schedule. We do also respond to complaints when received. 9. If you inspect on a schedule, how often do you inspect each rental building? 36.8% 31.6% 21.1% 10.5% Annually Every 2 years Every 3 years Every 4 years . The City of Columbia Heights inspects common areas and exteriors of aI/ rental buildings annual/y. . 10. If you inspect on a schedule, how often do you inspect each individual unit? 21.1% 21.6% 15.7% 15.7% Annually Every 2 years Every 3 years Every 4 years The City of Columbia Heights inspects each unit every 2 years. (Author's note: Total percentages add up to more than 100% due to variations in inspection programs within some communities. For instance, a community may inspect certain size buildings on an annual basis while inspecting other size buildings every 2 years.) 11. Assume you have conducted an initial inspection (either complaint or scheduled) and noted code violations. The property owner has not repaired the violations yet. Explain your enforcement procedure. (Author's note: Procedures vary widely among respondents. A community may well take multiple actions against a property owner and may have .. .. .. ...... . varying procedures depending on type of violation. As can be seen by the statistics below, most communities provide at least 1 notice to the owner before proceeding with other actions. Also, use of the court system is very popular as a final alternative.) 64.7% 58.8% 17.6% Provide a first notice requiring compliance Provide a second notice requiring compliance Provide a third notice requiring compliance 11.8% 88.2% Issue a city administrative ticket Issue a criminal complaint, ticket, summons or give to attorney 23.5% 11.8% Suspend or revoke rental license Condemn building or unit affected The City of Columbia Heights gives owners 3 notices followed by license revocation action. 12. Do you charge fees for re-inspections? 47.3% Charge fees CH charges fees 52.6% Do not charge . If you charge fees, what is the rate for these fees? · Rates for fees varied from $25.00 to $150.00. The mean was $45, and the median was $38.50. · 55.6% of the communities do not charge a re-inspection fee until the 3rd and subsequent inspections. CH charges reinspection fees for all reinspections except the inspection where all violations are corrected. · One community varies the re-inspection fee based on size of the building. CH does this also. We charge $50 for up to 4 units and $70 for buildings with 4 or more units. 13. Is your program self-sufficient? (In other words, does the income generated by the program cover the costs associated with the program?) 21.1% Yes 63.2% No CH is not self-sufficient. 15.8% Unsure .