INDIANAPOLIS | Cities and towns across Indiana, including several region communities, are one signature away from losing their ability to vigorously regulate rental properties within their borders.
The Republican-controlled House voted 67-24 on Tuesday to accept Senate-approved changes to House Bill 1403, which exempts rental properties with more than five units that are managed by professional landlords from municipal inspection requirements and associated fees, if they hire their own inspectors.
State Rep. Jud McMillin, R-Brookville, the sponsor, said the measure -- supported by a state associations of landlords and real estate agents -- will minimize government intrusion while ensuring a continued supply of safe housing choices.
"It gives the opportunity for private-sector individuals who need to meet very rigorous standards, and do government's job quite frankly better than government can, the opportunity to opt out," McMillin said.
Some lawmakers remained skeptical of the self-inspection plan, even after it was changed by the Republican-controlled Senate to require inspectors not be a landlord's employee. Inspections also would be limited to specific apartment features and structures; localities couldn't add items to the inspection list.
"You're kind of putting, in my opinion, the fox in charge of the hen house," said state Rep. Matt Pierce, D-Bloomington.
Hammond Mayor Thomas McDermott Jr. has been the most vocal opponent of the legislation, which he's dubbed, "The Slumlord Protection Act."
He said Hammond needs a strong rental registration program to crack down on single-family homes that have been cut up into multiple apartments, often by absentee landlords.
A January fire killed three children living in a Hammond home that had illegally been cut into two apartments.
"This is not the way things are supposed to work," McDermott said. "We're all supposed to be on the same page when it comes to public safety."
Under the plan, Hammond's $80 per unit annual rental registration fee would have to drop to $5 per rental property. McDermott said the costs of the city's inspection program, which currently are paid out of those fees, likely will have to come from other city revenue if the inspections are to continue.
McDermott said he hopes Republican Gov. Mike Pence "does the right thing" and vetoes the legislation that's now headed to his desk. But he doubts Pence will, since the governor refused even to meet with McDermott to discuss the proposal.
At the same time, McDermott said he's consulting with attorneys to see if exemptions allowing Bloomington and West Lafayette to continue their rental inspection programs may be grounds for overturning the measure, if it's signed into law.
Legislative ire toward municipal rental registration and inspection programs developed in 2012 after Merrillville proposed subsidizing its police force with proceeds from a $100 per unit apartment registration fee.