Define "uninhabitable"... (repair/tenant issues)

[Jason Sinclair]

Thank you so much to anyone who dares read this and throw me any opinion or ideas on how to proceed. Above is the snippet from our lease the tenant signed. 

Tenant was out of town for a week, during which time the neighboring unit in the townhouse had a clog cleaned out from their kitchen sink that then landed in the joint stack. The neighbor's water then, for a week, backed up into my side's kitchen sink, onto the floor, through the floor, into the ceiling below, the ceiling fell through and finally the neighbor noticed water on their side and stopped using their water. My tenant made it home to a basement ceiling having collapsed on his furniture, immediately notified me. I immediately put in a claim with my insurance, they sent a remediation crew and it has been two more weeks until I could get a definitive answer from a plumber that we need to replace the cast iron piping and stack shared between us and the neighbor (her insurance won't pay anything so I'm needing to do it just to get it done). 

I am trying to figure out where I am legally with the lease, if I want to cut him loose (young person who has only partially paid rent so far as he is complaining about the TurboTenant charges for paying with a card, then got a money order in two differing amounts while still falling $200 short) or try to keep him as he has signed a two year lease. 

The tenant has paid for a mold test and has texted me that he has asthma and cannot stay in the townhouse although the utilities are on and he can sleep, go to the bathroom, shower and cook. The flooring in the kitchen is up, the main level bathroom is disconnected but the upstairs bathroom is fine. He has multiple bongs for smoking marijuana, and a number of empty joint containers lying around so I can't believe he actually has an asthma problem. I have no problem with a young man smoking after a long day's work as an insurance adjuster (although he didn't have any renter's insurance to cover his ruined speakers in the water leak). He was inquiring if I had ALE insurance to cover his having to spend a few nights in a hotel but I do not. 

Should I try to keep him?

Can I keep his deposit if he wants to break the lease early as it is by my definition inhabitable?

Should I reduce rent for the month the house is partially inhabitable?

It is the 21st of August and we still don't have full rent and he has been charged $50 a day ($1050 in late fees), should I try to collect those but return the deposit and cut him loose?

Very excited for a whole new kitchen and drywall and I was excited for a no-maintenance tenant but this turned out to be the opposite just because he hasn't paid rent (keeps wanting to convince me to use Venmo... no thanks). 

My apologies for the scatter-brained writing, trying to keep it concise as I know if you are reading this you understand the value of your time. Thanks to any inquiries or suggestions. 

Very humbly, 

Jason