No Building Permits for “Slumlords”

In Legislation, Real Estate by Richard Bianco

The local media, government officials (usually when seeking re-election), housing advocates and the legal services community throw around the amorphous term “slumlord” to describe a landlord that treats tenants badly by failing or refusing to make needed repairs to a rental unit. The point at which a landlord crosses over into ‘slumlord’ territory was anybody’s guess, until now. On November 7 the D.C. Council has proposed an official definition of “slumlord.” (in a sense). The “Slumlord Deterrence Amendment Act of 2017” imposes harsh sanctions on people that own an interest in a rental property which amasses more than five (5) Class 1 violations in a year. Specifically, the slumlord in question may be denied a Basic Business License (including renewal) or Building Permit, of any kind, for a year after all of the Class 1 Violations are cured. Alright, I admit, it’s not a statutory definition in the sense that it says “A Slumlord shall be defined as….” However, it is an implicit definition, and a bright line between the slumlord and the non-slumlord, at least in the eyes of the City Council.

More important than the label, however, is the burdensome consequence. If passed, the proposed legislation would amend both the Business Licensure and Construction Code Statutes. In the case of the Business License Statute (D.C. Code §47-2851.11), DCRA “shall” be required to deny issuance or renewal of a basic business license to a person or entity that has an ownership interest in rental property that has been cited for more than five (5) Class 1 infractions in a 12 month period. It is important to note, that the license prohibition extends to properties and/or businesses in the District that have nothing to do with the rental housing in question. So, the statute affects the individual’s ability to do business in the District, across the Board.

The existing Construction Code (D.C. Code §6-1407.1), unlike the Business License Statute, is permissive, stating that an applicant “may” be denied a building permit twelve months from the date that all Class 1 infractions have been cured. Presumably, there must be some wiggle room to allow DCRA to issue permits for the purpose of repairing Class 1 Violations as well as other considerations within their discretion.

Class 1 Violations are the most serious as defined by the Municipal Regulations and a complete list can be found at 16 DCMR 3305. However, they can basically be boiled down to life safety issues, such as the structural unsoundness of a building, failure to maintain fire extinguishing equipment, failing to maintain an appropriate egress etc.

Given the cadre of council members co-sponsoring this legislation (six), it seems likely that this legislation, or some form of it, will be enacted in the coming months. If you are a landlord and want to know how this new legislation might affect you, call us for a consultation.