Landlords' Latest Appeal to State Lawmakers Adds to Local Tensions

Above: a rental house in East Lansing.

Tensions appear to be rising between East Lansing landlords and East Lansing homeowners who live in rental-heavy neighborhoods—in spite of representatives of the two groups having recently worked together over many months to hash out possible compromises of zoning rules.

This week, a group of East Lansing landlords successfully appealed to a Michigan Senate committee to address their concerns, to the disappointment of non-landlords who have worked on the issue and who believe the landlords are undermining local process and even goodwill. But landlords tell ELi they have no choice but to seek protection of their interests every way they can, including by trying to get State legislative relief.

The issue concerns City restrictions on landlords with regard to making changes to “nonconforming” rental properties. These are properties that are legally being used differently than they are zoned for. (Read ELi’s report on the issue.)

The most politically controversial of these properties are rental houses that used to be single-family, owner-occupied homes in older neighborhoods, including Bailey, Southeast Marble, Red Cedar, Chesterfield Hills, and Oakwood—although as ELi has explained, some large rental apartment buildings in the East Village area are also currently “nonconforming.”

Currently owners of nonconforming rental properties are restricted by East Lansing law from making improvements they often want to make—including changing interior layouts and creating additions.

This week, the Michigan Senate Committee on Local Government supported landlords’ wishes, discussing and passing an amendment on a bill that by its definitions will apply only to East Lansing. This is happening even while East Lansing’s Planning Commission is actively reviewing draft reform legislation that resulted from months of discussions by the East Lansing Nonconforming Use Committee, a group of landlords, neighborhood homeowner representatives, and others convened by City Council.

Yesterday, I asked Nancy Marr of Prime Housing Group, a major landlord in East Lansing and a member of the Nonconforming Use Committee, why landlords have gone to the Michigan Senate even as East Lansing’s Planning Commission is working on ordinance changes to address landlords’ concerns.

Marr told me, “After five years of trying to get something done at the local level, the fact that we have gone to the state level is the only reason something is moving forward at the local level.”

She says the landlords are trying “to provide the best housing we can and we're taking what we feel are the necessary steps to be able to provide that. We have been very clear from the very beginning that we are not trying to increase [housing] density. The bill specifically addresses this and we have continually stated it. We see this as a benefit for the renters that live in the houses and apartments, a benefit for the city with more taxes [because improved properties generate more property taxes], and a better house or apartment complex for the neighborhood in the long run.”

Marr says the landlords “aren't treating this as an adversarial issue with constituent groups.” In response to email questions from me, Brian Hagan, landlord and Vice Chairperson of the Nonconforming Use Committee, responded “we discussed the email you sent within the landlord group. Rather than reiterating Nancy's comments, I will just concur with her assessment since it appears we are all on the same page.”

But some non-landlords do see the landlords’ move as undermining local process. Dan Bollman, a member of the Nonconforming Use Committee, East Lansing resident, and architect, told me, “I suspect there could be some bad feelings generated from this. Personally, I have worked—since the Pilot Formed-Based Code Program in 2012—to find a remedy to this unworkable arrangement. We now have very workable language that is following the proper ordinance process. I cannot say that I am terribly happy knowing that I volunteered my time and knowledge to the effort while the state legislative process continues, with the intent of undermining that effort.” 

Bollman does not see himself as “against” landlords’ interests; he notes that he has publicly supported the zoning appeals of some landlords (not paying clients of his architectural firm, East Arbor Architecture). But, he says, “I do not believe that this is an issue that should be sorted at the state level. I find it particularly frustrating that the self-proclaimed ‘party of small government’ [i.e., Republicans] would seek to overturn local zoning matters with statewide legislation.”

Bollman adds, “I’m at a loss to understand how it can be claimed that this [local process] is not moving fast enough. The Planning Commission held a Public Hearing last Wednesday. While the text needs some modification, it is finally at the point where some real changes in the ordinance and the resulting city policy will permit modifications to non-conforming properties.”

According to Bollman, “There are workable, common sense solutions to this issue and the Non-conforming Use Committee worked to find a balance between the current over-regulation and the needs of the neighborhoods, which are protected by the non-conforming use regulations.” Changes being considered by the Planning Commission for recommendation to City Council include allowing interior structural changes, expansion of buildings by up to 20%, and the addition of bathrooms in nonconforming rental properties.

Asked about the landlords’ appeal to the Senate committee this week, Sally Silver expressed significant frustration. She told me, “This is a combative approach not suited to civil discourse.”

Silver is a long-time homeowner and leader of the Bailey neighborhood and was also on the Nonconforming Use Committee. She says, “Certainly this will create tension between landlords and residents in neighborhoods with large numbers of rental properties, but it should concern all citizens when the legislature takes up matters that should be handled locally and which traditionally have been handled thus. Clearly, this detracts from the authority of voters in smaller jurisdictions or in the ability we have to manage our own affairs.”

Silver feels the process in East Lansing has actually moved quicker than it should be, given the complexity of the matter. She also is frustrated because, “Throughout discussions on these matters and on other committees, neighborhood representatives wanted some form of quid pro quo for allowing landlords to make more alterations to their non-conforming rental properties than now allowed: improvements to yards and more plantings of shrubs and trees, reductions in the number of tenants in some houses, or better design standards. Such matters were also discussed and put forward by the committee, but none of these quid pro quos were included in the proposed ordinances” now being considered by the Planning Commission.

Silver told me, “I certainly regret that because of the threat of state legislative action, we and the city did not have the time to take that more comprehensive approach. Good legislation takes time. Speed of action should not be privileged over quality and thoroughness of the law-making process. This is not an emergency.”

Prime Housing Group’s Nancy Marr disagrees, saying it is time for the system to change, explaining, “the landlords want the same rights as the homeowner next door. What is the benefit of not allowing improvements?”

But some homeowners fear that in fact “improved” properties could mean unattractive additions, more people renting properties (because it is more comfortable to do so, not necessarily because of more than the legal number of renters moving in), and an end to any hope that economic pressure will cause some of rental houses to be sold to people who will owner-occupy the homes, effectively reverting neighborhoods to being more like their original compositions.

Joanne Russell, homeowner in the Red Cedar Neighborhood and also a member of the Nonconforming Use Committee, told me, “personally I'd be very disappointed if the landlords went back to the state. I think many other older neighborhoods would as well.” She says, “The city has moved this process along as quickly as they usually do.” She notes that “the committee recommendation allowed for many improvements—bathrooms, 20% additions, interior changes—without losing their non-conforming status.”

Mayor Mark Meadows tells ELi that it’s possible the bill will go no further: “I don't think the bill will go to the floor [of the Senate] but am not certain.”

According to Meadows, “As presented, it is clearly unconstitutional as a violation of Article IV, Section 29: ‘The legislature shall pass no local or special act in any case where a general act can be made applicable, and whether a general act can be made applicable shall be a judicial question. No local or special act shall take effect until approved by two-thirds of the members elected to and serving in each house and by a majority of the electors voting thereon in the district affected...’”

As it is, the way the bill is written means it is only applicable to East Lansing. Meadows believes “even if it is a valid local act, it has a mountain to climb. In the House the Dems can beat on 2/3 votes and it will never pass a local vote.”

Note: You can see the complete responses of the people I interviewed by email here. This article was corrected after publication to indicate that the Senate committee discussed and voted on an amendment to the bill, not on the bill itself.

Disclosure: ELi is supported by readers, and these include Nancy Marr of Prime Housing Group, East Arbor Architecture (Dan Bollman’s firm), Sally Silver, and Joanne Russell.