After year one of a two year rollout, how's the law doing and what can we expect this year?
It’s now March, which means we’re exactly one year into Cleveland’s lead safe rental law. You’re forgiven if you’re not aware of this law. Cleveland hasn’t exactly done the best job of informing landlords of their obligations and what they need to do to comply. Sure, there’s websites and hotlines where you can get this information. But aside from unreadable postcards which many accidentally ignored as junk mail, they haven’t really been proactive in informing landlords about this law. If you don’t know the law exists, how do you know to look up those websites or call those hotlines?
As an example of the slow progress in rollout, you can look at the dashboard created by Case Western Reserve University and see that only 1,695 properties totaling 7,557 rental units have been certified as lead safe under the new law. While that may seem like a lot, there’s approximately 80,000 rental units in the city. Do the math. (I did it for you; it’s less than 10%.) Think about that. This is being rolled out by zip code over two years. We’re halfway there, and not even close.
So, aside from the numbers, how’s the law doing so far? Whether you’ve already gotten your properties certified, still planning, or hoping to hold out in hopes this law disappears, it’s important to know the reality of how this law’s rollout is going, how it’s being enforced, and what to expect in the coming year.
Buyers beware! In addition to many landlords not being aware of this law, neither are most Realtors, mortgage brokers, title agents, and home inspectors. And those landlords that do know about it are taking advantage of that fact. Many landlords are putting their homes on the market in an effort to take advantage of uninformed out-of-town investors. And it’s working. I’ve been getting a lot of calls from these investors—even some local ones—to get a home inspection on a rental property, and they have no idea the law exists. Their Realtor didn’t tell them about it. Most Realtors don’t know about it, and there’s no requirement that they say anything about it even if they did. I’ve even gotten calls from investors who already bought a home and found out about the law after. FYI: I’m happy to go into real estate, mortgage, and title offices to talk to agents about the law and how to help their clients prevent these unpleasant surprises.
Good luck in housing court! I mentioned before that the city hasn’t done the best job of informing the public. If you call the hotlines at the city or the Lead Safe Cleveland Coalition, they’re helpful and understanding to the fact that this rollout has been slower than expected. They give the impression that, while they want to get everyone into compliance as soon as possible, they have some level of patience as people get caught up. They assure you that, as long as you know about it and you’re working on it, don’t worry. They won’t be sending you any fines or putting liens on your property yet, even though the law says they can. However, it’s a completely different story in Cleveland Housing Court. There is no mercy in Cleveland Housing Court. If you have a property that hasn’t been lead safe certified yet, you cannot bring an eviction case against your tenant. I emphasize this for a reason. Think about this scenario: You have a tenant that’s not paying rent or is in some other violation of their lease. You’re already out thousands of dollars in past due rent (not uncommon given the recent moratorium due to Covid), but before you can evict your tenant, you have to go into your property and repaint any deteriorated paint inside and out, perhaps replace all the windows if they’re the older wooden type, clean everything with a HEPA vacuum, and get the property tested by a licensed technician before you can even file your eviction. All this with a tenant living there who knows that, if you’re successful, they’re getting thrown out. There is a very, very, very, small loophole to this: Under pressure from eviction attorneys, the court is now allowing evictions to proceed if the landlord can prove that they are being denied entry to the property by the tenants. However, this isn’t easy. You have to hire a licensed Lead Risk Assessor to go to the property in hopes that the tenant turns them away. This has to be done twice. Then have the assessor sign an affidavit attesting to the fact that they could not get in. If that works, the eviction will proceed but you’ll have 30 days after the move-out to get the home certified, and you cannot rent the unit until you do. However, if the risk assessor goes to the property and the tenant so much as lets them through the door, then you have to do the work and get the home certified prior to eviction. If you’re dealing with an eviction, I highly recommend seeking legal council to help you through this process. Even if you think you won’t need to evict someone, you better plan ahead. Evictions tend to happen when you least expect them.
Housing court is on a mission. While the city doesn’t seem to be planning to issue fines anytime soon, Cleveland Housing Court appears to be close to doing so on its own. I’m friends with a few eviction attorneys, and one of the told me the court’s magistrate, Mona Scott, has said she plans to send tickets to any properties that are past due, starting with the first zip codes in the rollout (44135 and 44120). I heard this back in January so, while I can’t confirm it, I wouldn’t wait too long if your property is past due.
It's now harder to pass the Clearance Examination. At the time the law was passed, the thresholds for lead concentration in dust was 40 μg/sqft. (micrograms per square foot) for a floor, 250 μg/sqft. for a window sill, and 400 μg/sqft. for a window trough. A few years ago, the EPA and HUD adopted more stringent standards of 10 μg/sqft. for floors, 100 μg/sqft. for sills and troughs, and 40 μg/sqft. for exterior living areas such as porches and decks. On December 1st of last year, the Ohio Department of Health adopted those thresholds. What this means for landlords is that the dust sampling portion of the Clearance Examination just got a lot more difficult to pass. It’s very important that you follow the proper cleaning procedures and use a HEPA vacuum prior to the exam, or you’re likely to fail.
A potential legal challenge? According to a recent article in the Plain Dealer, there’s a legal challenge working its way through the court system. Before landlords get too excited, however, this challenge only addresses one small part of the enforcement, not the law itself. The question being addressed is whether or not Cleveland Housing Court can prevent evictions to force compliance. The lead safe rental law does not specifically say anything about the use of evictions, but Judge Scott believes she can do this because the court has broad powers to enforce housing codes. This case is currently before the 8th Ohio District Court of Appeals, and legal experts cited by the PD seemed split on what the outcome might be. Since this could take some time to make its way through the courts, and there’s no guarantee as to the outcome, don’t wait to get your home certified if your zip code is past due or due in the near future.
What’s next? Aside from potential fines and pending litigation, what can we expect between now and next March when all zip codes are supposed to be compliant? The law has a review clause stating that, after one year, it should be reviewed by city council and amended if needed. There’s been little in the news about this, but I did see there were a couple of risk assessors and landlords proposing a change to the requirement that properties be recertified every two years. They’re calling for some properties, such as those built in the 60’s and 70’s, or with newer vinyl windows, to have longer periods between recertification. But I haven’t heard anything that would indicate any major changes or delays to the certification process or the law itself. I hear rumors among landlords and even a few attorneys that major legal challenges are forthcoming, and landlords should wait this out before spending the money on compliance. But Mayor Bibb, city council, and the housing court are all determined to make this work. In fact, this issue wasn’t debated much in the last election. Bibb’s opponent, Kevin Kelly, along with most of the candidates for other offices were supportive of the law or voted for its passage. So, waiting this out in hopes it will fail could be risking hefty fines and impossible evictions.
If you’re not sure what you need to do or how to get started with the certification process, I recommend going back and reading my previous blog posts where I explain step-by-step what you need to do.
More importantly, help do what the city has failed to do: Get the word out to landlords, buyers, Realtors, or anyone who deals with rental properties in the City of Cleveland.