I believe sometimes a bad experience is more reflective of the individual than the company. 

Does anyone know if this individual needs to be a W2 or can I hire on a 1099?

I think that gets lost VERY quickly with certain individuals.

I presently have a negative cash flow  in all 3 properties but am more interested in paying off the mortgages early to reap rewards later.Any thoughts? 

In smaller towns, this is usually a specific individual within the Planning Department. 

Well I've never really thought if they appreciate it on an individual level or not.Some do say thank you, some do not. 

Your risk vs. reward is way off balance there. 

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23DSCR lenders generally let you vest either individually or as an LLC.

So, in theory one could get a 2:1 leverage, earning the rewards on $2 for every $1 capital spent out of pocket.     

If he didn't want it or can't afford it, I would have reward him with 60 days time to find another place, then find a new tenant that can pay what it is worth….