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Ordinance Amendment to Incorporate Rent Abatement and Escrow AccountsCity of Dubuque City Council Meeting Action Items # 2. Copyrighted October 18, 2021 ITEM TITLE: Proposed Ordinance Amendment to Incorporate Rent Abatement and Escrow Accounts SUMMARY: City Manager recommending the City Council adopt an Ordinance to allow for all remedies allowed by the State of Iowa for correcting code violations in rental properties. ORDINANCE Amending City of Dubuque Code of Ordinances Title 14 Building and Development, Chapter 1 Building Codes, Article J Property Maintenance Code, Section 14-1 J-2 International Property Maintenance Code Amendments SUGGESTED Suggested Disposition: Receive and File; Motion B; Motion DISPOSITION: ATTACHMENTS: Description Type Ordinance Amendment to Incorporate Rent Abatement City Manager Memo and Escrow Accounts- MVM Memo Staff Memo Staff Memo Ordinance Amending Chapter 14-1J-2 Ordinance Rent Escrow Draft Policy Supporting Documentation THE CITY OF Dubuque DUB TEE All -America City Masterpiece on the Mississippi � pp zoo�•*o 13 zoi720zoi9 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Proposed Ordinance Amendment to Incorporate Rent Abatement and Escrow Accounts DATE: October 13, 2021 The Building Codes adopted by the City Council, combined with the Rental License Ordinance, dictate the fines, fees and penalties for noncompliance with building codes as well as the Rental Licensing Ordinance. The State of Iowa Code allows cities several ways to encourage property owners to keep properties maintained and licensed when letting that property to another person (renting). The City of Dubuque Ordinance does not currently provide for all remedies that the State of Iowa allows. The remedies not listed in the City Ordinances are; rent abatement and the establishment of an escrow account. With the proposed ordinance amendment, the City will be able to abate rent if a property owner fails to carry an active rental license, has failed to provide an essential utility service or failed to remedy a condition that poses a substantial risk to the health or safety of the tenant. Rent abatement means that the property owner is unable to recover any rent from a tenant until the situation is cured. The rent that is abated never becomes due/payable. If the City abates rent, notification will be provided to both the property owner/agent and the tenants affected. Additionally, with the proposed ordinance change, the City may set up an escrow account for a property that remains in non-compliance with city codes. Rent normally paid to the property owner, is instead paid to the City and placed in this escrow account. The escrow account is used to abate the violations and bring the property up to code. Any money remaining in the escrow account after violations are remedied, is returned to the property owner. In most situations, the escrow will reimburse the costs of the improvements, so tenants do not have to wait for improvements to be made. These remedies for violations allowed by the State of Iowa will be helpful in gaining compliance for property owners that continue to ignore notice of violations, Municipal Infractions and Court Orders, and allows the City to help tenants live in a safe space by fixing the violations. City staff met with the Dubuque Area Landlord Association Executive Board in June, July and October 2021. Suggestions for edits to the ordinance from the June meeting were made and discussed again at the July 2021 meeting. City staff met with a group of local banks in August 2021 regarding the proposed ordinance to ensure there was collaboration and notification to banks that have liens/mortgages backed by the property (asset) and rent generated (income). Based on the input, changes were made to timelines for notifications and appeal periods, as well as the ability for the first lienholder to appeal the escrow determination. These additional options for remedies do not preclude the City from using other remedies such as issuing additional municipal infractions, declaring a public nuisance, charging the property owner with Contempt of Court, or petitioning for the title to a property. Housing and Community Development Director Alexis Steger recommends the City Council adopt an Ordinance to allow for all remedies allowed by the State of Iowa for correcting code violations in rental properties. I concur with the recommendation and respectfully request Mayor and City Council approval. k�4 Mic ael C. Van Milligen MCVM:jh Attachment cc: Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Alexis M. Steger, Housing and Community Development Director 2 Dubuque THE CITY OF DUB E Alf -America City Masterpiece on the Mississippi p pp zoo��o 13 zoi7*20*zoi9 TO: Michael C. Van Milligen, City Manager FROM: Alexis M. Steger, Housing and Community Development Director DATE: October 12, 2021 RE: Proposed Ordinance Amendment to Incorporate Rent Abatement and Escrow Accounts DISCUSSION The Building Codes adopted by the City Council, combined with the Rental License Ordinance, dictate the fines, fees and penalties for noncompliance with building codes as well as the Rental Licensing Ordinance. The State of Iowa Code allows cities several ways to encourage property owners to keep properties maintained and licensed when letting that property to another person (renting). The City of Dubuque Ordinance does not currently provide for all remedies that the State of Iowa allows. The remedies not listed in the City Ordinances are; rent abatement and the establishment of an escrow account. With the proposed ordinance amendment, the City will be able to abate rent if a property owner fails to carry an active rental license, has failed to provide an essential utility service or failed to remedy a condition that poses a substantial risk to the health or safety of the tenant. Rent abatement means that the property owner is unable to recover any rent from a tenant until the situation is cured. The rent that is abated never becomes due/payable. If the City abates rent, notification will be provided to both the property owner/agent and the tenants affected. Additionally, with the proposed ordinance change, the City may set up an escrow account for a property that remains in non-compliance with city codes. Rent normally paid to the property owner, is instead paid to the City and placed in this escrow account. The escrow account is used to abate the violations and bring the property up to code. Any money remaining in the escrow account after violations are remedied, is returned to the property owner. In most situations, the escrow will reimburse the costs of the improvements, so tenants do not have to wait for improvements to be made. 1 These remedies for violations allowed by the State of Iowa will be helpful in gaining compliance for property owners that continue to ignore notice of violations, Municipal Infractions and Court Orders, and allows the City to help tenants live in a safe space by fixing the violations. These additional options for remedies do not preclude the City from using other remedies such as issuing additional municipal infractions, declaring a public nuisance, charging the property owner with Contempt of Court, or petitioning for the title to a property. OUTREACH TO STAKEHOLDERS City staff met with the Dubuque Area Landlord Association Executive Board in June, July and October 2021. Suggestions for edits to the ordinance from the June meeting were made and discussed again at the July 2021 meeting. Board members expressed concerns that the language was not clear enough as to when the escrow would be used and that an appeal would stay the escrow until the decision of the appeal board was final. These updates were made and are reflected in the ordinance amendments being proposed to City Council. City staff met with a group of local banks in August 2021 regarding the proposed ordinance, to ensure there was collaboration and notification to banks that have liens/mortgages backed by the property (asset) and rent generated (income). Based on the input, changes were made to timelines for notifications and appeal periods, as well as the ability for the first lienholder to appeal the escrow determination. The City of Dubuque wants to engage those with interest in the property to keep properties maintained, so it is important to recognize Assignment of Rents that may be in place. A lienholder who has been active enough in the property to default a loan and receive Assignments of Rent has an active interest in the property, which is given consideration in the proposed ordinance. However, the Assignment of Rents during an escrow period, would only allow the lienholder to receive an amount of rents that monetarily satisfies the original loan payment agreement prior to being placed in escrow. The draft policy that is required by the proposed ordinance was also presented to the DALA and local banks in October. No concerns about the first draft were raised; however, the City will continue to have conversations and receive input from stakeholders prior to adopting a final policy. RECOMMENDATION I respectfully request City Council adopt the proposed Ordinance to allow for all remedies allowed by the State of Iowa for correcting code violations in rental properties. 2 cc: Crenna Brumwell, City Attorney Prepared by: Crenna M. Brumwell, Esq. 300 Main Street Suite 330 Dubuque IA 52001 563 589-4381 ORDINANCE NO. 36-21 AMENDING CITY OF DUBUQUE CODE OF ORDINANCES TITLE 14 BUILDING AND DEVELOPMENT, CHAPTER 1 BUILDING CODES, ARTICLE J PROPERTY MAINTENANCE CODE, SECTION 14-1J-2 INTERNATIONAL PROPERTY MAINTENANCE CODE AMENDMENTS NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. Section 14-1 J-2 of the City of Dubuque Code of Ordinances is amended to read as follows: 14-1J-2: INTERNATIONAL PROPERTY MAINTENANCE CODE AMENDMENTS: The following additions, deletions, modifications, or amendments of the International Property Maintenance Code, 2018 edition, adopted in section 14-1J-1 of this article to read as follows: Section 103.5. Fees. Amended to read: 103.5. Fees. The fees for activities and services performed by the housing and community development department will be established by the city council. Any unpaid penalty, fine, fee or interest shall constitute a lien on the real property and may be collected in the same manner as a property tax. The City shall send a notice of intent to file a lien to the owner of the housing by first class mail to such owner's personal or business mailing address. Section 106.5. Abatement of Violation. Amended to read: 106.5. Abatement of Violation, Escrow Established. A. Abatement of Violation. The imposition of the penalties herein described shall not preclude legal action by the City to restrain, correct or abate a violation, or to prevent illegal occupancy of a building, structure or premises, or to stop an illegal act, conduct, business or utilization of the building, structure or premises. B. Escrow System Established. 1. Pursuant to the authority granted in Iowa Code 364.17, the City hereby creates an escrow system for the deposit of rent which will be applied to the costs of correcting violations of the codes applicable to residential rental housing in the City of Dubuque. 2. No rent shall be recoverable by the owner or lessor of any dwelling which does not comply with the codes applicable to residential rental housing in the City of Dubuque until such time as the dwelling does comply with the applicable codes. 3. If other methods have failed, the code official may contract to have work done as necessary to remedy violations of the applicable codes at a residential rental property, the cost of which shall be assessed to the owner or lessor and constitute a lien on the property; or be paid using the funds deposited into the escrow system for the cost of correcting violations. 4. Escrow Order and Payment Requirement: a. An escrow order will be sent by U.S. Mail and certified mail to the owner or lessor, the first lienholder, and the tenant and will be posted at the address. b. Upon receipt of an escrow order, tenants shall pay their rent to the city which will hold the funds in escrow towards repairs. When rent is placed in escrow the owner or lessor may not recover rent from the tenant. C. The effective date of the escrow order is fourteen (14) days from the date of the order. d. A first lienholder may submit proof of an "Assignment of Rents' to the City. The City will adjust the escrow order to limit escrow collection of rents to the amount above the amount of the monthly mortgage payment due to the first lienholder. e. The owner, lessor, or first lienholder may appeal an escrow order to the Housing Appeals and Mediation Board. f. If, at hearing the Housing Appeals and Mediation Board adjusts or overturns the escrow order the funds shall be released to the owner or lessor and shall be payable within fourteen (14) days. 5. An escrow order shall be stayed pending an appeal by an owner or lessor. 6. The City shall develop a policy outlining the parameters and procedures for initiation of an escrow order which shall be on file with the Inspection and Construction Service Division and available to the public for review. 14-1J-3: RENTAL LICENSES: J. Suspension And Revocation Of Rental License: 1. Causes: The City Manager may, for good cause, suspend or revoke a rental license for a rental unit, and in the case of a multi -family dwelling, suspend the license as to one or more rental units for a period not to exceed one year for any of the following: a. Conviction, judgment, plea of guilty, or finding of guilt of the licensee for violation of any provision of the Property Maintenance Code; b. Misrepresentation by the licensee of any material fact in the application for a rental license; C. Refusal by the licensee to permit inspection of the licensed rental unit(s) by authorized City personnel; d. Nonpayment of the fee for renewal of the rental license; e. Failure to attend the Successful Rental Property Management Class; f. Failure to perform a required criminal background check on an applicant for tenancy after July 1, 2011; or g. Failure of a priority category to comply with an inspection schedule or pay inspection fees. Tenants will be relocated from the rental unit at the priority category's expense. 2. Opportunity To Appeal: Prior to any suspension or revocation under this subsection, the City Manager must give notice in writing to the property owner, manager, or licensed real estate professional and provide for an opportunity to appeal. 3. Period Of Revocation Or Suspension: During the period of revocation or suspension, a unit for which the rental license was suspended or revoked may not be relicensed. 4. Notice To Licensee: The City Manager shall cause to be issued to the licensee a notice that the license is suspended or revoked, setting forth the reason(s) therefor. The notice shall be sent by certified United States mail to the licensee at the address on file with the City Manager. 5. Appeal: The licensee may appeal the decision of the City Manager to the Housing Board of Appeals. An appeal must be filed, in writing, within twenty (20) days from the date of the notice of suspension or revocation. 6. Notice To Tenant: Upon suspension or revocation the City Manager must give written notice of the suspension or revocation of the license to each tenant, requiring the tenant to vacate the premises within a time frame determined by the City Manager if determined necessary. Any tenant who fails to vacate the premises after such time shall be subject to penalties under title 1, chapter 4 of this Code. 7. Relocation Of Tenants: If suspension or revocation of a rental license is the responsibility of the property owner, manager, or licensed real estate professional, as determined by the City Manager, then any displaced tenants shall be relocated at the property owner, manager, or licensed real estate professional's expense and the City Manager is authorized to assess the rental property for any costs incurred by the City. L. RENT ABATEMENT: 1. The code official may order rent abated when the code official determines that the owner or lessor has, after issuance of a notice of violation of this chapter: a. Failed to provide an essential service (water, sewer, electricity, heat); b. Failed to remedy a condition that poses a substantial risk to the health or safety of the tenant; or C. Rented a dwelling unit without a rental license including renting under suspension or revocation. 2. A rent abatement order means that the owner or lessor may not recover rent from the tenant. Rent shall be abated until the condition for which rent abatement was ordered has, in the judgment of the code official, been remedied. 3. The code official shall provide a copy of the rent abatement order to the owner or lessor at the address on the rental permit and to the tenant by U.S. mail and by posting the entrance door to dwelling unit. Notice of termination of the rent abatement order will be given in the same manner. 4. Rent abatement shall be stayed upon filing of an appeal by the owner or lessor. 5. The City shall develop a policy outlining the parameters and procedures for initiation of rent abatement which shall be on file with the Inspection and Construction Services Division and available to the public for review. Section 2. This ordinance shall take effect upon publication. Passed, approved, and adopted this 18th day of October, 2021. Roy D. ol, Mayor YU Attest: Adrienne Breitfelder, City Clerk EFFECT OF AMENDMENT 14-1J-2: INTERNATIONAL PROPERTY MAINTENANCE CODE AMENDMENTS: The following additions, deletions, modifications, or amendments of the International Property Maintenance Code, 2018 edition, adopted in section 14-1J-1 of this article to read as follows: Section 103.5. Fees. Amended to read: 103.5. Fees. The fees for activities and services performed by the housing and community development department will be established by the city council. Any unpaid penalty, fine, fee or interest shall constitute a lien on the real property and may be collected in the same manner as a property tax. The City shall send a notice of intent to file a lien to the owner of the housing by first class mail to such owner's personal or business mailing address. Section 106.5. Abatement of Violation. Amended to read: 106.5. Abatement of Violation, Escrow Established. A. Abatement of Violation. The imposition of the penalties herein described shall not preclude legal action by the City to restrain, correct or abate a violation, or to prevent illegal occupancy of a building, structure or premises, or to stop an illegal act, conduct, business or utilization of the building, structure or premises. B. Escrow System Established. 1. Pursuant to the authority granted in Iowa Code 364.17, the City hereby creates an escrow system for the deposit of rent which will be applied to the costs of correcting violations of the codes applicable to residential rental housing in the City of Dubuque. 2. No rent shall be recoverable by the owner or lessor of any dwelling which does not comply with the codes applicable to residential rental housing in the City of Dubuque until such time as the dwelling does comply with the applicable codes. 3. If other methods have failed, the code official may contract to have work done as necessary to remedy violations of the applicable codes at a residential rental property, the cost of which shall be assessed to the owner or lessor and constitute a lien on the property; or be paid using the funds deposited into the escrow system for the cost of correcting violations. 4. Escrow Order and Payment Requirement: a. An escrow order will be sent by U.S. Mail and certified mail to the owner or lessor, the first lienholder, and the tenant and will be posted at the address. b. Upon receipt of an escrow order, tenants shall pay their rent to the city which will hold the funds in escrow towards repairs. When rent is placed in escrow the owner or lessor may not recover rent from the tenant. C. The effective date of the escrow order is fourteen (14) days from the date of the order. d. A first lienholder may submit proof of an "Assignment of Rents" to the City. The City will adjust the escrow order to limit escrow collection of rents to the amount above the amount of the monthly mortgage payment due to the first lienholder. e. The owner, lessor, or first lienholder may appeal an escrow order to the Housing Appeals and Mediation Board. f. If, at hearing the Housing Appeals and Mediation Board adjusts or overturns the escrow order the funds shall be released to the owner or lessor and shall be payable within fourteen (14) days. 5. An escrow order shall be stayed pending an appeal by an owner or lessor. 6. The City shall develop a policy outlining the parameters and procedures for initiation of an escrow order which shall be on file with the Inspection and Construction Service Division and available to the public for review. 14-1J-3: RENTAL LICENSES: J. Suspension And Revocation Of Rental License- 1 . Causes: The City Manager may, for good cause, suspend or revoke a rental license for a rental unit, and in the case of a multi -family dwelling, suspend the license as to one or more rental units for a period not to exceed one year for any of the following: a. Conviction, judgment, plea of guilty, or finding of guilt of the licensee for violation of any provision of the Property Maintenance Code; b. Misrepresentation by the licensee of any material fact in the application for a rental license; C. Refusal by the licensee to permit inspection of the licensed rental unit(s) by authorized City personnel; d. Nonpayment of the fee for renewal of the rental license; e. Failure to attend the Successful Rental Property Management Class; f. Failure to perform a required criminal background check on an applicant for tenancy after July 1, 2011; or g. Failure of a priority category to comply with an inspection schedule or pay inspection fees. Tenants will be relocated from the rental unit at the priority category's expense. 2. Opportunity To Appeal: Prior to any suspension or revocation under this subsection, the City Manager must give notice in writing to the property owner, manager, or licensed real estate professional and provide for an opportunity to appeal. 3. Period Of Revocation Or Suspension: During the period of revocation or suspension, a unit for which the rental license was suspended or revoked may not be relicensed. 4. Notice To Licensee: The City Manager shall cause to be issued to the licensee a notice that the license is suspended or revoked, setting forth the reason(s) therefor. The notice shall be sent by certified United States mail to the licensee at the address on file with the City Manager. 5. Appeal: The licensee may appeal the decision of the City Manager to the Housing Board of Appeals. An appeal must be filed, in writing, within twenty (20) days from the date of the notice of suspension or revocation. 6. Notice To Tenant: Upon suspension or revocation the City Manager must give written notice of the suspension or revocation of the license to each tenant, requiring the tenant to vacate the premises within a time frame determined by the City Manager if determined necessary. Any tenant who fails to vacate the premises after such time shall be subject to penalties under title 1, chapter 4 of this Code. 7. Relocation Of Tenants: If suspension or revocation of a rental license is the responsibility of the property owner, manager, or licensed real estate professional, as determined by the City Manager, then any displaced tenants shall be relocated at the property owner, manager, or licensed real estate professional's expense and the City Manager is authorized to assess the rental property for any costs incurred by the City. L. RENT ABATEMENT: 1. The code official may order rent abated when the code official determines that the owner or lessor has, after issuance of a notice of violation of this chapter: a. Failed to provide an essential service (water, sewer, electricity, heat); b. Failed to remedy a condition that poses a substantial risk to the health or safety of the tenant; or C. Rented a dwelling unit without a rental license including renting under suspension or revocation. 2. A rent abatement order means that the owner or lessor may not recover rent from the tenant. Rent shall be abated until the condition for which rent abatement was ordered has, in the judgment of the code official, been remedied. 3. The code official shall provide a copy of the rent abatement order to the owner or lessor at the address on the rental permit and to the tenant by U.S. mail and by posting the entrance door to dwelling unit. Notice of termination of the rent abatement order will be given in the same manner. 4. Rent abatement shall be stayed upon filing of an appeal by the owner or lessor. 5. The City shall develop a policy outlining the parameters and procedures for initiation of rent abatement which shall be on file with the Inspection and Construction Services Division and available to the public for review. RENT ESCROW POLICY GUIDESHEET Basis Used to Abate a Violation and Recover Costs Through Rent Escrow A property owner may be subject to the escrow of rent to abate a building code violation once all the following conditions have been met: • Property Owner received a Notice of Violation(s) • A Court Order has been issued regarding the violation • Property Owner received a Municipal Infraction for the violation(s) • The Court Order has expired and the violation remains Notice Notice of the escrow must be provided to the property owner, tenant and first lien holder in writing and must inform them of all appeal rights and that failure to appeal will constitute a waiver of all rights to an appeal (14-day appeal period per ordinance) Process/Procedures for Rent Escrow The determination to initiate a rent escrow based on the above requirements being met will reside with the Code Official. PRIOR TO RENT ESCROW DETERMINATION RENT ESCROW DETERMINATION ESCROW COLLECTION AND CLOSURE Court Order Issuance —Triggers notification to First Lien Cost to fix violation(s) is determined based on in-house estimates Schedule Repair: Holder that a court order has been issued, and failure to • Contractor will be hired on a cost and qualification basis^ comply may lead to the escrow of rent received. Escrow may be used if: • Access to the property will be coordinated with Property • Estimate = Less Than 3 months of Fair Market Rent* Owner, Tenant or through Search Warrant/Court Order • Rent amount can be reasonably determined and collected when required • Rent Abatement conditions have NOT been met • Repair will be made immediately — escrow will be collected for reimbursement over time. *If cost to repair is greater than 3 months of FMR, escrow determination is made by the ^The City of Dubuque will follow the established administrative policy to receive Code Official for extenuating circumstance three estimates for work as able. The lowest quote will only be accepted if prior workmanship has been demonstrated. Court Order Expires (typically 30 days after issuance): Determination Letter Posted on Entry Door to Unit/Property and Sent Collection of Rent: to: Compliance with Orders, results in no further action The City of Dubuque will collect rent directly from tenants. • Property Owner Non -Compliance moves Property to Rent Escrow • Tenant Any non-payment of rent by a tenant will be reported to the Determination of Feasibility • First Lien Holder property owner within 7-days of non-payment. Additional Municipal Infractions may be issued during the A request for appeal filed within 14 days of the order, will stay the Release of Escrow: determination of escrow period. escrow order until the appeal is heard. Once the repair cost has been recovered, and the violation has An order of rent escrow does not preclude the City from filing The appeal may be filed by the Property Owner or First Lien Holder been corrected per the Code Official, the remaining escrow will a Contempt of Court for failing to comply with a Court Order. be released to the Property Owner or the First Lienholder if an Assignment of Rents are required to be filed with the City of Dubuque Assignment of Rents has been filed. prior to, or within, the 14-day appeal window to be applicable. Tenant will be notified of the release and obligation to pay rent to Property Owner or First Lienholder. STATE OF IOWA SS: DUBUQUE COUNTY CERTIFICATE OF PUBLICATION I, Kathy Goetzinger, a Billing Clerk for Woodward Communications, Inc., an Iowa corporation, publisher of the Telegraph Herald, a newspaper of general circulation published in the City of Dubuque, County of Dubuque and State of Iowa; hereby certify that the attached notice was published in said newspaper on the following dates: 10/22/2021 and for which the charge is 103.30 Subscribed to before me, a Notary Publicin and for Dubuque County, Iowa, this 22nd day of October, 2021 \Q Notary b is in and for Dubuque tounty, Iowa. �`a •,. JANET K. PAPE Commission Number 199859 My Comm. Exp. DEC 11, 2022 Ad text : OFFICIAL PUBLICATION ORDINANCE NO. 36-21 AMENDING CITY OF DUBUQUE CODE OF ORDINANCES TITLE 14 BUILDING AND DEVELOPMENT, CHAPTER I BUILDING CODES, ARTICLE J PROPERTY MAINTENANCE CODE, SECTION 14-1J-2 INTERNATIONAL PROPERTY MAINTENANCE CODE AMENDMENTS NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. Section 14-1J-2 of the City of Dubuque Code of Ordinances is amended to read as follows: 14-lJ-2: INTERNATIONAL PROPERTY MAINTENANCE CODE AMENDMENTS: The following additions, deletions, modifications, or amendments of the International Property Maintenance Code, 2018 edition, adopted in section 14-1J-1 of this article to read as follows: Section 103.5. Fees. Amended to read: 103.5. Fees. The fees for activities and services performed by the housing and community development department will be established by the city council. Any unpaid penalty, fine, fee or interest shall constitute a lien on the real property and may be collected in the same manner as a property tax. The City shall send a notice of intent to file a lien to the owner of the housing by first class mail to such owners personal or business mailing address. Section 106.5. Abatement of Violation. Amended to read: 106.5. Abatement of Violation, Escrow Established. A. "Abatement of Violation. The imposition of the penalties herein described shall not preclude legal action by the City to restrain, correct or abate a violation, or to prevent illegal occupancy of a building, structure or premises, or to stop an illegal act, conduct, business or utilization of the building, structure or premises. B. "Escrow System Established. 1."Pursuant to the authority granted in Iowa Code 364.17, the City hereby creates an escrow system for the deposit of rent which will be applied to the costs of correcting violations of the codes applicable to residential rental housing in the City of Dubuque. 2."No rent shall be recoverable by the owner or lessor of any dwelling which does not comply with the codes applicable to residential rental housing in the City of Dubuque until such time as the dwelling does comply with the applicable codes. 3."If other methods have failed, the code official may contract to have work done as necessary to remedy violations of the applicable codes at a residential rental property, the cost of which shall be assessed to the owner or lessor and constitute a lien on the property; or be paid using the funds deposited into the escrow system for the cost of correcting violations. 4. "Escrow Order and Payment Requirement: a. "An escrow order will be sent by U.S. Mail and certified mail to the owner or lessor, the first lienholder, and the tenant and will be posted at the address. b."Upon receipt of an escrow order, tenants shall pay their rent to the city which will hold the funds in escrow towards repairs. When rent is placed in escrow the owner or lessor may not recover rent from the tenant. c."The effective date of the escrow order is fourteen (14) days from the date of the order. d."A first lienholder may submit proof of an Assignment of Rents to the City. The City will adjust the escrow order to limit escrow collection of rents to the amount above the amount of the monthly mortgage payment due to the first lienholder. e."The owner, lessor, or first lienholder may appeal an escrow order to the Housing Appeals and Mediation Board. f. "If, at hearing the Housing Appeals and Mediation Board adjusts or overturns the escrow order the funds shall be released to the owner or lessor and shall be payable within fourteen (14) days. 5."An escrow order shall be stayed pending an appeal by an owner or lessor. 6. "The City shall develop a policy outlining the parameters and procedures for initiation of an escrow order which shall be on file with the Inspection and Construction Service Division and available to the public for review. 14-lJ-3: RENTAL LICENSES: J."Suspension And Revocation Of Rental License: 1."Causes: The City Manager may, for good cause, suspend or revoke a rental license for a rental unit, and in the case of a multi -family dwelling, suspend the license as to one or more rental units for a period not to exceed one year for any of the following: a. "Conviction, judgment, plea of guilty, or finding of guilt of the licensee for violation of any provision of the Property Maintenance Code; b."Misrepresentation by the licensee of any material fact in the application for a rental license; c."Refusal by the licensee to permit inspection of the licensed rental unit(s) by authorized City personnel; d."Nonpayment of the fee for renewal of the rental license; e. "Failure to attend the Successful Rental Property Management Class; f. "Failure to perform a required criminal background check on an applicant for tenancy after July 1, 2011; or g. "Failure of a priority category to comply with an inspection schedule or pay inspection fees. Tenants will be relocated from the rental unit at the priority category's expense. 2. "Opportunity To Appeal: Prior to any suspension or revocation under this subsection, the City Manager must give notice in writing to the property owner, manager, or licensed real estate professional and provide for an opportunity to appeal. 3. "Period Of Revocation Or Suspension: During the period of revocation or suspension, a unit for which the rental license was suspended or revoked may not be relicensed. 4. "Notice To Licensee: The City Manager shall cause to be issued to the licensee a notice that the license is suspended or revoked, setting forth the reason(s) therefor. The notice shall be sent by certified United States mail to the licensee at the address on file with the City Manager. 5. "Appeal: The licensee may appeal the decision of the City Manager to the Housing Board of Appeals. An appeal must be filed, in writing, within twenty (20) days from the date of the notice of suspension or revocation. 6. "Notice To Tenant: Upon suspension or revocation the City Manager must give written notice of the suspension or revocation of the license to each tenant, requiring the tenant to vacate the premises within a time frame determined by the City Manager if determined necessary. Any tenant who fails to vacate the premises after such time shall be subject to penalties under title 1, chapter 4 of this Code. 7. "Relocation Of Tenants: If suspension or revocation of a rental license is the responsibility of the property owner, manager, or licensed real estate professional, as determined by the City Manager, then any displaced tenants shall be relocated at the property owner, manager, or licensed real estate professional's expense and the City Manager is authorized to assess the rental property for any costs incurred by the City. L. "RENT ABATEMENT: L "The code official may order rent abated when the code official determines that the owner or lessor has, after issuance of a notice of violation of this chapter: a. "Failed to provide an essential service (water, sewer, electricity, heat); b. "Failed to remedy a condition that poses a substantial risk to the health or safety of the tenant; or c."Rented a dwelling unit without a rental license including renting under suspension or revocation. 2."A rent abatement order means that the owner or lessor may not recover rent from the tenant. Rent shall be abated until the condition for which rent abatement was ordered has, in the judgment of the code official, been remedied. 3."The code official shall provide a copy of the rent abatement order to the owner or lessor at the address on the rental permit and to the tenant by U.S. mail and by posting the entrance door to dwelling unit. Notice of termination of the rent abatement order will be given in the same manner. 4. "Rent abatement shall be stayed upon filing of an appeal by the owner or lessor. 5. "The City shall develop a policy outlining the parameters and procedures for initiation of rent abatement which shall be on file with the Inspection and Construction Services Division and available to the public for review. Section 2. This ordinance shall take effect upon publication. Passed, approved, and adopted this 18th day of October, 2021. /&/Roy D. Buol, Mayor Attest: /s/Adrienne N. Breitfelder, City Clerk Published officially in the Telegraph Herald newspaper on the 22nd day of October, 2021. /s/Adrienne N. Breitfelder, City Clerk It 10/22