Rental Property Compromise Reaches Council

Sunday, October 23, 2016, 9:46 pm
By: 
Alice Dreger

Above: Rental houses in East Lansing’s Bailey neighborhood.

City Council appears poised to pass two new ordinances providing some relief to landlords who have been prohibited from improving and expanding residential rental properties, including formerly owner-occupied homes in the Bailey, Chesterfield Hills, Southeast Marble, Oakwood, and Red Cedar neighborhoods and rental buildings in the East Village. Following many months of discussion and negotiation on the matter of “nonconforming rentals” by an ad hoc committee of landlords and near-university neighborhood representatives and by East Lansing’s Planning Commission, City Council will hold a hearing on the two draft ordinances on November 9, 2016, and will likely vote to pass some version of them.

The matter has generally involved two fairly different types of properties. One are older houses in near-university neighborhoods that were once owner-occupied but, years ago, turned into student rental houses. The other are larger apartment buildings in the East Village, which is the area between Grand River Avenue and the Red Cedar River on the north and south, and Bogue Street and Hagadorn Road on the west and east.

In both cases, zoning by East Lansing has rendered these properties “nonconforming.” By virtue of the City Planning Department’s reading of the regulations, landlords of these properties have been prohibited from doing interior renovations and expansion of the type many have wished to do. Landlords have appealed to State-level committees in the hopes of having East Lansing’s regulations overruled, creating tension in East Lansing.

Last Tuesday, City Council voted to move two draft ordinances to public hearings for a likely vote on November 9. As noted below, a sampling by ELi of those involved in the months of negotiations indicates that most parties actively involved appear to be satisfied with this latest development as a reasonable compromise.

Ordinance 1380, if passed, would “allow renovations to multiple-family buildings with nonconforming uses in cases where the renovations will not increase the occupancy or footprint by more than 20 percent.” This refers to properties designed to hold more than one family, like the larger apartment buildings in the East Village. Ordinance 1382, if passed, would “allow structural alterations to the interior of nonconforming rental units” including houses “as well as an addition of not more than 20 percent of the floor area.”

Dan Bollman, an East Lansing resident and architect who served on the ad hoc study committee, tells ELi he thinks the way this is moving forward strikes a “good balance.” Bollman says, “I live in a neighborhood that is largely populated with non-conforming use rental buildings. Personally, I am in favor of the [drafted] ordinance. The permitted expansions would allow for necessary interior changes and upgrades to our older housing stock, including the possible addition of new rooms.”

Sally Silver, who lives in the Bailey neighborhood and also served on the ad hoc study committee, notes that the changes to be allowed in the East Village were relatively uncontroversial in the committee’s discussion. As for allowing changes to the rental houses in neighborhoods like her own, including allowing additions totaling up to a 20% increase in a house’s square footage, Silver tells ELi, “The Bailey Community Association approved several of the ordinances on this matter proposed by City Council, including this one. I might have preferred one of the options allowing a smaller percentage change, but this is not a bad compromise.”

Brian Hagan, partner in Hagan Realty and a landlord representative to the ad hoc committee, tells ELi the draft ordinances “are a good first step.” He had hoped “to see City Council adopt the 40% option” for additions to nonconforming rental houses “since it was supported by the Non-Conforming Use Committee with a 6-3 vote.” Says Hagan, “As we have said all along, we believe improved rental properties are a benefit to not only the tenants and landlords, but the neighborhood on a whole as well. We have not sought an increase in density, we simply want the same right to improve our properties as a homeowner has.”

Hagan indicated landlords are also satisfied by what will be allowed in the East Village if these ordinances pass: “it seems to address our concerns and we look forward to seeing it pass at the City Council level.” Nancy Marr of Prime Housing Group, which owns multiple larger apartment buildings in the East Village, agrees: “the [proposed] change in the code seems to address our concerns and we are hopeful it will pass the City Council.”

If these ordinances pass, all interior renovations and additions would still be subject to the rest of the usual restrictions on development, including, for example, restrictions in place in Historic Districts. Some landlords have consistently said in discussions on this matter that they are not looking to increase the number of allowable renters for individual properties, but rather to improve the properties under existing rental licenses, including by bringing bedrooms out of basements and by adding and improving bathrooms and kitchens.

City Council will take public comment on the matter at the November 9 meeting. Individuals wishing to weigh in can also write to council@cityofeastlansing.com.

 

Note: After publication of this article, the word "Some" was added to the beginning of this sentence (near the end of the article) in the interest of precision and at the request of a reader involved in the public discussions: "Some landlords have consistently said in discussions on this matter...."