Lawmakers in Cleveland, Ohio, passed a new ordinance on February 5 that will protect tenants from subpar living conditions by creating a way for rental housing code violations in units owned by out-of-town landlords to be addressed in a timely manner. “Ordinance No. 1039-2023” requires out-of-town landlords to assign to their rental units local agents who can be reached in the event of health or safety issues related to the units. Those assigned to oversee properties must reside in one of the local counties approved by the Cleveland City Council and will be liable for addressing housing code violations in the properties. The law also imposes financial consequences for landlords who do not address maintenance problems in their rental properties.
By passing “Ordinance No. 1039-2023,” the lawmakers seek to address a growing problem in the city. Over the past decade, housing officials in the city have watched the number of out-of-town landlords, known also as “absentee” landlords, increase drastically. Many out-of-town landlords in the Cleveland-area are limited liability companies (LLCs) and property management companies that have been attracted by low-cost properties whose values have not recovered from the city’s foreclosure crisis.
Frank Ford, a researcher with the Fair Housing Center for Rights & Research in Cleveland, draws attention to the dual negative impact of absentee investors on low-and-moderate income families. “The low prices these homes are selling for, often below $50,000, should represent affordable homeownership opportunities, but investors are grabbing up these homes and paying cash, shutting down those opportunities.” Moreover, “the data shows these investors are less likely to maintain the homes, forcing tenants to live with housing code violations.” Ford also notes “this increased investor activity, and the negative consequences that follow, are disproportionately impacting people of color neighborhoods of Cleveland.”
With so many new absentee landlords in the city, housing code violations have often gone unchecked. In 2022, for example, lawmakers in the city levied a lawsuit against a group of absentee landlords for failing to address more than 100 housing code violations in three apartment buildings. Tenants in the properties noted instances of mold and leaks – common habitability issues that are generally found in older housing structures that are not well maintained. Across the nation, it is reported that 16% of all renter-occupied units are affected by at least one habitability-related issue, including lack of smoke detectors, lack of plumbing, or presence of mold.
Faulty housing structures and conditions can exacerbate health disparities among children and families. The U.S. Office of Disease Prevention and Health Promotion notes a causal link between housing quality and mental and physical health in particular. For children, poor housing quality can have effects that persist well beyond childhood, often causing delayed cognitive development due to prolonged lead exposure. Additionally, leaky pipes in a household can lead to the growth of mold, which in turn can increase the likelihood of adults and children developing issues such as asthma. Meanwhile, lack of heating inside a residential unit can lead to impacts related to mental health outcomes, like a heightened risk of developing depression.
The new law, which has been named the “Resident’s First” law by Cleveland Mayor Justin Bibb, a key proponent of the bill, will make it easier for tenants to reach their landlords to ensure that any housing code issues they face will be rectified. Attempts to reform Cleveland’s housing laws are part of a larger effort championed by Mayor Bibb, who in September 2023 released a comprehensive agenda to reform the city’s housing enforcement laws.
Under the new law, all rental properties will be required to have a “local agent in charge.” The agent will be required to provide their contact information, including an updated method of communication by which they can be reached. The owner of a property can be assigned as their own agent; however, they must be a resident of Cuyahoga County or an adjacent county, including Medina, Summit, Portage, Geauga, Lake, or Lorain counties.
Similar laws have been passed across the nation. For example, the State of Rhode Island required landlords and property owners to register their residence with the state and provide information about a local individual who will be responsible for maintaining and overseeing any rental unit. Under Rhode Island’s law, a landlord or property owner must provide the name, address, and phone number of the property’s responsible party, and that party is legally responsible for the unit.
Under Cleveland’s new civil ticketing system, moreover, city officials will be able to levy fines against landlords, or a property’s local agent in charge, to ensure tenants are not forced to live in dilapidated housing. Through the new civil ticketing system, the city will be able to issue fines of $200 per day to landlords violating the new ordinance. If the fines are not paid by the landlord or agent, the fees will be added to the owner’s property tax bill.
The passage of Cleveland’s new law followed more than three hours of debate by City Council members. The ordinance originally included point-of-sale inspections for vacant properties, but this provision was ultimately rejected. The Council will attempt to address the issue of inspections for vacant properties this spring.
Learn more about the new ordinance here.