Stonecrest proposes tighter rental-inspection rules and business-license requirement for offsite landlords

City staff and Councilmember Tammy Grimes presented a proposed amendment at the May 12 work session that would tighten inspection and certification requirements for multifamily rental properties and create registration obligations for single-family rental units.

Director Kawhi told the council the draft ordinance raises the city’s inspection coverage for multifamily housing: the proposal requires larger coverage each year so that 50% of units are inspected annually and 100% of units are inspected every other year, with inspectors required to provide a compliance report and checklist. “Currently, we have 20% of the inspections for every 5 years for multifamily that has been amended to 50% for, fifth 100% to be every other year,” Director Kawhi said during the presentation. The draft also adds a required letter of compliance completed by a certified building inspector and attaches the inspection requirement to business-license renewal for property operators.

Councilmember Tammy Grimes, who framed the item as a priority for District 5, said the city is seeking to “put some teeth into” existing rules so renters live in safe, maintained units. Grimes described field observations of mold, broken air-conditioning and dilapidated decks and said the certification and reporting requirements are meant to force consistent, verifiable inspections: “So it's 1 thing to say I have enough money to own the property, but the things that you need to have in order to conduct your, business here in Stonecrest, that's where we're trying to make that rubber meet the road,” she said.

Staff said property owners will be responsible for hiring certified inspectors and providing inspection reports to the city; the city will review submitted compliance reports and may withhold or affect business-license renewals for properties that do not comply. Director Kawhi said additional city staff will not be required to implement the program because inspections and certification are supplied by the property owners’ contracted inspectors and the city will review compliance packages.

Council members asked about single-family rental properties that are being used as rental units. Staff said single-family rental units that are not owner-occupied will be required to register with the city; registration will generally require an occupation/business tax certificate (a business license) for owners who do not live in the city. When Councilmember Terry Fye queried whether that requirement would be treated as a rental registry, the city attorney, Denmark Ashby, explained the city can require an occupation tax certificate for any business operating inside its limits and that a court could not nullify the General Assembly’s statute authorizing such certificates.

Why this matters: the proposed changes would increase the city’s regulatory oversight of rental housing and tie compliance to business-license renewals, affecting out-of-area landlords and large apartment owners as well as tenants who report substandard living conditions.

Sources and attribution: quotes and details are taken from on-the-record presentations and council discussion during the May 12 work session.

Clarifying details recorded in the meeting: the draft raises multifamily inspection coverage to inspect 50% of units annually and to reach 100% every other year; building-inspector reports and a standardized checklist are required; newly constructed units have a 12-month timing clarification tied to certificate of occupancy inspections; single-family rental units that are rented and not owner‑occupied will be required to register and may need an occupation tax certificate (business license); staff said no additional city inspectors are required because property owners will submit third-party certified inspection reports.

Ending: Staff said it will continue drafting ordinance language and that the proposal will return to council in a later meeting for formal consideration.