Indiana landlords turn to Rokita for help as fears of evictions rise

A group of Hoosier landlords has asked Indiana Attorney General Todd Rokita for help in getting compensation from the state for the rent they lost during the eviction moratoriums and is preparing to take legal action against the state and federal governments.

Indiana Property Rights Alliance, a nonprofit founded to advocate for property owners’ rights, wrote a letter to Rokita on Sept. 1 detailing the impact of the moratoriums imposed by Indiana and the federal government on their businesses. In particular, they assert the protections had a disproportionate impact on small “mom and pop” landlords.

“Too many tenants have stopped making payments because evictions stopped in Indiana,” the alliance wrote. “Who pays for this — the landlords and not the United States or Indiana.”

In addition to its appeal to the attorney general, the organization has hired Thrasher Buschmann & Voelkel in Indianapolis and plans to file lawsuits by mid- to late-September, according to Laura Guy, president of the alliance.

Guy countered the image that has grown during the COVID-19 public health emergency that landlords have been preparing for mass evictions. Property owners, she said, invest in their local communities and help keep rental costs low by remaining local.

Moreover, she said, she does not know of a single landlord who wants to kick families out because they cannot pay rent. Rather, these landlords want to work with tenants.

“I want to reiterate landlords care for their communities,” Guy said. “We’re not sitting back, counting money and eating ice cream. We are working very hard.”

Moratoriums on evictions and foreclosures were enacted at the beginning of the COVID-19 pandemic to prevent families from losing their homes during the pandemic. Indiana ended its moratorium in August 2020, then the Centers for Disease Control and Prevention issued a narrower moratorium in September 2020. The moratorium was most recently extended to Oct. 3, but the U.S. Supreme Court overturned it, saying the CDC had exceeded its authority.

The alliance used its letter to make a direct plea to Rokita.

“Indiana Property Rights Alliance, Inc., asks you to support landlords and to take actions to protect the real property rights of Hoosier landlords,” the alliance wrote. “We ask you to publicly announce that you and your office are going to enforce the Indiana Constitution, and pressure the Governor, General Assembly and Judiciary of Indiana to honor and enforce Article 1, Section 21 of the Bill of Rights of the Indiana Constitution … .”

Rokita’s office expressed his sympathy for landlords and tenants. However, the state’s top lawyer did not make any commitment to help the property owners get the compensation they are seeking.

“Landlords are understandably frustrated about the eviction moratoriums that have made it difficult for some of them to earn income on their investment properties as a result of their inability to evict certain nonpaying tenants,” an AG spokesperson told Indiana Lawyer. “Tenants likewise have been very vulnerable during the pandemic as a result of COVID-related shutdowns and the impact that has had on certain industries where a large number of workers happen to be renters.”

How many tenants across the state stopped paying rent and how much is owed in arrears is unclear. The total damages landlords have suffered is still being calculated, according to Guy.

She noted that while the property owners were not getting rent, they still had business expenses to meet. They had to pay property taxes, insurance, maintenance on the rental units and any utilities they agreed to cover in the lease.

“When is this going to end and when is the burden on landlords going to be lifted?” Guy asked.

Rokita’s office directed renters and property owners to access the rental assistance that is available.

“Hoosier renters and landlords can now continue to seek out monetary assistance if they have had difficulty paying or receiving rental payments during the COVID-19 pandemic,” the AG spokesperson said. “Hundreds of millions of dollars have been allocated to the State of Indiana and are being distributed through the Indiana Emergency Rental Assistance Program (IERA), which can be used to supply up to 12 months of rental assistance that benefits both property owners and tenants.”

Also, the spokesperson highlighted the self-help center available through the Consumer Financial Protection Bureau, which offers financial assistance for rent as well as utilities. Some of the programs allow for property owners to apply for the assistance themselves.

But Guy said to date, the rental assistance has not been helpful. The process for getting the financial support “changes every day” and property owners do not have direct access to the funds. Some programs require landlord approval but only the renters can access the money, she said.

The situation has left many property owners struggling and angry.

“Mom-and-Pop Landlords are fed up and demand to be compensated by the State of Indiana,” the alliance wrote in its letter. “They are tired of Indiana taking their services and property without just compensation first assessed and tendered.”