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BEST OF | 2012 >>
Mayor Tim calls a timeout
Rental conversion moratorium draws opposition
By Bob Treu
Sunday, August 04, 2013 3:05 PM
A few days after the governor of Michigan declared Detroit to be bankrupt, I stopped at Mayor Tim‘s office to see how La Crosse was doing and ended up discussing the new moratorium on the conversion of single family homes to rentals. While the mayor feels this is a move important to the city’s health, he assured me we wouldn’t be following Detroit down the behavioral sink any time soon. On the other hand, he convinced me that the situation in La Crosse is serious enough to demand immediate attention.
To some observers, La Crosse remains an exceptionally attractive city. Caught between the Mississippi River and the bluffs, it offers tree-lined streets rife with birdsong and impressive storybook mansions that seem afloat in a timeless dream. To others it is a city in crisis, where yards go untended and houses try to turn the peeling paint of their faces away from the sun. It’s the place where a year ago the floor of a Sixth Street rental buckled, sending 40 people plummeting through a gaping hole. And like most cities it has its occasional outbreaks of violence. In the few months since I last talked with Mayor Tim (Kabat), a young man was fatally stabbed in the bathroom of a convenience store and a woman was shot in the back by a man who was apparently in town for a drug deal. Both of these events occurred on Fifth Avenue, a few blocks from where I live.
Following a pattern established much earlier in our largest cities, people have been abandoning La Crosse for suburbs like Onalaska and Holmen for decades. But when the economy crashed in 2007 something else happened: housing values quickly dropped by 30 percent or more and interest rates dropped to laughable lows. Stormy weather for most, it was sunny skies for investors who wanted to pick up properties on the cheap and rent them out.
According to Mayor Tim, La Crosse now has 51 percent of its housing in rentals, which is one of the highest percentages in the state. According to him, there is no shortage of rentals in the city. He feels we are at a crossroads, a precarious point where we can no longer let things slide, and for that reason he authored the new ordinance.
As La Crosse reacted to the moratorium, we learned something else about ourselves. When a neighborhood or even a few houses begin to show signs of deterioration, renters and landlords blame each other for the blight, and homeowners begin to generalize about and stigmatize renters. Often those stereotypes determine where people want to buy homes and how the homes are valued on the market. Add to that a changing and more diverse demographic and suddenly the moratorium became a touchy issue.
But just what does the moratorium do? The helpful folks in the Planning Office handed me a copy of something called subsection 8.07 of the City Code, which is, refreshingly, easily contained on two sides of a single sheet of paper. In fact you could skip the “whereases” and read the ordinance in less than a minute. It establishes a moratorium on the conversion of single-family homes into rentals in the (R-1) Single Family Residential District and the Washburn District. To see what that means, I checked out the color-coded map on the Planning Office wall. The residential area (shown in a tasteful tan) comprises much of the north side and the part of the south side east of West Avenue. There is a sizable and somewhat garish purple area just west of the university that will, presumably, be allowed to flourish in its present state of excitement. Then there is a sizable light green area decorated with polka dots that represents the Washburn Residential zone, just south of the central city. This troublesome area was redefined almost seven years ago in an attempt to limit density. It is the part of La Crosse that most resembles an inner city, and has an enormously diverse population, almost any way you define diversity. It is also the area being championed by the Neighborhood Renovation group, an organization that actually recommended a yearlong moratorium.
The ordinance also calls for a study of the rental situation, which can seem confusing, since studies usually precede new laws. The first of the “whereases” that precede the text of the ordinance finds it necessary to study the impact of conversions to rentals; while the ordinance itself finds it necessary to preserve one-family homes in order to study the impacts of conversions. There must be a chicken and egg type joke going around city hall about which came first, the study or the moratorium. Of course, we could have a moratorium without a study, or even a study without a moratorium, but Mayor Tim apparently decided to stick the tail of this particular snake into its mouth and see what would happen, which isn’t so much illogical as a sign of urgency. Too many studies go on and on without ever implementing anything. The mayor would like to avoid that this time.
The moratorium ordinance has plenty of support and passed the City Council on a 15-2 vote, but it also has plenty of opposition. One dissenter, speaking on television news, suggested the moratorium is a violation of the American principle that we can own as much property as we like and do whatever we want with it, a view not universally endorsed by constitutional scholars. Particularly surprising was the dissent of Audrey Kadar, who has a long and honorable record of supporting community projects. She feels the moratorium isn’t necessary at this point and called it “punitive.”
But perhaps the most organized opposition comes from local Realtors, whose leader, Cindy Gerke-Edwards, said the moratorium will hurt those it is meant to help. Mike Peterson, of Re/Max, feels there is a shortage of rental properties, and also worries about people like the client he represents who is having difficulty selling a home in the Washburn area. The client bought another home to accommodate a growing family and is having trouble making two payments. The new ordinance might seem to prevent her from renting out the Washburn property, which is the obvious solution, but she may not be in much of a jam after all, since the ordinance contains a hardship clause allowing people like her to apply to the council for a waiver.
I also spoke with Melissa Sample of Bi-State Realty. She shares Peterson’s view that there is a shortage of rentals in La Crosse. She cited the university, Gundersen Clinic, Trane and First Logic as institutions that constantly bring in professionals for limited periods of time, often people who want to live close to work. Still, she feels the moratorium is not as horrible as some real estate people say. She feels it’s important to register properties with the city and work with the inspectors to avoid problems.
So who is right about the availability of rental space: the mayor or the real estate agents? When I visited with Dave Rinehart, chief city inspector, I discovered that question is not easy to answer in any objective way. There are 10,384 rental units registered, but how do you count the unregistered ones? Nor is it possible to accurately track the growth of rental units over time, since the city does not archive such information. Like an elephant who has lost his memory, it knows only what is going on in front of it. Thus Rinehart was also unable to tell me much about the outburst of speculation after 2008. He could only tell me from his own observations that 360 Real Estate, Brian Benson and Steve Eide were some of the larger players.
Also, the chief inspector’s reaction to the moratorium is on record. He feels people will continue to convert single family homes to rentals without registering them, because he simply doesn’t have the staff to search them out. Presumably that’s what Mayor Tim meant when he said he would like the study to propose ways to “put some teeth” into the city’s rental code.
Or perhaps he was thinking of that incident last September when a floor collapsed in a Sixth Street rental property. Melissa Sample told me the upstairs of that building was definitely “cool,” and she had thought of living there herself at one time. Nonetheless, the building was not registered as rental space at the time of the collapse. The owner, Nate Brooks, of River City Rentals, was fined $240, a sum he argues proves he is guilty of no huge affront. According to Rinehart, Brooks turned up a couple of days after the incident with 37 rental registration forms for places he was already renting out, and he is eager to get the collapsed property back in business. No wonder the mayor is calling for more teeth. It’s been pretty much all gums up to now.
There has also been the troubling undercurrent of criticism that the moratorium is a discreet attempt to stem the tide of African-American migration into La Crosse, since most African-Americans moving into the city can’t afford to buy and will be dissuaded by the lack of rentals. One noteworthy online comment warned of African-Americans and college students vying for limited rental space. In any case, this question must be part of any study, and it would be a good thing if the mayor appointed a representative of the minority community to serve on the committee.
Assuming Mayor Tim can overcome the opposition and inertia that confront almost any serious attempt to make a city work, he may face a more powerful opponent: the crass ideology that sees cities as somehow dysfunctional and worthy only of dismantling. The Wisconsin State Senate is considering a bill that would prohibit municipalities from requiring registration of rental properties and their landlords. That would mean all attempts to control rental properties and stabilize neighborhoods, everything Mayor Tim is trying to do with the moratorium, would come to naught.
What La Crosse is experiencing, in a slightly less exaggerated way, is what Detroit and other cities are struggling with: an enormous, apparently irresistible rejection of cities. Since World War II people have been moving to the suburbs and now the exurbs, leaving cities to deal with more and more complicated problems with fewer and fewer resources.
Take a turn into any of the coulees between here and West Salem and you will be amazed at the size, the splendor, and the number of new homes. The suburbs that once depended upon cities have ended up strangling their hosts. And every time things fall apart in a place like Detroit, the Right declares a victory, because the battle to save the cities has become a political debate.
We need to recognize, without dissimulation or exaggeration, that none of these things would have happened, at least not in the same way, without the internal combustion engine. One of the main reasons Europeans consume so much less energy than Americans is that they haven’t abandoned their cities.
But there is a small countermovement under way in America, especially among young people who are willing to try a different, less damaging lifestyle. They are starting to bike to work, learning about mass transit schedules, and discovering that most ‘burbs don’t offer anything better than listening to a concert or watching the tows chug by in Riverside Park. Even taken together these roadside conversions might not change the course of history, but wait until gas reaches $6 a gallon and living in a coulee west of West Salem loses its charm. That’s when the real urban renaissance begins.
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