Council members disagree on deposit

Members of the Havre City Council's Ordinance Committee were divided Monday night on a proposed ordinance that would require a water deposit from renters and new homeowners.

During a two-hour meeting, committee members discussed the ordinance and listened to public comments, nearly all of which came from local landlords. Committee chair Rick Pierson said after the meeting he thought it was too early for the committee to take action and suggested it study the issue further. The three other committee members agreed.

Committee member Allen "Woody" Woodwick said during the meeting that he thinks the proposed ordinance reflects a compromise among the parties involved. Committee members Tom Farnham and Pam Hillery said they had reservations about it.

Woodwick, a landlord and a member of the Water and Sewer Committee, proposed a water deposit last summer after a number of landlords complained that they's getting stuck with water bills of tenants who either waste water or leave without paying their water bills.

The proposed ordinance would require a water deposit of three months' worth of water bills based on the monthly average of water use in the unit over the last 12 months or $120, whichever is higher. Renters and property owners who are getting water service with the city for the first time would pay the deposit. Water users whose service is disconnected for nonpayment would also be required to pay the deposit before getting service reconnected.

Farnham questioned whether tenants would be able to afford the deposit.

"When I read over the ordinance, I think $120 is pretty steep," he said, noting that new renters also have to pay first and last months' rent, a security deposit, and deposits for utility and telephone service.

"You're looking at $1,300 or $1,400 just to move out of the house," he said. "I'm happy with the ordinance that's in existence right now."

Farnham, who manages the Eagles Club in Havre, equated landlords getting stuck with unpaid water bills with other businesses being burned by bad checks.

"Business has its losses," he said. "It's just part of doing business."

Hillery also expressed opposition to the proposed deposit.

"I have very strong feelings against the deposit," she said, adding that she owns rental properties in two other cities.

"I don't have any problem with the landlord being responsible," she said. "The difficulty is that tenants probably have the least ability to pay."

Woodwick said he believed that paying a water deposit should be the responsibility of the tenant.

"Part of the cost of being a tenant is coming up with the money to move in," he said.

Committee members asked City Attorney Jim Kaze about the proposed ordinance.

Pierson asked if a list of delinquent water bills would be considered public or private information.

Kaze said a good argument could be made either way, but he would "counsel the city not to divulge that information."

Pierson asked if a landlord could get stuck with more than three months of water bills left unpaid by a tenant, making the $120 insufficient.

Kaze said it was unlikely because the disconnect procedure should ensure that service is stopped before three months of nonpayment lapsed.

Local landlord Jim Treperinas questioned the fairness of having to pay for someone else's debt. He asked if council members thought he should get stuck paying for $3,000 in damage done to a rental by a tenant.

"That's what you have a security deposit for," Farnham said. "It's part of doing business."

Local landlord Brad Lotton called the current ordinance "ridiculous" because it makes the landlords, rather than the city, responsible for collecting delinquent water bills. "The city needs to take responsibility for this," he said.

Lotton told the committee he was speaking on behalf of the Havre Landlords Association, a group that represents "hundreds of properties and millions of dollars in business." He said the association should be allowed to meet on a "one-to-one basis" with the committee to help draft a new ordinance.

"The lobbyists that know about the business should help write the ordinance," he said. "I ask, on behalf of the Landlords Association, that you scrap this whole thing and come to the table to come up with a solution that's equitable."

Pierson said the committee should consider the offer. "I think we might want to sit down and listen to what these folks have to say," he said.

Hillery objected. "I don't see a legitimate forum for meeting with them individually," she said.

Kaze told the committee that if it met with the Landlords Association, it would have to post notice of the meeting and allow the public to participate. He said the association could legally lobby members of the committee on an individual basis, but that it could not meet in private with the "committee as a group, or a majority of the committee as a group" without violating state open-meeting laws.

The Ordinance Committee is the second City Council committee to consider the issue. The Water and Sewer Committee forwarded the ordinance to the City Council without making a recommendation on it. Then the council voted Feb. 15 to send the draft proposal to the Ordinance Committee for review.