1. City Council Meeting May 7, 2018
Proposed Amendments to Chapter “Inspection Ordinance” Related To The Occupancy Inspection Program
City Council Meeting May 7, 2018

2. Amendment to Inspection Ordinance
Executive Summary
Inspection Ordinance (i.e. Occupancy Inspection Program) was adopted in 1973 and last revised in 1991
Staff reassessed the Occupancy Inspection Program (OIP) and considered the following four alternatives:
Streamline OIP to refocus on life and safety violations
Discontinue OIP, in lieu require seller to obtain and disclose a property records report
Discontinue OIP
Retain OIP without changes

3. Amendment to Inspection Ordinance
Executive Summary
Staff recommends to streamline program and refocus on life and safety violations
Inspection criterion limited to unpermitted additions/conversions utilized as habitable space and unpermitted electrical panel replacements/upgrades
Allowing self-certification for minor code violations
Exempting condominium/townhouse units from required inspections

4. Amendment to Inspection Ordinance
Background
Point of sale requirements for other cities in L.A. County
Approximately 16 of 88 cities in Los Angeles County require a point-of-sale inspection
Scope of inspections varies between cities
Drive-by inspection of exterior (Hermosa Beach)
Walkthrough of exterior (Azusa, Cudahy, Huntington Park, Inglewood)
Exterior and interior of non-residential structures (Bell, Carson, El Monte, Hawaiian Gardens, Lynwood, South Gate)
Exterior and interior of all structures (San Fernando, Compton, Maywood, San Marino, Pasadena)

5. Amendment to Inspection Ordinance
Background
Pre-sale requirements for comparable cities

6. Amendment to Inspection Ordinance
Background
History of the Occupancy Inspection Program
1950s first formal program to include mandatory inspections with the purpose of protecting occupants and improving housing stock
Occupancy Inspection Phase I included single family and duplex units
Occupancy Inspection Phase II included multi-family units
Occupancy Inspection was bifurcated into mandatory point-of-sale inspections for single family and duplex units (i.e. OIP); and mandatory inspections every four years for multi-family units (i.e. Quadrennials)
Occupancy Inspection Program was revised to allow for self-certification of minor violations

7. Amendment to Inspection Ordinance
Background
Overview of Current OIP Program
Code Compliance Division consists of a Property Maintenance/Zoning Enforcement Section and Housing Section
Housing Section administers the OIP (1,800 cases per year) and Quadrennial (5,500 rental units per year) programs
Properties are inspected for Major and Minor violations
Major violations require re-inspection to verify correction of violation
Minor violations do not require re-inspection, however, property owner can self-certify corrections were completed
Seller and buyer have option of deferring correction of Major violations via a Transfer or Responsibility, whereby the new property owner is required to correct violations within a specified time period

8. Amendment to Inspection Ordinance
Background
Overview of Current OIP Program
List of typical Major and Minor Violations:

9. Amendment to Inspection Ordinance
Background
Evolution of Code Compliance and Home Inspections

10. Amendment to Inspection Ordinance
Background
Criticism of the OIP
OIP redundant as in-depth private home inspections already take place
Substandard properties are typically improved prior to sale or shortly thereafter
Lack of consistency in inspections, whereby pre-existing violations were not identified during previous sale but have been identified at resale
OIP requirements delay escrow and jeopardize sales agreements
California State Audit
OIP audited in 2016 as part of larger audit that included 2 other cities
Intent was to assess administration of the program in conformance with adopted ordinance and approved rules and regulations
Various deficiencies identified, most notably consistency and lack of follow-through

11. Amendment to Inspection Ordinance
Background
Cities response to deficiencies
Utilization of specialized Code Officers dedicated to the OIP
Utilization of itemized checklist during inspections; also available to public
Implementation of an online portal that allows scheduling and payment of OIP inspections
Utilization of supplemental contract resources to assist with back-log of OIP cases
Utilization of mobile inspection software that allows for an expedited report
Continuous training on identification and abatement of Housing Code violations

12. Amendment to Inspection Ordinance
Analysis
348 OIP cases were received between Jan. – Mar. 2018
21 of the 97 cases with major violations included one or more unpermitted additions/conversions being utilized as habitable space
Remaining 76 of 97 cases with major violations were largely limited to unpermitted HVACs, water heaters, windows and inadequate fire separation (i.e. self-closing door between habitable space and attached garage)

13. Amendment to Inspection Ordinance
Analysis
Condominiums and townhouses are significantly less likely to have Major and Minor Violations
Major Violations limited to unpermitted HVACs and water heaters

14. Amendment to Inspection Ordinance
Analysis
Option A: Streamline OIP to life/safety violations
Quality of housing stock has significantly improved
Other programs in place to address code violations
OIP allows Code Compliance to enter property and conduct a thorough inspection
Approximately 100 properties per year are identified with illegal additions/conversions utilized as habitable space
Exempt Condominiums and townhouses from required inspections (only self-certification required)
Unreported illegal construction results in undervalued property appraisals and reduced property tax revenues

15. Amendment to Inspection Ordinance
Analysis
Option A: Streamline OIP to life/safety violations
Major Violations requiring re-inspection
Illegal addition, alteration, conversion utilized as a habitable space
Unpermitted electrical panel replacement/upgrade
Minor violations requiring self-certification
Other minor electrical deficiencies
Unpermitted mechanical equipment
Missing or improper fire detection
Required gas shut-off

16. Amendment to Inspection Ordinance
Analysis
Option B: Discontinue OIP, require seller to obtain and disclose a property records report prior to sale or transfer of the property
Property records report would include the following:
Street address and legal description
Zoning classification
Occupancy as indicated and established by permits record
Permit history
Code Compliance case history (including previous OIPs)
Land use permits
Any deed restrictions

17. Amendment to Inspection Ordinance
Analysis
Option C – Discontinue OIP
Utilize existing and new resources to identify and enforce code violations
Redirect staff resources to a more robust Quadrennial program
Option D – Retain OIP and continue as is
Increase of fees are required to adequately administer the program
Rigorous inspections are duplicative of already utilized private home inspections

18. Amendment to Inspection Ordinance
Next Steps
If Council agrees to streamlined OIP, staff would complete the following:
Prepare revisions to the existing inspection ordinance to streamline the Occupancy Inspection Program as outlined in Option A; including authorization of the City Manager to prepare updates to the adopted Rules and Regulations which outline the administrative enforcement and implementation of the inspection program.
Return to Council for approval of any necessary fee changes to ensure cost recovery for the program.
Partner with the Pasadena Foothill Associations of Realtors and other stakeholders to update the Rules and Regulations for the OIP.

19. Amendment to Inspection Ordinance
Recommendations
Find that the proposed Pasadena Municipal Code Amendments are exempt from environmental review under Section 15061(b)(3) (general rule) of the California Environmental Quality Act (“CEQA”); and
Direct the City Attorney to prepare an ordinance within 60 days amending Pasadena Municipal Code Section “Inspection Ordinance” and the associated “Rules and Regulations” as outlined in the staff report.

20. City Council Meeting May 7, 2018
Proposed Amendments to Chapter “Inspection Ordinance” Related To The Occupancy Inspection Program
City Council Meeting May 7, 2018

21. Sample Property Records Report