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HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 6/3/2003 * PLEASE NOTE: Since the Glendale City Council does not take formal action at the Workshops, Workshop minutes are not approved by the City Council. MINUTES CITY OF GLENDALE CITY COUNCIL WORKSHOP June 3, 2003 1:30 p.m. PRESENT: Mayor Elaine M. Scruggs, Vice Mayor Thomas R. Eggleston, and Councilmembers Joyce V. Clark, Steven E. Frate, David M. Goulet, H. Phillip Lieberman, and Manuel D. Martinez ALSO PRESENT: Ed Beasley, City Manager; Pam Kavanaugh, Assistant City Manager; Jon Paladini, Deputy City Attorney; and Pamela Hanna, City Clerk 1. PROPOSED PROPERTY MAINTENANCE CODE CITY STAFF PRESENTING THIS ITEM: Ms. Pam Kavanaugh, Assistant City Manager and Mr. Dan Gunn, Code Compliance Administrator This is a request for the City Council to review the proposed property maintenance code language; accompanying budget plan and implementation timeline and to provide the Code Compliance Division with direction. In March of 2002, City Council Property Maintenance Subcommittee Chairman David Goulet called the first meeting and outlined the goals of the subcommittee: Research comparable cities' practices; Resolve issues of visual blight and deterioration; Identify and/or develop programs that could assist homeowners in complying with stricter property maintenance codes, and; Ensure public input and review throughout the property code language development process. A yearlong process of monthly meetings, public input and review meetings, and staff research and development produced a proposed property maintenance code for council review. In November of 2001, Mayor Scruggs appointed council members to a subcommittee that would research the viability of adding a property maintenance code to the existing city codes. Councilmembers Steve Frate, Joyce Clark and David Goulet were appointed to the Property Maintenance Subcommittee. 1 Staff provided the residents of Glendale the following opportunities and methods to review and give staff direction on the proposed property maintenance codes: City of Glendale Web Page review of codes and electronic mail posting of comments and questions; Code Compliance Division Telephone Hotline for residents to use to request a mailed copy of the proposed property maintenance code language; Three public meetings held in the north, central and west areas of the city. Citizens were notified of these opportunities through various articles and press releases in local newspapers, neighborhood newsletters, council district newsletters and city department special events. City department staffs were invited to complete a survey from the Property Maintenance Subcommittee concerning current issues in relation to codes and property maintenance. Various departments also took advantage of the opportunity to present to the Property Maintenance Subcommittee in the monthly meetings. The implementation of the complete property maintenance code will require an appropriation of $141,238 ($121,188 ongoing appropriation and $20,050 onetime appropriation) with an expected implementation timeline of October 2003. This budget includes two full-time code inspectors and one part-time clerical support staff, the accompanying equipment for staff and community awareness materials. The implementation of a partial property maintenance code will require an on-going appropriation of $3,000 for community awareness materials. The expected implementation timeline is August 2003. The recommendation was to provide this information to City Council for review, discussion and staff direction. Councilmember David Goulet, Chairman of the City Council Property Maintenance Subcommittee, said the process began with an analysis of other cities practices. Public meetings were held throughout the city and several hundred people attended. The public in attendance wanted immediate changes. We are still receiving comments from the public. After the meetings were completed, we prioritized concerns and considered funding capabilities. Councilmember Goulet thanked Councilmembers Clark and Frate for their service on the committee. He also thanked Mr. Dan Gunn, Code Compliance Administrator and Ms. Megan Elsworth, Senior Management Assistant for their assistance. Ms. Pam Kavanaugh, Assistant City Manager, thanked Ms. Joan Campbell, C.A.T. Team Officer and Ms. Nancy Khiel, City Prosecutor. She introduced Mr. Dow Rigler, with Home Depot Community Relations, and explained Home Depot's contribution as well as Make a Difference's roll. Ms. Kavanaugh described how the partnership with 2 Home Depot and Make a Difference were developed. She noted copies of the proposed Property Maintenance Code were handed out at the public meetings. She reviewed the Property Maintenance Subcommittee leadership role and how the Property Maintenance Code was developed. Mr. Dan Gunn explained the six council districts were divided in half, with three districts assigned to each of the Code Supervisors. He stated doing so has centralized responsibilities and provided a more direct link with citizens and internal customers. He said another rather significant change is their approach to proactive inspections. He stated, historically, the city has been primarily complaint driven, however, they now proactively inspect properties and identify and resolve city code violations on a daily basis. He said their new approach has increased the number of cases per month to 300, which equates to 450 additional city code violations now being resolved. He explained the chronic offender process applies to individuals that repeatedly violate city codes. He said, under past practices, an individual with three violations within a 12 month period could be designated a chronic offender and court action could be initiated. He said the timeframe has now been extended to 24 months. Mr. Gunn discussed the volunteer program now being implemented, explaining individuals volunteer their time, assisting the city with illegal signs that appear in the city's rights-of- way. He said the individuals are removing over 400 signs per month and placing warning stickers on illegally located vehicles for sale. He said the staff time that is saved is put back into commercial properties. Furthermore, he said the compliance timeframe has been reduced to 10 days and the City Prosecutor now meets with the defendant at the time of arraignment and initiates a plea offer. Mr. Gunn stated the main goal of the subcommittee was to involve the public in the discussion. He said they incorporated a variety of methods in order to achieve that goal, including public and neighborhood meetings. He said, through the public meetings, it became apparent there was an interest in support programs for individuals who cannot physically or financially meet the city's standards. He said in cases of hardship, Code staff would act as the referral and work with the individual and city staff to resolve violations. He pointed out there will be restrictions in terms of eligibility and resource availability. Mr. Erik Strunk, Community Partnerships Director, discussed the community volunteer program, stating they have had great success in linking city departments up with volunteers. He explained the HELP program is a partnership between Home Depot, the Make a Difference Foundation, Code Compliance, the Volunteer Program and other non-profit agencies, helping homeowners make improvements to their homes. Councilmember Clark asked if the HELP Program is strictly for low to moderate income homeowners. Mr. Strunk stated the HELP Program is not targeted toward income eligible people and will take each homeowner's specific circumstances into account. Councilmember Lieberman suggested they utilize some of the criteria established when Home Depot helped place security doors throughout his district. 3 Mr. Gilbert Lopez, Revitalization Manager, explained the Community Revitalization Division administers the Community Development Block Grant to help citizens throughout the city through a variety of programs. He said the Exterior Improvement Program (EIP) was developed to assist low to moderate income individuals with repairs to the exterior of their homes. He stated the program is modeled after the Roof Program and can be used in conjunction with other programs. He explained that in order to qualify, homeowners have to live in the house 12 months prior to application and the household income has to be 60 percent or less of the county median. He stated the EIP is currently being tested and will be officially launched in July of this year. He said there is enough funding at this time to do 15 homes and, as of July 1, there will be funding for another 20 homes. He stated the maximum amount awarded per household is $5,000. He reviewed improvements that would be eligible for funding under the program. He noted 56 of the 301 housing related projects done last year resulted in repairs or improvements to the exterior of homes. Councilmember Lieberman pointed out demolitions are also done. Mr. Lopez agreed, stating they have funding for 10 additional demolitions next year. In response to Vice Mayor Eggleston's request, Ms. Kiel explained the new arraignment process for code violators. She said she now goes to the arraignment and makes the violators an offer. Mr. Gunn stated, following the public input process, the original draft language for the Property Maintenance Codes was refined. He said the new proposed codes would add new definitions and seven new code categories. Mayor Scruggs reported receiving a number of comments during the public meetings regarding whether or not the city should be able to cite for what is occurring in a homeowner's backyard. Mr. Gunn said the codes, as they are currently written, do not exclude rear yards, however, they do not typically look in back yards. He said the codes could apply, however, if conditions become overly egregious. Mayor Scruggs asked if the city would investigate complaints called in concerning back yards. Mr. Gunn responded yes, noting the complaining party would have to allow the city access to their yards to view the violations. Councilmember Martinez asked if the city could take action if the violations are not visible from the street. Mr. Gunn stated the codes are primarily enforced from public rights-of-way, however, specific complaints are handled on an individual basis. He said violations that result in safety, health or fire hazards will be addressed. Mayor Scruggs said neighbors who go to the effort of contacting the city have usually reached a high level of frustration. She said residents read the city's codes and expect them to be enforced. She pointed out the codes do not specify that they may only be enforced in the front yard and not the back yard, thereby creating false expectations. Mr. Gunn stated each complaint is handled on a case by case basis. He explained they view from ground level whether it is from the street or from a neighbor's back yard. 4 Councilmember Martinez referenced a situation where a homeowner covered unsightly materials in his back yard with a tarp. He said the neighbor's still feel the yard is blighted because the tarp does nothing to improve the yard's appearance. Mr. Gunn stated the current codes do not define or regulate screening materials. Councilmember Martinez suggested, in the situation he referenced, the homeowner research to see if one of the city's programs could assist them in constructing a fence. Mr. Gunn reported, on average, there are one-and-a-half violations per property. He displayed slides of blighted and damaged properties and homes. He said the proposed codes would regulate damaged exterior door and boarded windows on occupied structures, pointing out boarded windows represent both blight as well as safety hazards in terms of emergency egress. He said they have heard complaints about the use of inconsistent materials on fences, noting repairs can often look worse than the original condition. He stated the current codes do not regulate fences except in the area of swimming pools. Councilmember Martinez asked if repairs that were previously made, but look worse than the original condition, would be subject to the new codes. Mr. Gunn stated no properties would be grandfathered in under the new codes. Mr. Gunn explained the codes would regulate some landscaping issues. He said, while the codes do not require live plants, dead plants or trees are not allowed. He stated some form of ground cover would also be required on dirt yards. He said exterior materials not naturally resistant to decay need to be protected and peeling paint will be regulated. He said they have also received frequent complaints about damaged roofs that are covered with a tarp in lieu of being repaired. Mr. Gunn stated Code has implemented several administrative changes and has seen a substantial increase in its workload. He said, however, they have been able to maintain a very responsive and high level of service to citizens. He explained two options for adding codes without negatively impacting the current level of service have been developed for consideration, noting neither option is currently funded. He said the first option would be a partial implementation and would utilize current staffing. He stated the option would result in $3,000 of additional ongoing costs to cover educational materials and handouts. He said the second option would be full implementation of all seven codes and would necessitate the need for two additional Code Inspector positions, associated equipment and resources, as well as a half-time support person. He said there would also be ongoing costs associated with courtesy notices and compliance orders. In response to Councilmember Martinez's question, Mr. Gunn explained Code will work with the Communications Department on a media plan, utilizing all available resources, to inform citizens of the new codes. He said they would also ask each Councilmember to include Code in their district meetings to allow them an opportunity to explain the codes. He said they will also look to the Community Partnership Department and get the message out through their neighborhood leaders. Councilmember Martinez 5 suggested some neighborhoods would be left unaware of the changes unless a direct mailing is done. Councilmember Frate pointed out blighted and damaged homes are located in all six districts, regardless of the quality of the surrounding neighborhood. He said the process was done slowly with a lot of public input. He stressed that the new codes are not intended to harm anyone, which is why they have worked to establish assistance programs. He said everyone needs to consider what they want their neighborhood to look like in 20 years. Councilmember Clark suggested notification be included in the Council members' district newsletters. She said she will devote a great portion of her district newsletter to code revisions if Council decides to move forward. She stated they could also utilize door hangers and door-to-door visits to let people know of the changes. Councilmember Lieberman asked if the code differentiates between renters and property owners. Mr. Gunn explained, while renters are held responsible for certain conditions, the property owner is ultimately responsible. Councilmember Lieberman stated he fully supports the code changes and would like to see the changes implemented as soon as possible. He asked if the $760,000 identified during the budget process as available funds have since been allocated. Mr. Beasley said Council decided to place those funds into the Contingency until January. Councilmember Lieberman expressed his opinion the program should be implemented in the FY 03/04 budget. He invited Code to attend his district meeting on June 5 to discuss the code changes. Councilmember Clark stated citizens are in favor of enhanced codes and code enforcement. She said the Committee also looked at opportunities to create a stable funding source. Mayor Scruggs stated a resident complained that 10 days is not sufficient time to obtain bids and complete major repairs. Mr. Gunn clarified the city generally gives 30 days for work to begin, but looks at the homeowner's willingness to communicate with the city and that reasonable progress is being made. Mayor Scruggs asked about the Landfill's policy with regard to the number of trips a homeowner is allowed each month. Mr. Reedy explained new software has allowed the Landfill to change their policy. He stated homeowners are now allowed to deposit up to one ton of material per month, but are not limited on the number of trips they can make. He noted homeowners are required to bring their water bill to confirm they are Glendale residents and have to drive across the scales both on their way in and on their way out of the landfill. Mayor Scruggs asked about the notification process with regard to code violations. Mr. Gunn stated the old process gave residents 15 days to comply, after which time a second notice would be issued, followed by a third and final notice. He said the current process gives residents 10 days to rectify the situation, after which time a final notice is 6 sent. Mayor Scruggs asked if the request for additional staff takes into account the fact that time will not be spent revisiting properties and issuing second notices. Mr. Gunn responded yes. He explained zoning and rental code issues are considered specialty areas because they are more complex and require more time and communication with the property owner. He stated the inspectors that handle zoning and rental code violations do not carry as high a case load as other inspectors. Mayor Scruggs asked if it is Code's intent to lower the number of cases handled by each inspector. Mr. Gunn stated an individual inspector can reasonably manage 65 to 75 zoning and rental related cases. Ms. Kavanaugh pointed out a substantial amount of time will be spent initially educating citizens on the new codes and explaining the assistance programs that are available. Mayor Scruggs asked if everyone would be eligible for funding assistance. Ms. Kavanaugh stated all residents will be eligible for the HELP program, but certain eligibility requirements will have to be met to participate in the Make A Difference program. Mayor Scruggs asked where citizens would go if they are not considered low or moderate income, but cannot afford to bring their properties into compliance. Ms. Kavanaugh explained Home Depot is providing $5,000 for supplies and small repairs. She said those in need of paint could apply to receive supplies from Home Depot and those physically incapable of painting could apply for volunteer assistance. She stated, unfortunately, homeowners who do not meet the eligibility requirements of the Roof Repair Program will have to look elsewhere for financial assistance to make roof repairs which can be extraordinarily expensive. In response to Councilmember Lieberman's question, Mr. Lopez stated the Roof Repair Program is currently available. He noted the Rehab program, which is 80% of the County median, can also be used to make roof repairs and other major repairs up to $25,000. He reported 42 roof repairs were done last year. Mayor Scruggs pointed out there could be homeowners who do not meet the income eligibility requirements, but cannot afford to make the necessary improvements. Mr. Dunn said they performed an unscientific comparative analysis and noted the number of properties that would fall under the new standards. He said landscaping was the largest issue. Councilmember Frate stated most of the homes that require roof repairs only need partial repairs or to replace missing tiles. Councilmember Lieberman said a woman called him and expressed her opinion the city should repair her patio wall which was damaged when the city allowed SRP to irrigate the land 34 years ago. He said, unfortunately, the city is not able to do anything for her. Councilmember Clark said, if Council decides to move forward, inspectors and residents alike will go through a learning process. She suggested major roof repairs will take precedence over those needing only minor repairs. Councilmember Martinez pointed out the last sentence in the draft language regarding painted surfaces was omitted in the final draft. Mr. Gunn said, after further study, staff 7 felt the language was not enforceable. Vice Mayor Eggleston asked why additional staff will be needed if investigators will no longer have to revisit sites and issue second notices. Mr. Gunn explained inspectors have already had to absorb an average of 300 more cases each month because of proactive inspections. Vice Mayor Eggleston expressed his opinion Code will have to proceed with kindness to prevent a backlash of bad press and irate citizens. Councilmember Martinez asked if the current code lists stagnant pools as a violation. Mr. Gunn responded yes. In response to Councilmember Frate's comments, Mr. Gunn said a comparative analysis was done with other cities with regard to the top items. He stated Glendale's codes are comparable with other cities, with the exception of those being proposed. He said the City of Phoenix has had some form of Property Maintenance Code for over 20 years, however Tempe and Mesa only recently implemented their codes. He noted the other communities also experience situations where homeowners do not meet income eligibility requirements and are ultimately held responsible for making the improvements. Mayor Scruggs said when Council initially discussed the Property Maintenance Codes, Phoenix had an out-clause for residents who could not afford to make the necessary repairs. She asked if Glendale's code should have a similar out-clause or another way of handling situations where a property owner cannot afford to make necessary improvements. She stressed the importance of acknowledging that those types of situations will occur and to be up front about there not being provision to exempt. Councilmembers Martinez, Frate, and Lieberman voiced their support for moving forward with the Property Maintenance Codes. Councilmember Goulet cautioned that an out-clause could result in a blighted property. He agreed staff should proceed with the code changes, stating the kinds of programs already in place and proposed for the future will allow the city to deal with specific situations. Mayor Scruggs stated she is still very concerned about the roofing program and would like to know how other cities handle such situations. Vice Mayor Eggleston stated he would like to look at an out-clause for major repairs. Councilmember Clark cautioned that an opt-out clause could negate the intent of the code. She stated any opt-out clause would have to be very narrowly defined and narrowly applied. She said she continues to support the code as presented. Mayor Scruggs clarified staff has not been directed to work on an opt-out clause, stating she would like to see how the situation is handled in other cities. Ms. Kavanaugh stated 8 Mr. Gunn and staff have worked hard with volunteer groups and Home Depot to find ways to assist residents who cannot comply with the codes. Councilmember Martinez said he would also like to know how cities that have opt-out clauses determine which homeowners should be relieved of the burden. 2. REVIEW OF THE 1989 RESIDENTIAL RENTAL TAX ORDINANCE CITY STAFF PRESENTING THIS ITEM: Mr. Chris Zapata, Deputy City Manager and Mr. Bob Drake, Billing Tax and License Administrator. This is a request for the City Council to review and provide staff with direction on Glendale's Residential Rental Tax Ordinance exemptions and licensing. In reviewing this ordinance related to the city's business practices, it was determined that a modification to the existing ordinance could result in an equitable residential rental tax collection exemption policy that replicates commercial property rental tax exemptions. The 2000 Census identified the City of Glendale as having 26,613 rental units which is 35.2% of all housing stock. There are 5,602 (21%) residential rental properties that do not pay a 1.8% sales tax on rental income. The current ordinance, adopted by City Council in 1989, allows a person to own up to four residential rental properties in the City of Glendale and be exempt from paying a sales tax on the rental income derived from those residential rental properties. Once a person owns five residential rental properties then the owner must pay the 1.8% sales tax on all five units. Owners of commercial rental properties must pay the 1.8% sales tax regardless of the number of units owned. In comparison to Glendale, cities across the Valley have more rigorous tax payment requirements for residential rental property owners. All Valley cities, except Glendale, use the state of Arizona as the baseline for assessing rental unit tax. A residential rental property owner may own up to four residential rental properties in Glendale and any amount in the state of Arizona and be exempt from paying sales tax in Glendale. Chandler and Peoria do not allow a sales tax exemption for residential rental properties. Tempe allows a sales tax exemption to owners of one residential property in the state of Arizona. Phoenix, Scottsdale and Mesa allow a sales tax exemption to owners of two residential properties in the state of Arizona. Licensing requirements in the current ordinance make it difficult to monitor the ownership of residential rental properties and accurately assess the sales tax. Arizona state law requires rental properties to be registered with the respective county. Maricopa County depends upon residential rental owners to take initiative in registering their properties with the county. This voluntary compliance is not effective in giving local municipalities timely and adequate information. Local residential rental property licensing would provide Glendale the ability to monitor and enhance the health safety and welfare of property owners and tenants. Many issues that are faced by the City in relation to crime and code violations are compounded by the inability to identify the property owners for problem mitigation. Also, licensing of all residential rental properties with the Tax & License Division would provide Code Compliance with a more accurate accounting of residential rental 9 properties to enhance the inspection aspect of the Residential Rental Property Code adopted in 1999. A recent collaborative program between the City of Glendale and the Maricopa County Attorney's Office to inspect residential rental properties for violations of tenants safety, health and welfare (G.R.I.P.) has found that of the first five property owners inspected by this task force, only two were registered and licensed with the City of Glendale. The five properties inspected were chosen because having a multitude of violations and crime reports. On June 27, 1989, the City Council adopted Ordinance No. 1608 that provides the current direction for staff to collect sales tax from residential rental properties. The Arizona Multi-Housing Association was notified of the request to lower the number of exemptions for the purpose of registering and licensing residential rental properties in Glendale. No objections were raised, but support for the change was also not pledged. It is expected that a yearly increase of $600,000 in sales tax and licensing revenues would be generated if no exemptions were allowed for owners of residential rental properties. No additional staffing requirements would have to occur to implement a change in the tax exemptions. The generated revenue would be able to provide a funding source for adoption of the proposed property maintenance codes and accompanying budget requests for implementation of the codes. The recommendation was to provide staff direction regarding possible modification of the 1989 Rental Tax Ordinance to provide equitable tax collection practices with all rental properties. Vice Mayor Eggleston asked how the city will know if a property is a rental property. Mr. Zapata explained property owners are required to go through a registration process. Mr. Drake stated a person indicates whether they own or rent a property when they sign up for utility services. He noted a state regulation now requires that all residential rentals also be registered with the state. Vice Mayor Eggleston asked if the state assesses a fee for registration. Mr. Drake said the state allows two exemptions at which point a license is required. He stated there is no fee associated with registration. Mr. Zapata confirmed for Mayor Scruggs that the city would only tax those rental properties located in Glendale. He said, while the landlord typically pays the tax, it is usually included in the rent. Mayor Scruggs asked if a bill will be sent to the property owners every month. Mr. Drake said, depending on how much rent is collected, bills will be sent monthly, quarterly or annually. He explained the more money collected, the more often a property owner pays the tax. Mayor Scruggs asked if the city could exempt itself from the Model City Tax Code through a Filing Frequency Provision. Mr. Drake stated no. Councilmember Lieberman said the state bills him annually on his rental properties, 10 noting, however, it is a very small percentage. He pointed out the city already has established billing procedures which are used currently for property owners who own more than five rental properties. He said he also has to pay an annual fee of$50.00 to the city to be able to collect sales tax. He noted the Federal Government sees sales tax as part of the property owner's income. Mayor Scruggs expressed concern about the money the city will spend mailing bills to property owners on a monthly basis. Mr. Drake explained an annual filer has to have a gross taxable income of less than $5,000, a quarterly filer has to have a gross taxable income of more than $5,000 and less than $50,000, and a monthly filer has to have a gross taxable income of more than $50,000. Mayor Scruggs suggested military people who are temporarily assigned elsewhere and rent their homes be exempt from paying the tax. Councilmember Lieberman pointed out the tax is passed on to the renter, therefore, the property owner is not negatively impacted. Vice Mayor Eggleston asked if people who own one or two rental properties would also pay the city's $50 per year license fee. Mr. Drake responded yes, explaining a duplex or other grouping of rental properties would be subject to a single $50 fee, however, rental properties located in different areas of the city would each be subject to a $50 fee. Vice Mayor Eggleston expressed his opinion an annual fee is unfair, stating he would like staff to research whether a one time set up fee could take its place. In response to Mayor Scruggs' question, Mr. Drake clarified a 200 unit apartment complex would pay one $50 annual fee, however, three single rental units located in three different locations would each pay $50. Mayor Scruggs asked if any other class of business is exempted from an annual fee. Mr. Drake said only businesses that pay less than $50 per year in tax. Mayor Scruggs expressed her opinion there is a basic inequity in the amounts paid by contiguous and non-contiguous properties, stating, however, she is not concerned that the fee is paid annually. Councilmember Goulet disagreed, stating a 200 unit complex pays considerably more to the city for service than separate single units. He reiterated the cost is passed on to the renters. Councilmembers Martinez, Lieberman and Frate agreed. Vice Mayor Eggleston disagreed. Mayor Scruggs directed staff to move forward with the tax ordinance as proposed. ADJOURNMENT The meeting was adjourned at 4:10 p.m. 11