July 05, 2006

The War Against "Smart" Slumlords

Whenever there's news of an enforcement action against an illegally occupied house, readers always ask, "Why can't they just shut it down?"

This week East Hampton Town Prosecuting Attorney Tiffany Scarlato spoke to The Independent about the difficulties inherent in investigating and prosecuting illegal rental homes. She also described measures the town is taking in furtherance of Supervisor Bill McGintee's new "zero tolerance" policy.

Suspected code violators snared in a sweep last month are suffering the consequences of the new policy. But before any alleged slumlord or tenant gets into the system, town officials embark on a lengthy and often frustrating investigation, beginning at the complaint stage.

Once the town receives word of a suspected illegally occupied house, surveillance begins. It's not easy, Scarlato informed. In recent years, owners of the illegal abodes have become more and more savvy about hiding signs of over-occupancy, she said. At some houses, tenants use shuttles to get to cars parked off-site. Fencing and hedges create "fortresses" where little is visible from the road. But that hasn't completely short-circuited surveillance. Investigators have even posed as highway department staff, on rare occasions taking a ride in the bucket of a cherry picker to get a bird's eye view.

Once officials feel more certain that something hinky is happening at a house, they approach the domicile. By law, they can only "do what the UPS man can do," Scarlato explained. That means they can knock on a door, but they can't walk around the house peering in windows. According to the attorney, officers have literally been kept waiting at the front door, while mattresses are tossed out the back and flimsy walls are knocked down. One officer, Scarlato recounted, was standing on the stoop watching as a truck pulled out from behind the house loaded with evidence.

To increase the effectiveness of investigations, staff in the ordinance enforcement department has been redeployed of late, working hours when they're most likely to see action at houses. Lots of observations are made during the early morning hours before most people go to work, as well as later at night.

As with the case of six suspected overcrowded houses busted last month, eventually some dwellings make it into the system. In the past, under a policy of seeking voluntary compliance first and foremost, simple court proceedings did little to deter code violators, thanks to adjournments, and modest fines that could be written off as simply the cost of doing business. Even a recent increase in fines pales in comparison when one considers landlords can make upwards of $5000 a month in rental income.

Under the new policy, however, landlords and tenants both are required to report to court every week. They're asked to offer updates on efforts they're making to come into compliance. And when they do, officers are checking. In one case already, a tenant reported that he'd moved out of the illegal dwelling. Officers checked his new digs and found he was living in a tiny, 5 by 8 space. And so another illegal rental was brought into the system.

Beyond weekly court appearance that require time off from work, plus paying for an attorney, Scarlato agrees that another strategy may prove the best deterrent. Town officials are contacting the IRS, letting the agency know of suspected illegal rooming houses. The attorney implied that there are some of the homeowners who don't appear to have jobs beyond running the illegal operations. They may not file income tax at all, much less claim the rent proceeds. The town is in the process of compiling information on the half dozen cases from last month to forward to the feds, she said.

Currently, Scarlato said she's prosecuting about 40 or 50 housing related cases in court. There are another 100 complaints investigators are plugging away at. While the town is making headway, especially with the new level of aggressive prosecution, Scarlato noted that some myths about working the cases continue to abound.

For example, the town can't simply evict tenants, or quickly shut down illegal houses. Few judges would sign rulings that leave tenants in the streets with their bags, she said. Additionally, it takes Supreme Court action to close down houses permanently. "These cases do, unfortunately, take some time to clean up," she said. The court is more likely to close down and evict groupers in seasonal homes if they have a place to go, she noted.

Another misconception? Often readers will complain of overcrowded houses in their neighborhoods, wondering why the town hasn't "done something" about them. "The town can't be everywhere," Scarlato noted. She reminded that residents could call in complaints anonymously. "I'd rather they didn't sit home and stew about it." Soon, the town plans to establish a housing hotline that will make it easier for folks to make reports.

While Scarlato sees the strategy of keeping suspected violators on a short leash with weekly court appearances, as well as using the IRS and potential local property tax re-assessments as a deterrent, she favors yet another measure to quell the number of illegal house — instituting a rental registry.

Southampton Town uses its rental permit program in illegal housing investigations with success, she said, "It's their first line of defense." She's got a draft of an East Hampton version ready to go, but the notion has met with opposition from residents who feel it's too intrusive.

As the war has waged on, Scarlato noted one victory of sorts. While landlords have become more savvy and ingenious about ways around the system, they have also stepped back from the bold and horrific ways of just a couple of years ago. Those who run illegal boarding houses are still imperiling tenants by housing people in illegal spaces, like basement apartments, but there have been fewer cases involving dozens of men living in squalid conditions. Landlords have apparently, Scarlato said, "gotten very smart."

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