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Amid a Pandemic, North Texas Tenants Grapple With Landlords

As unemployment claims in Texas skyrocket, some tenants in the Dallas-Fort Worth area are finding themselves at odds with their landlords.
As unemployment claims in Texas skyrocket, some tenants in the Dallas-Fort Worth area are finding themselves at odds with their landlords.
Rental Realities

The sound of skittering rats was common. Mold would fester, threatening rot. Perhaps worst of all, the plumbing stopped working.

“Pretty much everything that could go wrong was going wrong,” Peter Wierenga says of his Fort Worth home. “But the landlord wouldn’t do anything about it.”

So Wierenga was not surprised when, as the COVID-19 crisis began, his landlord refused to make any concessions. Wierenga and his three roommates were slated to move out when their lease ended on April 30, but moving in the middle of a global pandemic didn’t seem safe. Willing to tolerate a month more of mold, the roommates requested an extension on his lease. The request was denied. But it wasn’t the rejection that irked Wierenga and roommates. It was the manner in which it was delivered.

“There wasn’t any negotiation,” he says. “They basically told us, ‘It is what it is. You have to leave.’”

Wierenga’s woes pale in comparison to the challenges faced by other local tenants, particularly those who have already endured weeks without paychecks. Many of those tenants, including several interviewed for this story, have received eviction notices on their doors, a practice the county's moratorium on evictions hasn't deterred. While the Supreme Court of Texas extended an eviction suspension until April 30, Dallas County’s moratorium runs through May 18. When that moratorium ends, housing advocates worry justice of the peace courts will be flooded with eviction lawsuits.

Across North Texas, apartment renters, house dwellers and business owners are talking to their landlords about lease terms and rent costs, often because they have lost significant or sole sources of income. If renters are seeking refuge, their best — and perhaps only — hope is flexibility from their landlords.

Of the nearly two dozen tenants interviewed for this story, most elected to remain anonymous to avoid any further conflict with their landlords. Only a few permitted the use of their full name. Allen Falkner was one. The Dallas business owner runs Nines Bar, Fade Fast Tattoo Removal and Charlie’s Star Lounge, all of which are rented by Madison Partners.

“They made it clear that they are handling each tenant differently,” Falkner says. “In fact, we have a different deal with two of our properties than we got for the third. The main thing is that they treated me like a human and not a number.”

Kim Finch, owner of the bars Single Wide and Double Wide, is also thankful for her landlord’s flexibility.

“So far I have been lucky, and all my landlords have been working with me,” she says.

Finch also works with the company Madison Partners, among other landlords. The company is charging Finch triple nets, a rental agreement wherein a tenant pays insurance, taxes and maintenance. It’s likely the best deal that Finch and other small-business owners can get while they await much-delayed small-business grant money.

Businesses can get creative — converting alleyways into drive-thrus like Las Almas Rotas — but landlord leniency may be key to their long-term survival. The level of leniency may, in some cases, be out of the landlord’s hands.

“I understand the landlords are being hounded for money, too,” Finch says. “If the banks give landlords relief, that can trickle down to the tenants.”

Jon Hetzel with Madison Properties admits that his company has faced some challenges with the banks.

“It can be a breach of your agreement to abate tenants’ rent without getting lenders’ permission,” he says. “That can lead to a whole bunch of nasty stuff.”

Madison Partners works with local banks, insurance companies and commercial mortgage-backed securities (CMBS) lenders. Hetzel says the local banks have been generous and understanding, while the insurance companies have been less flexible. CMBS lenders have been the most difficult. These loans are packages of a bunch of commercial mortgages that are bundled and sold to bond holders.

“The way they’re legally structured doesn’t allow them to do anything without the bond holders’ permission,” Hetzel says. “So their hands are tied, which means our hands are tied.”

CMBS lenders tend to service the bigger properties that are most likely to sustain themselves months without significant income. Still, Hetzel says, some of those tenants, including companies like Bed Bath & Beyond, have been requesting rent relief.

“They sent us a letter saying, ‘We can’t pay,’ so we sent one back saying, ‘We appreciate that these are tough times, but you can’t just take your own deferral or abatement,'" he said.

For now, Madison Partners is making concessions where they can, knowing that they will likely have to pay for some of those concessions with their own cash.

Communication Is Key

Elsewhere in North Texas, other management companies are working with tenants and owners simultaneously, trying to keep both happy. In Denton, family-owned management company Property Search owns residential and commercial properties, including a nail salon and CrossFit gym. As the coronavirus pandemic reached Texas, one of the company’s landlords texted all of her clients.

“I told them, ‘Due to COVID-19, we’re going to have to be in communication more than ever,’” the landlord says. “‘Let me know if your income will be affected, because I’d like to get you on a payment plan.’”

While the landlord did not threaten eviction, she has still posted eviction notices for people who have not contacted her, and says she will proceed with evictions after April 30. She says all but three tenants have been in touch with her, and even for those three, she is hoping eviction won’t be necessary.

“Tenants will never end up in an eviction situation if they communicate with their landlords,” she says. “For the most part, landlords care about their tenants and want them to stay in their property.”

The pandemic has brought into question whether evictions are even financially viable for landlords, especially at a time when tenants are not exactly lining up to move. That is no small comfort to housing advocates, who still worry that landlords will file eviction lawsuits against tenants who have lost their jobs.

Frances Espinoza, executive director of the North Texas Fair Housing Center, has spent her entire career running nonprofit organizations. Her current organization is primarily focused on housing discrimination. Yet since April 1, they have received an inordinate amount of calls about rent assistance.

“Most callers this month are reaching out, because they have received notice of evictions,” she says. “They’re looking for resources, and it seems like there aren’t any.”

A Dallas County moratorium on evictions hasn't stopped landlords from posting eviction notices on tenants' doors.
A Dallas County moratorium on evictions hasn't stopped landlords from posting eviction notices on tenants' doors.
Rental Realities

The city of Dallas has no emergency fund for rent assistance, and nonprofit resources are limited. That leaves most tenants with one option: negotiating with landlords.

In Espinoza’s experience, landlords have been most willing to work with tenants they know. When one of her Irving clients was short $200 on her April rent, the tenant reached out to her landlord.

“Because she is a longtime tenant, they worked with her,” Espinoza says.

Another client is having more difficulty with their landlord. Unable to pay April rent and wary of accumulating late fees, the tenant tried to get out of his lease and move his family elsewhere.

“They didn’t want to let him out of the lease,” Espinoza says, “so we’re still trying to find a solution.”

Other clients have lost relatives to COVID-19, severely limiting their ability to pay rent this month or next. And with the economy in shambles, tenants, especially those employed in the service industry, are worried about when they’ll find work again.

These conversations are further complicated when you add in a language barrier. Many of the Fair Housing Center’s clients are Spanish speakers, and some can’t understand the eviction notices when they arrive at their doors.

“I see patterns of landlords discriminating against immigrants and people of color,” says Dewey Marshall, one of Espinoza’s staffers. “Lots of my clients who aren’t hearing back from their landlords are people of color. Landlords who don’t communicate worry us, because we can’t tell those tenants that they are safe from eviction.”

Centers for Disease Control data shows that people of color are more likely to die from the coronavirus, and genetics aren’t to blame. Confined to crowded urban areas by the lack of affordable housing, people of color are less likely to be able to practice social distancing. As U.S. Surgeon General Dr. Jerome Adams noted in a White House press conference on April 10, "Only 1 in 5 African Americans and 1 in 6 Hispanics have a job that lets them work from home.” In that same press conference, Adams said people of color are “socially predisposed to coronavirus exposure.”

Espinoza and her team are particularly worried about undocumented immigrants who won't have access to assistance from the U.S. Department of Housing and Urban Development. The city of Dallas is set to receive $5 million in HUD money as part of the federal government’s stimulus acts. In a marathon Zoom meeting on Wednesday, the Dallas City Council debated how to best use the money, with some expressing doubts about a “first-come, first-serve” system.

"We’re going to end up with a report that shows we’ve served in a way that is not equitable, and is not serving our most needy residents,” council member Cara Mendelsohn said in the meeting.

“At the very least, we need a grace period,” Espinoza says. “Otherwise, all of these landlords are going to start filing evictions as soon as evictions are able to be executed, and then we’ll have a bigger homeless population.”

A New Proposal

That was the principal motivation behind an ordinance being mulled over by a Dallas City Council committee. The ordinance, originally introduced by council member Adam Bazaldua, draws inspiration from a similar ordinance passed by the city of Austin. At its core, the ordinance is an alteration to the eviction notification process.

Currently, landlords place a notice to vacate on a tenant’s door and are legally able to file an eviction lawsuit 72 hours after the notice. That lawsuit goes to a justice of the peace court, where a judge hears arguments from the landlord and the tenant.

The proposed ordinance would change notices to vacate to “a notice of possible eviction,” and give tenants 21 days to provide proof of hardship. Upon providing that proof, the tenant then has up to 60 days, including the original 21, to provide continued proof of hardship. On day 61, landlords can file an eviction lawsuit. At any point in that 60-day time frame, landlords and tenants will be able to arrange their own agreement.

“All this is trying to do is keep people in their homes for a reasonable period of time,” says Mark Melton, a Dallas attorney who helped draft significant changes to the ordinance. “As a city, we don’t have the infrastructure to handle a mass homeless event.”

On Thursday, the City Council committee unanimously recommended that Mayor Eric Johnson put the measure up for a vote before the full council. Melton is “cautiously optimistic” that the ordinance will pass. If it does, he thinks the pros will outweigh the cons.

"There are going to be bad actors on both sides of this,” he says. “We’ll have tenants that just don’t want to pay, and landlords that are abusive and try to be intimidating. But that won’t be the majority of people in either case, and we can’t make policy based on the minority. We want to protect people who are trying to do the right thing, but just can’t do it right now.”

Espinoza is hopeful the ordinance will pass, in part because it will help defend tenants in a possible justice of the peace court hearing.

“My experience is that judges don’t care why tenants can’t pay,” she says. “There has to be something else in place to guide these judges, otherwise they’re going to behave the same way they always have.”

Espinoza joined Wednesday’s City Council meeting to encourage members to pass the ordinance when it reaches their agenda. She was joined by a series of representatives from churches and organizations throughout Dallas, most of whom tuned in to speak for impoverished people at risk of eviction. One woman, speaking through a Spanish translator, implored the council to help provide adequate rent assistance.

“I am here to beg you to put your hand on your heart,” the woman said. “We must direct funds to help the most vulnerable in our city. They support our restaurants. They feed us. They support our public spaces. These are our brothers and sisters.”

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