City Hall

Citrus Heights considering $500k proposal for mandatory rental inspections

For Rent sign, modified. // Elvert BarnesCC BY 2.0

Alec Pronk contributed to this report–
Nearly 15,000 rental homes and apartments in Citrus Heights may soon be subject to a new rental inspection ordinance, in a move officials say is needed to prevent blight and ensure rental properties are appropriately maintained inside and out.  The program will be considered for approval by the city council on Aug. 9 and is projected to cost around a half-million dollars per year, funded through new annual fees to be paid by rental owners.

While the city currently has a state-mandated program in place to respond to complaints from tenants about the condition of rental properties, a staff report says the new program would be proactive rather than reactive — resulting in regular interior and exterior inspections of rental properties in an inspection cycle of three years. Details of the proposal were published on the City’s website late Friday in a 9-page report submitted to the city council by Police Chief Ron Lawrence.

The proposal would create a Rental Housing Inspection Unit within the police department that would have a proposed annual operation budget of $505,450, largely to fund the addition of three full-time Code Enforcement officers and two full-time program assistants. An additional startup cost of $145,790 is also proposed to initially come from the City’s General Fund to cover the purchase of two new vehicles and associated equipment, but the staff report states that money would be reimbursed once registration fees are collected.

The majority of costs would be paid by charging rental property owners an annual $95 fee per property, with the fee applied to any single-family or multi-family residence that is intended for use as a rental property. The remaining costs would be paid for through an increase to an existing “Rental Stock Fee” of $12 per unit, which currently funds 75% of Code Enforcement staffing. That fee would be raised to $17-27 per unit, depending on the number of rental units owned.

According to Lawrence’s staff report, of the 14,800 rental units in Citrus Heights, 88% were built prior to 1990, and 44% were were built in the 1970s. The report cites concern regarding a “lack of quality control” during the 70s and 80s, and also notes that critical components of rental units, like HVAC systems and roofing, are nearing the end of their life.

The report also cites research finding that approximately 40% of rental property owners live more than 10 miles outside the city. Of those, the report says a large portion live in the Bay Area, causing concern that such rental units are less maintained as a result of owners’ distance from the property.

Currently, police report receiving about 1,300 code enforcement-related calls a year, with roughly one-quarter of those calls being related to rental properties. With a current staff of three code enforcement officers to respond to calls, the police department says its officers are only able to be 5% proactive with their time.

But doubling the number of Code Enforcement officers would change that, if the new ordinance is adopted.

According to the staff report, the police chief would determine the most problematic areas to be inspected first. Notification would be sent to both owners and tenants 30 days prior to inspections. Tenants would be able to reject an inspection, but rental owners would not be able to refuse inspection if the tenant would like the property inspected.

A rental property with 15 units or less would have a minimum of one interior inspection for all units on the property within the three-year cycle. For properties with 16 or more units, at least 5% of units would be inspected once within the three-year cycle. All rental property exteriors would also be inspected at least once within the three-year cycle.

The program would exempt rental properties built within five years from inspection, and rental units subject to other governmental inspection agencies are also exempt from the proposed inspection program.

Rental properties with over 16 units would be able to attain “self-certification.” If the property passes initial inspections and has no prior code violations, the owner can apply for self-certification in the program’s second cycle. However, these properties could still be subject to random inspections.

According to the the police chief’s report, staff consulted the California Apartment Association (CAA), the state’s largest representative of the rental housing agency, while drafting the proposal. Other unnamed experts were consulted and the report states “staff incorporated some of the suggestions made.”  A representative for the CAA was unable to be reached for comment on Saturday.

If approved by the city council, the program would begin inspections on July 1, 2019.

Similar to Citrus Heights, Modesto is considering a new rental inspection program. According to reporting from the Modesto Bee, the city is facing pushback from rental property owners. Attendees of a Modesto City Council meeting spoke out against the proposed program as a “governmental overreach,” and said it would cost rental owners too much and unfairly target smaller property owners.

Although a public hearing for the proposed Rental Housing Inspection Unit is not on the agenda for Thursday’s council meeting, members of the public are allowed to comment on any item on the agenda before a vote is made. The meeting will be held at Citrus Heights City Hall on Aug. 9, at 7 p.m.

Document: Read the staff report

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