Insofar as the upcoming 2025 regular session of the Louisiana Legislature and dealing with scofflaw apartment complex owners (and somewhat stealing from the “Mad Max” franchise), two bills enter, one bill leaves.
An issue that primarily has popped up in Shreveport involves apartment complex owners not paying water bills to the city and no real means to force them to do so. This leaves the city with the Hobson’s choice of tolerating it or cutting it off that then puts residents in a bind. Residents supposedly have an approximation of their water bills rolled into rent, as the complexes have a single line paid wholly which then splits off into individual units. But even though most occupants pay their rent, owners at several complexes haven’t remitted their due to the city for months.
The city has trouble collecting as ownership arrangements under law don’t present a responsible entity from which the city readily can collect. The complexes in question are older, lower-income residential in nature where the owners, because the properties aren’t worth much, bleed them as much as they can. Also some such properties the city has had declared derelict, with others otherwise habitable it has tolerated leaving water on a few hours a day so as not to make the situation of the residents paying in good faith untenable.
Their ownership structures, limited partnerships, shield the individuals behind them from punishment, and the sanctions against LLCs amount to a pittance. Nor does the city’s rental registry program enacted a couple of years ago provide any relief, as the units have capacity for running water, but whether it flows by payment choice that code doesn’t address.
As a result, one bill has been introduced and one intended bill is promised for legislative consideration to deal with the issue. Democrat state Rep. Steven Jackson has filed HB 6 that makes a felony failure to forward fees intended for utilities, as well as provides for civil redress in seizing the property or monetary assets involved, and subject the offending entity to racketeering prosecution as well.
But, again, the buffer than an LLC constructs between itself and persons makes this a toothless effort. Nor will civil penalties address the matter, as what would happen is owners would let the property go completely to pieces in extracting as much as they can, then willingly turn it over. Finally, it would be duplicative in a sense that affected residents can complain about being defrauded under the law.
This separateness Democrat state Sen. Sam Jenkins has vowed he will try to overcome with a bill he plans to submit. The outlines of this would allow the city to recoup at least some of what it’s owed by allowing it to slap a lien on the property, kicking in when its title is transferred typically through a sale.
With this on the books, only the most drastic step by owners of buying and eventually abandoning would become a viable money-making scheme and only in some cases. That could discourage some fly-by-night owners from becoming landlords and for others they might make a better go at paying water bills.
Only Jenkins’ intended bill adds to the fight against dishonest landlords. If its final form is what he has signaled, it deserves passage, while Jackson’s doesn’t contribute anything and may be shunted off to the side.
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