Question A on the June 13 municipal ballot proposes changes to the rent ordinance that the Rental Housing Alliance claims will “fix” the ordinance. As a member of the Portland Rent Board, representing District 5, I am intimately familiar with both the language of the ordinance and the challenges of implementing it. In my opinion, the rent ordinance is working as intended. Further, I believe that any changes to the ordinance to make it easier for tenants and landlords should occur through a transparent revision process initiated by the City Council.
It is important to remember that the primary economic goal of the rent ordinance is not to “control” anyone, but rather to “stabilize and make more predictable future rent increases, all while remaining in conformance with Maine law, and ensuring that Landlords within the City receive a fair return on investment.” In this regard, the ordinance is working. Consider the following statistics from the Rent Board’s most recent annual report.
Starting first with units not subject to the rent ordinance, 33% of units saw increases in rent from 2021 to 2022, with an average increase of 7.6%. The increases ranged significantly depending on unit size, with three-bedroom units seeing the highest average increase (10%) and five-bedroom units seeing the lowest average increase (5.5%).
Of the 8,779 covered units under rent control, only 30% saw increases in rent from 2021 to 2022, with an average increase of 5.8%. The increases applied much more evenly across all unit sizes, with four-bedroom units seeing the lowest average increase (4.8%) and five-bedroom units seeing the highest increase (6.1%). In other words, units under the rent ordinance saw more even, stable increases in rent.
Advocates for Question A often cite that capping the increase allowed when a new tenant moves in “forces” landlords to increase rent every year. The data don’t support this conclusion – roughly 30% of landlords increased rent last year, regardless of whether they were subject to the ordinance or exempt from it. Additionally, the ordinance allows landlords who do not take an increase to “bank” the increase for a future year. This means that the only true cap on rent increases is the limit of 10% per calendar year – a limit that is necessary to discourage the destabilizing effects of rents increasing arbitrarily any time a voluntary turnover occurs, even if it may require some adjustments to typical practices for some landlords.
From an economic standpoint, the rent ordinance is working, but that doesn’t mean that there aren’t issues that could be addressed through changes to the ordinance. The implementation of the ordinance has been challenging, in part because of understaffing in the Housing Safety Office. Despite limited capacity, the Housing Safety Office has worked tirelessly both behind the scenes and with the Rent Board to interpret provisions of the ordinance that are not clearly defined; simplify the processes for applicants (both landlords and tenants), and address legal concerns. I am hopeful that the three new staff positions included in the current city budget proposal will increase the capacity of the Housing Safety Office both to enforce the existing ordinance and to consider ways to address any challenges. It is hard to see how continuing to tinker with the terms of the ordinance every six months will do anything but increase complexity for both landlords and tenants.
Neither the Rent Board nor the Housing Safety Office staff was consulted in the drafting of Question A. It is unlikely that the proposed “fixes” will do anything except allow larger rent increases for landlords, at the cost of reducing the ability of the ordinance to maintain the stability of the rental market. To the extent that the ordinance can be improved in the future, it should be via a public process, inviting input from all members of the public, providing a mechanism for feedback from staff tasked with implementing the ordinance, and ultimately passing through the City Council before being put before voters.
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