Oct 10

Milwaukee is preparing to expand its mandatory Residential Rental Inspection Program, i.e. landlord licensing.

If you own rental properties in Milwaukee, it is imperative that you listen to this to make future investment decisions and to prepare for the future in general.

The Apartment Association was represented at yesterday’s hearing by Attorney Heiner Giese.

Link to hearing video

Click on item 15 or scroll to 2:03:40 if you want to listen to the background and stats from Commissioner Dahlberg.

The AASEW testimony begins at 2:30 into the hearing.

Link to AASEW written comments

Link to DNS PowerPoint (as PDF)

Listening to the hearing you get a good feel for which Aldermen appreciate our work and financial investment, and those who don’t.  Aldermen Perez and Donovan clearly understand the difficulty of our industry. Alderman Donovan’s email asking the proposal be held.

I urge you to speak to the Aldermen that represent the area where your properties are located.  Explain to them the challenges and hard work that you face on an ongoing basis. Also point out how DNS does not evenly enforce codes, but holds rental properties to a different standard.

If you are a Southside landlord, I am setting up meetings with both Donovan and Perez.  If you have properties in either District please email me with your concerns, whether you are interested in attending the meetings and which District your properties are located in.

Finally, if you are not a member of the Apartment Association, you should consider joining.  For $99 a year you not only will learn a lot about how to be a more effective and profitable landlord, but a portion of your dues goes to fight things like this.  More information on the Association  or join online

Sep 28

Taxpayer’s leasing activities are not only non-charitable, but also commercial. The manner in which a business is carried out indicates whether its purpose is exempt or commercial. Living Faith, 950 F.2d.at 372. If an organization competes with commercial entities, uses market pricing, and other terms, and accumulates a large surplus, it will be deemed to operate for commercial purposes. Taxpayer provides normal property services to its tenants, presumably in competition with for-profit landlords, and has accumulated a very large surplus. These factors lead to the conclusion that it is operating for commercial purpose. See B.S.W. Group, 70 T.C. at 358, Living Faith, 950 F.2d at 373. Therefore, Taxpayer’s rental activity during the examination years constitutes a substantial commercial purpose, and this activity is fatal to Taxpayer’s exemption. Better Bus. Bureau. 326 U.S. at 283.

http://www.irs.gov/pub/irs-wd/201438034.pdf 

Sep 27

The AASEW’s ever popular Landlord Boot Camp is just around the corner.  It will be held on Saturday, October 4, 2014 from 8:30 am – 5:30 pm at the Clarion Hotel located near the airport.

At this Fall’s Boot Camp I will be updating everyone on how the courts have been handling and interpreting all of the law changes since Act 76 was passed back in March of this year.

I will also address numerous other of topics that will help you navigate Wisconsin’s complex landlord – tenant laws.  Learn how to run your properties with greater profit while staying out of trouble.  Landlording can be pretty complex, with a seemingly never ending myriad of paperwork, rules, landlord-tenant laws and simple mistakes that can cost you thousands.

Some of the other topics that will be covered include:

1) How to properly screen prospective tenants

2) How to draft written screening criteria to assist you in the tenant selection process

3) How to comply with both federal and state Fair Housing laws including how to comply with “reasonable modifications” and “reasonable accommodations” requests

4) How to legally reject an applicant

5) What rental documents you should be using and why

6) When you should be using a 5-day notice versus a 14-day notice, 28-day notice, or 30-day notice and how to properly serve the notice on your tenant

7) Everything you wanted to know (and probably even more than you wanted to know) about the Residential Rental Practices (ATCP 134) and how to avoid having to pay double damages to your tenant for breaching ATCP 134

8) When you are legally allowed to enter your tenant’s apartment

9) How to properly draft an eviction summons and complaint

10) What to do to keep the commissioner or judge from dismissing your eviction lawsuit

11) What you can legally deduct from a security deposit

 12) How to properly draft a security deposit transmittal  (“21 day”) letter

13) How to handle pet damage

14) What to do with a tenant’s abandoned property and how this may affect whether or not you file an eviction suit

15) How to pursue your ex-tenant for damages to your rental property and past due rent (and whether it is even worth it to do so)

There will also be time for “Q&A” and Lunch is included!

If that is not enough you will also receive a manual that is over 100 pages that includes all of Tristan’s outlines on the various topics and various forms.

 Who:         Taught by Attorney Tristan Pettit, who drafts the landlord tenant forms for Wisconsin Legal Blank.

When:       Saturday, October 4, 2014  from 8:30 AM – 5:30 PM —- Registration opens at 7:00 AM

Where:     Clarion Hotel 5311 S. Howell Avenue, Milwaukee

Price:        AASEW Members only $159 .  Non AASEW Members  – $249

Register:    Go to www.LandlordBootCamp2014.com and you can register online and read prior attendees testimonials.

Last year’s AASEW Landlord Boot Camp was filled to capacity.  So much so we even had to turn people away.  So register early to reserve your spot.

I hope to see many of you there.

Thanks

Sep 18

Over on the ApartmentAssoc Yahoo Group an owner asks who is responsible for the costs associated with “Reasonable Modifications”, in this case a ramp.

An owner must allow the ramp as a reasonable modification.  The tenant must pay the costs associated with the modification.

JOINT STATEMENT OF THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AND THE DEPARTMENT OF JUSTICE REASONABLE MODIFICATIONS UNDER THE FAIR HOUSING ACT

Who is responsible for the expense of making a reasonable modification?

The Fair Housing Act provides that while the housing provider must permit the modification, the tenant is responsible for paying the cost of the modification.

www.hud.gov/offices/fheo/disabilities/reasonable_modifications_mar08.pdf

With this said, there are groups that provide assistance of grants in some cases to facilitate such modifications.  One place to start is:

http://county.milwaukee.gov/DSD/Disability-Resource-Center.htm

You may find that the modification creates a long term tenancy as well as a marketable benefit for future tenants.

Note that for “Reasonable Accommodations” the owner must bear the costs if those costs are reasonable.

What is the difference between a Reasonable Modification and a Reasonable Accommodation?

A reasonable modification is a physical change to the interior or exterior of a unit or property, such as installing a ramp.    A reasonable accommodation is a change to your policies; such as allowing a service animal in a property with a no pet policy.

Sep 02

Over on the ApartmentAssoc Yahoo Group we had a discussion about the number of foreclosed properties Milwaukee has for sale and how the city limits sales to owner occupants.  Orv Seymor replied:

You are missing the point, the city does not want any investors buying or rehabbing any of these properties.

They want control over the entire rental market in Milwaukee or they want to be able to say that they made these bldgs. available on the private market before they tore them down and built new housing with taxpayer dollars, which again, would give them control over the entire  rental market in Milwaukee.

You see, they cannot stand to see anyone make a profit when they in the  housing business

I believe the City’s motivation is more perverse than even Orv’s opinion.

Rather than trying to control the entire rental market and therein the profits as Orv suggests, I would argue these sales restrictions by the city are just another part of the process in which the City’s attempts to exclude the poor and racial minorities from Milwaukee.

Other tools in the City’s toolbox include excessive property tax assessments of lower valued neighborhoods, disparate code enforcement practices that ignores worse conditions at owner occupied housing, while excessive enforcement of even petty violations on rental housing occupied by poorer or racial minority tenants, as well as differential rules for owner occupied and rental housing.

Evidence of this argument? Look at sales of Milwaukee Eastside, Southwest Side and Bayview homes, cash or conventional financing, compared to their assessments. Then do the same with sales, cash or conventional financing, of properties in the 12th or 15th Aldermanic Districts. Those in the higher valued neighborhoods are selling at or above the assessment, while those in the lower valued neighborhoods are selling for often less than 35% of assessment. The effect is lower income occupants have a higher tax burden than more expensive homes as a percentage of their home’s value.

The next time you get an exterior order take a look around the block. Look up the neighboring properties that are in similar or worse condition on the City’s property information site. Most often you will see the owner occupied properties, and even those were the tenants more closely match the race of the neighbors, are ignored. You may, with a bunch of effort, even find the Alderman was behind the complaint. If the City truly thought this was legal, why do they fight so hard to hide the fact that city employees or officials were the complainant .

Then make a complaint to DNS on those adjoining properties and demand that DNS holds these adjoining properties to the same standard as they hold yours. If you are extremely persistent they may even write orders on the worst of those neighboring properties. Go back and review the records and the properties six months later. Often you will find the orders on those adjoining properties show on the City’s computer as being complied with, even though many of the violations remain. The disparity is so ingrained that when asked, the inspectors often justify their actions with social economical arguments that have nothing to do with codes or housing conditions.

On our properties I document these things with written complaints, screenshots of city records and, in aggregate, thousands of photos of our properties and those adjoining. I urge you to do the same. If you wish to share your documentation with me that would be great.

In part Milwaukee stole a page from the St Paul MN playbook, as evidenced by writings between our former Commissioner of DNS and his St Paul counterpart that were obtained by St Paul, MN landlords’ during discover in one of many federal cases St Paul landlords have filed against their city’s (alleged) discriminatory and disparate inspection practices. One St Paul case was accepted by the US Supreme Court only to have the Obama Administration pressure St Paul into dropping their bid for review by the SCOTUS on the eve of oral arguments.

A St Paul official expressed the view at a public hearing that if you ‘Get rid of the nest, you get rid of the vermin’ (Not at the office to grab the actual quote, but this is close) It seems like this too was a sentiment adopted by Milwaukee’s leadership and those sentiment have spread to surrounding communities. Make it impossible to provide housing for certain classes of people to live in your city and they all go away.

Disparate housing code enforcement, rules affecting only certain classes of properties, property tax assessment schemes that put greater burdens on poorer neighborhoods and restrictions on purchasing, all aimed at making it difficult or unreasonable for members of protected classes to live in a city is not proper use of police powers. Preventing these type of discriminatory policies is really the foundation of all Fair Housing laws.

If a city is to employee housing code enforcement and property tax assessment in a manner to drive out certain social economic groups, then those efforts should be funded by the kkk, not taxpayers.

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