Managing the Business Risks of - xchange19.com · • Pet processing policies are not standardized...

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Transcript of Managing the Business Risks of - xchange19.com · • Pet processing policies are not standardized...

Page 1: Managing the Business Risks of - xchange19.com · • Pet processing policies are not standardized within the same firm • Inconsistent pet data collection / requirements / review
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Managing the Business Risks of

Pets & Assistance Animals

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The Three Ps

Three primary things that regularly cause challenges in rental housing:

1. People

2. Packages

3. Pets

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Business Risks with Pets & Assistance Animals

• Pets/Assistance Animals = Risk for Property Managers• Lawsuits from pet bites / Discrimination claims / Property damages

• Increasing Insurance premiums/deductibles

• Assistance Animal (Service/ESA/Companion) fraud is rampant

• PMs manage real property assets and are not fair housing experts

• PMs have limited pet information from the tenant prospects

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• Pet processing policies are not standardized within the same firm• Inconsistent pet data collection / requirements / review of the data

• PMs are not maximizing their revenue potential for pet deposits, pet fees and pet rents

• Applicants often hedge on their pet’s data without verification / recourse• Not officially “on the record” regarding a pet’s past / present behaviors

• Possible federal agency violations• HIPAA violations with applicant's medical information• HUD violations of discrimination for service/companion animals• Unexpected legal costs and fines

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ABC’s of Pet Risk

• Affirmations

• Questions regarding owner’s general pet care

• Behavioral

• Past and present behaviors of the subject pet

• Compatibility

• Collecting specific pet information to assess the probability of property damage

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Affirmations

• Is the pet owner formally on the record, for your records?

• Does the pet owner understand the concepts of pet damage?

• Does the pet owner understand your firm’s pet policies?

• Does the pet owner regularly take the subject pet to a veterinarian?

• Does the pet owner keep the subject pet on a leash except when behind a fence?

• Does a non-pet owner understand no pet sitting or fostering is allowed?

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Behavioral

• Does the subject pet have a current rabies vaccination?

• When do the shots expire?

• Does the owner provide you a copy of the subject pet’s shot record?

• Has the subject pet ever been quarantined? If “yes”, why?

• Unvaccinated pet bite / worm virus / military transfer

• Has the subject pet ever bitten another animal and caused injury?

• Has the subject pet ever bitten a person and caused injury?

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Compatibility

• Is the subject pet compatible for the property?

• What is the breed of the subject pet?

• Active and restricted breeds

• “Other” breed is vague

• Is the subject pet too large for the property/apartment community?

• Does the pet’s picture match the disclosed breed?

• Is the subject pet a puppy?

• Is it house trained?

• Is the pet spayed/neutered?

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Pet-Related Revenue Opportunities

• Pet-related fees do not have to be fixed and finite

• Pet owners will pay more to have their pets – they're not a entitlement

• Smaller dogs are not always better.

• Variable Pet Pricing can be based on pet and pet owner housing-related risk factors

• Pet Deposit (refundable)

• Pet Fee (non-refundable)

• Pet Rent

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• Readily apparent vs. Not readily apparent

• Obvious vs. Non-obvious

• Visible vs. Invisible

• Must be a disability and disability-related need

DISABILITY TYPES &

NEEDS

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• Never, ever, ever, ever, ever inquire about the specific nature of an individual’s disability!

• Always think in terms of “Yes” or “No” questions and answers

DANGER: DISCRIMINATION CLAIM

AHEAD

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• Reasonable Accommodation Request (it’s not an application)

• Requesters (Individual seeking a Service/Assistance Animal)

• Verifier (Third-party individual making the diagnosis)

• Housing Provider (Landlord/Property Manager)

• Assistance Animal = ESA/Service/Companion/etc.

DEFINITIONAL

ROLES

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• FHAct allows housing providers to:

• Establish the legitimacy of the Requester’s disability status

• Seek reliable and credible supplemental confirmation of the underlying disability

• Evaluate supplemental information to determine whether the animal provides assistance that ameliorates the effects of the established disability

• Apply the Test of Reasonableness• Every case is unique and different

FHAct GUIDANCE

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• What about guard dog pet insurance policy exclusions?

• Financial hardship is a valid reason to decline a Service/Assistance Animal….Caution!

• HUD Memo – Insurance Breed Restrictions, 06/12/2006• Bryan Greene – Currently is the Assistant Deputy

Director of HUD

INSURANCE BREED

RESTRICTIONS

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• Top initiative of HUD Secretary

• Additional HUD guidance is in progress but no definitive release date

• Several states have passed more specific legislation for licensure and misdemeanor criminal penalties

• HUD must review and determine State laws as substantially equivalent which is creating a State vs. Federal quandary

FEDERAL & STATE

UPDATE

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• Requester

• Fair Housing Claim of Discrimination (State and Federal)

• Pro-bono attorneys waiting to pursue claims

• Housing Provider

• Some states have a misdemeanor penalty for service and assistance animal fraud

• No federal penalties whatsoever for a Requester’s false claims

• Property damage from Assistance Animals is subject to recovery through civil adjudication

RECOURSE

OPTIONS

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• Self-screen and review with internal resources ($$)

• Hire external counsel ($$$$)

• Utilize a third-party, no-charge service (FREE)

SOLUTION

OPTIONS

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• Assistance animal fraud

• Altered letters

• Forged signatures

• Former employees

#BUSTED

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• HUD 2013 Memo

• HUD & DOJ Joint Statement

• Breed Restriction Insurance Memo

• DOJ Guidance Memo on Service Animals

• NARPM.org

• PetScreening.com

• https://www.petscreening.com/hud-ada-fhact-links

RESOURCES

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