Sound City Realty Fined $27,400 for Failing to Disclose Lead Paint Hazards
Tennessee property manager repeatedly failed to warn tenants about lead paint dangers in six older rental units, violating federal law designed to protect children and pregnant women from neurotoxic exposure.
Sound City Realty, a Tennessee property management company, violated federal lead-based paint disclosure laws at six rental properties built before 1978. The EPA found the company failed to provide mandatory lead hazard pamphlets to tenants, omitted required warning statements from lease contracts, and performed renovations without proper certification. Families with young children and pregnant women faced potential exposure to a known neurotoxin because the company did not follow basic safety rules. The EPA fined Sound City Realty $27,400 to settle the case.
Lead poisoning causes irreversible harm to children. Every landlord must follow these rules.
The Allegations: A Breakdown
| 01 | Sound City Realty entered into lease agreements for six residential properties built before 1978 without providing tenants the EPA-approved lead hazard information pamphlet titled ‘Protect Your Family From Lead in Your Home.’ The pamphlet warns that lead exposure is especially harmful to young children and pregnant women. | high |
| 02 | The company failed to include the mandatory Lead Warning Statement in lease contracts for four properties. Federal law requires this statement to inform tenants that housing built before 1978 may contain lead-based paint and that lessors must disclose any known hazards before renting. | high |
| 03 | Sound City Realty did not include a statement in lease contracts disclosing the presence of known lead-based paint or indicating no knowledge of such hazards, as required by federal regulation. This omission left tenants uninformed about potential dangers in their homes. | high |
| 04 | The company failed to obtain required signatures from lessors, agents, and lessees certifying receipt of lead hazard information for two properties. These signatures verify that all parties acknowledge the disclosures and understand the risks. | medium |
| 05 | Sound City Realty offered to perform or performed renovations at the six properties between January and December 2022 without obtaining firm certification from the EPA. Federal law prohibits any firm from performing renovations that disturb painted surfaces in pre-1978 housing without this certification. | high |
| 06 | The company performed renovation work that can generate lead dust, such as sanding, scraping, window repair, and removal of building components, without the training and certification designed to protect tenants from contamination. These activities pose direct health risks when done improperly. | high |
| 07 | Sound City Realty managed properties including units built in 1930, 1947, 1968, 1969, and 1971, all of which fall under federal target housing regulations. The company had a legal duty to comply with lead disclosure and renovation rules at every one of these locations. | medium |
| 08 | The EPA inspection in December 2022 found that Sound City Realty could not produce required records at the time of the inspection. The company only submitted compliance records after the inspection, on December 7, 2022, and January 25, 2023, revealing the extent of the violations. | medium |
| 01 | The EPA conducted only one inspection of Sound City Realty’s business in December 2022, despite the company managing multiple pre-1978 properties over several years. Limited agency resources mean most property managers face minimal risk of detection. | high |
| 02 | Sound City Realty operated without firm certification for renovation work throughout 2022, demonstrating that companies can perform illegal renovations for extended periods before enforcement action occurs. The system relies on reactive inspections rather than proactive monitoring. | high |
| 03 | Federal regulations allow companies to settle violations without admitting wrongdoing. Sound City Realty neither admitted nor denied the allegations while paying the penalty, shielding the company from reputational harm and potential civil lawsuits. | medium |
| 04 | The consent agreement requires only that Sound City Realty certify current compliance and that violations have been corrected. No independent verification, ongoing monitoring, or public reporting of compliance measures is mandated. | medium |
| 05 | The EPA’s enforcement relies heavily on document review rather than physical inspection of properties or interviews with affected tenants. Violations came to light only through missing paperwork, not through assessment of actual lead hazards or tenant harm. | medium |
| 06 | The regulatory framework provides no compensation or remediation for tenants who lived in these properties without proper disclosures. The $27,400 penalty goes to the federal treasury, not to the families potentially exposed to lead hazards. | high |
| 01 | Sound City Realty saved money by not purchasing and distributing EPA-approved lead hazard pamphlets, not obtaining firm certification for renovations, and not training staff on compliance requirements. These cost-cutting measures directly increased the company’s profit margins. | high |
| 02 | Obtaining proper firm certification and hiring certified renovators costs more than using uncertified contractors. Sound City Realty performed or offered renovation services without certification, giving the company a competitive price advantage over compliant firms. | high |
| 03 | The $27,400 penalty may represent less than the total cost of full compliance across six properties over multiple years. If the company calculated that paying occasional fines costs less than systematic compliance, the violation becomes financially rational under a profit-maximization model. | high |
| 04 | Sound City Realty continued leasing properties and performing renovations throughout the violation period, generating rental income and service fees while avoiding compliance costs. Tenants paid market-rate rents without receiving the federally mandated safety protections their rent should have included. | medium |
| 05 | The company’s business model depends on managing older, pre-1978 housing stock where lead-based paint regulations apply. Rather than building compliance costs into their operations, Sound City Realty treated legal requirements as optional, externalizing health risks onto tenants. | high |
| 06 | Property management firms compete on price and occupancy rates. Companies that skip compliance steps can offer lower fees to property owners or complete turnovers faster, creating market pressure that rewards corner-cutting over tenant safety. | medium |
| 01 | Lead exposure is especially harmful to young children under age six, causing irreversible neurological damage, cognitive deficits, behavioral problems, and learning disabilities. Families leasing from Sound City Realty had no warning that their children faced this risk. | high |
| 02 | Pregnant women exposed to lead can experience serious complications. Lead crosses the placental barrier and can harm fetal brain development, yet Sound City Realty failed to warn expectant mothers leasing these properties. | high |
| 03 | Renovation activities like sanding, scraping, and window repair generate lead dust that spreads throughout a home. Sound City Realty performed these activities without proper containment, cleanup, or tenant notification, maximizing the risk of exposure. | high |
| 04 | Lead poisoning symptoms may not appear immediately, meaning families could have lived in contaminated conditions for months or years before discovering the harm. The lack of disclosure prevented tenants from taking protective measures or seeking early medical testing. | high |
| 05 | Children who ingest lead dust from paint chips or contaminated surfaces can suffer permanent IQ reduction and developmental delays. These effects last a lifetime and reduce educational attainment and earning potential, perpetuating cycles of poverty. | high |
| 06 | The EPA-approved pamphlet that Sound City Realty failed to provide contains specific instructions for reducing lead exposure, recognizing hazards, and protecting children. Depriving tenants of this information eliminated their ability to make informed decisions about their families’ safety. | high |
| 07 | Workers performing renovations without proper certification and training faced direct exposure to lead dust. These workers may have carried contamination home to their own families, extending the circle of potential victims beyond the rental properties. | medium |
| 01 | Sound City Realty managed rental properties in multiple Nashville-area communities including Madison, Goodlettsville, and several Nashville neighborhoods. The violations affected geographically dispersed families, suggesting systemic company-wide failures rather than isolated incidents. | medium |
| 02 | Tenants in older, more affordable housing disproportionately face lead hazards. Sound City Realty’s properties, built between 1930 and 1971, likely served lower-income families who have fewer housing alternatives and less bargaining power with landlords. | high |
| 03 | Children who suffer lead poisoning require additional educational and medical services funded by local school districts and public health systems. Taxpayers bear these costs while the property management company that caused the exposure pays only a one-time federal fine. | high |
| 04 | When landlords violate disclosure laws with minimal consequences, it signals to other property managers that compliance is optional. This creates a race to the bottom where ethical companies face competitive disadvantage against those willing to cut corners. | medium |
| 05 | Community trust in the rental housing market erodes when enforcement actions reveal widespread violations. Tenants may feel powerless to protect their families, not knowing whether their current or future landlords are following the law. | medium |
| 06 | Low-income families facing lead exposure cannot simply move to safer housing. Rental markets in many areas have limited vacancies, security deposits create financial barriers, and families may be locked into leases, trapping them in hazardous conditions. | high |
| 01 | Sound City Realty settled the case without admitting or denying any wrongdoing. This standard settlement practice allows companies to pay fines while publicly maintaining they did nothing wrong, avoiding accountability for the specific harms alleged. | high |
| 02 | The company faces no criminal charges, no individual liability for officers or employees, and no requirement to compensate affected tenants. The penalty goes entirely to the federal government, leaving victims without direct remedies. | high |
| 03 | Sound City Realty must only certify that it is currently in compliance and that violations have been corrected. No independent auditor verifies this claim, no follow-up inspections are mandated, and no public compliance reports are required. | medium |
| 04 | The consent agreement allows Sound City Realty to continue operating immediately with no suspension of business licenses, no probationary period, and no enhanced monitoring. The company resumes normal operations the day the settlement is filed. | medium |
| 05 | Property owner Juli Schuman signed the consent agreement on behalf of the company. No corporate board review, no shareholder disclosure, and no public explanation of how these violations occurred or what systemic changes would prevent recurrence. | medium |
| 06 | The settlement contains no provision for tenant notification. Families who lived in these properties during the violation period may never learn they were denied required lead hazard information, preventing them from seeking medical testing or legal remedies. | high |
| 07 | The EPA’s enforcement relies on companies self-certifying future compliance. Sound City Realty violated the law repeatedly across multiple properties, yet the settlement assumes the company will now voluntarily follow rules it previously ignored. | high |
| 01 | Low-income families rent older housing where lead hazards are most prevalent. Sound City Realty’s properties, built between 1930 and 1971, target this market segment, meaning the company’s cost-cutting directly harmed economically vulnerable tenants. | high |
| 02 | Children who suffer lead-induced cognitive damage experience reduced lifetime earnings, perpetuating intergenerational poverty. Sound City Realty’s violations potentially created long-term economic harm that compounds existing wealth inequality. | high |
| 03 | Wealthy families can afford newer housing built after 1978 or can demand lead inspections and abatement before signing leases. Poor families lack these options and must accept whatever housing they can afford, absorbing risks that more affluent renters avoid. | high |
| 04 | Medical costs for lead poisoning treatment, educational interventions for affected children, and lost parental income from missed work fall on working-class families. The property management company that caused the exposure pays a flat fine regardless of the actual human costs. | high |
| 05 | Property owners who hire companies like Sound City Realty benefit from lower management fees when those companies cut compliance costs. The savings flow upward to property investors while health risks flow downward to tenants with no ownership stake. | medium |
| 06 | Tenants lack the resources to conduct independent lead testing, hire attorneys to challenge lease violations, or relocate to safer housing. This power imbalance allows property managers to violate disclosure laws with minimal risk of tenant-initiated enforcement. | high |
| 01 | Sound City Realty’s violations demonstrate how property management companies can systematically ignore tenant safety regulations when penalties are low and enforcement is sporadic. The $27,400 fine may be less than the cost of full compliance, making violations a rational business decision. | high |
| 02 | Federal lead-based paint disclosure laws protect vulnerable populations, especially children and pregnant women, from a known neurotoxin. When companies violate these laws across multiple properties over multiple years, it reveals that current enforcement is insufficient to deter misconduct. | high |
| 03 | The consent agreement structure allows Sound City Realty to settle without admitting wrongdoing, pay a modest penalty, and continue business without meaningful reform. This pattern repeats across industries, signaling that regulatory violations are treated as minor business expenses. | high |
| 04 | Tenants who rented from Sound City Realty during the violation period receive no compensation, no notification, and no pathway to remedies. The settlement protects the company and the government’s enforcement record but does nothing for the families potentially harmed. | high |
| 05 | Real estate and property management operate under a profit-driven model that creates incentives to minimize costs, including compliance costs. Without substantially higher penalties or criminal liability for health and safety violations, companies will continue to calculate that breaking the law is cheaper than following it. | high |
| 06 | This case exemplifies how neoliberal capitalism’s emphasis on deregulation and minimal government intervention creates conditions where public health protections are undermined. When agencies lack resources for proactive enforcement, companies exploit the gaps at the expense of the most vulnerable populations. | high |
Timeline of Events
Direct Quotes from the Legal Record
“Pursuant to Title X, it is a prohibited act under Section 409 of TSCA, 15 U.S.C. § 2689, for any person to fail or refuse to comply with a provision of Title X or any rule or order issued under Title X.”
💡 This establishes that Sound City Realty’s failures were not administrative oversights but violations of federal law with legal consequences
“Lead exposure is especially harmful to young children and pregnant women. Before renting pre-1978 housing, lessors must disclose the presence of lead-based paint and/or lead-based paint hazards in the dwelling. Lessees must also receive a federally approved pamphlet on lead poisoning prevention.”
💡 The required warning statement explains exactly why these violations endanger vulnerable populations
“The records submitted by Respondent failed to document that prior to entering the leases referenced in Paragraph 33(c) through (f), Respondent had: Provided the lessees with an EPA-approved lead hazard information pamphlet as required by 40 C.F.R. § 745.107(a)(1); Included as an attachment or within the contracts to lease target housing the appropriate Lead Warning Statement as required by 40 C.F.R. § 745.113(b)(1); and Included as an attachment or within the contracts to lease target housing a statement by the lessor disclosing the presence of known lead-based paint.”
💡 This shows the violations were not isolated incidents but a pattern affecting multiple properties
“At the time Respondent offered to perform and/or performed the renovations, Respondent had not obtained ‘firm certification’ as required by 40 C.F.R. §§ 745.81(a)(2)(ii) and 745.89(a)(1).”
💡 Performing renovations without certification means Sound City Realty had no trained staff to prevent lead contamination during construction work
“The term ‘renovation’ is defined at 40 C.F.R. § 745.83, to mean, in part, the modification of any existing structure or portion thereof, that results in the disturbance of painted surfaces… The term renovation includes but is not limited to the following: the removal, modification, or repair of painted surfaces or painted components (e.g., modification of painted doors, surface restoration, window repair, surface preparation activity (such as sanding, scraping, or other such activities that may generate paint dust)).”
💡 These common renovation activities generate lead dust that spreads throughout homes when performed without proper safeguards
“For the purpose of this proceeding, as required by 40 C.F.R. § 22.18(b)(2), Respondent: admits that the EPA has jurisdiction over the subject matter alleged in this CAFO; neither admits nor denies the factual allegations set forth in Section IV (Findings of Facts) of this CAFO; consents to the assessment of a civil penalty as stated below.”
💡 Sound City Realty pays the fine without admitting it did anything wrong, a common settlement structure that shields companies from accountability
“By executing this CAFO, certifies to the best of its knowledge that Respondent is currently in compliance with all relevant requirements of 40 C.F.R. Part 745, Subparts E and F, and the Act, and that all violations alleged herein, which are neither admitted nor denied, have been corrected.”
💡 The company that violated the law for years now simply promises it is following the rules, with no independent verification required
“Based on a review of Respondent’s records to determine Respondent’s compliance with 40 C.F.R. Part 745, Subpart F, the EPA determined that Respondent entered into contracts to lease the residential dwellings that are target housing (‘the Properties’) at the following locations, on the specified dates listed below: a) 555 North Dupont Avenue, #A6, Madison, Tennessee 37115, Year Built – 1968, lease entered on August 12, 2022; b) 606 Ellen Drive, Unit A, Goodlettsville, Tennessee 37072, Year Built – 1971, lease entered on May 1, 2021; c) 1315 Kermit Drive, Nashville, Tennessee 37217, Year Built – 1947, lease entered on July 1, 2019, and lease renewed on January 8, 2022; d) 316 A Lorna Drive, Nashville, Tennessee 37214, Year Built – 1969, lease entered on May 20, 2022; e) 1731 Dr. DB Todd Jr. Boulevard Nashville, Tennessee 37208, Year Built – 1930, lease entered on October 26, 2022; and f) 265 Sunrise Avenue, Nashville, Tennessee 37211, lease entered on April 29, 2022.”
💡 Six separate properties over three years demonstrates systematic non-compliance, not accidental oversight
“Respondent is assessed a civil penalty of TWENTY-SEVEN THOUSAND, FOUR HUNDRED DOLLARS ($27,400) which shall be paid within thirty (30) days after the Effective Date of this CAFO.”
💡 A penalty under thirty thousand dollars may be less than the cost of compliance across six properties over multiple years
“Penalties paid pursuant to this CAFO shall not be deductible for purposes of federal taxes.”
💡 This provision exists because companies routinely treat fines as ordinary business expenses and write them off their taxes
“In accordance with 40 C.F.R. § 22.18(c), Respondent’s full compliance with this CAFO shall only resolve Respondent’s liability for federal civil penalties for the violations and facts specifically alleged above.”
💡 The settlement resolves only the government’s enforcement action and provides no relief to tenants who were denied required safety information
“Any change in the legal status of Respondent, or change in ownership, partnership, corporate or legal status relating to the company, or changes pertaining to its ownership and/or management of the Properties identified in Paragraph 33, will not in any way alter Respondent’s obligations and responsibilities under this CAFO.”
💡 The company can continue operating immediately with no suspension, no probation, and no enhanced oversight period
“Pursuant to 40 C.F.R. § 745.107(a)(1), the lessor shall provide the lessee with an EPA-approved lead hazard information pamphlet. Such pamphlets include the EPA document entitled Protect Your Family From Lead in Your Home (EPA #747-K-94-001) or an equivalent pamphlet that has been approved for use in that State by EPA.”
💡 This pamphlet contains specific instructions for protecting children from lead exposure that Sound City Realty’s tenants never received
Frequently Asked Questions
The EPA has a link where you can click on to read the legal case file for free: https://yosemite.epa.gov/OA/RHC/EPAAdmin.nsf/Filings/9DBBC9A739FC5E2B85258B49007E73C7/$File/Sound%20City%20Realty,%20LLC.CAFO.6.13.24%20TSCA-04-2023-3125(b).pdf
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