Working Session

Mayor and City Council Work Session
May 3, 2006 – 5:00 p.m.
A101

Present: Mayor Brown, Bob Brooks, Doug Christensen, Hal Gershman, Gerald Hamerlik, Dorette Kerian, Curt Kreun.
Absent: Eliot Glassheim.

Others Present: Howard Swanson, Rick Duquette, Don Shields, Pete O’Neill, Brad Gengler, Bev Collings, Al Grasser, Daryl Hovland, Saroj Jerath, Emily Fossen, John Packett, Pete Haga, Todd Feland, Jon Dorner, Tu Yen Tran, Cameron Stewart, 13 citizens.

Gershman called the meeting to order at 5:00 p.m.

1) Residential Rental Licensing.

Gershman stated that a group of landlords had submitted a request for some changes in the existing ordinance for residential rental licensing and that the committee would go down the list and review each of the requested changes.

The first requested change was in regard to the three strikes rule in the ordinance. The landlords were requesting that this be modified to include a 12 month period of time during which the three strikes would occur. They further asked that should only one or two strikes occur, followed by 12 months with no strikes that the record would be cleared and start clear.

Marvin Hodny, rental owner, stated that the landlord group had gathered information from 30 cities that do license rental units and that all had some type of verbage like they were proposing and that all would allow for the record to clear with no violations within a 12 month period.

Christensen responded that he does not have a problem with making a change to allow for the record to start over but is not sure whether 12 months is the right length of time to address some of the problems that the ordinance was meant to address. Hodny stated that most other cities use language that says if have one or two violations, but then none in next 12 months then record is cleared.

Hamerlik suggested that perhaps 3 violations in 24 month period as it would be cleaner to monitor. Gershman agreed that with a rolling type system it would be harder to monitor than just having a set period of time.

Robin Loegering, rental owner, stated that she felt that a flat 24 months is unfair to landlords, as if you happen to get a couple of problem tenants, you could get three violations within that time, even if you are responsive and work to get rid of the problem tenant. She suggested that perhaps something be included that would allow the record to start clear if you evict the tenant that got the violation or get the problem corrected. She continued that you might also get a neighbor that is over sensitive and then could get three strikes even though you are working to correct the problem. Christensen responded that this is where the landlord could provide information to the Mayor or administrative hearing officer and they would have the discretion to not suspend or revoke the rental license. Kerian commented that if you are having consistent problems with your tenants, then perhaps it may mean that there may be a need to look at the process that you use to choose the tenants. Kreun reiterated that having the administrative hearing process can help the landlords in that it allows them to provide information as to how they are remedying the problems and then the hearing officer can review that to see if its reasonable or if there is something else like oversensitive neighbors going on and then help to get the problem resolved.

Gershman stated that it seemed that the consensus was to change the ordinance to 3 strikes in a 24 month period.

Gershman stated that the next requested change was to base the suspension or revocation of the license on the action of the landlord, and not the action of the tenant. Some audience members commented that they did not feel they should be responsible for the actions of their tenants, as those are beyond their control. The Council discussed that there needs to be a level of responsibility on the part of the landlord to make sure that the conduct occurring on their property is appropriate, and that they can exercise control to a certain extent over this in the tenant selection process.

Gershman stated that the consensus was to recommend that this item remain unchanged.

Gershman stated that the third request was that any violation of the ordinance be heard in Municipal Court, rather than in the Mayor’s administrative court. Swanson stated that he has a concern in regard to this proposed change, as all other license that the City issues are under Chapter 21 of the City Code and all violations of those licenses is heard administratively and that this license should not be treated any differently. He also commented that if the change were made it could increase the potential cost to the City, as any charge in Municipal Court can be removed to District Court which would greatly increase the cost to the City and the Landlord.

The group discussed that having the violations heard in an administrative proceeding was to the benefit of the landlord, as there is some reasonableness that can be applied by the hearing officer. The discussion continued that this process can also move much more quickly than the court system and that keeping this in the administrative arena does not bring any violations into the criminal system.

Gershman stated that consensus was to leave this item unchanged.

Gershman stated that the next request was to remove the $20 annual fee. Hamerlik stated that there had been much discussion on this at the time the ordinance was initially drafted and that the fee as it stands is very low. He continued that right now we are working on 2007 budgets and are looking at the increased costs and all other licenses that we issue pay a fee to cover costs associated with licensing and does not see that this should be treated any different.

A citizen from the audience stated that he felt it was unfair to only impose this license fee on 1&2 family rentals and not on other larger apartment units. Kerian responded that this was discussed when the ordinance was under consideration and the reasoning is that there are increased inspection costs with these units that are conversions than with larger units that are initially constructed for use as multi-unit apartment buildings. She continued that the issues that are unique to conversions are some that the ordinance was put in place to address.

Kreun agreed and stated that some of these concerns being voiced may be because there are a couple of different groups of landlords that have come about and that some were more involved with the process in developing the ordinance and that it was discussed then the difference in inspections and the need for more frequent inspections. He commented that the $20 cost does not even come close to covering the costs of the inspections.

Christensen stated that he agreed with the historical comments made by Kerian and Kreun and added that this ordinance is in place to address the issues that arise when conversions are done of single family homes to rental units and that there are some issues that need to be addressed. He continued that the inspections of these units are costs to the City and the costs need to be covered and that is done through a fee.

Gershman stated that the consensus of Council is for the fee to remain at the $20 level at this time.

Brooks commented that these consensus decisions will go forward to Council as recommendations and that this will be discussed at an upcoming Committee of the Whole meeting and then a final decision made at the City Council meeting. Swanson stated that he will not have the ordinance rewritten in time to get on the agenda for the next COW meeting, but it should be ready for the second COW in May.

Gershman stated that the next proposed change is to change from the current residency requirement of Grand Forks or Polk County to a 60-mile radius of Grand Forks. Hodny stated that there are some rental owners that live just north of town in Walsh County and that they are closer and feel that they can adequately address any concerns with their rentals more easily than some one who lives on the far edge of Polk County and is much further away in miles. A rental owner stated that he is a property owner and lives in Alvarado and can reach any of his rentals within 20-25 minutes, which may be sooner than someone who lives on the southend of town getting to the northend of town, yet he would be required to have a property manager.

Swanson stated that he has no position on this change and that initially they had drafted Grand Forks and Polk County as it is easily checked, but could also have the 60-mile radius will just need different method of checking. The group discussed that maps could be made available and then could easily see if you are within the 60 miles or not.

Gershman stated that the consensus recommendation would be to change the ordinance to residency within a 60-mile radius of Grand Forks.

Gershman stated that the last proposed change is to delete the request for criminal record in the application.

Hamerlik stated that this also had much discussion when the ordinance was being drafted, but he has no position on whether it should be in or out. The group discussed that should there be a need for this type of information it would be available through other sources, so may not be necessary on the application.

Swanson stated that he had one thing to add and that is that under current ordinance if report is made to Police Department and they respond, that regardless of conviction the administrative hearing officer has ability to make discretionary call such as when neighbor may be just being overly sensitive or when something else might be going on and that there is another sentence that should be removed so that the hearing officer would be able to look further to see if something other than a violation is going on. The group consensus was to make the change as recommended by Swanson.

Hodney stated that he had one other concern in regards to property that may be vacant for longer than nine months and as a result use the ability to continue using it as a nonconforming use. He sited an example of some foreclosure situations where it may take longer than that for the process to go through and then would not be eligible to be a rental any more. Christensen stated that usually foreclosures take less than nine months. Collings corrected that the time limit is actually 18 months vacancy to lose the ability to be a nonconforming use.

Hamerlik stated that the reason this item was initially brought back for discussion was that Swanson found a need to make some changes in the setbacks due to the change from R1 to R2, and that then the information from the landlord group came in and it was decided to include that in the discussion. He asked that Swanson then brief the group on those needed changes.

Grasser requested that before we move to the setbacks that the group discuss one other item in regards to the costs and fees for the rental license. He stated that he has some concern with the fee not covering the cost, particularly when we have already had a lot of problem with people paying late, necessitating numerous reminders being mailed to get the license applications in. He suggested that perhaps Council could consider adding a late fee to help cover some of those additional costs. Collings stated that the usual late fee is that the license fee doubles. Swanson responded that the Council could discuss this, but that there is a penalty of $500 listed in the code for renting without a license and that could be enforced in the event there is a problem getting people to submit the proper license applications and renewals.

Collings asked for guidance from the Council as to the process they would like to see to impose that penalty, as thus far only 1,088 license applications have been filed, which is about half of the 2,004 rental units that should be submitting applications. Swanson responded that the advice he has provided is that for prosecution they would like to see three letters having been sent to the rental owner and that he would be very comfortable proceeding with prosecution knowing that they have been notified three times that they require a license and they have chosen to disregard the notices. He continued that this year there has been some confusion due to the change in the application form and then all the meetings going on talking about potential changes that may be made and that some may be holding off on submitting their license application with the thought that it may be changed or dropped. He recommended sending one final notice following the approval of these final changes and then proceed to uphold what we have passed.

Mayor Brown commented that he would like to discuss the amount of the fee, as it appears that an actual fee of $60 may more adequately cover the costs associated with the license issuance and that in working with the budget if that cost can not be recovered from the fee, that then will have to find another way to cover it. Brooks responded that this is something that should rather be discussed through the budget process and not as part of the discussion tonight. Grasser that he will leave the fee at $15 for this year.

Hamerlik asked that discussion return to the setback issue on which Council received a draft ordinance in the mail.

Swanson explained that as a result of the change in zoning from R2 to R1 in the Univerity Park area there are some changes in the setbacks for side and rear yards that need to be made. He commented that the draft that he provided is the most lenient wording possible and that he believes that the draft will address most of the concerns that were raised. He added that the new wording will not help someone who was not conforming before.

Kerian inquired whether this would then move forward to Planning & Zoning Commission. Swanson stated that Inspections has reviewed the draft and has no problems with it so the next step is to send it to the first meeting in June, after which it will go to Committee of the Whole, City Council and then back for a second reading at P & Z Commission, followed by a second reading at City Council.

A rental owner expressed thanks to the Council for listening to the concerns of the rental owners and encouraged them to look at including other rental units in the City in the license program as most other cities do. Christensen stated that it may be possible that Council will look at including others at a later time. Gershman stated that he is not in favor of expanding the ordinance to include any others.

Hamerlik asked that in the matter of the setbacks, that the draft ordinance be distributed to interested parties and encouraged anyone with comment to express them as the ordinance moves through the process and reiterated that it would be on the Planning & Zoning Commission agenda for the first Wednesday in June. Christensen stated that he feels that the changes will improve the area.

Bob Hoffman stated that he had arrived at the meeting late and apologized if he was asking something that had already been clarified, but requested some clarification on the three strikes. He inquired whether if the police responded to an incident like a domestic dispute at a property if that would also count as a strike against the landlord. Swanson responded that the ordinance states that if any charges are made for certain listed offenses it would count as a strike. He read from the ordinance the charges listed as follows: noisy party, disorderly conduct, resisting arrest, interfering with a police officer, providing alcohol to minors, minors possessing or consuming alcohol or illegal sales of alcohol, and allowing more than four unrelated persons to reside within a rental unit licensed pursuant to this article.

Hodny added that this would then be where the administrative hearing officer could use his/her discretion to determine that steps had been taken to remedy the situation so that it would not lead to a suspension or revocation of the license. Swanson stated that was correct.

2) Government Advisory Committee.

This item will be discussed at next week’s meeting.

3) Adjourn.

Meeting adjourned at 6:00 p.m.


Respectfully Submitted,

Sherie Lundmark
Admin Specialist Sr.