For the second time in three years, housing activists are asking voters in Maine’s largest city to enact a form of rent control.
An Act to Protect Tenants is Question D on Portland’s ballot for the Nov. 3 election. It’s one of five referenda placed on the ballot by People First Portland, a political action committee run by the Southern Maine Democratic Socialists of America.
It would limit most rent increases to the rate of inflation plus any annual property tax increases. It also would require landlords to get approval from a new rental board, comprised of tenants and landlords, for any additional rent increases, up to 10 percent in any given year, to cover repairs, upgrades or other major capital investments.
The ordinance also would change at-will tenancies, in which a tenant rents an apartment on a monthly basis and without a lease. It would triple the amount of notice landlords must give a tenant when ending an at-will tenancy, from 30 days to 90 days, although the landlord can pay the tenants $500 per unit to reduce that notice to 60 days or $1,000 to reduce it to 30.
Additionally, the rental board would be empowered to fine landlords for violating the ordinance.
The ordinance would exempt owner-occupied apartment buildings with up to four units. That’s a narrower exemption compared to the proposal rejected three years ago, which did not differentiate between owner- and non-owner-occupied buildings. Institutional housing provided by housing authorities, schools, religious institutions, hospitals and the like all would be excluded.
Proponents say the measure is needed to correct a power imbalance between landlords and tenants, and prevent service workers, artists and other low-income renters from being priced out of the city. Opponents, however, argue that the ordinance will guarantee annual rent increases and discourage investments in the city’s old housing stock.
Em Burnett, a spokesperson for the People First Portland campaign, said the ordinance “democratizes the process for managing rent increases” and will prevent people from being priced out of the city. People First Portland said the ordinance also would require an annual housing rental report that is more detailed, including a district-level breakdown, than the biennial report currently produced for the council.
“People are really concerned with the direction of the city and I think tenant protections gets at the heart of it,” Burnett said. “We’re losing parts of Portland that make us great and that’s the people.”
Burnett added, “Tenants don’t really have a say here. This is giving tenants more of a voice.”
Burnett said the ordinance also would ban discrimination against tenants who use Sec. 8 vouchers and other housing assistance – something that opponents say is already prohibited under state law and is simply a marketing ploy to get support for rent control.
Voters rejected a similar rent control proposal in 2017 by a nearly 2-1 margin, with opponents casting 64 percent of the ballots.
Brit Vitalius, the president of the Southern Maine Landlord Association, said the issue of rent control was thoroughly debated in 2017 and resoundingly rejected. He said the measure will incentivize landlords to increase rents annually and stop investing in properties, while allowing bad tenants to remain in apartment buildings for three months, instead of one. And it will increase administrative burdens for the city, which just eliminated 65 positions in its recent budget.
“The people of Portland soundly rejected rent control by an overwhelming vote,” Vitalius said. “Portland voters clearly concluded that rent control is not the solution to affordable housing challenges and voters did not want Portland to become a rent-control city.”
The ordinance would not prevent landlords from issuing a seven-day eviction, called a Forced Entry Detainer, to evict tenants for cause. But landlords contend that process is time-consuming and that most landlords deal with problem tenants simply by providing 30-day notice.
If approved, the council would not be able to amend or repeal the ordinance for at least five years. Instead, any changes during that period would have to be done through another referendum, which could be initiated by the council.
So far, opponents have reported a significant fundraising and spending advantage.
Through Sept. 30, Building a Better Portland, the political action committee opposed to this proposal and two other referenda, has received $262,885 in cash and in-kind support, including two polls costing about $39,000 each by the Chicago-based National Realtors Association. Of the PAC’s 97 cash donors, 39 businesses and individuals contributed $1,000 or more, including six businesses or organizations giving $10,000. The Maine Association of Realtors made a $25,000 donation. And the PAC has over $81,100 remaining.
That dwarfs what’s been received by proponents. People First Portland PAC had raised over $23,000 in support of its campaign to pass all five referendum questions they put on the ballot. About two-thirds of that support, $15,000, has come from unions, while the bulk of individual donations came from people donating under $50. The campaign had a little more than $9,700 remaining for the final month of the campaign.
There are currently 17,653 rental units registered at 4,307 properties in Portland, according to the city’s rental registry. That’s more than half of the city’s roughly 35,500 housing units. The tenant protections would apply to at least 11,000 of those units that are located in buildings with five or more units. It’s unclear how many of the remaining 6,400 units are in owner-occupied buildings with four or fewer units and would be exempted from the ordinance.
The ordinance would limit annual rent increases to inflation, as measured by the region’s Consumer Price Index. Landlords would be able to add on any property tax increases included in the city budget on top of inflation. And landlords could increase the rent by 5 percent when a unit turns over, but only once a year.
Landlords can choose not to increase rents in any given year and bank the allowable increase for future use. But under no circumstances can a rent increase exceed 10 percent in any given year.
Any additional rent increases would have to be reviewed by a new rental board, as would other landlord-tenant issues, including noncompliance with the ordinance.
The seven-member board would be comprise city residents appointed by the City Council. It would include one representative from each of the five council districts plus two at-large members. The city must take “reasonable steps” to ensure no more than three landlords and at least three tenants serve on the board, which would be staffed by the city’s housing safety office.
The ordinance also increases reporting requirements for landlords and increases the registration fee. When registering their units with the city, landlords would have to disclose the current rent for each unit, the amount it was increased, the reason for the increase, a tally of any banked rent increases and the number of bathrooms, bedrooms and whether there is a kitchen.
The registration fee would be increased by nearly 43 percent, from $35 a unit to $50 a unit. Landlords can currently reduce that fee to $15 a unit for added safety measures, including having fire sprinklers or prohibiting smoking in a lease. The proposed ordinance would allow landlords to only lower that fee to $30. The revenue would be earmarked for the housing safety office.
The full language for each of the six proposed ordinance changes may be read on the city’s website.
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