The promise — and limitations — of the right to counsel for evictions

A much-needed reform to a fundamentally unreformable housing system

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During the pandemic, this once-per-month newsletter may be split into two issues: one monitoring developments related to the COVID-19 pandemic, and one for other news on housing justice.

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This issue focuses on right to counsel, highlighting both the urgent need for this reform as well as the ways in which our housing system is so irreparably broken that even radical reforms like right to counsel fall short. What’s needed is a fundamental rethinking of housing in this country.

Housekeeping:

  • Central CT DSA hosted a free webinar featuring historian Hannes Rolf on the Swedish Tenants Union, the most powerful and successful tenants union in the history of the world. He discussed the Swedish Tenants Union and the lessons it holds for reforming the American housing system. You can watch a recording here.

The promise of right to counsel

Right to counsel gives tenants in eviction court the right to a free attorney, paid for by the public.

The right to counsel movement is on fire right now; entering 2017, nowhere in the US had the right to counsel for tenants facing eviction. Four short years later, seven cities have established a right to counsel, or at least free legal assistance programs to tenants facing eviction: New York and Rochester, NY (though Rochester’s program is set to expire at the end of June); Newark, NJ; Cleveland, OH; Boulder, CO; Santa Monica, CA; and the most recent, Baltimore, MD, which passed right to counsel this past December.

The benefits of right to counsel are extraordinary. Tenants in eviction court are less likely to be thrown out of their home, but even if they do lose their home they might experience a much softer landing: attorneys in eviction court are often able to convince judges to allow more time to move out (and find a new place) and reduce or eliminate the money tenants owe in back rent, for example. Merely appearing in court records for an eviction — even if the landlord was found to be in the wrong — can be devastating to a tenant’s ability to find housing in the future. Attorneys are often able to prevent tenants from appearing in court records (despite having been in court). Aside from being the right thing to do, right to counsel even saves government money because people are less likely to wind up homeless.

Your city needs right to counsel, too! You can participate in a free webinar (or view a recording afterward) hosted by people in each city that won right to counsel, discussing how they won it and how it can be won in other cities (see also their right to counsel campaign toolkit). The webinar is hosted by the National Coalition for a Civil Right to Counsel and Right to Counsel NYC Coalition.

Right to counsel is desperately needed across the US. But right to counsel is only a reform to a rental housing system that is fundamentally unreformable, and that’s the topic of the rest of this section. First, we’ll see that the vast majority of involuntary moves are not evictions, but precipitated by issues such as a landlord increasing rent or inadequately maintaining an apartment. Second, countries with excellent protections for tenants do not have a right to counsel. And finally, unscrupulous landlords have found many loopholes in the legal system, allowing them to refuse to maintain their apartments (even if their negligence endangers its inhabitants) and foist the costs of this destructive business model onto the public.

New episode of Housing for Us: rental housing instability even when there are no formal evictions

We expect to have about 20 episodes of Housing for Us, interviewing people who have experienced tragedies of the American housing system you might not realize go on, and talking to people who live in housing systems that work really well. You’ll learn that the American housing system is way worse than you thought, but you’ll also learn how to fix it as we travel the world looking for a better way.

In our brand new episode, we speak to Nick (who serves as the treasurer of this organization) about his childhood of insecure housing. He moved 9 or 10 times as a child (so many times he can’t remember exactly how many), yet was never evicted. Shockingly, Nick’s mom was employed full-time as a receptionist, and he lived the majority of his childhood in a well-to-do suburb. It’s not solely a matter of poverty or inner-city slumlords; rental housing in the US is extremely insecure and unstable, no matter who you are or where you rent.

An astonishing 30-35% of renters move every year, though in the past decade (per the Census Bureau) we have seen so-called “historically low” levels of renters moving. In the 2010s, “only” 20-25% of renters move every year. In our interview, Nick said that if his family had a modest, safe home at a price they could afford, they would have moved 0 times in his childhood, which would have meant less stress and more stability for his family. We look at other data showing that renters aren’t moving because they want to, but because they have to. A housing system that forces renters to move every few years when most would prefer not to is a housing system that is irreparably broken.

Here’s the tie-in to right to counsel: The vast majority of renters’ moves — including all of Nick’s 9 or 10 moves as a child — are not evictions; they’re over a landlord not renewing a lease, a landlord increasing rent, maintenance issues, etc. Moreover, the best available data reveal that illegal evictions (a landlord illegally forces a tenant to move out by, e.g., removing the front door) are twice as common as legal evictions. Though desperately needed, right to counsel would do nothing to address the vast majority of involuntary moves in our rental housing system since the vast majority of involuntary moves never go through the courts.

Prior to the pandemic, evictions were filed at a rate of one every 4 seconds in the US; as soon as the eviction moratoriums end, we will surely return to this dizzying pace of evictions, if not more. Yet the vast majority of involuntary moves are not evictions. Clearly, this is a housing system that is totally broken.

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Final episode of Housing for All released

With our friends at Outrageous Mechanisms, we distill all the essential information you need to know about reforming the American housing system into 4 episodes. Episodes 1 and 2 discuss five housing systems that work really well and what we can learn from them: Norway, Singapore, the Netherlands, Austria, and Sweden. In episodes 3 and 4, we make the case that all housing is public housing: all housing has been so heavily subsidized by the federal government that it would otherwise not exist or be unrecognizable without it. It is no exaggeration to say that we all live in public housing. We can reach the goal of housing for all without spending any more money because the government already devotes so many resources to housing.

If you’re not a podcast listener, we’ll recap the major points from the podcast in this newsletter (last month was Norway). This month — because they tie into this issue’s focus on right to counsel — we’ll look at our extended discussion of length of tenure regulations as well as two stories we highlighted about terrible abuses in the American rental housing system.

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Length of tenure regulations

In choosing five housing systems to explore in the Housing for All podcast, one of the most important criteria was housing security: are people forced to move if they don’t want to move?

All five housing systems featured in Housing for All have excellent housing security, yet none of them use right to counsel. In other words, our housing system is totally broken and only an attorney can protect you from its worst abuses. In better housing systems, ordinary people don’t need lawyers to protect them. Right to counsel may be imperative in the short term, but in the long term, we should demand a housing system where ordinary people don’t need lawyers to stay in their homes.

One of the ways these housing systems ensure housing security is through length of tenure regulations, or a tenant’s right to stay in an apartment even if her landlord wants her to leave. Of the five countries we discuss, three — the Netherlands, Austria, and Sweden — have indefinite length of tenure. This means that a rental lease never ends and tenants don’t have to worry about whether or not their landlord will agree to renew it: the lease has no end date and simply lasts until the tenant wants to move out (the other two countries use homeownership, rather than rental housing, to ensure security of tenure). A landlord can only force a tenant to move against her will if the tenant falls several months behind on rent, destroys property, or the landlord herself is without a place to live.

You did not misread that: in the US, if you are a minute late or a penny short on rent, your landlord has the right to start the process to evict you, but in some countries, you must be multiple months behind on rent before a landlord can evict you. And whereas in the US a landlord has an unlimited right to refuse to renew a lease after a single year (or shorter if your lease is month-to-month), in these countries a landlord only has this option in very limited circumstances (in the Netherlands, a landlord must have an “urgent need” for the home, like if her own house burned down).

Germany and Switzerland also have indefinite length of tenure, and in Germany, Switzerland, and Austria, people can inherit rental leases from their parents under the exact same lease terms as their parents had. In this way, people can inherit an apartment in the way that someone might inherit a house their parents own.

With indefinite length of tenure, renting is so secure that it is not unusual for someone to grow up their entire childhood in the same apartment and live most of their adult life in the same apartment. In countries where leases can be inherited, it is not unusual for someone to live their entire childhood in an apartment with their parents, move out as a young adult, and move back in (assuming their parents’ lease) when their parents pass on or move to someplace smaller in retirement.

A broken legal system

In the Housing for All podcast, we highlighted two stories investigating abuses in the American rental housing system: an article from 2019 in the Brooklyn Eagle and a series from the Milwaukee Journal-Sentinel from 2015-2016.

Reporters from both newspapers spoke to tenants in housing with serious and potentially deadly issues: collapsed ceilings, toxic mold, faulty wiring causing housefires, a lack of plumbing, gas leaks, missing windows and doors, and a lack of heat and hot water during frigid winters. When a landlord signs a lease, she is bound by contract to properly maintain her housing. Clearly, this legal obligation is in fact toothless. If the tenant does not obey her contractual obligations, she will be swiftly thrown onto the streets; if a landlord does not obey her contractual obligations, there are often few or no consequences.

Milwaukee’s story is even worse, because landlords have even found ways to erase $100,000 or more in debts to the City of Milwaukee: through totally legal use of loopholes in corporate law, five- and six-figure bills for property taxes and fines for code violations are simply forgiven. Aside from robbing the city government of much-needed revenue for services like schools and sanitation, the series exposes how landlords have found other ways to pass the costs of their destructive business model onto the public.

When it’s legal to make massive profits while passing so many externalities onto tenants and the public, it’s clear that inadequate representation within the legal system isn’t the problem — the legal system itself is the problem.

Right to counsel

The Center for American Progress has an excellent policy brief on right to counsel. It’s a long read but well worth it; here’s the section summarizing the research on the effects of right to counsel:

A 2013 study on eviction cases in Manhattan showed that providing legal counsel to tenants was associated with a 77 percent decrease in the number of cases that resulted in a warrant for eviction.49 Similarly, a 2010 study from Massachusetts revealed a 77 percent decrease in judgments for eviction when tenants were represented as well as a 45 percent decrease in the number of cases in which tenants lost their homes.50

Two eviction-prevention pilot programs in Boston used a randomized study to measure the effect of full legal representation for a targeted group of low-income tenants facing eviction between 2009 and 2011.51 In one program, two-thirds of tenants with full representation retained their homes, compared with just one-third of similar unrepresented tenants. Tenants with full representation also received a combined total of more than $306,000 in financial benefits, such as damage payments and waived rent, compared with about $73,000 total for unrepresented tenants. Additionally, tenants with full representation benefited from having ample time to find new housing. The second program showed little difference in retaining homes between fully represented and unrepresented tenants, though it is not clear why. Both pilot programs revealed that full representation allows attorneys to have a thorough understanding of each client’s case and to manage the case accordingly.

In Hennepin County, Minnesota, data collected between 2016 and 2018 showed how the extent of representation—full, limited, or none—influences a variety of tenant outcomes in eviction cases. In all dimensions of the study, tenants with full or limited representation fared better than unrepresented tenants.52 Tenants with full representation won 21 percent of their cases, while those with limited representation won 24 percent of cases, and unrepresented tenants won only 11 percent of cases. Fifty-two percent of fully represented tenants remained in their homes, compared with 48 percent of tenants with limited representation and just 31 percent of unrepresented tenants. Similarly, 78 percent of fully represented tenants left court without eviction filings on their records, while this was true for only 17 percent of tenants with limited representation and 6 percent of unrepresented tenants. Notably, the study also concluded that represented tenants are four times less likely than unrepresented tenants to enter homeless shelters.

An analysis of more than 100,000 nonpublic housing eviction cases in Philadelphia filed between 2012 and 2017 examined how represented and unrepresented tenants fared in terms of forcible displacement and other disruptions that often accompany eviction.53 Tenants with representation were forcibly displaced from their homes in just 5 percent of cases, compared with a staggering 78 percent of unrepresented tenants. Represented tenants were also twice as likely as unrepresented tenants to receive a favorable judgment. Tenants with representation were 15 percent less likely than unrepresented tenants to have a second eviction case brought against them.

Fewer evictions means fewer devastating consequences that tend to result from evictions, including forced moves that disrupt nearly every dimension of a household; entries into homeless services systems and the trauma that accompanies homelessness; and extremely high eviction-related monetary costs that cities must shoulder.54 A 2016 cost-benefit analysis of a right to counsel in eviction cases for renters with incomes up to 200 percent of the federal poverty level in New York City found that the net cost savings for the city would be $320 million per year, after accounting for the cost of providing counsel.55 Specifically, $251 million would be saved by preventing 5,237 families from entering shelters; $9 million would be saved by preventing 278 individuals from entering unsheltered homelessness; and $259 million would be saved by preserving 3,414 affordable rental homes. A report about the two randomized pilot projects in Boston indicated that if the state provided representation for a targeted group of Massachusetts renters, then the state would achieve a net savings of more than $3 million in emergency homeless shelter costs alone.56 A report about the Philadelphia analysis estimates that more than 14,000 Philadelphians could avoid eviction every year and that the city could realize annual net savings of more than $40 million if the city provided representation to all low-income tenants.57 This is a conservative estimate of cost savings, as additional unquantified costs are expected to result from fewer evictions filed, including a decreased negative effect on tenant credit scores and the preservation of affordable homes, among other savings.

The introduction outlining the scourge of evictions in the US housing system is also excellent. The whole brief really is worth reading in full.

New York and Milwaukee’s worst landlords

When a landlord signs a lease, she is bound by contract to properly maintain her housing. As the stories highlighted in this section make painfully clear, this legal obligation is toothless, a fact unscrupulous landlords can — and do — exploit to the fullest. This is extraordinary hypocrisy in our legal system, as serious, life-altering penalties exist when tenants do not obey that same rental lease their landlord is able to ignore. If a tenant is a minute late or a dollar short on rent, the landlord has the power to swiftly summon law enforcement to remove the tenant from the home, her possessions thrown to the street and her life upended.

But while consequences for a tenant disobeying a lease are severe and enforced with the iron fist of our legal system, consequences for a landlord disobeying that same lease are often the responsibility of toothless or understaffed municipal agencies or are unenforced by the courts. Thus, a landlord is not under obligation to obey a contract; in a rental lease, the provisions are mandatory for the tenant but optional for the landlord.

The first example comes from the Brooklyn Daily Eagle from 2019. Every year, the NYC Public Advocate (an elected official, second in line to the mayor) attempts to shame landlords into doing maintenance by trumpeting their name publicly. Shockingly, that year’s report revealed that just 10 landlords had a combined 11,830 outstanding building code violations. Eagle reporters went to one address to show that code violations aren’t victimless nuisances like a dripping faucet (emphasis added):

During a tour of Korn’s property at 250 East 29th St. in Brooklyn Monday, resident Megan Adams, 65, said she’s been living under horrendous conditions for about 16 years. In January her bathroom ceiling collapsed from water damage and the heat is frequently shut off, she said...Adams said she frequently finds mice droppings, and one rodent recently crawled on her as she napped.

“It’s like we are nobody in here,” she said...“The fact of the matter is, in exchange for rent … you have to have a unit that is safe for human beings to live in. Jason Korn has not provided that and so that’s what this is about, doing the best we can to shame the landlord into doing the work they’re supposed to be doing,” Williams said.

Clearly, the legal system is not capable of holding landlords accountable to their contractual obligations to maintain their housing. There is little or no recourse for a tenant whose landlord will not perform basic maintenance. There are no consequences for landlords except for being shamed in the media, but a landlord who allows their tenants to live in these conditions clearly has no shame.

Finally, the Milwaukee Journal-Sentinel ran their Landlord Games series starting in 2016. It, too, takes up the issue of deferred maintenance, finding incredibly dangerous conditions, including raw sewage, faulty wiring that had caused a house fire, toxic mold, and gas leaks, as well as other issues which make apartments unlivable, such as a lack of heat and hot water in Wisconsin winters (and tenants attempting to heat their homes with their stoves), or missing windows and doors. Reporters spoke to multiple tenants living in buildings in such dangerous conditions that the city had ordered that they could not be occupied until brought up to code. One tenant

pointed to her kitchen sink, which was filled with filthy, greasy and moldy water. The pipes under the sink were disconnected, making it impossible to drain it.

“I called and they said they would fix it,” said Hicks, who has since moved. “It’s been at least a month.”

But the bigger story is the series’ exposure of landlords’ abuse of multiple loopholes, mostly centered around corporate law governing LLCs.

The scheme works like this: the landlord doesn’t technically own any of her rental properties. Rather, an LLC controlled by the landlord is the owner. Unscrupulous landlords frequently have many LLCs; some landlords have a separate LLC for each and every building.

When the tenants pay rent each month, they’re not paying rent to the landlord; they’re paying rent to the LLC. The landlord gets to keep all the profits of the LLC, but it’s the LLC that’s liable for all taxes, fines for building code violations, lawsuits, etc.

Collecting rents can be profitable, but paying for building maintenance is not. So, abusive landlords simply ignore repair and maintenance issues, endangering and making their tenants miserable in the process. Eventually, the deferred maintenance accumulates until the buildings become unlivable and need to be demolished.

In theory, enforcement of building codes is supposed to prevent owners from allowing their buildings to fall into disrepair. Milwaukee’s Department of Neighborhood Services can issue monetary fines for deferred maintenance, particularly for problems that endanger tenants’ safety. Yet abusive landlords’ buildings accumulate fine after fine from Neighborhood Services; reporters found single buildings with tens of thousands of dollars in unpaid fines for code violations. Landlords make bare minimum payments to keep courts at bay without ever paying in full. Clearly, they have found a loophole.

At first glance, this seems like a terrible business model: buying expensive capital, then deliberately letting it decay to the point where it can no longer generate revenue, all the while incurring massive fines. Why would a landlord do this? How can this possibly be a profitable business model?

The next step of the Landlord Games series explains how.

Once a building becomes unlivable, it’s no longer profitable for the landlord, and she simply stops paying property taxes on the buildings. The City of Milwaukee’s policy is to wait for a building’s owner to fall three years behind on property taxes before seizing the building in foreclosure. This is probably a good policy; if an ordinary Milwaukee resident falls behind on property taxes on her only home, she shouldn’t lose her home immediately. Maybe she lost her job and fell behind on her property taxes as a result; if so, she should get some time to catch up and pay off the balance.

But abusive landlords exploit this three-year period, continuing to collect rents for three years. At the end of three years, the city takes the building in tax foreclosure.

In theory, the landlord should now owe the City a massive, five-figure bill for unpaid property taxes and building code fines. But remember, it’s not the landlord that owns the buildings: it’s the landlord’s LLC. In other words, Neighborhood Services has not been issuing fines for code violations to the landlord; it’s been issuing fines to the LLC. Similarly, it’s not the landlord who owes property taxes: it’s the LLC. So it’s not the landlord who owes the City a small fortune: it’s the LLC. The landlord owes nothing.

So the LLC owes the City a fortune. What’s the financial state of the LLC? The LLC lost its property to tax foreclosure, so it doesn’t have any income. And the landlord has pocketed all the revenues of the LLC, so it doesn’t have any assets. In other words, the LLC is broke. Since the LLC is broke, there’s nothing the City can do; all the unpaid fines and property taxes are forgiven. Reporters found landlords with forgiven property tax bills in excess of $100,000 and forgiven fines for code violations in excess of $100,000.

Now, not only has the City forgiven a massive bill, but it must also assume responsibility for an unlivable building. It’s now the City’s responsibility to pay for demolition or other necessary costs of the abandoned building (like utility disconnections, increased police patrols, etc); this can cost a city in excess of $30,000 (often, the buildings need to be demolished; this alone costs over $15,000). The block is now blighted by an abandoned, unlivable building.

Many of the landlords in this series live in Milwaukee’s suburbs so they don’t have to actually experience any of the consequences of what they do. One landlord featured prominently in the series drives a Corvette and once came up with $700,000 cash in a few days’ time to bail himself out when he was jailed for ignoring orders for lead abatement.

In sum, loopholes in the legal system allow landlords to make fabulous profits by renting out grossly substandard and dangerous apartments, ignoring property taxes, ignoring building code violations and fines, blighting neighborhoods, and pushing all of the costs of their destructive business model onto the public.

Milwaukee is unique in that these abuses were plastered on the front pages of the local newspaper. These landlord games occur across the country and demonstrate the need to totally rethink our legal system surrounding housing.

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