Certified: Uncovering Lansing´s hidden rental crisis

Bancroft Court is a quiet street nestled in the Genesee Neighborhood on Lansing’s near west side. The house at 816 is a mustard yellow two-story, three bedroom, single-family home built in 1916, decorated with flowers in a new bed. Children’s toys are on the porch and yard.

The exterior masks an appalling interior.

Since George VanDouser, 42, and his family moved into the rental home last year, it’s been a health and safety nightmare. The deadbolts don’t work; they bar the door with twoby-fours. Lights go on and off randomly. A shower upstairs drips water into the kitchen below onto anyone standing at the sink. There is standing water in the basement and mold in the corners. A shorn-off and ragged pipe sticks out of the wall. When it rains, VanDouser said, the water comes out of the pipe “like a faucet.”

The VanDousers’ substandard housing is what hundreds — more likely thousands — of low-income families in Lansing call home. It’s a problem made worse by dated technology and insufficient staffing in the city’s Code Compliance Office, city officials and landlords said. The result is a flawed system of inspections that leaves families like the VanDousers vulnerable and powerless.

VanDouser agreed to speak to City Pulse while acknowledging that the house, for which he pays $750 a month, would be subjected to increased inspection scrutiny as a result of this story. He feels he has no other option.

“I’ve lived in this house for nearly a year, and it’s beating me,” he said.

He lives here with his wife and two children, a 15-year-old daughter with asthma and other disabilities and a 12-yearold son. His two 2-year-old grandchildren visit “at least three or four times a week.” His brother-in-law just moved in.

The family survives on his disability checks and monthly Social Security payments. Like other low-income families, there are limited housing options, and what is available often is substandard. Complicating the situation, not all of Lansing’s rental properties comply with city’s rental registration laws. Some properties are not registered at all, while others have expired rental certifications as they await inspections.

An investigation by City Pulse has found that of Lansing’s identified rental properties, 42.53 percent are certified rental properties. That means they are fully inspected and all fees have been paid. Just over one third of Lansing’s identified rental properties have an expired certification or are in some process of complying with city housing ordinances. In addition, owners of 23.27 percent of the properties have withdrawn them from the certification process — which may include properties still being rented, albeit illegally.

Overall, over 30 percent of Lansing’s housing stock has been identified as rental. This figure includes single-family housing as well as multiunit rentals in the city.

Randy Hannan, chief of staff to Lansing Mayor Virg Bernero, acknowledged the city’s ability to manage rental properties is “imperfect.” He said part of the problem is trying to get high quality data out of the current technology.

He compared the situation to trying to obtain high definition quality digital imagery while using only a film camera.

Rental housing has come to the fore in City Hall because City Councilwoman Jessica Yorko, who represents the 4th Ward (coincidentally where the VanDousers live), has taken it on.

“I’ve been aware for the last few years of Lansing having a rental housing problem,” said Yorko, who lives near the VanDousers. “But these are the first hard numbers I have seen.”

Yorko said the entire system is broken, something Hannan challenges.

“I think that’s an overstatement,” Hannan said. “The system works reasonably well.”

He conceded that technology problems and a backlog in inspection appointments do lead to properties’ falling through the cracks. And that’s the case with the Van- Douser home. Had staffing been at full force, the property would have been inspected by city officials and the problems identified before City Pulse brought the issues to the attention of city officials.

Under current law, single-family dwellings like the VanDousers’ are inspected by code compliance officials every three years. Those inspections provide the property a “certification.” Sixty days before a property’s certification is set to expire, the city sends the property owner a notice. An owner has to appear at the city´s Code Compliance Office, pay a re-inspection fee and schedule an appointment for that inspection. While awaiting this re-certification, the property is listed as expired in city records.

The VanDouser rental was certified in August 2012, but that certification expired earlier this year. City data, publicly available on the city’s property portal, do not indicate when the certification expired, nor does it show when, or if, the city will reinspect the property. It does show that during the certification process in 2012, former landlord Willie Dillard was cited for safety issues. It is unclear, however, what those concerns were.

While the city records specific violations in its database, it does not make those violations or the results of specific inspections publicly available on the website.

It isn’t only tenants who are affected by the city’s policies and practices. Landlords tell City Pulse they can wait as long as six months for that inspection, leaving the property as “expired” in property records during that period. That does not necessarily mean a property is unsafe, it just means the city’s backlog prevents city inspectors from immediately inspecting and recertifying properties.

During last week’s meeting of the Public Safety Committee of the City Council, the lead housing inspector for the city acknowledged the backlog.

“If you look at [the city’s online property portal], you’ll see a lot of expired ones,” Scott Sanford told the committee. “That’s because we are scheduling inspections so far in advance because of staffing issues.”

Right now, the Code Compliance Office has seven housing inspectors on duty and an open position that has been funded. City officials said they are working to find someone to fill that post. The city also has three positions funded for premise inspectors, who inspect properties for violations such as weeds, disabled vehicles and garbage. None of those funded positions is filled, and the city is paying a contractor to conduct this work. Housing inspectors are also authorized to issue premise violations.

During the budget process earlier this year, Yorko proposed doubling the number of officers tasked with inspecting the inside of properties. The Bernero administration and City Council rejected that proposal, saying it would have cost nearly $900,000 this budget year, and more in following years.

In addition to more boots on the ground, Yorko wanted to require annual inspections of all rental properties in the city. According to records, there were 13,686 identified rental properties in Lansing as of April 20. That’s out of 45,416 properties. Currently singlefamily rental units are being inspected every three years, unless there has been an inordinate number of premise violations in the proceeding period. In that instance, certification is for two years only.

During the budget fight, the city administration assured the Council it had the staffing to properly monitor, inspect and enforce the city’s rental laws.

“I’m trying to reconcile the statements I heard from staff in hearings and committee meetings with what I hear is happening in the community,” said Yorko. “I can’t do that. The staffing situation is a problem.”

Hannan agreed that staffing is a concern, but believes it is difficult to measure the effectiveness of the Code Enforcement Office without a full complement of funded employees doing their jobs.

“No one wants unsafe housing in the city, no one,” Hannan said. “But you can’t just throw more resources at it. You have to look at it and figure out what is going on.”

Ultimately the whole issue of rentals comes down to resources: Resources for the city to enforce its laws, resources for property owners to improve their properties, resources for low-income residents to pay for safe, stable housing.

Experts in the housing issues of the city told City Pulse that much of the ongoing crisis stems from the housing collapse that began in 2006 and Great Recession that followed. They said to imagine properties on a continuum from poor to outstanding. When the crisis hit, those properties on the lowest end have been lost to tax or traditional foreclosure. That has made marginal properties out of ones that were doing better. A result is the landlords are struggling to keep them up to code. The property owners simply don’t have the cash flow to invest in and improve the properties.

Many properties that were victims of the economic crisis and tax foreclosure face demolition. The cost to tear them down is cheaper than fixing them up. So Ingham County in cooperation with the city has embarked on an unprecedented blight removal program. In the next year, 240 properties will be demolished by the two agencies, many of them properties obtained by the Ingham County Land Bank after they were taken in tax foreclosure.

Property tax revenues plummeted as a result of the bursting of the housing bubble, leading to statewide municipal funding problems. But this struggling to stay afloat and invest and improve properties adds to that problem.

Lansing city government was able to weather the economic storm because of its strong rainy day reserve fund, but a decade of cuts from revenue sharing took its toll, Hannan said. The city has one-third of the staff doing the same amount of work a decade ago. So when an already strapped department is down an employee, the workload piles up — as has happened with code compliance and rental inspections. There is little room for error.

The mayor has created an internal ad hoc working group to “take a deep look at the data” related to rental properties, Hannan said. Using that data, the group hopes to recommend specific changes in technology and possibly staffing in the fall. Those recommendations would be used in the development of the next fiscal year budget, which goes into effect July 1, 2016.

Ultimately, concerns about safe housing is about the health and safety of the community.

“When rentals are inspected on a regular basis, you have concerns with impoverished people who are already at risk for health issues being put at higher risk,” said Julie Powers, executive director of the Greater Lansing Housing Coalition.

Eric Schertzing, the Ingham County treasurer who chairs the land bank, said Lansing is dealing with a fundamental reality facing many communities in Michigan and across the nation.

“They’re the recipients of the carnage of the economy,” he said of the properties, the owners and those looking to rent.

“People use houses and houses use people,” Schertzing said. “But how do communities keep those houses — and by extension those people — safe? I don’t know the answer to that.”

In April 2015, City Pulse submitted a Freedom of Information Act request to the city of Lansing seeking the city’s databases of all properties on the tax rolls and identifying the taxpayers of record on each property. On April 20, the city compiled the data, which serves as a snapshot in time of the city’s property rolls. Using the released data, City Pulse was able to identify properties as well as reveal technology problems for the city. While the city has access to these databases of property rolls, they do not have the technological capacity to run specific searches. For instance, the city cannot run a report identifying code compliance contacts for ta specific property. In order to do that, city officials would have to hand search each and every property entry in the online property portal BS&A, a time-consuming job.