Toledo Lead Paint Law...Halted for the THIRD Time

Toledo Lead Paint Law...Halted for the THIRD Time

Andrew FidlerBusiness Member
Real Estate Broker · Toledo, OH · Member since 2011 · 384 posts · 434 votes

https://www.toledoblade.com/local/city/2020/06/26/kapszukiewicz-administration-delays-lead-safe-housing-enforcement-citing-coronavirus/stories/20200626079


The latest and greatest on the Toledo Lead Ordinance. The 2019 declaration of a new lead ordinance which would be enforced by Toledo's Dept of Neighborhoods (not the County Health Dept as the ~2016 version was going to be) has been officially ended. 

The deadline for compliance was at the end of this month but there hadn't been any publicity, publication, or out reach. Check the BP archives back in February 2020 I requested a lead certification for a property and was blatantly told by our Dept of Neighborhoods that there was no certificate, process for inspection, nor staff on hand forming any department as of yet.

What Does Andrew Think? The City will begin discussion late this year and there is a possibility they will have the momentum to get it right this time. I know the topic is largely political so factor our mayor is up for election in 2021 so the program's future will rest on the goodwill generated through the program.

I hope any program affects ALL rental properties not units 1-4 in size (children are exposed to lead in all properties not just small ones) followed by ALL HOMES (children are exposed where lead is present - old homes - not just landlord rented ones). I hope they simplify the process for visual peeling paint as the initial inspection and get away from the expense and hassle of wipe tests. I will continue to provide a voice for property managers and investors in Toledo to make a lead program successful. 

I do think a program is coming, it's just a matter of time for Toledo to get the traction to put a program into place and begin friendly education and grant programs followed by firm language and eventual fines and enforcement. 

I see a lead paint program as a necessity to force landlords to update their properties, many owners will have to decide if they will re-paint or install vinyl siding/windows or dump their properties to new owners who will. (My personal portfolio has been aggressively installing vinyl siding, soffit, fascia, and using waterproof laminate flooring over any painted ones. Whenever the lead ordinance occurs I won't have an uphill battle, nor will I have reporters documenting blighted properties I am responsible for)

Conclusion - whenever a lead ordinance finally does come into effect and age through to enforcement Toledo real estate will suffer in the most difficult neighborhoods. Those of us who see that as a buying opportunity will displace those who are a hazard to our community and the public AND the new owners will benefit.

In the mean time hunker down as Covid spikes again and remember the communicating on Bigger Pockets and with your favorite Toledo property manager are safe ways to develop your real estate skills while staying safe!

(Please post if anyone has an update on Cleveland/Akron/Columbus/Cincinnati lead paint program ordinances, I'd be curious if we have a state-wide delay)

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Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
4y

I am with @Andrew Fidler and I don't think this is going away. The optics of the situation and its effect on politicians to now back off of this after all the rhetoric they whipped up is impossible. I believe the courts will eventually side with the city, BUT the question at hand is what does this look like after all that comes down. I have said all along if the city wants a law like this then EVERYBODY goes into the pot. Apartments, homeowners, etc. Not just one small select group of property owners. I have personally had issues with houses I was working on where the property next door had peeling paint but because they were an owner occupant they didn't have to address the issue. My property would have paint blowing into the yard that I had to clean up. If someone in my property were to have lead poisoning and the health department were called in I would be the only one under the microscope. The peeling paint coming off the neighbor's house wouldn't even be a factor in the investigation, discussion, and the lawsuits that would follow even if it was pointed out this could be the source of the problem. Therefore the only way to be fair is EVERYONE must comply or nobody.

I am all for improving housing, but not as an unfunded mandate that is thrown against only one group of property owners while ignoring all the other types of property owners (apartments & owner-occupants) and factors (lead pipes still in city water lines) that could go into the lead problem. Either we have an honest discussion about the problem as a whole and EVERYONE contributes to the solution or we let things stay as they are until EVERYONE is ready to be involved. Housing providers didn't create this problem over night by themselves. This has been a long time coming and it needs to be a community solution with every property involved, an efficient and effective inspection system that is fair, and most importantly A LOT of money to help property owners become compliant without bankrupting them. It is that last piece that will be the most problematic. Government is great at issuing mandates and fines to enforce, but not quite so good at providing funding to help with those mandates.

Andrew brings up another good point about the unintended consequences of this law if it is allowed to stand exactly as it is right now. This law was modeled after Rochester New York, where today the blighted housing stock stands at 35% and rising. Property owners have simply thrown up their hands and walked away and now you have a decreased supply of rentals and an increase in blighted and abandoned properties that are turning into eye sores and problems. That will likely happen in Toledo because as Andrew pointed out, putting in a $30K investment into a $20K house and renting it for $400 per month simply won't work. So, one of two things will happen. The property will become abandoned and eventually have to torn down or an investor will put the $30K in, but now it will rent for double or more and push all the people that can't afford that rent away. Where they will go is anyone's guess. It has happened in other cities and progrssives have a name for it, they call it gentrfying and say the word with venom as if the people investing caused the problem. Nope, laws like this are what will eventually create it assuming it doesn't go the other way and just stay an abandoned, blighted, and crime ridden mess.

I know of several areas in Columbus that gentrifying has occured and some of those previously blighted and run down neighborhoods are now posh upper middle class areas. Where the people that used to live there went I am not sure of, but they couldn't afford to stay there. Unfortunately I am not sure Toledo will go that route. We don't have a dynamic and growing economy as Columbus does, we arent the state capital, and we don't have any modern industries coming in to provide jobs and higher incomes that would push up the need for housing to improve in those poorer areas of Toledo. I could be wrong and I hope I am. I would love to see the entire city improve, but I am just not convinced that is where this will go.

This is a big problem that will involve everyone if we want to find a true solution. Time will tell if we get there. 

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  • Rental Property Investor · Toledo, OH · Member since 2019 · 115 posts · 72 votes
    6y

    Thanks for the thorough update, @Andrew Fidler!

  • Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
    6y

    Andrew for mayor 2021

  • Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
    6y

    Wait so kids in 1-4 families are “protected” and kids in multi-families 5+ get to eat lead for snack each day?

  • Andrew FidlerBusiness Member
    OP
    Real Estate Broker · Toledo, OH · Member since 2011 · 384 posts · 434 votes
    6y

    @Account Closed - Correct. The original 2016 ordinance received a lawsuit from the investment community on multiple grounds, one of which was the unequal application of the rule to business. 

    There were a few arguments thrown out during testimony, the strongest was "studies show the majority of lead poisoning stems from small 1-4 family units and that's why we are regulating those specifically and not larger buildings". Our attorney asked for documentation on this claim and it was unsupported but referred to regularly in city council meetings. (Oh, did I mention the other scuttlebutt was that city council owned investment property sized over 4 units in size?)

    The argument I could live with is "the phase 1 program starts with units 1-4 in size, phase 2 will contain all investment and commercial properties, phase 3 will be all properties built before 1978".

    Hopefully our pro-business mayor for whom I have great respect shall lead a successful lead paint program.

  • Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
    6y

    @Andrew Fidler I agree that some type of program is coming eventually at the city or state level it will come. I don't think this is a bad thing in principle, but like most things, the devil is in the details. The wipe test is a real problem in my book because currently the regulation mandates that one test must be done on the floor with no test being done outside to establish a baseline. Lead can be tracked in from locations outside the home, end up on the floor, and be flagged in a wipe test. Plus this test is expensive and takes a lot of time to process when compared to a visual test, which can be done in much greater volume quickly and efficiently.

    If a house fails now an investor has some real problems. They need to remove residents and get full remediation done by certified professionals. That could become staggeringly expensive very quickly and I see many property owners just choosing to walk away and default rather than spend thousands of dollars to remediate. That just means more dilapidated properties, lower property taxes, decreased housing, and a continual decline in the city. I just don't see how that is good for anyone.

    Personally, I have no problem with visual inspections and forcing landlords to fix peeling paint and generally fix up properties. That goes a long way to making sure property owners keep up properties and keep the neighborhoods and city a nice place to live for all and safe for residents.

    As I told some members on City Council I have never met a landlord that wants to poison children, but that it isn't fair to go into an existing property where an investor was operating under a certain understanding on expenses and income for the property and suddenly tell them the property is not inhabitable and force them to immediately come up with piles of cash on the spot to get the property in rent-ready condition again. It just seemed to me there was some ways we could do this that would keep residents safe, avoid bankrupting investors and keep affordable housing options open for people.

    I will say with 4 city council members being arrested by the FBI today on bribery charges after a 2-year investigation and two of those individuals being the ones to really push for this law that it may be delayed for a long time, but time will tell what happens next.

  • Andrew FidlerBusiness Member
    OP
    Real Estate Broker · Toledo, OH · Member since 2011 · 384 posts · 434 votes
    6y

    @Michael Temple Oh buddy I can't agree with you more, the indictment of four (of 12) members of Toledo's city council is earth shattering. These are legacy personalities who have finger prints all over the old lead ordinances.

    https://www.toledoblade.com/local/police-fire/2020/06/30/Federal-agents-take-Toledo-city-council-members-into-custody-amid-bribery-probe/stories/20200630090

    Here's the article for anyone who didn't read it yet (the 40 page indictment is heady stuff, there are two years of improper action that's been documented by the FBI). 

    I believe this is the biggest torpedo possible for the old version of the lead ordinance and I have multiple colleagues curious how genuine the outrage against lead paint was. Was there a financial interest paying bribes to make the lead ordinance so politicized and anti-landlord? There was going to be a real estate implosion through out Toledo if the ordinance ever started fining mom-and-pop landlords as they'd been threatening to do.

    I am watching the new riveted, it's an interesting time. The 11:1 Democrat:Republican hold on council is being attacked and truly this holds some great promise for some CHANGE in Toledo which is what this town has needed for going on 50 years.

  • Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
    6y

    @Andrew Fidler I couldn't agree more. I am not sure they will ever repeal it per se, but never putting any infrastructure behind it and continually delaying it is basically the same thing. The problem is as long as it is "on the books" so to speak it can come to life at any point without any additional votes from city council so I would like to see it actually amended and changed. I have no issue with visual tests and actually think that might be a good thing to force some people to take better care of their properties. 

  • Real Estate Investor · Dallas, NC · Member since 2016 · 43 posts · 10 votes
    6y
    This is excellent information! I was certain the indictment of those city council members would reflect on this ordinance. It saddens me to see what is happening to my hometown! 
  • Real Estate Investor · Dallas, NC · Member since 2016 · 43 posts · 10 votes
    5y

    I was reading on 13ABC (https://www.13abc.com/2021/02/...) and saw that the lead law still only applies to "rental properties with four units or fewer" and I thought it was supposed to apply to all rental properties.  How is this allowed?  Why should only smaller units be liable?  Am I missing something? 

  • Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
    5y

    @Renee F. No, you aren't missing anything except that people that own large apartment buildings have deep pockets to hire A LOT of lawyers and tie this law up for years and years. Conversely the smaller properties are owned by smaller investors without the same level of resources to fight back. City Council is choosing to pick on the group they think they are most likely to prevail against and has the least means to fight back.

    Many investors I talk to think this is grossly unfair and that lead contamination can come from a lot of different places and isn't always a result of lead paint. The city still has lead water pipes in parts of the city water system that they have no money or ambition to fix. I wonder how many people get too high of lead from that source?

    I realize lead contamination from many sources, including lead paint, is a problem, but to dump this entirely on the backs of small landlords without considering the financial and housing impacts and offering very few solutions outside of "fix it or else" mandates is B.S. If the city wanted to really solve this problem it would open a wide ranging and comprehensive discussion that would talk about lead exposure from all sources, financial impacts, housing, water, and most importantly, financial solutions to solve it together. 

  • Real Estate Investor · Dallas, NC · Member since 2016 · 43 posts · 10 votes
    5y

    Michael that is exactly how I feel. I have one property with an elderly couple living in it simply because I couldn't sell my property at the time I moved. When they choose to move or pass away, I will sell my home.  For me to have to spend the amount of money that is required to be compliant will really impact the amount I receive from the house.

  • Andrew FidlerBusiness Member
    OP
    Real Estate Broker · Toledo, OH · Member since 2011 · 384 posts · 434 votes
    5y

    @Renee F. and @Michael Temple - man it's been it's been a while since we talked about Toledo lead paint on BP! 

    I have been participating in several of the lead paint planning sessions here in Toledo as the new ordinance is defined and enacted...so I have a front row seat you could say. 

    https://toledoleadsafe.com/ - This is the city website for up to date requirements. 

    Differences between the last ordinance: 

    • Only family childcare homes and residential rental properties with 1-4 units built before 1978 fall under the lead-safe certification law.
    • The fee for the lead-safe certification is $25 instead of the previous $45.
    • The Toledo-Lucas County Health Department will issue the lead-safe certificates, while the City of Toledo’s Department of Neighborhoods will coordinate the program, and Code Enforcement will enforce.
    • Lead-safe certificates are available for 5 years, or 20 years in the case of full abatement.
    • Residential rental properties must also be registered with the Lucas County Auditor.

    The lead ordinance as implemented is quite similar to the original version, a multi-phased roll out beginning the conclusion of phase 1 in June 2022, you can see the map on the ordinance page above.


    I can provide some comment on the "why 1-4 units only" and sure Michael is correct that everything with politics has to do with power, votes, and depth of pockets so fancy apartment buildings allied with the NAA are going to be side step some of the initial ordinance. That said the ordinance was enacted citing empirical data supporting that the preponderance of lead contamination cases stem from poor census zones (why the ordinance starts in specific areas vs others) and that cases occurring in rental properties largely stem from smaller apartment units 1-4 in size. 

    I can definitely understand that 1-4 units ( 4 units being the cut off for residential mortgages before mortgages are classed as commercial) small-time owners are the majority...this in turn leads to high variability of maintenance and clearly the data shows a significant uptick in shoddy maintenance resulting in lead exposure to children, commonly in the poorer census areas.

    From my own experience within 43608, a challenged area for resident income, there are the catch-22 properties the ordinance is seeking to eliminate. My experience has found that for the past decade a 3/1 SFH rents for $700, this is a solidly renovated home with LVP floors, 80% furnace, gas water heater, vinyl siding, detached garage, and a fenced yard. The Catch-22 properties offer $400 rent rates with little to no upgrades or maintenance, properties which those who have to pay 100% of their rent (aren't receiving financial assistance) can afford so they accept the situation and their long-term exposure to squalor results in an elevated lead blood level for a child. (Larry Sykes formerly of city council was aggressive at stating the lack of a city lead ordinance meant nothing was done proactively, thus we were waiting for our children to be contaminated, in essence they were now the canary in the coal mine)

    I have to say I am not really bothered by the lead ordinance here in Toledo - owners who maintain their property already simply are facing a few hundred dollars of wipe-test inspection. Any claims of "but I have to scrape the peeling paint and that will cost me thousands" simply tells me there was maintenance being left ignored so get it repaired and move on or get out of the business. 

    I am hopeful this ordinance will move through inception to enactment - currently all we have achieved in Toledo is excess communication from the housing providers who are active in the community, read the news, and have anxiety over passing inspection. We have to get the ordinance enacted through that phase in order to determine those who are offering excessively cheap, sub-standard housing and force them to fund large rehab projects or out of our community.

    I participate in the Toledo / Lucas County Comprehensive Housing Strategy initiative, we just had our latest meeting last week with some riveting conclusions. I don't want to bore anyone with the statistics unless you are interested, but we have 15% of our properties still vacant while having unprecedented need for housing in our poorer neighborhoods. 

    Toledo will have to evolve its housing stock past the lead ordinance if it hopes to truly rejuvenate itself. I absolutely anticipate housing providers preferring to sell rather than rehab sub-standard housing and some of those vacant properties will end up being demolished. However if we are approaching this with the view that having residents living in sub-standard housing is unacceptable then this is the inevitable byproduct.

    Those of us with an investor mindset will be ready and waiting for the slum-lord business model to be evicted from our town will be waiting excitedly to renovate these properties...especially with the market prices being as high as they are in Q1 2021!

    (I feel that with our pro-business Mayor Wade Kapszukiewicz and an evolved city council a renewed investor lawsuit is not something I foresee, there truly is an upside for our community if we can see the ordinance through to completion)

  • Real Estate Investor · Dallas, NC · Member since 2016 · 43 posts · 10 votes
    5y

    @Andrew Fidler, yes, it's been a while since we discussed this ordinance! I understand what you are saying about why it's just the 1-4 units EXCEPT my mother did home visits for the "poor" population for years and she will be the first one to tell you that the worst situations are NOT the 1-4 units but the larger units. In fact, she told me when I was reading this that she saw the worst situations in the larger developments. Be that as it may, I still see a situation where the city is just making money. Everyone can disagree with me but in my situation, I'm not making a ton of money and doing it as a business and an extra couple hundred dollars for an unnecessary test does make a difference.  I would sell my home now except I promised my tenants that I wouldn't until they are gone.  Thanks for the update.

  • Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
    5y

    @Andrew Fidler Thanks for the update. I had heard some of that from my REIA group, but some of it was new. I had a long discussion with a lead inspector from REIA last week and she gave me a run down on how the test goes and what you have to do to fix stuff. I have to say that gives me some relief as it doesn't seem nearly as daunting as I was first led to believe. Plus my properties are in the very last group to be inspected so I don't even have to worry about getting the test done for 5 years or something like that.

    I am not sure I would classify Wade K. as a "pro business" mayor. I have too many inside stories from the Toledo Chamber to give him that title. Ditto for the city council. However I will say that both the current city council and mayor are better than previous incarnations of both.

    Regarding the redevelopment of the city's housing stock, I would be all over that IF I knew where it would start and how fast it would move. If you look at the German village area in Columbus today it doesn't even resemble what it was back in the late 1980s. Back then it was run down and dilapidated, but today it is a posh, upper middle class area. If you had started buying properties in there in early to mid 1990s you would be rich today. If I saw a similar spot in Toledo I might jump in on that. I see some promise on the other side of the river (east side) where those new developments went up and the new Metropark is being built. I am wondering if that neighborhood going back a mile or so will become a rejuvenated area or if it will still take 40 years for it to turn around.

    However, I am a bit off track. It appears the lead law is here to stay so I guess we need to figure out how to live with it. I agree, those property owners that buy nicer stuff and keep it well maintained have a lot less to worry about than others who don't.

  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Andrew Fidler

    States like Massachusetts require new owners to get a lead based paint inspection because they make new owners liable if there is any lead based paint present in the property even after they take ownership. By punishing the owners it creates an accountable environment.

    Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews
  • Lien VuongBusiness Member
    Real Estate Agent · Boston, MA · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Marc Rice Re: MA - While you're correct on the owner being responsible for previous sellers' lead exposure you are not required at all to perform a lead paint inspection and most home still remain unknown status even with transfer of ownership. 

  • Real Estate Investor · Dallas, NC · Member since 2016 · 43 posts · 10 votes
    5y

    All things considered, I think this should be universal! Why are they still just targeting 1-4 units rather than ALL rental properties. It's a sham by the City of Toledo, as per usual. I lived in the city for 47 years and I am well aware of the BS that goes on. It's the typical politics. 

  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    5y

    What I can say is painting and windows can be the biggest expenses. If they go to the swipe test you need to clean both floors and windowsills right before the inspector comes. In an older home no tenant keeps the house clean enough to pass.

  • Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
    5y

    Doctors blood test kids lead level in Ohio? Mandatory in my state.

  • Rental Property Investor · Toledo, OH · Member since 2017 · 257 posts · 215 votes
    5y

    @Marc Rice I have only visited MA once and I have no knowledge of RE laws there. What you said doesn't surprise me and yes it sounds like it creates accountability, but at what cost? It certainly isn't fair and honestly I am surprised a rental property even exists with laws like that. I can see huge liabilities for the hapless small landlord that stumbles into a mess based on laws like that.

    @Renee F. I am with you there. I think you make it a law that applies to everyone, including home owners or no one. Not these selected targets based on who they view has the deep pockets to make a fight out of it.

    @Colleen F. from talking to the lead inspector last week I learned the same thing. She said all her tests were conducted in and around 3 bedroom windows. She said even the old wooden windows, likely with lead paint under everything, could pass as long as they are completely sealed and have been cleaned. My approach is just to buy a bit nicer stuff and replace the windows with vinyl replacements and toss the old wood crap in the trash. Paint the rest of the house very well and possibly replace doors as well. Expensive, yes, but much less likely to cause me headaches down the road and will eventually increase the value of my investment, which is what this is all about.

  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    5y

    Children are typically screened twice for lead at 12 and 24 months. On Medicaid its required and I believe in high risk zip codes but it is crazy not to do it.  

    @Marc Rice I think you mean new owners of rental homes. I just sold my  MA home and bought a condo in MA it wasn't required to lead test.  Disclosure was required that lead may be presented due to the age of the property but since we never tested. We had nothing to disclose.

    @Michael Temple In RI wood windows must be replaced and friction services cannot have paint. It is ok to replace in your case but if you have historic wood windows for some houses the vinyl is just a step down from a well functioning wood window that already has a nice storm.  We had stained wood that still had to be replaced. Also the thing you will run into if you restore a property that has been deteriorating for a while is alot of the lead paint got into the dirt around the house and the trim on the window so that needs to be replaced too.  They can get picky on exterior peeling paint as well. One time they wanted us to paint a stained outbuilding. So hopefully you get something safe and reasonable. 

  • Member since 2020 · 25 posts · 16 votes
    4y

    I passed a test today to find out next time around the carpet same size is going down like .0002 under this, I would have failed. I grew up in Toledo, but I am ready to take my butt back to ft Myers. You would NEVER have these issues in Florida.

  • Member since 2020 · 25 posts · 16 votes
    4y

    BTW the time it took to prepare to ensure I was confident I’d pass prob cost me about $2,000. It took a few months to pass as I was balancing other properties & other items. Terrible experience. My properties always stayed nice and super clean. This makes me not even want to be in residential at all. 

  • Member since 2020 · 25 posts · 16 votes
    4y

    It’s a shake down. The city could offer housing stock improvements by joint ventures, low interest rate loans, tax deferrals or abatements. 

  • Member since 2020 · 25 posts · 16 votes
    4y

    Many landlords in Toledo are elderly & own 2-4 properties. This is frequently a primary means of retirement in addition to SS and pensions. 

    How they are going to pass these inspections I have no idea. I guess they can hire a painter and window installer. But anyone you pay $14 an hour is not going to have the owners best interest in passing. 

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