Questions remain on TCU overlay plan

Scott Nishimura

Fort Worth’s consensus agreement on a controversial zoning overlay that would limit the growth of “stealth dorms” in several neighborhoods around TCU is leaving substantial questions on the table, including how to address tenants’ bad behavior.

The City Council is scheduled to vote Dec. 2 on the overlay, which would pare the number of permissible unrelated people living in single-family homes to three from five; a registration system that property owners would have to sign up for by March 31 to grandfather existing properties that have more than three unrelated residents; and lifting a moratorium on new single-family permits that the council implemented in the district while it debated the overlay.

A volunteer committee of representatives from neighborhoods, investors, Texas Christian University, and the city that reached agreement on the overlay couldn’t agree on how to handle tenant behavior – the issue that drove the debate. Instead, they’re recommending the City Council pursue that issue in a chronic nuisance ordinance.

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And the city hasn’t addressed one underlying question raised during the debate: whether stealth dorms – large single-family homes rented by the room to TCU students – are legal. The political consultant Bryan Eppstein, a TCU-area resident who’s led in pushing for the overlay, contends that stealth dorms meet the city’s definition of boarding houses, which are illegal in single-family zoning and ineligible for grandfathering.

“There’s a dark cloud hanging over all of this,” Eppstein says.

Eppstein is being blocked in his attempt to get various definitions clarified, including boarding houses and fraternity houses.

He spent $400 and filed a request for interpretation of the definitions with the city’s Zoning Board of Adjustment. But the week before Thanksgiving, the city attorney’s office told Eppstein his request was improper and must be connected to specific properties. By the most widely used estimates, there are about 270 investor-owned and leased properties in the zoning overlay that would be eligible for grandfathering.

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Dana Burghdoff, the city’s deputy planning director, said she expects the staff will meet in the near future to clarify definitions. She pointed out some differences between definitions of boarding houses and the way stealth dorms operate, including parking requirements and one that boarding houses have an on-site manager.

“That’s not part of the description,” Eppstein responds of the manager provision. “That’s a requirement” for boarding house operators.

The city’s potential exposure to litigation from investors and landlords has been a constant thread running through the negotiations. Landlords raised the potential for litigation if the council approved the overlay without grandfathering, and the city staff acknowledged Fort Worth could be vulnerable.

State and federal courts’ interpretations on the constitutionality of regulatory taking of property include a situation where government entities “unreasonably interfere with investment-backed expectations,” Gerald Pruitt, Fort Worth’s deputy city attorney, says.

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The overlay agreement grandfathers existing properties in perpetuity, but property owners would surrender the grandfathered use if they discontinue it for more than two consecutive years. They could still seek a variance to resume the nonconforming use through the city’s Zoning Board of Adjustment.

Jon Samson, executive vice president of the Greater Fort Worth Builders Association, says he believes the city could still face potential lawsuits from property owners in the overlay area who may consider in the future leasing having more than three unrelated people living in their homes.

The proposed overlay includes a provision that requires all owners of leased, one and two-family dwellings in the overlay area to sign up by March 31, 2015 for a registry, which would grandfather their existing uses on that date.

“It wasn’t just the investors who were losing their property rights,” Samson noted. “It was every property owner who was losing property rights.”

He acknowledged, however, that the March 31 deadline will likely cover most affected property owners.

“I think most of the property owners probably have decided already if they were going to rent their homes out,” he said.

Whether and how to address tenant behavior is the main issue the overlay doesn’t address.

A small breakout group of neighborhood and investor representatives from the larger mediation committee reached an agreement on a proposed property owner registry that would have fined property owners for chronic violations of city ordinance or state or federal law. Neighborhood groups that pushed for the overlay have complained of noise, parking problems, litter, and other problems from the TCU students, and that construction of the homogenous stealth dorms has wrecked historic neighborhoods’ flavor.

But the compromise agreement fell apart in the last of four mediation group meetings, and the city attorney’s office recommended the issue be pursued in a chronic nuisance ordinance and be applied citywide.

“There’s nothing that’s not legally permissible” about including tenant behavior in the rental registration ordinance, but “it’s just a much broader discussion,” Melinda Ramos, senior assistant city attorney who represented the city with the committee, said.

Even without tenant behavior addressed immediately, “ultimately (the overlay) is a win for the neighborhoods,” Mike Coffey, of the University West Neighborhood Association, said.

“At the very least, the destruction of the neighborhoods won’t continue anymore,” Coffey, one of the neighborhood leaders who pushed for a compromise with landlords on the tenant behavior issue, said. “We’ve reduced the financial incentive at least to tear down traditional (neighborhood homes to build) five-bedroom homes, and that’s a start.”

The overlay area includes the Berkeley Place, Park Hill, University Place, Paschal Heights, University West, Colonial Hills, Tanglewood, Westcliff and Westcliff West, Bluebonnet Hills, and Bluebonnet Place neighborhoods.

The landlord registry also requires nformation for each property owner, local contacts for property owners who don’t live within 50 miles of TCU, the disclosure of number of current unrelated adult inhabitants, and updates to that information when it changes. Property owners who have permits for new construction, but haven’t completed it by March 31, would be grandfathered most likely by the number of bedrooms, Burghdoff said.

It doesn’t require identities of tenants, which neighborhood groups had initially sought but investors protested on privacy grounds. It also doesn’t require fees or inspections.

“I think we’ve got to have some sort of nuisance behavior (provision) in the rental registration,” Coffey said.

Mike Banta, a mediation committee member, investor, and president of the Bluebonnet Place Neighborhood Association and an investor who owns one affected property that rents to four adults in the overlay area, said he supports addressing chronic nuisance behavior.

“But it seemed to be a separate issue” from the registry, he said.

And whatever the city ultimately decides on nuisance behavior, “the teeth need to be biting on the chronic problems” and not good landlords, he said. Neighborhood associations generally agreed the investor landlords on the mediation committee were conscientious.

Banta also said he doesn’t want the city to address definitions immediately.

“We’ve come to an agreement in mediation, and I don’t want definitions changed at this time,” he said.

City Councilman W.B. “Zim” Zimmerman, who represents one of two TCU-area council districts in the overlay, said in an interview before Thanksgiving he was still studying the mediation committee’s agreement before deciding how he’ll vote.

Of note, he said he wanted to work through the unresolved questions on tenant behavior.

“We’re trying to understand what that means and what alternatives are out there that would give some assurances to homeowners,” he said.

Zimmernan said voting on the overlay was paramount, because its passage would allow the council to immediately lift the moratorium on new single-family permits.

“That’s the one we need to resolve,” he said.

He said he was open to not voting on the rental registration immediately, to address nuisance behavior. The mediation committee’s agreement on the overlay required an accompanying agreement on the rental registry, but Zimmerman said he believed the committee’s agreement provided some flexibility to the council.

Council member Ann Zadeh, whose southside district is the other one in the overlay, said she wanted to address the overlay and rental registration together.

“I would rather not put off rental registration, because it was part of the agreement between all of the parties,” she said.

She said she was open to a citywide discussion on nuisances.

“Some neighborhoods have been interested in that for a very long time,” she said.