Rental registration realities

Austin’s City Council will be voting on adoption of a rental registration regime this week. Two reports by of the University of Texas Law School Community Development Clinic are the key documents driving the policy case in favor of rental registration. So, are the Clinic’s arguments compelling?

First, let’s be clear about what exactly I mean by ‘rental registration’.

Local discussions often conflate the term ‘rental registration’ (herein, I will simply refer to it as ‘registration’) with completely distinct code enforcement policies such as investing in additional inspection and enforcement capacity, changing operational focus, or updating local code regulations. Practically speaking,  registration is fining or preventing leasing by some set of rental operators if they fail to fill out a form with contact information and descriptive data about their building. In the discussion below, registration will be taken to be mandatory form-filing.  This will help clarify its distinct contribution to public value.

With that important clarification, here are key takeaways after examining the Clinic’s reports’ arguments.

1. Forms don’t confirm serious violations. Inspections do.

The reports – as well as the proposed “Spelman” and “Tovo” ordinances – aim to reduce the number of Austinites living in ‘sub-standard’ housing.  Some sub-standard conditions are worse than others but the reports are fuzzy about what precisely to prioritize. It is implied that internal and structural problems that might lead to tenant dislocation (a few hundred per year) or death (2 cases occurred twelve years ago) are very important.  Additionally, one of the papers cited by the reports focused on different North Carolinian registration efforts and advanced housing fires as a metric.

The current problem is that not all serious sub-standard (i.e. dangerous) conditions that might lead to displacement, death, or fire are known.

rental_reg_quadsHow does requiring landlords to fill out a form directly help with the ‘deep red’ quadrant representing unknown danger? It doesn’t.  Even if we make the completely unrealistic assumption that the data in the forms will be perpetually high quality and that the worse actors will dutifully fill out the form, the registration process itself doesn’t yield much insight about a property’s condition.  A physical inspection is needed.

The data gathered in the form – such as current contact information for the person with management responsibility for a property – might be of value during enforcement actions after a property is classified as dangerous.  But this just makes the case for scarce resources being allocated towards maintaining high quality data on problem properties instead of the entire city.  This targeted focus is the approach taken by the Spelman ordinance, whereas the Tovo ordinance aligns with the broader focus recommended by the Clinic.

2. True public value is locked inside inspection operations ‘black box’. Registration is tangential.

Given that registration itself yields no insight into the unknown-and-dangerous quadrant without inspections, the real potential source of public value is improving the allocation of inspection resources, as well as considering additional investment in inspection resources.

The Clinic’s reports describe the current ‘complaint-driven’ algorithm for inspection prioritization as basically first-in-first-out (FIFO) with some ad hoc bumping for complaints that might be dangerous.  In addition, there is no set policy as to which inspections will become ‘comprehensive’ and attempt to uncover dangerous structural conditions. It appears to be left to the discretion of the individual inspector.

The reports make a compelling case that the current operational algorithms miss dangerous conditions.  The report doesn’t specify how many Austinites are impacted by the misses.  Remember though, that displacements mentioned in the report number in the dozens to hundreds per year and deaths are extremely rare.  The goal is to get those units perpetually to zero.

The reports advocate supplementing the existing FIFOish algorithm with broad inspections. Specifically, properties that are older than five years and have more than two units should get externally inspected with some unspecified share of internal units inspected.  There is no specific recommendation of how often properties should be inspected, but the benchmark communities aim for covering the entire target universe every 2-5 years.  The reports urge that properties with repeated violations should be inspected more frequently.

A broad approach will certainly rack up the number of sub-standard conditions that the City is aware of and is likely to reduce the number of incoming calls since inspectors are out churning through properties.  But will it be better at catching dangerous conditions on a timely basis?

This remains unclear. It really comes down to the details on the number of inspectors, the operational algorithms, and the underlying distribution of dangerous conditions.  If not enough inspection capacity is allocated or if it is too dispersed, then we could see the same displacement, death, and fire numbers because the inspectors will be covering a broad swath of less-than-perfect-but-not-dangerous properties.

For example, it is completely unclear if the ventilation violation that led to the deaths cited in the reports would have been caught if we had inspections every few years. This is because of how quickly the illegal conversion and ventilation issues led to the deaths.

The lack of quantitative rigor in understanding the actual pipeline size of properties that might soon lead to displacement or fire is one of the telltale signs that the discussion around registration is not sufficiently data-driven at this point.

Before investing in more inspection resources or a broader inspection mandate, I’d suggest improvements to the code enforcement ‘black box’ of operational algorithms.  Using existing data, it might be possible to predict which buildings are likely to lead to displacement or fire using basic statistical techniques like regression. If New York City can do it, we certainly can.  And obviously this approach is much more resource efficient than adding inspectors and throwing them at the haystack.

It is important to note that having landlords fill out forms is tangential in improving the operational algorithms.  Multi-unit properties are known from existing tax records and problem properties are known from past code violations and enforcement actions.

  3. Compliance is the actual bottleneck to change. Investing in compliance should be prioritized.

In addition to registration, the Clinic’s reports make several additional recommendations intended to support the transition of dangerous properties into compliance.  The recommendations include investments in information technology and legal staff as well as changes to certain practices.  These investments in compliance are the actual major bottleneck to improving lives – what’s the point of increasing the number of diagnosed dangerous properties if we have no proven, scalable approach to transforming them?

Perhaps Council will be willing to spend on registration capacity, more inspectors, and compliance activities.  But so far, my subjective take is that registration consumes too much of the political oxygen from advocates, which in turn will also consume the actual hard dollars and political capital.  This is a substantial problem since we don’t have a track record of turning around the existing dangerous properties we know of or should know of given existing data.

A more prudent use of resources would be to couple (1) an improvement in code enforcement operations through new triage algorithms and predictive analytics with (2) meaningful investments of money and Council’s time on improving compliance infrastructure.

4. The Tovo approach is actually about regulating high student occupancy units. The Spelman approach is narrowly tailored to solve the actual problem: repeat offenders.

Of the two ordinances under consideration, the Spelman approach is more targeted and efficient at actually solving the potential displacement, fire, and deaths created by dangerous properties.

The Tovo proposal represents a subsidy for certain sections of North Austin and Hyde Park to receive substantial code enforcement support; certainly some of it will be aimed at sub-standard housing. But advocates for the Tovo proposal have made it clear that a significant – if not primary concern – is forcing properties with high student occupancy to be broken up not because of sub-standard housing but because of noise and neighborhood ‘character’ concerns created by student presence. Rental registration is a necessary tool to enforce restrictive housing occupancy limits many Tovo ordinance proponents also separately advocate.

Busting ‘stealth dorms’ is not the intent behind the Clinic’s reports.  Sadly, it is the actual policy direction that the Tovo registration regime provides cover for. The Clinic focuses on inspection of multifamily units, whereas the Tovo approach also includes ‘non-compliant’ rental single-family in order to be able to go after units with high student occupancy.

After all, subsidizing enforcement of quality of life issues endured by residents choosing to live close to the University of Texas is not the same efficiently preventing dangerous housing from collapsing and catching fire.  Inevitably, these trade off – there are only so many inspectors, lawyers, and analysts.

Further, note the places included in the Tovo pilot:

(1) North Austin Civic Association (NACA)
(2) “Restore Rundberg”
(3) East Riverside/Oltorf Combined Neighborhood (EROC)
(4) Central Austin Neighborhood Advisory Committee (CANPAC) Planning Areas
(5) Hyde Park
(6) Northfield and North Loop.

East Riverside and Oltorf makes sense; but the inclusion of such a broad set of areas North of the University, along with the ‘stealth dorm’ discourse deployed by some of the proponents of the Tovo approach, not to mention the original resolution language, make it clear that the focus goes beyond the sub-standard/criminal problem properties discussed by the Clinic.

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4 Responses to Rental registration realities

  1. Mike Dahmus says:

    The redirection of legitimate safety concerns to provide cover for an ultimately unrelated, but highly desired by neighborhood associations, issue reminds me of McMansion – which was originally pushed on “drainage emergency!” grounds and ended up producing policy which actually encourages more impervious cover.

  2. Great job focusing on the core questions here, which are, 1) what is the supposed problem, 2) how does this approach address it, and 3) at what cost to non-targets? In trying to address two “problems” — dangerous multifamily and “nuisance” single-family — with the same blunt instrument, blanket registration is vague toward 2), but fairly clear with regard to 3) — it will inflate bureaucracy and increase costs.

  3. Chris says:

    As I explained on twitter, both versions of the ordinance in Council backup (as of this morning) treat a rental registration like a permit. I.e., it’s a piece of paper the City must issue in order for a person to “operate, lease, occupy, or otherwise allow another person to occupy a rental property subject to this chapter.” Thus, a tenant does not have a right to lawfully OCCUPY an apartment that does not have a rental registration.

    This is a problem because both versions of the Ordinance allow the code official to not only suspend, but also to revoke a rental registration. “Suspension” of a rental registration prohibits a landlord from renting vacant units but does not affect a tenant’s right to remain. (It does affect the tenant’s right to sublet the apartment, however.)

    Revoking the registration, however, appears to mean that the rental property is no longer registered. Which means the tenant no longer may occupy it. Which means the tenant commits an offense, punishable by a $500 fine even for unknowing violations, merely be remaining in the apartment. All without any provision of notice to the tenant of a pending revocation or opportunity to contest it (unless he happens to hear about it). The “registrant” gets notice of a pending suspension, not the tenants.

    Note also that, as currently drafted, registration can be suspended and revoked for any uncured violations of code — they need not be health & safety related.

    As currently drafted, this reads like a huge power grab by code enforcement, an administrative scheme that allows them to empty apartments without having to go to the trouble of showing safety or health violations. I hope (and believe) this will be corrected before tomorrow.

  4. Pingback: More Rental Registration Realities | Keep Austin Wonky

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