Governor Signs Residential Rental Inspection Bill Into Law

From the Apartment Association of North Carolina’s (AANC) website:

 In a major victory for North Carolina rental housing providers, the Apartment Association of North Carolina-initiated Bill – Residential Building Inspections – was ratified by the N.C. Legislature on June 18th. Once signed by Governor Perdue, the bill will become law immediately, and will rein in advocacy-minded local units of government who have exceeded – or might want to exceed – their statutory limitations on housing inspections. The Bill:

  • Requires units of government to have reasonable cause to believe that unsafe housing conditions exist in order to inspect private housing, via landlord history, reports, or actual knowledge by a unit of government. This provision allows resources to be used to focus on unsafe conditions, problem properties and irresponsible owners and landlords.
  • Requires government housing inspection programs to be administered in a non-discriminatory way regarding housing type or ownership.
  • Provides local governments the authority to make an exception to the reasonable cause test in order to conduct periodic inspections as part of a targeted effort to arrest blight within designated Community Development or similar zones.  
  • Prohibits local governments from requiring permits as a condition of operating rental housing – unless a property has more than 3 violations in a twelve month period, or falls within the top 10% of local crime or disorder problems.
  • Prohibits local governments from levying rental registration fees unless a dwelling unit has more than 2 violations in a twelve month period, or falls within the top 10% of local crime or disorder problems.

 Context: North Carolina cities have historically been concerned about housing conditions in their jurisdictions, especially in older, poorer neighborhoods, and have appropriately adopted ordinances calling for minimum housing quality codes. The administration of these codes are an important tool in helping North Carolina municipalities fight neighborhood decline while ensuring to housing consumers that minimal health, safety, and sanitation conditions are maintained in residential structures.

Unfortunately, some N.C. municipalities have substantially broadened these programs aimed at stemming blighted conditions and now apply them to all housing, or at least all rental housing, as part of mandatory inspection approaches. Sometimes these programs are tied into required permits and fees as a condition of operating rental property. Programs designed to systematically inspect all rental housing for the purpose of improving housing quality are bad public policy and waste needed resources that could be used to combat problematic housing.

Inspection programs in these environments amount to a “housing tax” with no public benefit. The core of current NC law gives units of government the authority to respond to housing conditions that are unsafe, dangerous, and unfit for human habitation. The new law ensures that units of government don’t exceed their authority.