Negligent landlord banned from state for 7 years in agreement with city, state

One week after the city reached an agreement with the negligent landlord JPC Affordable Housing Foundation and three weeks before the threatened deadline when water would be shut off to over 1,100 households at four Indianapolis apartment complexes, the Attorney General's Office and Citizens Energy Group have sealed a deal to protect tenants.

The agreement settles the three April lawsuits filed by the city, state, and utility company in an unprecedented, coordinated legal strategy to hold the landlords accountable.

The President of JPC, Oron Zarum, and his lawyer, Joshua Kahane, did not respond to an IndyStar request for comment.

Under the agreement with JPC, the apartment company that claims to be a nonprofit will have to sell all four remaining apartment complexes it owns in Indianapolis by the end of this year to a bona-fide third party. The apartments are Woods at Oak Crossing and Covington Square on the west side, and Berkley Commons and Capital Place in the south side. The city hopes that with the sale, the four properties will come under the care of a more responsible owner, just like what happened with the Lakeside Pointe and Fox Club apartments that were also owned by JPC and sold in March.

A landlord did not pay water bills: Residents at 1,400 homes may lose water.

JPC Affordable Housing Foundation, which has a business address in New Jersey, will have to dissolve itself and its affiliates, which go by the names of JPC Charities, Pure Charity Fund and Aloft Management LLC, by April 30 2023. Lastly, the company will be prohibited from owning and managing apartment complexes in Indiana for seven years.

Residents no longer will have to worry about the water being shut off. Citizens Energy Group agreed to continue utility service to the apartments. Through the proceeds from sale of the four properties, Citizens said it expects to receive about 80% of the $1.9 million debt owed to the utility by JPC.

The city previously said it will recoup up to $850,000 of a debt owed to it by JPC through the sale as well, through its own settlement agreement.

Mayor Joe Hogsett acknowledged at a press conference Thursday regarding the settlement that damage had already been done with the uncertainty that tenants have lived with for months. After Citizens Energy Group threatened in July to disconnect water to thousands of homes if the $1.9 million bill was unpaid, many neighbors at the complexes felt pressured to get out, unsure if the water would still be running come September.

"Nobody up here ... wants families to have to put up with the kind of uncertainty we saw at the properties in question," Hogsett said. "Parents of young students not knowing where they'll live when the school year starts. Older residents on fixed income not knowing if they can afford the costs of signing a new lease if forced to move. Renters who pay their bills, only to find out the landlord was not passing the money on to the water company."

Poor living conditionsLakeside Pointe landlord enjoyed tax breaks for years while residents suffered

Rokita and Hogsett: Legislative changes needed

The city and many residents of the beleaguered apartment complex have called on the state legislature to do more to prevent such abuses by a landlord from happening again.

"It should not take a three-way lawsuit by a local government, a utility, and a state level official to bring justice in such a clear case of neglect," Hogsett said.

Attorney General Todd Rokita also said at the press conference that he supports changing current Indiana nonprofit laws that have proved to be inadequate. As an example of the insufficiency of current law, he cited his office's lawsuit from last summer, when a judge ruled that the attorney general did not have authority to intervene against JPC regarding two of its other properties, Lakeside Pointe at Nora and Fox Club apartments.

Tenants suffered years of neglect:Then, their homes caught fire.

Hogsett said that he supported statewide legislative changes that would prevent harmful landlords like JPC from abusing tenants. Indiana law does not currently allow tenants to withhold rent when a landlord fails to make needed repairs to their home, even in cases like this where tenants were paying for utilities through their rent but the landlord failed to pay the utility company.

Democrat-led legislation to enact such a right was killed by Republican lawmakers at the Statehouse earlier this year. The Republican-controlled Statehouse had also previously prevented Indianapolis from enacting a tenants bill of rights in the 2021 legislative session.

Contact IndyStar reporter Ko Lyn Cheang at kcheang@indystar.com or 317-903-7071. Follow her on Twitter: @kolyn_cheang.

This article originally appeared on Indianapolis Star: Indiana landlord JPC Affordable Housing Foundation to sell properties