Maintenance Solutions For Property Managers. DANNY HARDEMAN Real Estate Broker Professional Property Manager

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1 Maintenance Solutions For Property Managers DANNY HARDEMAN Real Estate Broker Professional Property Manager

2 Topics Review of TAR Lease Paragraphs 18 (Repairs) Smoke Alarm and Security Device Requirements EPA s Lead Based Paint Renovation, Repair and Painting Program Rule (RRP) Communication with Tenants and Owners In House Maintenance vs. Independent Contractors 2

3 3 Property Manager s View

4 4 Tenant s View

5 5 Owner s View

6 6 TAR Lease Paragraph 18: Repairs

7 7 TAR Lease Paragraph 18: Repairs

8 8 TAR Lease Paragraph 18: Repairs

9 9 TAR Lease Paragraph 18: Repairs

10 Security Devices The security device statute applies to: a room in a dormitory or rooming house mobile home single family house, duplex, or triplex living unit in an apartment, condominium, cooperative, or townhome project. 10

11 Security Device Definition Exterior door a door providing access from a dwelling interior to the exterior. Property Code does not define doors from garage to exterior or garage overhead doors as exterior doors. 11

12 Security Device Requirements Landlord (at landlord s expense) must equip the dwelling with: a window latch on each exterior window doorknob lock or keyed dead bolt on each exterior door sliding door pin lock on each exterior sliding glass door sliding door handle latch or sliding door security bar on each exterior sliding glass door keyless bolting device and a door viewer on each exterior door. 12 TPC (a)

13 Smoke Alarm Requirements Applies to: Single Family Home Mobile Home Duplex Apartments Condominiums Any dwelling unit in a multifamily unit residential structure that is being leased to a tenant. 13

14 Smoke Alarm Requirements designed to detect both the visible and invisible products of combustion designed with alarm audible to a person in bedroom it serves tested and listed for use as a smoke alarm by Underwriters Laboratories, Inc., Factory Mutual Research Corporation, or United States Testing Company, Inc. 14

15 Smoke Alarm Requirements Where must a smoke alarm be installed? Each bedroom in a dwelling unit. Outside of each bedroom (i.e. hallway in immediate vicinity of bedroom) If the dwelling unit has multiple levels, at least one smoke alarm must be located on each level. 15

16 Video on Security Devices and Smoke Alarm Compliance Ken Jennings of Texas ReKey YouTube title: Texas Property Code Chapter

17 EPA s Lead-Based Paint Renovation, Repair and Painting Program Rule (RRP) Became fully effective April 22, 2010 aimed at protecting against lead based paint hazards associated with renovation, repair and painting activities in properties built before 1978 requires workers to be trained to use lead safe work practices and requires renovation firms to be EPA certified 17

18 What Is the Lead-Based Paint Renovation, Repair and Painting Program (RRP)? Training, certification, and work practice requirements: Firms are required to be certified Firm employees must be trained (either as a certified renovator or on the job by a certified renovator) in use of lead safe work practices, and lead safe work practices that minimize occupants exposure to lead hazards must be followed. 18

19 What Is the Lead-Based Paint Renovation, Repair and Painting Program (RRP)? Renovation is broadly defined as any activity that disturbs painted surfaces Includes most repair, remodeling, and maintenance activities, including window replacement 19

20 Who Must Follow the RRP Requirements? Anyone paid to perform work that disturbs paint in housing built before 1978 Rental property owners/managers (if performing the work) General contractors Painters Plumbers Carpenters Electricians 20

21 What Activities Are Subject to the RRP Requirements? Any activity that disturbs paint in pre 1978 housing and child occupied facilities Remodeling and repair/maintenance Electrical work Plumbing Painting preparation Carpentry Window replacement 21

22 What Housing or Activities Are Excluded and Not Subject to the Rule? Housing or components that have been declared lead free by a certified inspector or risk assessor. Certified renovator may declare specific components lead free using an EPA recognized test kit or by collecting paint chip samples and obtaining test results from an EPA recognized laboratory showing the components do not contain lead based paint. 22

23 What Housing or Activities Are Excluded and Not Subject to the Rule? Minor repair and maintenance activities that disturb 6 square feet or less of paint per room inside, or 20 square feet or less on the exterior of a home or building. NOTE: minor repair and maintenance activities do not include window replacement and projects involving demolition or prohibited practices. 23

24 RRP - FAQ s Is painting considered renovation if no surface preparation activity occurs? No. If the surface to be painted is not disturbed by sanding, scraping, or other activities that may cause dust, the work is not considered renovation and EPA s lead program requirements do not apply. NOTE: Painting projects that involve surface preparation that disturbs paint, such as sanding and scraping, would require compliance. 24

25 RRP - FAQ s Is a renovation performed by a landlord or employees of a property management firm considered a compensated renovation under RRP rules? Yes. The receipt of rent payments or salaries derived from rent payments is considered compensation under EPA s lead program. Therefore, renovation activities performed by landlords or employees of landlords are covered. Best Practice: Utilize certified subs to minimize liability 25

26 26 EPA RRP Pamphlet for More Information

27 Tenant Expectations Set expectations on maintenance requests during the lease signing and/or in a Tenant Handbook. Repair requests must be in writing Not delinquent in rent at time of repair request Define emergency repairs materially affects the physical health or safety of an ORDINARY tenant Flood, Blood, or Fire Ordinarily, a repair to the heating and air conditioning system is not an emergency. Define non emergency repairs no immediate threat of damage or safety 27

28 Tenant Expectations Communication is key at all stages of repair life cycle. Acknowledge receipt of request Attempt to troubleshoot with tenant: saves landlord money! PM should have general knowledge of common repair items Follow up calls for status updates and closure or work orders. 28

29 Tenant Expectations Tenant self help troubleshooting resources: PM staff via phone troubleshooting YouTube Ace Hardware website how to videos Discussion forums Google Best Practice: Take very detailed photos of all major systems and appliances in property in order to view while troubleshooting over phone. 29

30 Managing Owner Expectations Funds for Repairs Advice to Owner Place 10 20% annual gross rents in reserves / rainy day fund (depending on age of property) Covered in management agreement Require reserves? Loans to Owners must be in writing Wait on funds Deduct from Owner monthly rent distribution 30

31 Owner Expectations Communication Notification and authorization When and how to notify Is there an authorization limit in management agreement? Emergency vs. non emergency authorization Best practice: After any property visit. 31

32 Tracking Existing Service Contracts and Warranties Collect copies of all warranties and instruction manuals Identify any special service contracts Track warranties (software/hard files) 32

33 Maintenance Competency Judged as a professional with special knowledge Courts have held the property managers have superior knowledge of repair issues and place higher standard on PM s than general public. Owners will blame and possibly sue the PM for poor quality repairs. 33

34 Building your Team of Subs Painter Electrician Roofer General Handyman Plumber HVAC Lawn Service Pool Service Flooring Appliances Appliance Repair Carpet Cleaning Window/Glass Repair Tree Service House Cleaners Disaster Restoration General Contractor Etc., Etc. 34

35 Why Use Independent Contractors (Subs) No maintenance staff required (no overhead/payroll) Inexpensive solution Easiest to operate Reduced insurance requirements Some liability reduction 35

36 Where to Locate Vendors Referrals from other trades Supply houses Owners Other PM s NARPM Members Staff 36

37 Subcontractor Requirements Expectations Vendor/Contractor Agreement Customer Service Tenant communication protocol while onsite Property condition report to PM Check AC filter / smoke detectors Animals onsite? Damage to property? Work Order procedures Job cost thresholds and change orders 37

38 Subcontractor Requirements Payment Expectations Weekly Monthly When owner has funds in account Preferred Vendor payment program Requires written disclosure to owners 38

39 In-House Maintenance Pros: Potential Profit Center for PM Company Easier scheduling service calls Property knowledge and history in house Quicker emergency response time 39

40 In-House Maintenance Cons: Increased insurance requirements Liability and Worker s Compensation Transportation Tools and equipment Employee training Employee policy handbook Employee uniforms 40

41 41 Questions?

42 Danny Hardeman BLUE CROWN PROPERTIES Broker/President Professional Property Manager Office 42

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