1) As a former house-painter I can say that latex paint is water soluble and would never dry inside damp environment like a disposal. It would simply dilute and wash down the drain. If water still goes down the drain, then there's no latex paint in there.
2) Latex would not gum up the bearings either since the motor and bearings are sealed apart from the chop and drain areas. And the wrench rotates easily so the bearings are fine.
3) It sounds like your disposal just stopped working. Motors slow down and begin to overheat, and eventually all motors stop working.
There are no repair parts for disposals.
4) The renter is not to blame. The leaking tubular drain pipes say that general property maintenance is behind schedule, so it would be hard to collect damages in front of a judge.
On the positive side, the leak did not cause major damage to the cabinet and floor, and I've seen that problem a lot, and it's expensive to repair. So if problem is just the disposal, then that's cheap enough to fix yourself.
5) I wrote EZ steps for replacing disposal plus tips for permanently fixing tubular pipes from days when I worked apartment maintenance. This information could be a money-saver.
http://www.fixya.com/support/r7929008-replace_garbage_disposal
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Also take advantage of fixya phone service.
For a price, expert speaks with you over phone while you work on disposal or any do-it-yourself project.
Fixya is always less expensive than a service call.
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It might be that the grinder plate has become separated from the motor, and that the motor is actually spinning. Turn it on and while it's humming and put your finger on the spot where the Allen wrench goes to see if it's spinning. Either way, you would probably need to replace it. PVC doesn't corrode, so that one has me puzzled. And regarding the paint, that was probably illegal, but I don't think it would have harmed the disposal. I assume the reset button is "in" and it doesn't pop out. All in all, the Insikerators are a good buy, but you might want to go with a bigger model next time.
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