All Forum Posts by: Christopher Sandys

According to ORC Chapter 5323:  "No owner of residential rental property shall fail to comply with the filing or updating of information requirements of section 5323.02 of the Revised Code or shall fail to satisfy the designation of agent requirement or the filing of the appropriate designation of agent document requirement of section 5323.03 of the Revised Code. The county auditor may impose upon any person who violates this section a special assessment on the residential rental property that is the subject of the violation that is not less than fifty dollars or more than one hundred fifty dollars."

Nothing about a criminal violation.  Just a $150 fine for failure to register.  That's the Ohio portion.

City of Toledo announces updates to lead-safe paint certification (msn.com)

Registered and Compliant by 31 March

"If you fail to properly register with the county auditor or fail to obtain a lead-safe certificate for your property you may be charged with a misdemeanor of the first degree pursuant to TMC Section 1760.99. Additional penalties and/or fines may be assessed under TMC Section 1726.99 and ORC Chapter 5323."

Does anyone know where I can find the most current version of the TMC [Toledo Municipal Code]?  I would like to read TMC Section 1760.99 and 1726.99.

That is absolutely wonderful news @Michael Temple, that Ohio has preemptively shut down any and all attempts to control rent.  The political leanings of the State Legislature are at the other end of the spectrum from the Toledo City Council.  

@Darius Ogloza There's no way Fatboyz would pass that exterior, visual inspection!  But it is Friday night, and I'm feeling frosty.  I might take a trip the other city (East Toledo - over a bridge) and check out what all this Fatboyz excitement is all about!

A more serious note, the Toledo Early Bird Matching Grant program is a HUD Community Development Block Grant. HUD has strict, published rules on how much of the grant can be used for program admin under their document "State CDBG Program Eligibility Requirements." See them here:
State CDBG Program Eligibility Requirements | HUD.gov / U.S. Department of Housing and Urban Development (HUD)

The City of Toledo tells its businesspeople to provide kickbacks of their HUD grants to their counterparties to effectuate City administration of this HUD program. Why isn't the city paying for this aspect of the program administration? Why is the City instructing us to spend an unspecified portion of the grant, which is designed to benefit the underserved, as a kickback to tenants? Is the City of Toledo defrauding HUD, or engaging in reckless program management? It sure looks that way. I'm not saying I put a call into the Cleveland Field Office for HUD, but someone may have initiated just such a call this afternoon.

While we're talking about the [supposedly] altruistic intentions of this policy, let's not forget that anyone over 50 years old (like me) grew up in fully-leaded homes.  It was in our gasoline for all our cars.  It was everywhere.  

The peak of the crisis is long gone.  The pre-1978 homes will eventually have their windows replaced.  The interior wet plaster will eventually be replaced with sheet rock and new paint.  This is a self-correcting problem that has been on the mend for over 4 decades.  And it gets better every year with every new coat of paint and derelict home that is destroyed.  

Not for one second do I buy this public crisis proclamation.  It's not rational.  However, I do like homes that are properly maintained, @Andrew Fidler.  

If there were no Federal HUD money going to Toledo to abate lead, would Toledo be abating lead? I think not.

Oh man, the dreaded rent control! There is a huge list of negative externalities that are well known consequences of rent control.  I wouldn't be surprised, given the level of financial illiteracy I've observed in a short period. And I already know which group of underserved and disfranchised people it would harm the most.  Councilwoman Williams, care to guess? 

I do not know if I fully agree, @Darius Ogloza, that the Toledo market has that much excess capacity.  Thankfully, the Lucas County Land Bank has been demolishing lots of trash homes.  Demographics of an aging population... Toledo has been on the downswing since the early 20th century.  It looks like it has finally stabilized.  If Toledo wants to learn from locales that are doing things correctly, look to where people are in-flowing.  Cities and States that are business friendly.

You are Marin County?  I lived in LA in the 90s (Hermosa, Redondo, & West Side).  California is a different planet, now, and not for the better.  I hear the Bay Area has been hit the hardest.  One of the most beautiful places with tremendous natural and cultural beauty - being destroyed through business-hostile policies.  Will Toledo follow that example?  Who knows - they just might.  

It's pretty sad that as a business man my local government is properly described as "opposition."  What does that say about Toledo?

Hi Andrew,  thank you for the reply, and nice to meet you.  I fully understand and agree that I purchased the property at a discount attributable to factors that I need to fix.  I spent $64k on acquisition, and another $6k on materials and 6 months of sweat equity to get it to where it is now.  I do not want to be a slum lord; I want my properties to an asset to the community.  

I do not, however, want to risk a criminal indictment for not working quickly enough to fix my property.  The City of Toledo's response is that I need to forgo rent until it is compliant, and it looks like I have choice given the potential penalty.  My tenant will live rent-free, and I will invest further.  My $64k house will be an $88k house by the end of 2023.  It will be very nice.  Gentrified, as someone in this thread dare speak earlier.  And the rent will reflect that gentrification.  And my message to Councilwoman Vanice Williams is that the group that will carry the ultimate financial burden of my upgrades will be (in her own words): "Toledo’s vulnerable communities; black and brown people, and low-income residents."  Nice work, councilwoman.  Way to go.

Macroeconomists call this "Cost Push Inflation."  THAT is what Toledo City Council is doing to its citizens. The demand for housing is inelastic.  Long ago I became utterly astounded by the lack of financial literacy possessed (or not) by elected officials and most of their hired bureaucrats.  That's not just Toledo, but I experienced it first-hand on the state legislation level in Connecticut.  

It's not the goal I have an issue with. It is a virtuous and worthy goal. It is the implementation and execution I can most aptly describe as Kafka. I am reaching out to HUD to discover if they know that the City of Toledo is advising landlords to give HUD money kickbacks to tenants. I mean ... it's HUD money with HUD strings. Is that legal?

(Michael P - Nice wit; well done!)

I'll throw a little more fuel onto this Kafkaesque Fire.  There is an "Early Bird" matching grant program, ostensibly to help landlords meet compliance minimums.  One needs to perform the repairs, and request the city reimburse them for 50% of their costs.  Presuming the reimbursement program works precisely as promised, this seems like a no-brainer.  However, there are two strings attached:

1. It must be rented at or below HUD's Fair Market Rates

2. Tenant's annual income must be below 80% AMI

Now number 2 is utterly absurd.  My tenant works 60-hour weeks at Dana Corp.  He swaps his life for income, which is virtuous.  But it disqualifies me from being able to apply for the Early Bird matching money.  That money is only for landlords that rent to people who cannot afford rent.  

How do they even enforce this, you may ask.  You, the landlord, are required to submit your tenant's IRS Form 1040.  You think I'm kidding.  I may be a witty guy, but I'm not clever enough to make up something that absurd.  
Early-Bird-MG-Packet-FINAL-1.pdf (toledoleadsafe.com)

This gets even better!  How do you convince your tenant to give you a copy of their 1040?  I know there is no way I would give that info to my landlord.   Well, the City has a solution for that (detailed on page 5 of the linked PDF).

" Some rental owners incentivize tenant participation by passing along the savings from this grant in the form of a gift
card."

I am not a lawyer, but I have to ask: Is that even legal?  Where I come from (Toledo), they call that a "kickback."  Don't think that since this came from the Mayor's office that it must be legal.  From what I've seen, Toledo government is not attracting the best and the brightest.  These dolts are making stuff as they go... evidenced by years of their policy and its implementation being curbed by the courts.  

The only solution I can see at this point is to cease collecting rent from my tenant until I can get it Lead Safe Toledo compliant.  I am not going to risk a criminal charge to collect rent.  

If there is anyone on this thread that is actively involved in the lawsuits against the city, then I send you my sincerest gratitude.  I am so appreciative that someone is challenging these pathetic, little tyrants.  I'm also willing to throw in a $100 towards the legal fees.  If every landlord threw in a $100 per door per year, then we would have a pretty nice war chest for legal and lobbying.  

"First-Degree Misdemeanor."  

A criminal offense?!  180 days in prison and a $1,000 fine ... for not painting your house - quickly enough.  This is going from bad to far-worse.  Maybe they should just cut to the chase and make it a felony.  This is particularly ironic coming from the Toledo City Council - 1/3 of which is currently under criminal indictment.

I had an email conversation with the Lead Safe Coordinator last Friday, exactly one week ago.  I said: "My concern is that I could be in the process of allocating funds and manpower to ensure that my property passes an inspection, and in the interim, I am flagged by your inspectors for being noncompliant. My understanding is that there are severe penalties for noncompliance. Is that a realistic concern?"

She acknowledged that it is, indeed, a valid concern.  She added that she is not currently enforcing the ordinance.  That provides a modicum of solace, because of the qualifier "currently."  There is no way to paint a house exterior in winter.  I need to save up (I'm guessing) about $6 grand for that, and I will be able to do that by June.  The rental income will not come close to covering that; I have the benefit of outside funds.  Then I have to address the interior.  Ideally, that will mean new windows, which is an upgrade I would like to accomplish over the next 5 years as rental-cashflow permits.  Now I'm starting to think - screw these guys.   I will perform the bare minimum to be compliant, and raise rents accordingly.  

Someone has to pay for this, and it will the citizens of the "underserved communities."  They will no longer be underserved with their nice, new paintjobs.  Fortunately, the tight rental market will allow me to execute this strategy, and push those costs onto the backs of the people they are trying to serve.  Absolute fools playing games with economics, a discipline they do not understand.  

I am a new owner and landlord of a 1917 single-family house in Old Towne. I just recently learned of this Lead Safe Toledo initiative, and it's pretty shocking. I bought the house for $64k, put $6k in repairs into it, and am renting it out for $1100/month. That may sound like a decent return, but I am paying ~ $100/month for trash and water, $560 on tax/PMI/insurance/principal/interest, plus about another $100/month on routine maintenance and upgrades. That is only $340/month net, in a perfect world (prior to income tax). As a total return, considering leverage, it's really nice. But considering an entire exterior repaint, plus some interior - I am in the red for a few years. Replace windows? Forget it. Even if I do the labor myself, this might be over a decade of operating losses.

My renter was well screened.  He is not poverty stricken, so there is absolutely no free government cheese for me.  

I could stomach this IF it were somehow legal.  How does this even come close to passing a smell test on the 14th Amendment Equal Protection Clause?  They target only a tiny portion of residences - the one's who's owners are the least capable of defending themselves against the oppressive arm of the government. There is no stipulation as to whether or not children are living in the house.   What about +4 units?  What about non-rentals?  Do not their children get equal protection under the law?  This is nothing more than a tremendous and ill-conceived government money grab.  

I have a call into the mayor's office.  Kaptur returns my calls.  DeWine returns my calls. Wade is batting zero in this regard, which speaks poorly of him.   I would bribe city council, but the DoJ cut-off that avenue.  (Just kidding on that last remark!)

If you are going to apply a law, apply it equally for the benefit and punishment of all, not simply to manhandle the most vulnerable.