Health & Safety

      Landlords are sued more than any other group of business owners in America.  The average settlement paid by a landlord's insurance company is $600,000 and the average jury award is $1.2 million.  Aside from civil rights violations, most lawsuits are related to health and safety issues.
      While both commercial and residential income properties have health and safety issues, we will focus primarily on issues of concern for residential. Many issues are of greater concern or only of concern for residential because those who utilize residential space do so for longer periods of time. For example, radon is usually of no concern for commercial property because radon presents little danger  for exposure totaling a few hours per week compared to 20 hours per day for years.

Health

      Landlords are increasingly being held liable for tenant health problems resulting from exposure to environmental poisons in the rental premises. Potential problems include asbestos, lead, mold, pests, and radon. You may want to check out our environmental pages to help you become aware of potential problems and perhaps how to deal with them.

Asbestos
      Asbestos is a problem because, as a toxic substance and a known carcinogen, it can cause several serious diseases in humans. Symptoms of these diseases typically develop over a period of years following asbestos exposure. Asbestos-containing materials (ACM) in buildings do not always pose a problem (that is, a hazard) to occupants and workers in those buildings. When can ACM become a problem? When asbestos fibers get into the air and are inhaled; that is, when there is human exposure.
      Intact, undisturbed asbestos-containing materials generally do not pose a health risk. They may become hazardous and pose increased risk when they are damaged, are disturbed in some manner, or deteriorate over time and thus release asbestos fibers into building air. EPA's asbestos program for schools (AHERA) and its guidance for other building owners is founded on the principle of "in-place" management of ACM. This approach is designed to keep asbestos fiber levels low by teaching people to recognize asbestos-containing materials and actively manage them.
      Asbestos Ban - EPA has found that there are rather common misunderstandings about its 1989 bans on asbestos-containing materials (ACM) and products or uses. Newspaper and magazine articles, Internet information, even some currently available (but outdated) documents from the EPA and other federal agencies may contain statements about an EPA asbestos ban that are incorrect.
      In fact, in 1991 the U.S. Fifth Circuit Court of Appeals vacated much of the so-called "Asbestos Ban and Phaseout" rule and remanded it to the EPA. Thus, much of the original 1989 EPA ban on the U.S. manufacturing, importation, processing, or distribution in commerce of many asbestos-containing product categories was set aside and did not take effect. Six asbestos-containing product categories are still subject to the 1989 asbestos ban. However, EPA has no existing bans on most other asbestos-containing products or uses.

Lead
      Scientists and government health agencies recognized that there were health problems caused by lead poisoning many years ago. Lead paint was banned for use in European housing more than sixty years ago. The use of lead to raise the octane in gasoline and the manufacture and use of lead-based paint in housing was finally prohibited in the U.S. in 1978. 
      Failure to make full disclosure and remedy environmental hazards such as lead, is not only very risky business, but as of September, 1996, disclosure of lead hazards is required by federal law.  Even if you didn't cause or know about lead-based paint or pipes in a rental building, you have an obligation to give tenants notice that such hazards even might exist.
      The Residential Lead-Based Paint Hazard Reduction Act, commonly known as Title X (Ten), was enacted in the U.S. 1992 and Environmental Protection Agency (EPA) regulations implementing Title X as to rental property were implemented in September and December of 1996.
      Before signing a lease or rental agreement, a landlord has been required to give every new tenant since 1997 the EPA pamphlet, Protect Your Family From Lead In Your Home. Both the landlord and tenant are also required to sign an EPA-approved disclosure form that will prove that the landlord told the tenants about any known lead-based paint or hazards. The required lead documents are available to members in the Forms Web.
      Property owners must keep the disclosure form as part of their records for three years from the date of the start of the tenancy. While EPA regulations do not specifically cover tenancies created prior to September 1996, landlords should error on the side of caution and disclose information on lead-based paint or hazards to all residential tenants.
      These properties are not covered by Title X:

• Housing certified as lead-free by an accredited lead inspector
• Lofts, efficiencies and studio apartments
• Short-term vacation rentals
• A single room rented in a residential dwelling
• Retirement communities (housing designed for seniors, where one or more tenants is at least 62 years old), unless children are regularly present.

     In addition to the federal regulations, some states also have there own lead paint laws, usually more stringent than the federal, so investors in pre-1978 residential income property should be sure to understand the lead paint laws of the state in which they invest.  The RHOL web site has considerable information regarding lead paint issues.

Mold
      The first case alleging mold contamination was settled about 5 years ago for 11.4 million dollars. Since then, significant developments have followed. Court cases have increased at a rapid rate and insurance coverage has decreased. Owners and managers of income property (landlords) should be aware that toxic mold lawsuits are being brought by residents claiming both property damage and personal injury. The best protection against potential liability is a broad program of prevention.
      Mold growth is facilitated by excess moisture.  Accordingly, moisture control prevents indoor mold growth. Actions that can be taken by landlords includes the following:

• Repair leaking plumbing and control sweating plumbing
• Improve ventilation in areas that have moisture sources (e.g., bathrooms & laundry room)
• Make sure drain spouts direct water away from foundations
• Eliminate leakage around windows and  doors
• Avoid cold spots on interior walls by proper placement of ducts
• Replace  impermeable (e.g., vinyl) wall coverings with permeable ones.
• Install ceiling fans and consider forced air heating where not already in place, as they increase air movement which inhibits mold growth

      Comprehensive information about detection and correction of mold infestation can be found on the EPA web site and in the EPA publication "Building Air Quality, a Guide for Building Owners and Facility Managers." You should also read the RHOL moisture page.  Two EPA web pages of interest are: 
    "A Brief Guide to Mold, Moisture, and Your Home"
    "Mold Remediation in Schools and Commercial Buildings"

      Landlords should also have a written plan covering operation and maintenance as related to mold.  The plan should include documentation of any actions taken and it compliance with local laws and with ASHRACE standards. Federal law regarding airborne mold contamination expired at the end of 2000, but many states already have laws on the books or are currently working on them.  In the absence of governmental mandates, Landlords who have a plan that reflects proper maintenance procedures that are carried out by adequately trained persons will have shown good faith.
      Safe and healthy indoor air quality should be considered of paramount importance and complaints by tenants must be taken very seriously.  The lease should include specific instructions about who to notify in the event of leaking plumbing, "off" smells, standing water, or any other conditions that suggest a mold problem or might potentially facilitate mold growth.

Pests
      Pests can include cockroaches, ants, crickets, mice, rats, flies, scorpions, snakes, and almost any other living thing that a tenant might not want to see in his unit or yard.  Some of these items are health issues (even safety issues), some are not.  Even those which present no health or safety risk must be dealt with if the tenant is concerned about them.  Whether or not it is he landlord's responsibility to deal with pests depends upon (1) the lease, (2) the type of property, (3) the kind of pest, and (4) maybe a judge's whim.
      As an item of interest, consider the following.  You would think that anyone renting or buying a home in the desert should be expecting to share the the space with the natural residents there.  However, because of increasing incidences of lawsuits related to scorpions and snakes, the Arizona Association of Realtors has found it necessary to recommend disclosure of the obvious, that such creatures live there, in real estate sale transactions.  While such disclosure is not yet required by law in most jurisdictions that have such creatures, a prudent landlord in an area where they are particularly prevalent might want to consider providing it.
      The lease can sometimes assign responsibility for pest control to the tenant.  Whether you can do so can depend upon the type of property.  For a single-family home, you can likely make the tenant entirely responsible for future control so long as it clear when the tenant moves in.  For a multi-unit building things are more complicated.  For pests that move among units (e.g., crickets, cockroaches) the landlord should probably take responsibility, even if the law doesn't require it, because control must involve all units at the same time.  For pests that are a problem for one unit only, particularly when that unit is attracting the pests through negligence or bad housekeeping (e.g., food left out that attracts ants or fleas from their own dog) you may be able to put responsibility onto the tenant, particularly if the lease specifically deals with the issue.
      If the problem is in a gray area, you are probably better off to take care of it as a good will gesture for better tenant relations.  It will certainly be a lot cheaper than a vacancy.

Radon
      Radon is a radioactive gas which is one of the decay products of the element radium.  Radon comes from the natural (radioactive) breakdown of uranium in soil, rock and water and gets into the air you breathe.  Radioactive decay is a natural, spontaneous process in which an atom of one element decays or breaks down to form another element by losing atomic particles (protons, neutrons, or electrons).          
      You can't see radon. And you can't smell it or taste it.  Radon is estimated to cause many thousands of deaths each year. That's because when you breathe air containing radon, you can get lung cancer.  In fact, the Surgeon General has warned that radon is the second leading cause of lung cancer in the United States today. Only smoking causes more lung cancer deaths.  If you smoke and your home has high radon levels, your risk of lung cancer is especially high.  Cigarette smoking, the major cause of lung cancer, is responsible for 85 percent of the 170,000 cases diagnosed each year. Radon represents a far smaller risk for lung cancer and is estimated to be responsible for roughly 10 percent, or 17,000 cases per year. This estimate may be as low as 6,000 to as many as 36,000 radon-associated lung cancers per year.  Although the association between radon exposure and smoking is not well understood, exposure to the combination of radon gas and cigarette smoke creates a greater risk for lung cancer than either alone. The majority of radon-related cancer deaths occur among smokers.
      In a few areas, depending on local geology, radon dissolves at high concentrations in ground water where it can then be released into the air when water is used. 
      Out of doors, radon gas exists at harmless levels.  However, in areas without adequate ventilation, such as underground mines, radon can accumulate to levels that substantially increase the risk of lung cancer.
        Radon can be found all over the U.S.  It can get into any type of building - homes, offices, and schools - and build up to high levels.  But you and your family are most likely to get your greatest exposure at home.  That's where you spend most of your time.  Radon is a problem primarily in certain areas and tends to be rather localized even within those areas.  Newer construction, which tends to be more air-tight, and basements, which are surrounded by dirt, are usually more likely to have higher radon concentrations.  The level of Radon found in a basement can be 1,000 times the level in the attic.
      Testing is the only way to know if there is a risk from radon in a particular property.  Indoor radon levels are affected by the soil composition under and around the house, and the ease with which radon enters the house.  Homes that are next door to each other can have different indoor radon levels, making a neighbor's test result a poor predictor of radon risk in your home. In addition, precipitation, barometric pressure, and other influences can cause radon levels to vary from month to month or day to day, which is why both short- and long-term tests are available. Because radon levels can vary from day to day and month to month, a long-term test is a better indicator of average radon level. EPA and the Surgeon General recommend testing all homes below the third floor for radon.  EPA also recommends testing in schools.
      Testing is inexpensive and easy - it should only take a few minutes of your time. Millions of Americans have already tested their homes for radon.  There are simple ways to fix a radon problem that aren't too costly. Even very high levels can be reduced to acceptable levels.
      Short-term tests track radon levels for up to 7 days.  Long-term detectors give the average concentration for periods of 90 days or more.  Both tests are relatively easy to use and inexpensive ($10 to $30).
      Once a radon problem is corrected, the hazard is gone for good. Costs for reducing radon levels typically range from $500 to $2,500, with an average cost of $1,200.  A state or local radon official can explain the differences between testing devices and recommend the most appropriate test for your needs and conditions.  The EPA has a list of types of radon detectors meeting their standards.
      Radon is not currently an issue of universal concern.  To our knowledge, no jurisdiction requires radon inspections or disclosures by law.  However, it is recommended that abatement be undertaken if radon is known to be at higher levels than federal standards.

Safety and Security

      Although safety and security can be somewhat intertwined by the broadest definitions of both terms, we will consider safety issues to be those related to accidental injury and security issues to be those related to injury caused by others.  Hence, a hole in the sidewalk that might cause someone to fall is a safety issue, whereas, hiring a convicted sex-offender as gardener is a security issue.  Inadequate lighting can be both a safety and a security issue.  As with most things, you need to be aware of any special requirements related to these issues in your state and local area.  For example California, has specific requirements for door and window locks.

Locks
      Locks are relatively cheap and easy to install or add.  They may even help save lives and property.  Letting your tenants and property be an easy mark for a criminal, or renting to one, invites both traumatic and expensive trouble.
      When a tenant departs, the landlord has way to know how many keys are in existence nor who might have one.  Accordingly, the best policy is to re-key every lock each time there is a change in tenants.  The cost of re-keying is almost negligible if a landlord invests in moderately priced re-keying kits.  Owners of multiple properties can avoid the labor involved in that approach by keeping a few extra locks on hand and rotating locks among properties. Even the single-unit landlord can re-key his locks for $5.00 per lock plus about $1.50 per new key if he takes them into a home improvement store himself.  A landlord's expenditure of $25 or less to re-key a unit is an important investment in the safety of his new tenants and a major reduction in exposure to costly lawsuits.

      California has, since July 1, 1998, had a law requiring landlords to install and maintain working deadbolt locks on each entry door, window security devices or locks on all windows designed to be opened and locking mechanisms on exterior doors to common areas of the building. All locks and installations must comply with local and state building, fire and safety codes.
      Windows that can't be reached from the ground, roof or other platform are exempt, as are louvered and casement windows. The required distances for lack of access are 12 vertical feet and six horizontal feet. Buildings officially designated as historically significant are exempt from the law.
      If a landlord fails to install and maintain deadbolt and window locks, the tenant must notify the landlord and allow him or her a reasonable time to make the necessary modifications. After that, tenants can repair and deduct or take further legal action to enforce the requirements.

Lighting
      Exterior and common area interior lighting can be of concern regarding both safety and security.  Parking lots, carports, sidewalks, stairways, porches, hallways should all be well lit.  Operation of lighting should be checked regularly and the check should be done at night.  For energy conservation, most lights controlled by timers or solar cells, with the latter being preferable where possible because timers require regular adjustments throughout the year.  Also, timers do not take into account cloudy days that can require lighting in some interior zones.

Guards
      Employing guards can provide additional security and safety for larger complexes where the budget so allows. However, it can also actually create additional liability for the landlord in the following ways.

• Conflict between guards and tenants can sometimes be a problem.  Low pay for rent-a-cops often results in inadequately trained and supervised guards - retired or off-duty law enforcement officers are usually better.
• Hiring guards implies that there were problems to begin with, perhaps proving some liability for past events.
• The presence of guards may give false sense of security, making both the tenants and management less vigilant.
• Future elimination of guard services may, in itself, be judged negligent, particularly if done to save money rather than because the source of original problems has been reduced or eliminated.

Fire extinguishers
      Many state also have laws regarding the availability of fire extinguisher.  They usually must be available on every floor of an apartment building or in every 75 feet of hallway. Some states or local jurisdictions require them in each kitchen.

Smoke Detectors
      Perhaps the most important safety devices a property manager can install are smoke detectors. Most building codes now require at least one ionization detector on each floor of a dwelling. Many mandate a detector in each bedroom as well.
      The most commonly used smoke detector uses ionization detection, because it is the cheapest to manufacture. They are allowed by most housing codes and work just great for fast developing fires. However, they may not alert a sleeping child to a slow smoldering fire that can fill a room with deadly smoke before it goes off.
      The alternate choice is a photo-electronic smoke detector. It will detect smoldering fires, and could provide  as much as fifteen minutes of additional escape time.  The photo-electronic unit is also sold in a combination alarm, meaning it has both the ionization and the photo-electronic detector in one package. The duel detector is substantially more expensive, but by far a better choice over any single sensing detector.
      Smoke alarms do not detect flame, heat, or gas. They can only detect smoke ... if it can get to them. That's why most local codes now require that they be installed in each bedroom, adjoining hall ways to the bedrooms, on each level of the house and in the garage and basement.  They usually must be installed in the common areas of apartment buildings and in every bedroom of a rooming house.
      Smoke alarms initially relied on 9-volt battery power, the same size batteries that are used in many toys and other household items. As a result, the batteries were often removed for other uses and the detector became useless. Now many building and housing codes require smoke detectors to be hard wired into a house circuit, with battery back-up. They can be wired so that they are all connected together. That way, if one detector goes off do to smoke, it will activate all the other alarms. The best protection possible today.

Carbon Monoxide Detectors
      Carbon Monoxide (CO), known as the "silent killer" is a colorless, odorless gas generated by any fossil-fuel (oil, gas, coal, wood) burning device, including furnaces, kitchen ranges, water heaters, and clothes dryers.  Since CO is a product of incomplete combustion of the fuel, devices that are not well-maintained are particularly dangerous.  Inadequate venting for the device is another source of danger.  Since gasoline engines also generate CO, attached garages are also a potential source of danger.
      Although only a few jurisdictions to date require CO detectors by law, the number doing so will almost certainly increase rapidly in the future.  Even when not required by law, landlords will be exposed to significant liability if an inadequately vented or improperly maintained device results in injury or death to tenants.
      Since detectors can be purchased for as little as $20 each, the prudent landlord will provide them for all units having fossil-fuel burning devices or attached garages.  The detectors will go a long way toward preventing serious injury or death and keeping your property out of court.
      Alarms should be wall-mounted between knee and shoulder level near bedrooms, but at least 15 feet from all devices.
      Inspection of fossil-fuel devices at least once a year (twice is even better) is highly recommended, with all necessary adjustments and repairs made immediately.  In many areas, the local gas company or other utility will inspect for free.  Even if the landlord must pay for inspection by a licensed vendor, the cost will be negligible compared to the judgment that might be handed down by a jury if someone is seriously injured or killed due to failure to properly maintain the devices.
      Leases should also prohibit tenants from operating gas-powered electrical generators or hibachis inside the unit (and attached garage) when the power goes out.

Employees & Agents
      Selecting, screening, then hiring the right property manager and maintenance personnel can be as important as selecting property and tenants.  But that alone is not enough, an owner has both a financial and legal responsibility to provide adequate supervision as well.  If an employee does their job improperly, you pay the bill.  If they commit a crime, or their incompetence results in injury, you may be held financially responsible as well.  Verifying education and experience is only the beginning of the screening process.  Courts have held that employers have a duty to conduct a thorough background check too, so a criminal record check is highly recommended.  Minnesota recently passed important new legislation that now requires property owners to properly screen employees.  See: New L/T Law and Updates
      Carefully selecting all employees and clearly spelling out their duties will also help to prevent expensive problems down the road. Some consideration should be given to this matter even when hiring independent contractors for repairs and maintenance.

Pools, spas, exercise facilities
      Although these amenities are useful, sometimes even necessary, to attract and retain tenants, they also represent the potential for creating additional liabilities. Important considerations include:

• Well-designed facilities - quality equipment, adequate signage, and first aid considerations
• Instruction in proper use available
• Regular maintenance of facilities and equipment
• Rules & supervision - time of use and age of users with/without parental supervision issues

      Be sure that your insurance agent is aware of facilities and that they are covered in your policy.  Insurance companies will often require certain items related to such facilities.  For example, they may have requirements for pool safety equipment, signage, and fencing and will likely prohibit diving boards.

Miscellaneous
      The above safety and security items are not the only possible items of concern.  The prudent landlord not only worries about following all government regulations, but also looks for possible liabilities whether or not covered by law in their location.  For example, although probably only covered by law or building codes in a minority of jurisdictions, anti-theft grilles that cover windows should be able to swing open easily from the inside to allow egress from windows in the event of fire or other emergency. Additionally, windows themselves should open easily for the same reason.

Insurance
      We will cover some aspects of insurance in this lesson because one of the main needs for insurance is to protect the owner against liabilities for property damage, injury, or death of a tenant or a visitor to the property.  Having adequate liability and other types of property insurance is an absolute must.  One needs different insurance for a rental property compared to an owner occupied home.  Both liability and hazard coverages are significantly different.  Liability insurance is even more important for a rental, as you could be held financially liable for damages, injury, or death of your tenants or their guests and service vendors or for anyone else on your property even though you have much less control over these people in your rental than in your residence.
      A well-designed insurance program can protect your rental property from losses caused by everything from fire and storms to burglary, vandalism, and personal injury.  Where applicable, flood and earthquake insurance should also be considered.
      Landlords who have employees or who hire unlicensed contractors not having liability or workers compensation insurance should be particularly concerned that their insurance covers these persons.
      Although not well known, for property located where down-zoning has occurred since its construction, owners should consider obtaining a special coverage rider.  This coverage provides compensation when replacement improvements of the same type and/or density cannot be constructed because of changes in zoning designation or zoning definition resulting in prohibition against replacement following a significant or total loss of improvements.
      Some rental housing associations have been successful in helping their members secure coverage for discrimination lawsuits as well.
      A typical fire insurance policy on rental properties does not offer adequate liability insurance.  However, many homeowners policies contain $300,000 in liability protection on up to five rental units before additional policies need to be purchased. An umbrella insurance policy is also often used to obtain the desired coverage limit.  Don't ever take coverage for granted.  Insist that your agent help educate you on what you have and what you need.  Finally, read your policies to be sure that you have the protections that you thought you had.
      Many insurance carriers provide premium discounts for various safety devices.  For example, a typical carrier might discount 2 percent for smoke/fire alarms, fire extinguishers and deadbolt locks; 10 percent for a fire alarm that alerts either a central reporting station or the fire department directly; and 10 percent for an automatic sprinkler system.  Being in a gated community, having a permanent community security staff, or having a security alarm system in the the unit might result in additional discounts.