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Summerset fines show growing double standard between big, little guys

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Fresno City Hall needs to rethink the way it levies code enforcement fines.

That’s the clear message from administrative hearing officer Ed Johnson.

Johnson late last week delivered decisions on two appeals involving vacant residences. Both cases involved claims of blight. The city fined the property owners a total of $45,000 because they were allegedly dragging their heels on repairs.

Johnson dismissed all but $500 of the fines.

This comes on top of decisions from the early part of last week on two similar appeals delivered by Johnson. In those two, the city had fined property owners a total of $45,000, as well. Johnson dismissed all but $450 of those fines.

Let’s add things up: Four blighted vacant building cases from the city’s code enforcement division; a total of $90,000 in fines; four appeals; the dismissal of all but a total of $950 of the fines.

Barely 1% of the fines survived judicial scrutiny.

Something’s not right here.

On top of that, another code-enforcement appeal is making its way through City Hall. This one involves fines of $290,000 for 1,450 violations at the Summerset Village Apartments owned by Chris Henry.

I suggested to city officials that City Hall appears to dropping the code-enforcement hammer a lot harder on small-fry owners of empty houses than on the wealthy owner of a crumbling apartment complex whose endangerment of hundreds of residents attracted national attention.

City officials said I was comparing apples and oranges.

I wrote last week about two appeals by owners of vacant single-family residences. One house was in West Fresno, the other was in Central Fresno not far from Fresno High School. The city said the owners were too slow in doing things such as repainting exterior walls and putting proper security coverings on windows.

In both decisions, Johnson in essence said the city was being unfair. He said city’s enforcement habits raised serious constitutional questions about due process.

Johnson’s two most recent decisions cover the same ground.

The first decision involves a house in the 900 block of North Safford Avenue, about a half-mile west of the Tower Theatre. The alleged violation: Failure to use a clear material (Lexan) as a secure covering for windows. The fine: $7,500.

The city’s thinking was that the owner (who isn’t identified) had an official 30-day period to fix the violation. The violation carries a $250 per day fine. Once that 30-day period ended without action, then the fine is computed from Day 1 of the 30-day period.

The multiplication is easy: 30 X $250 equals $7,500.

Johnson’s second decision involves a duplex in the 1200 block of East Lansing Way, about a half-mile northwest of Manchester Center. There were five alleged violations, including damaged floors, peeling stucco and use of plywood for boarding purposes.

The city used the same formula for computing the fine. Each violation was left to fester for 30 days, resulting in a $7,500 fine per violation. Five times $7,500 equals a whopping $37,500 fine.

The East Lansing case merits a closer look.

The owners, Siu Ying He and Zhirong Lu, appeared at the Feb. 10 appeal hearing at City Hall. According to Johnson’s decision, the owners said they speak Chinese. An interpreter was provided during the hearing.

Also present were contractor Jerry Randrup and engineer Esteban Pauli, representing the owners.

The owners said they did not understand the various notices sent to them by City Hall because they were in English.

Randrup submitted a timeline covering nearly a year that, he said, showed that the owners had been diligent in fixing the duplex. Randrup said Lexan was in short supply locally, but had been ordered.

One of the duplex’s units apparently had been damaged in a fire. The other unit was occupied.

“Mr. Randrup argued that Appellant was proceeding in good faith withal of these issues and that the thirty day period for compliance was not reasonable under the circumstances,” Johnson wrote in his decision.

Pauli, according to Johnson’s decision, testified that this restoration project had “a great deal of complexity.”

City officials argued that the owners had been given plenty of notice and time to fix things.

Johnson said the city was going overboard in its effort to fight blight.

“In summary,” Johnson wrote, “I find it is very likely that the penalties as applied are excessive ….”

One of the things that really stuck in Johnson’s craw was City Hall’s habit of giving a property owner 30 days to fix the problem, then, when the 30-day period was up and nothing had been done, going back to Day 1 of the compliance period to tally up the fine.

In the end, Johnson upheld a single $250 fine for the Safford property and a single $250 fine for the Lansing property.

Let’s now circle back to my chat with city officials about the Summerset Village Apartments issue.

Several weeks ago I made a state Public Records Act request asking to review the city’s code citation against Henry.

I had learned from Michael Flores (the city’s other administrative hearing officer) that Henry was appealing his $290,000 fine for alleged code violations at the huge complex in Central Fresno, a short distance south of the Veterans Hospital. Flores said such an appeal hearing would include a “packet” from the code enforcement division laying out the charges and the city’s supporting data. I wanted to see the Summerset packet. Flores said the packet isn’t ready.

I figured the citation would be the next best thing.

The City Attorney’s Office grumbled a bit (something about protecting third-party rights to privacy), but eventually sent me an Internet link to the citation’s 400-plus pages.

Here’s what I couldn’t understand:

1.) The Summerset crisis is well-documented. Natural gas service was cut to the 220-unit complex in November. City Hall acted fast once it found out about the problem, but this was a week or so later.

2.) Hundreds of people were living at Summerset at the time. The total probably topped 1,000. The size of the Summerset crisis caused a lot of political turmoil at City Hall.

3.) The city’s code enforcement division got involved almost immediately. In the end, 1,450 separate alleged code violations were identified in a report dated Dec. 7. For example, violations Nos. 407 through 411 for Unit A of the 2681 E. Weldon Avenue units identify a damaged heating system, no hot water, the presence of vermin, a faulty smoke detector and a faulty carbon monoxide detector.

4.) Henry was fined $200 per violation — $290,000.

5.) The media reported all this in detail. The media in January also reported on a lawsuit filed against Henry by dozens of current or former Summerset tenants. The Bee’s Rory Appleton wrote an excellent story on Jan. 15 about the lawsuit.

6.) Appleton wrote that the $290,000 had been due Jan. 6, but city officials suspended the fines. They said the fines might be vacated if the problems are fixed in a timely fashion.

7.) Appleton quoted City Manager Bruce Rudd as saying the city was “a long, long way from determining the final penalties for Mr. Henry’s negligence.”

I chewed on the Summerset crisis. I chewed on Johnson’s decisions in the four appeals. I chewed on all the talk at City Hall over the past seven-plus years about neighborhood revitalization and the horror produced by unaccountable slumlords.

And I wondered: Why didn’t City Hall use its “30-day multiplier” rule on Henry? Why wasn’t he fined $8.7 million (30 X $290,000)?

On one hand, you have four vacant buildings with problems such as the wrong window coverings and the absence of address identification numbers above the front door. The owners were fined a total of $90,000, using the 30-day multiplier rule.

On the other hand, you have Summerset with 220 units. Perhaps 1,000 or more people lived in those units. By many accounts, the units’ problems could have led to a disaster (such as fire) causing many deaths. His fine is $290,000.

The owners of four empty houses got hit with the 30-day multiplier rule and fines totaling more than 30% of the fines dropped on Henry, who didn’t have the 30-day multiplier rule applied to him.

I bumped into Johnson this week at City Hall. He said the city had full legal authority to use the multiplier rule on Henry.

It sure seems to me City Hall is coming down a lot harder on the owners of those four vacant residential buildings than on the owner of the Summerset mess.

Or, as I asked city officials, why is Chris Henry getting a break and Siu Ying He and Zhirong Lu aren’t?

City officials said I’ve got everything wrong. They said the property owners in the four appeals were given plenty of time to fix things, but proved to be uncooperative. Henry, in stark contrast, immediately got to work fixing Summerset’s woes. City officials said Henry showed good faith and resolve.

OK, I said, then why fine Henry at all if he’s such a good citizen?

City officials said they want to retain some leverage, just in case.

OK, I said, then why not multiply the $290,000 by 30 and send a really strong message not only to Henry but to all other landlords as well?

City officials said Henry had displayed his good intentions by immediately beginning repairs.

Things were going in circles.

I gave up.

George Hostetter
George Hostetter is The Sun’s Fresno Civic contributor – covering the City of Fresno, County of Fresno, and Fresno Council of Governments.

3 Comments

  1. George, the other $$$ issue in all of these cases is the damage done to the property value of homes in the surrounding areas. Homeowners who decide to sell their homes have to disclose nuisance properties in their real estate listings. When the cumulative loss of value of surrounding homes is calculated, that ‘fine’ looks small. Please investigate the history of a home located at 2307 N. Maroa…two story on the N.W. Corner of Vassar and Maroa. This home has been boarded up for over five years and has occupied by squatters (gang members) who for months on end terrorized an entire neighborhood. Look at the number of ‘event’ calls made to the police and look also at the number of calls made to code enforcement. This home is severely affecting the property value of every single home in the adjacent neighborhood. This is a snap shot of what an epic failure the City has been in the general area of public safety and neighborhood stabilization. The owner of the home continues to be a ‘bad neighbor’ who, in the past eight years, has made no effort to keep her home in good repair. She is somewhat of a mystery as no one (except code enforcement) seems to know where she is. What price should be put on the damage done to an entire neighborhood?

  2. Nancy brings up a good point. Mom and Pop landlording is a great way for middle class people to invest and participate in the American Dream (what’s left of it). Often, these folks want to do the right thing, they simply don’t have the capital or the savvy to deal with the legal issues once a violation is in place. I’ve often wondered if the problem could be helped by the city providing no-interest loans to these small timers, who can end up being an economic engine, providing jobs for tradespeople and affordable housing and supporting and/or improving the neighborhood’s property values. George, do you know if such a program exists or has ever existed?

  3. Selectively targeted small property owner that the City came down with the “hammer and sickle”(Communist China isn’t this extreme). I speak from experience. Throwing over the top extreme enforcement on small property owners is NOT the solution to revitalizing neighborhoods but a draconian way for the City to prey financially on property owners in the name of and while displacing of poor families into homelessness. I find it reprehensible the way the City it utilizing disadvantage poor families as a tool for their own financial gains. I have real solutions that work for tenants and property owners without the heavy hand of government interference. Such as a disclosure explaining duties and responsibilities of both parties I call it the “Tenant Bill of Rights and Responsibilities”. How do you think a property owner maintains affordable housing when they are required to pay $30,000 in administrative fees(NOT FINES) and do hundreds of thousands of dollars in improvements? Ultimately displacing low rent paying tenants with higher paying ones. The City knows what they are doing because I have spoken to council members to fall on deaf ears. That is why I am running for Fresno City Council District 3, Sean Sanchez. Yes we need change but we need real life solutions that have a positive social impact for the tenants the city intended to help in the beginning. The City knowing that families are squeezed out of their affordable housing shows that it is intentional displacement by the cities policies. Show me one property where the city came with overwhelming show of force and required repairs where tenants rent remained the same and tenants were not displaced? The City gloats about the success of 1131 Jackson. What happened to the 13 original families? Are they paying the same rent they were paying at Jackson? I’m curious to know but doubt it. The property was stolen by the City and fixed and flipped for $700,000 and is now owned by a large property owner. Huntington Blvd had apartments for $500-600 per month but the City came and stole that property and flipped it for $2million to a San Diego Investor. They did all the dirty work of kicking out all 60 units of tenants and rehabbing the property that now rents for over $1,200 month. Who are the winners and losers? The tenants lost their affordable housing, the property owner lost their investment and American dream. The City flipped the property for $2million and got a new investor to gentrify the complex. Talking to several people about “slumlords” everyone agrees to go after them but NOBODY has offered a solution that doesn’t displace poor people from their affordable housing. Most people do not want to live in squalor, most would choose to live in a Gary McDonald custom home in Copper River but we live where we can afford and do the best we can with the resources we have.

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