MADISON — Gov. Tony Evers, together with the Wisconsin Housing and Economic Development Authority (WHEDA), announced today that two new loan programs, Restore Main Street and Vacancy-to-Vitality, are now available and expected to spur the development of new affordable housing units across the state.
“Expanding access to safe, reliable, affordable housing statewide in Wisconsin is critical to addressing our state’s pressing workforce challenges while connecting the dots to ensure our kids, workers, and families can be successful and thrive,” said Gov. Evers. “As we revitalize main streets and turn vacant commercial spaces into affordable residential units, we are building a brighter future for our workforce, our economy, and our state. I am proud that, through these new programs and investments we made in the budget, we are able to help Wisconsinites access the safe, stable housing they deserve.”
“Together, these new programs give us even more opportunities to add much-needed affordable housing in both urban and rural areas of our state that are desperate for safe, stable homes for working individuals, families, and seniors,” said WHEDA Executive Director Elmer Moore Jr.
Access to safe, reliable, and affordable housing is a critical part of helping address the workforce challenges facing the state. For years, Gov. Evers has proposed robust provisions and investments in expanding access to housing statewide, including in his 2023-25 proposed budget. The governor was glad to have the Wisconsin State Legislature join him in supporting this critical effort. The 2023-25 biennial budget signed by Gov. Evers provides one of the largest state investments in workforce housing—$525 million—in state history, including measures to fund both the Main Street Housing Rehabilitation Revolving Loan Fund and Loan Program, now called Restore Main Street, and Commercial-to-Housing Conversion Revolving Loan Fund and Loan Program, now called Vacancy-to-Vitality. Both programs were created earlier this year as part of a bipartisan package of bills Gov. Evers signed to help expand access to safe, affordable housing for working families.
The Restore Main Street Loan Program provides loan funding for building owners to cover the costs to improve housing located on the second or third floors of an existing building with commercial space on the ground level. Borrowers can apply for up to $20,000 per housing unit or 25 percent of the total rehabilitation cost at a low-interest rate of three percent or one percent in municipalities with a population of less than 10,000.
The Vacancy-to-Vitality Loan Program allows a developer to apply for a loan to cover the costs of converting a vacant commercial building to workforce or senior housing. Developers can apply for up to $1 million or 20 percent of the total project cost, including land at a low-interest rate of three percent or one percent in municipalities with a population of less than 10,000 or senior housing.
Both programs require municipalities to take steps to reduce the cost of the eligible project by voluntarily revising ordinances or regulations that affect the project on or after Jan. 1, 2023. Municipalities are also required to have updated the housing element of their comprehensive plans within five years.
For additional information about the loan programs, please visit WHEDA’s website here.
An online version of this release is available here.
Read the Full Paper Here
The FTC put out a 161-page paper. On page 22 the paper references fees in Rental Housing:
Comments from individual consumers about rental housing fees stated that leasing companies advertise monthly rents that do not include fees for mandatory ancillary services that unexpectedly and significantly increase renters’ monthly expenditures. The comments stated that leasing companies do not always identify the purpose of these fees.
Consumer and policy groups noted that landlords do not adequately disclose many unavoidable fees or fail to explain the purpose of fees, and supported a rulemaking pertaining to fees in connection with rental housing, including apartments, house rentals, and manufactured housing communities (“MHCs”).
The National Consumer Law Center (“NCLC”) conducted a survey of legal services and nonprofit attorneys that identified many unavoidable fees faced by tenants, and recommended that the FTC require that online platforms for rental advertisements disclose all fees, including fees charged before and after signing rental leases.
Private Equity Stakeholder Project supported enhanced fee disclosure requirements and upfront disclosure of the costs of goods and services to protect consumers and the economy at large. The comments also recommended that the FTC investigate unfair or deceptive practices related to housing fees and provide guidance on fees.
The comments also recommended that a rule prohibit certain rental-related fees as invalid per se because they are exploitative and target captive renters who often come from vulnerable groups. The comments stated that fees make rental housing even more unaffordable and jeopardize access to future housing and financial stability.
From the footnote:
NCLC noted that the survey was conducted between November and December of 2022, and showed that tenants face an array of unavoidable fees, including rental application fees, sometimes charged even if landlords know applications will never be approved, excessive late fees, utilities-related fees, processing or administrative fees, convenience fees, insurance fees, notice fees, trash fees, pest control fees, technology fees, common area and amenity-related fees, inspection fees, and mail sorting fees.
By Shawn Woedl, President of National Real Estate Insurance Group
When it comes to settlement methods, you have two options to choose from: Replacement Cost, or RC, and Actual Cash Value, also referred to as ACV. These two options determine how your claims payout is settled in the event of a loss. So, what’s the difference? Depreciation.
Regarding property insurance, depreciation represents the estimated reduction in value based on how much useful life is determined to be left in the damaged property. This is calculated by an adjuster, factoring in criteria such as age and general wear and tear.
Both RC and ACV account for depreciation. However, one settlement method allows for reimbursable depreciation whereas the other does not.
REPLACEMENT COST (RC)
This settlement method allows claims to be settled with reimbursable depreciation. Replacement Cost coverage requires you to be insured to a higher valuation per square foot but provides you with more financial protection.
For example, a kitchen fire at your property causes a partial loss, totaling $30,000 in damage. The deductible on this property is $3,000, so the insurance carrier will pay no more than $27,000. An assigned claims adjuster visits the property to determine how much useful life was left in what was damaged.
The actual cash value of the loss after depreciation is determined to be $15,000. You will receive a payment of $12,000 (the actual cash value minus the deductible). That $12,000 will go towards the necessary repairs and replacements. If expenses exceed that amount, you will pay out of pocket.
Let’s say the cost of repairs totaled $20,000. With provided receipts, a second check for reimbursable depreciation will be issued for an additional $5,000. Replacement Cost allows you to recoup some or all of the depreciation that was taken from you. The only part that is not recoverable is your deductible.
ACTUAL CASH VALUE (ACV)
Actual Cash Value policies pay the depreciated cost to repair or replace your damaged property and/or its contents. ACV coverage pays you for what the property and/or its contents are worth at the time of loss. Coverage with this settlement method is typically 20-25 percent cheaper than an RC policy and allows you to be insured to a lower value per square foot. However, ACV does not allow you to recover any depreciation.
For example, the same $30,000 kitchen fire occurred at a property with an ACV settlement method and a $3,000 deductible. The adjuster depreciates $15,000 from the loss. You will be issued a check for $12,000 (actual cash value minus the deductible). With an ACV policy, $12,000 is all you can recover from this $30,000 fire loss.
What you may not know is you can do whatever you want with that money- fix the damage or cut your losses, sell the property as is, and use the money to buy a car.
As a side note, depreciation is extremely difficult to determine until the loss occurs. It is based on the date of the last updates, not the original year built. Everything depreciates at a different rate, but the average is about 1% annually. Although roofs deteriorate much quicker due to weather exposure.
Read the Full Article Here
A paper by Aviv Caspi and Charlie Rafkin
This is a 76-page paper out of Memphis TN by Stanford RegLab and MIT Economics. You may not want to read a 76-page paper, so some highlights from this paper follow. (The statements in bold are highlighted for your convenience, not highlighted in the paper.)
Seeking to assist tenants, 17 cities and four states recently passed “Right to Counsel” programs that guarantee defense attorneys in eviction cases.1 This expansion represents perhaps the most significant shift in U.S. eviction policy in the past two decades, aside from temporary pandemic-era measures. Yet whether attorneys actually stop evictions is unclear.
The RPA has stated in the past that attorneys may hinder the process, stretching out the time a tenant remains in the property and therefore increases the amount of money the tenant owes in the end. This can also have negative impact on good tenants because security deposits may need to increase to cover the increased risk a non-paying tenant bears.
Despite landlord- friendly eviction law, providing an attorney reduces tenant eviction judgment rates within 90 days by 27 percentage points (50%). However, attorneys’ effects persist only when they can connect tenants to other services. Once a concurrent emergency rental assistance program expires, effects on judgments at 90 days shrink by about 70% and are indistinguishable from zero. Attorneys have little effect on informal outcomes and bargaining.
In Wisconsin, such "other services" can be Ross IES on Milwaukee's northwest side, which offers Emergency Rent Assistance once a year to tenants who are facing eviction. Another service that assists tenants and landlords with bargaining (coordinating payment agreements, etc.) is Mediate Wisconsin. RPA had Mediate Wisconsin at our recent Trade Show and they have been speakers at prior events.
Approximately 40% of tenant applicants prefer a lawyer to receiving $1,000. It costs about $350 to hire an eviction defense attorney in Memphis.
So in essence, 60% of tenants prefer receiving money than hiring an attorney.
By Gary D. Koch, Petrie + Pettit
Evictions are typically matters handled exclusively through the state court system, in whichever county the property is located. Every now and then, though, we have to make a trip to federal court to assist a landlord. This most frequently arises when a tenant files for bankruptcy protection.
Bankruptcy is authorized by the United States Constitution and is codified in Title 11 of the United States Code. There are 15 “chapters” of code, but the most common of those in this context are Chapter 7 and Chapter 13. The bankruptcy protections provided by filing under either chapter are extremely powerful, and can stop an eviction in its tracks.
Chapter 7 bankruptcies are relatively short-lived. The filing of a Chapter 7 bankruptcy creates an automatic stay of any action to collect on a debt, including past-due rent, or to continue any action to recover an interest of the “bankruptcy estate”, which includes the tenant’s right to continued occupancy of the rented premises.
Chapter 7 bankruptcies are typically open for four to six months before the case is closed. If the case results in a “discharge,” most debts which existed at the time of the filing are wiped out. Rent incurred before the case was filed is generally discharged in a Chapter 7 bankruptcy.
Chapter 13 bankruptcies usually run for a much longer duration. These bankruptcies may repay some amount of the existing debt to creditors, but do so over a 3 to 5 year period. The filing of a Chapter 13 bankruptcy also creates an automatic stay against collection or recovery.
There are a few exceptions to the automatic stay. Most relevant to a landlord, is that if a judgment of eviction is entered by the state court before the bankruptcy is filed, the landlord can still execute the writ and remove the tenant from the property. Be aware, however, that there is an exception to this exception, so there are limited circumstances when even a previously granted judgment of eviction is halted by a bankruptcy filing!
In all other circumstances, whether a Chapter 7 or a Chapter 13 is filed, in order to move forward with an eviction action, including serving a notice terminating the tenancy, the landlord will need permission from the Bankruptcy Court to do so. We obtain this permission by filing a Motion to Lift the Automatic Stay.
For Chapter 7 bankruptcies, the process of obtaining a lift of the stay requires a specific basis to file and may take as long as the life of the bankruptcy itself, so doing so may be an exercise in futility. Once the Chapter 7 discharges, dismisses or closes, the landlord can proceed against the tenant for any debt incurred after the date the Chapter 7 case was filed. Lifting the stay may allow the landlord to begin the process a few weeks earlier than the end of the bankruptcy.
For Chapter 13 bankruptcies, though, given their much longer duration, lifting the automatic stay is a viable option for the landlord. There need to be grounds for the motion, such as failure of the tenant to pay rent after the filing of the bankruptcy. The Bankruptcy Court will also likely give the tenant a “second chance” with the first motion, and order that any rental arrears incurred after the date the case was filed be included in the repayment plan, but may also order that any future missed rent payments will result in an immediate lifting of the stay.
Evictions are complicated enough, but when you add in a bankruptcy as well, navigating both the state AND federal courts becomes a minefield. Petrie + Pettit has shepherded may clients through both court systems and stands ready to assist you.
By Atty Heiner Giese
The Rental Property Association of Wisconsin, Inc. held its annual membership meeting at the Sonesta Hotel in Wauwatosa on November 20, 2023. An election was conducted for positions on the Board of Directors with the following results:
Out of four candidates, these three incumbent Board members were elected by majority vote for two year terms ending November 2025:
The new Board will elect a president and an executive committee at its next meeting.
The Marquette Lawyer magazine published a 10-page article in PDF form by Alan J. Borsuk and Tom Kertscher about evictions in Milwaukee.
View the PDF here
Some excerpts:
In the longtime words of the Wisconsin Supreme Court (these being from 1979): “The decisions of this court have held that there are a very limited number of issues permissible in an eviction action.”
Heiner Giese, a Milwaukee lawyer who has represented apartment owners for more than 40 years (and is the legal counsel for the RPA) is quoted in the article:
“Often, the most that attorneys for tenants can accomplish is to delay an eviction.”
The article explains more about this statement in the following two paragraphs:
But several property owners’ attorneys said that proceedings often are slower because more attorneys are involved and those attorneys use strategies for delaying outcomes. Some noted also that more property owners are calling on attorneys to represent them than in the past. Several attorneys said that delays in concluding cases can mean increases in lost rent for owners, and extra costs for owners to pursue cases can mean higher rents or increased security deposit requirements for all tenants, including those who pay their rent steadily.
But several property owners’ attorneys said that proceedings often are slower because more attorneys are involved and those attorneys use strategies for delaying outcomes. Some noted also that more property owners are calling on attorneys to represent them than in the past.
Several attorneys said that delays in concluding cases can mean increases in lost rent for owners, and extra costs for owners to pursue cases can mean higher rents or increased security deposit requirements for all tenants, including those who pay their rent steadily.
Tristan Pettit, an RPA board member, is also quoted in the article:
Tristan Pettit is executive vice president of the law firm of Petrie + Pettit and head of the firm’s landlord–tenant team. He said that the substantial increase in the percentage of eviction cases involving lawyers for the tenants has slowed down many proceedings. But, he said, it has also had benefits. “If you have a difficult tenant, having an advocate [for the tenant] can make things much easier,” he said.
The article also questioned the money going to attorneys who may delay the eventual eviction, rather than provide those funds to help tenants pay rent:
In the Stanford Law Review Online in July, two law professors questioned giving legal representation of tenants priority over what they regarded as the bigger need of tenants: rent money.
Here’s their view, as summarized by the law review: “Most low-income tenants facing eviction do not need a lawyer. They need rent money. . . . If we want to reduce evictions, tenant lawyers are not the best tool. Rental assistance could resolve, or even avoid the filing of, most eviction cases.” The authors said that the $46 billion in federal funds made available during the height of the COVID pandemic to help people who otherwise would have been facing eviction showed how much increased rental aid could reduce eviction problems. They called the movement to provide every tenant a lawyer in eviction proceedings “misguided.”
The article also covers the current trend in "redacting" or sealing of eviction records, by sharing Judge Cynthia Davis experience.
The number of requests in Milwaukee County Circuit Court to redact names of defendants in eviction filings has skyrocketed. In 2011, according to the clerk of the court, there were 63 such requests. In 2022, there were 1,959. “These have flooded our system,” Davis said. She was spending two mornings a week on such requests while she was on the small claims bench. Generally, Wisconsin law strongly favors—indeed, requires—the accessibility of public records. Among other provisions, the legislature has provided (Wis. Stat. § 19.31) that “[t]he denial of public access generally is contrary to the public interest, and only in an exceptional case may access be denied.”
The number of requests in Milwaukee County Circuit Court to redact names of defendants in eviction filings has skyrocketed. In 2011, according to the clerk of the court, there were 63 such requests. In 2022, there were 1,959. “These have flooded our system,” Davis said. She was spending two mornings a week on such requests while she was on the small claims bench.
Generally, Wisconsin law strongly favors—indeed, requires—the accessibility of public records. Among other provisions, the legislature has provided (Wis. Stat. § 19.31) that “[t]he denial of public access generally is contrary to the public interest, and only in an exceptional case may access be denied.”
Tim Ballering is an RPA Board Member and the current Treasurer. He is quoted in the article as well:
Ballering said that new tenants who have had an eviction in the prior year fail to fulfill their lease obligations (to pay their rent) at significantly higher rates than other new tenants. By three years post-eviction, the track record is about the same as that of tenants without eviction records. Preventing landlords from seeing names of people who have been evicted is not only a problem for landlords, he said, but also for people who are better candidates to be reliable renters yet who may lose out in getting an apartment to someone with a past eviction.
Tim is further quoted in the article when the topic of mediation is covered, specifically highlighting Mediate Milwaukee (one of the organizations the RPA has had as a speaker at general meetings and who had a booth at our recent Trade Show).
Property owner Tim Ballering said, “Mediate first is a concept that we were unaware of in our industry.” The impact of COVID-19 accelerated efforts to mediate, he said. “A lot of people knew mediation was available mid-process, but to do it upstream is best for everyone.” He said mediation efforts overall have been “very successful.”
By Dawn Anastasi, RPA Board Member
In our previous blog article, we mentioned how HACM is now starting to hold Virtual Sessions with its housing providers.
Here are some notes from the first session.
Link to HACM's Housing Portal
RPA's previous blog article on How to Sign up for the HACM Portal
The process for a voucher household:
From HACM:
Thank you for your continued partnership with the Housing Authority City of Milwaukee (HACM) to provide over 6,000 low-income individuals and families safe, quality, and affordable housing in Milwaukee! At HACM, we are continually looking for more efficient and effective ways to work together, both in serving our existing Section 8 participants and expanding our support for additional families in need.
Today, we are thrilled to introduce a new initiative that we believe will enhance our partnership: a monthly, virtual drop-in session for Section 8 Housing Choice Voucher (HCV) Housing Providers. Starting this coming Wednesday, November 8 at 10 AM, we invite you to join us online for this valuable opportunity to stay up-to-date on our Section 8 - Housing Choice Voucher program and to share your insights with us.
If you did not get an email from HACM with your registration link, contact Stephen Fendt via email.
BECOME A MEMBER - JOIN TODAY!
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