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Amy Dalrymple, Forum News Service, Published June 04 2012

Housing demand created by oil boom puts renters at risk

WILLISTON, N.D. – About 30 people, including families with single moms and people on fixed incomes, have been evicted from their Williston apartments after the building was sold to an oil company.

In a town without even a storage unit available for rent, many will be forced to leave Williston.

The situation is an example of something that a North Dakota legal advocacy office says is likely to keep happening in the era of rapid growth fueled by the oil boom.

Jenna Kabanuk, a single mom of two boys ages 3 and 6 months, moved last week to Wibaux, Mont., and now drives more than four hours each day to continue running her Williston cleaning service and to bring her boys to day care.

Of the other tenants – who received 30 days’ notice they had to move by May 31 – one man moved in with his parents, an elderly woman moved in with family in Mandan, one man planned to stay in an RV and another single mom fears she’ll have to move her teenage boys away from their hometown.

“This is just wrong to put 12 families out on the street all of a sudden,” Kabanuk said.

Jim Fitzsimmons, executive director of Legal Services of North Dakota, said these types of cases are happening too often in North Dakota’s oil- and gas-producing counties.

In some cases, buildings are purchased by companies and rents are increased so high that low- and middle-income tenants are forced to move.

In other cases, such as the latest case in Williston, tenants are displaced without having the option of paying higher rent.

“The situation is only going to get worse,” said Fitzsimmons, whose office tries to assist tenants. “Once in a while, lawyers can win on a technicality in court, but the real issue needs to be resolved by the Legislature.”

Fitzsimmons said he would like to see legislators consider putting percentage caps on annual rent increases in areas impacted by the oil boom.

Another solution is to increase incentives for affordable housing, he said.

Oil companies also should do what they can to minimize the impact on elderly and fixed-income residents, he said.

“They need to be part of the solution, not just part of the problem,” Fitzsimmons said.

The Williston apartment building, a 12-unit complex known as Sunrise Apartments, was owned by SLR Investments, said Realtor John Liffrig, one of the partners.

They sold the complex to Dave Forenza of the Denver area, who later assigned his interest to Thomas Petroleum, Liffrig said.

Forenza declined to comment.

Calls to the Thomas Petroleum office in Williston were referred to the Victoria, Texas, office, where the person designated to answer questions about the building is out of the office for a week.

Letters taped to the residents’ doors said the building would be getting a major renovation.

Liffrig said he and his partners were concerned about what would happen to the tenants, but their legal counsel said attempting to add anything into the contract about keeping rents affordable would likely not be enforceable because of state statutes against rent control.

The partners gave rebates to residents based on how long they had lived there. Two renters who had been there 12 years or more received $2,500 rebates.

The residents did not have leases and were renting month to month.

Legal Services of North Dakota, which has seven attorneys across the state, aims to help low-income and disadvantaged elderly people with areas of civil law. Legal Services is working to add another lawyer to northwest North Dakota to assist residents with housing issues, Fitzsimmons said.

But if companies adhere to state law, tenants often have little recourse, he said.

Williston Mayor Ward Koeser said it’s disappointing to hear about residents being displaced when buildings are sold.

“I know they’re probably doing it from a business perspective, but it makes it extremely difficult for the citizens who are living there,” Koeser said.

Koeser said he’d be surprised if legislators would approve some type of rent control.

In the meantime, city officials are working to make progress addressing the housing shortage but are having a difficult time catching up, Koeser said.

“The only solution seems to be to have enough housing so that the market demand is met and the prices start coming down,” he said.

Dalrymple is a Forum Communications Co. reporter stationed in the Oil Patch. She can be reached at adalrymple@forumcomm.com or (701) 580-6890