Legislature passes controversial bill to block new Indy landlord-tenant rules

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Tenant protections that the city of Indianapolis put in place just weeks ago are set to be overruled by state legislation that passed both chambers of the Indiana General Assembly on Wednesday.

Senate Bill 148 could also preempt an unknown number of other local ordinances across the state as it prevents all municipalities from regulating any aspect of landlord-tenant relationships.

The House voted 64-32 to approve SB 148, and the Senate voted 29-19 to pass it.

Indianapolis Mayor Joe Hogsett called the Legislature’s action “incredibly disappointing” and a “major setback for renters in Indianapolis and across the state.”

The controversial provision emerged at the Statehouse last month as a last-minute attempt to block the Indianapolis City-County Council from implementing two ordinances designed to protect tenants from predatory landlords.

The City-County Council passed the ordinances anyway, just hours after state lawmakers introduced the preemption language. Indianapolis Mayor Joe Hogsett then signed the ordinances in a rare public ceremony a couple of days later.

The city of Indianapolis has the second-highest number of evictions, only behind New York City, according to the Eviction Lab from Princeton University.

One of the Indianapolis ordinances allocates $250,000 in funding toward initiatives that aim to help tenants understand their rights and responsibilities in renting, including launching a tenant information hotline and creating the Tenant Legal Assistance Project, which would provide tenants with pro bono legal representation for claims against bad-actor landlords. Some of the funding would go toward Indiana Legal Services’ Eviction Avoidance Project.

Another ordinance requires all landlords to provide tenants with a notice of their rights and responsibilities. Those who fail to do so face a fine of $500. The ordinance also prohibits landlords from evicting tenants in a retaliatory fashion if the tenants report unsatisfactory living conditions, such as a lack of water or heat, to authorities. Landlords who violate that portion of the ordinance face a fine of $2,500. Repeat offenses could cost them up to $7,500 in fines.

Initially, the state legislation would have taken effect on July 1, but lawmakers changed the date last week so it will be in effect immediately. Both of the ordinances in Indianapolis will be preempted if Gov. Eric Holcomb signs the bill.

Hogsett’s administration, which opposed the legislation, has also said the legislation could take away its ability to impose fines against landlords who violate their regulations.

“Our city is home to many good landlords, but it is unassailable that too many of our residents are still being victimized at the hands of bad actors,” Hogsett said in his statement.

“It is also clear that the problems facing cities and towns across Indiana are unique to each jurisdiction and the solutions must be as well,” he said. “Instead of allowing local governments to address these challenges head on, Senate Bill 148 would take that power away and place the burden on our most vulnerable residents to navigate the legal system — without the benefit of being educated on their rights.”

State Sen. Jim Merritt, R-Indianapolis, who unsuccessfully ran for mayor against Hogsettt last year, previously told IBJ he generally supported Hogsett’s proposals, but he voted in favor of the bill on Wednesday.

The state proposal has drawn widespread criticism. A group of nearly 300 opponents sent a letter to Senate President Pro Tem Rodric Bray and other members of the Senate urging them to defeat the measure. And advocates for tenant rights gathered at the Statehouse on Monday to publicly voice their concerns.

James Taylor, CEO of John Boner Neighborhood Centers said the state has “very weak protections” for tenants.

“Good landlords have nothing to fear by protecting tenant rights,” Taylor said at the Monday press conference.

Officials in Bloomington and West Lafayette have expressed concern the legislation wouldn’t allow local rental inspection programs and could raise questions about rental registries. But it’s unknown exactly how many local ordinances would be impacted.

“For all we know it can impact almost every city’s ordinance just because of how broadly that it’s written,” said Amy Nelson, executive director of the Fair Housing Center of Central Indiana.

The Indiana Apartment Association, which opposed the Indianapolis ordinances, has been the biggest supporter of the legislation, arguing that statewide regulations would provide consistency for its members.

On Wednesday, the association issued a statement saying the legislation will actually provide “a new statewide protection for tenants that has not been previously available.”

“This statewide protection will give actual relief to a tenant who has been wrongfully evicted, unlike the Indianapolis ordinance that directed the money back to the city,” the group said. “Cities across the state are still able to expand legal services and resources to residents in need much like Indianapolis is doing.”

Republican lawmakers have also argued that the language does include some protections for tenants to shield them from retaliatory action by landlords.

“I think it’s fair to renters and landlords, and I think that’s what we were trying to get to is that balance,” House Speaker Todd Huston said. “It’s good policy, and it probably should take effect as soon as possible.”

But state Rep. Matt Pierce, D-Bloomington, said landlords will be able to write leases that require tenants to waive rights to the protections outlined in the bill.

He said the General Assembly is turning into an empty vessel for special interests. “I think this is one of the lowest points I’ve seen in the General Assembly,” Pierce said.

State Sen. Karen Tallian, D-Ogden Dunes, said the “entire thing makes no sense.”

“Changes affecting renters and landlord-tenant law should not be made without a lot of consideration, vetting and open discussion,” Tallian said.

State Sen. J.D. Ford, D-Indianapolis, criticized lawmakers for overstepping local control.

“To me this is just another attack on the voters of Marion County,” Ford said. “Are we just a glorified city council? Or are we the Indiana Senate?”

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