Supporters, opponents pack council chambers for August 24 hearing.
The Saint Paul City Council has a lot to consider before its September 7 vote on proposed amendments to the city’s new rent control ordinance. More than 140 people packed the council chambers for the August 24 public hearing on the amendments. About 60 of them spoke. Dozens of written comments were also
received.
Tenants, landlords, developers and union leaders have battled over the implementation of rent control since it was approved by 53 percent of voters in a citywide referendum last November. This spring a 41-member task force appointed by Mayor Melvin Carter recommended a package of amendments to the ordinance that City Council members drew on to shape the proposed amendments.
The ordinance, which limits increases in the rent charged for housing to 3 percent per year, took effect in May. What is now before the council are several exemptions to the 3 percent cap and new tenant protections that would go into effect on January 1, 2023.
Developers, business chamber testify against rent control
More than a dozen developers, the Minnesota Multi-Housing Association and the Saint Paul Area Chamber of Commerce testified against the rent control ordinance.
Chamber of Commerce president B Kyle said rent control is not going to solve Saint Paul’s affordable housing shortage. More housing needs to be built before rental prices will truly stabilize, she said. The Chamber advocates the repeal of the rent control ordinance, she added, but failing that, an exemption for new construction should be adopted.
According to developers, the rent control ordinance has threatened the viability of new rental housing, prompting them to delay or cancel housing projects. “Rent control has shut down development in Saint Paul,” said Tony Barranco, president of Ryan Companies’ Minnesota operations. He and the Minnesota Multi-Housing Association also called for the repeal of the ordinance.
Ryan is the master developer of the 122-acre Highland Bridge project in Highland Park. Maureen Michalski, who is heading up that project for Ryan, noted that the development agreement for Highland Bridge calls for new market-rate housing to support the development of new affordable housing, both at Highland Bridge and elsewhere in the city. “The City Council has to decide whether this affordable housing mechanism will advance or falter,” she said.
Hearing dominated by supporters of rent control
However, the supporters of rent control vastly outnumbered opponents at the August 24 hearing. Several speakers said the proposed exemptions fly in the face of what voters and the mayor’s task force wanted.
Some speakers said they will be forced to move if the rent control ordinance is weakened. They objected to the city policy that since May has allowed landlords to apply to city staff for rent increases of up to 8 percent per year if they can demonstrate the need.
Stephanie Ericsson-Hinton, who is 69 and disabled, said the recent 8 percent rent increase on her Saint Anthony Park apartment means that 75 percent of her monthly income is now going toward housing, forcing her to use food shelves and skip medical appointments. “It’s my right to have stable housing,” she said. “But I can’t afford to live here and I can’t afford to move.”
Another resident of Ward 4, Deborah Muse, said that she and her husband donate plasma twice a month to pay their rent and cover other living expenses. She asked the City Council to reconsider any amendments that favor developers over renters.
Amendments sought for new construction, affordable housing
The biggest flash points in the debate were two amendments introduced by Ward 3 City Council member Chris Tolbert. One would exempt new housing construction from the 3 percent cap on rent increases. The exemption would remain in place for 20 years after the housing was constructed, and it would apply to housing that was constructed up to 20 years ago.
Tolbert’s other amendment would exempt from the 3 percent cap affordable housing that is supported by such programs as low-income housing tax credits and Section 8 vouchers.
City Council member Mitra Jalali of Ward 4 wants to scale back the exemption for new construction to 15 years and have it apply only to housing built after December 31, 2022. Jalali would also limit the affordable housing exemption to units with rents that are based on a percentage of a household’s income.
Exempting affordable housing from rent control would hurt the people who need that protection the most, several speakers said. Others said more protections are needed.
More tenant protections sought
Heidi Schallberg recently moved from Highland Park to Minneapolis after learning that her apartment of more than nine years would be demolished to make way for new development. She testified in support of an amendment that would require landlords to provide relocation assistance to tenants like her who are forced to move.
Several proposed amendments address just-cause protections for tenants, which require a landlord to provide a reason when tenants are evicted or their lease is not renewed. Another amendment addresses the notification requirement for tenants when a landlord seeks to increase rents above the 3 percent cap.
Tolbert supports an amendment for partial vacancy decontrol. That would allow landlords to defer for several years the 3 percent rent increases for longtime tenants and then use those increases in a single year when the tenant moves out. Other council members support full vacancy decontrol, which would allow landlords to raise the rent by any amount whenever a tenant moves out.
Another amendment would allow landlords who make major renovations to a property to cover their investment with rent increases above 3 percent if the increases occur over a period of time and not all at once.
— Jane McClure
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