City finalizes rent control ballot measures

MGN

After six months of grassroots organizing by the Minneapolis United Rent Control (MURC), the Minneapolis City Council voted in favor of a ballot initiative that will create a pathway for a strong rent control policy.

During the council’s Policy & Government Oversight Committee meeting, 11 of 13 council members voted in favor of two charter amendments establishing a process for passing rent control in Minneapolis on July 21. The proposals will appear on the ballot for the November 2021 municipal elections. 

“Minneapolis United for Rent Control [MURC] is fighting for a strong policy that caps rent increases at 3% annually and applies universally to all units, which is actually in line with the key findings of Minneapolis City Council’s own study conducted by the Center for Urban and Regional Affairs (CURA),” said Chris Gray of MURC.

“The first lie big developers are going to use is that ‘rent control’ sounds like a good idea, but it doesn’t work. Calling rent control ‘rent stabilization’ won’t stop them from saying this, and ‘rent control’ is easily understood by the renters.”

Minnesota law prohibits any law to control rents on private residential property unless the ordinance, charter amendment, or law that controls rents is approved in a general election, according to Minnesota Statute.

The first proposal would change Article I of the Minneapolis charter and allow registered voters to write rent stabilization policies and petition to put them on a ballot initiative by November 2022. The second proposal would change Article IV and allow the city council to write rent stabilization policy and submit it to voters in 2022 or later. 

“The charter amendments would open a path for Minneapolis to pass rent control,” said Gray. The proposals received a major push from Minneapolis City Council President Lisa Bender and Vice-Chair Jeremiah Ellison in January. The full city council voted to forward the proposed ballot measure to the Charter Commission in February. 

In February of this year, the council heard from more than 100 residents on proposed rent control charter amendments that would take action to stop displacements in Black, Indigenous and immigrant communities. Renters expressed concern about gentrifications, housing costs and getting pushed out of the city. 

Later that month the council approved and pushed two rent control proposals to its Charter Commission. However, the majority of the council rejected recommendations made by the city’s Charter Commission citing concerns about the language and legality.  

Council Members Linea Palmisano and Lisa Goodman voted against the council language and instead pushed for rent stabilization language proposed by the Charter Commission, which rejected the proposal that would allow citizens to write the policy and petition to put it on the ballot. 

“I’m concerned that we would knowingly submit this to the voters—a charter amendment that’s in conflict with state law,” Palmisano said. “This is different from a city ordinance; this is changing the city’s charter.” She also recalled when the City was in court this year for submitting proposals that were in conflict with state law. This was regarding a proposal requiring police officers to carry insurance. 

Council Member Jeremiah Ellison said he doesn’t support Palmisano’s push for the charter commission’s substitution. “I think the charter commission proposal provides an undue burden to a pathway for rent stabilization. It diminishes both the council’s ability to draft a policy and the public’s ability to have an opinion,” said Ellison.

“We have thought this through,” said Bender. “We have met with the city attorneys many times over many years, and I think that we have before us—in the version that passed in February—a robust approach to getting a policy in front of voters, getting ourselves options to deal with the legal ambiguity and state law around rent stabilization.”

Minneapolis Mayor Jacob Frey indicated he will veto the charter amendment that establishes a pathway to passing rent control through a ballot initiative, according to MURC. Even so, the city council has the power to override his veto at their meeting on Friday, August 6, with only 9 of the 11 “yes” votes.

According to the Minneapolis City Council, more than 180 local governments across the country have created similar policies, including statewide regulations in Oregon and California. Currently, only four states and the nation’s capital, Washington, D.C., have some form of rent control in place: California, Maryland, New York, and New Jersey, according to Apartment Guide.

Rent control is a broad term for legislation that puts limits on a landlord’s ability to increase rent. Rent control laws allow cities to regulate the housing market and are most common in cities where housing is scarce or overly expensive. 

“Any working-class person who has rent control in a city like New York or San Francisco will tell you it’s probably the reason they can continue to stay in these cities,” said Gray. “However, it is true that these places have rent control and the prices are still going up, but that’s because big developers and real estate lobbyists have undermined rent control with concessions and carve outs over the years,”

Rent stabilization, which is what the city council has proposed, promotes stable, predictable rent prices. Rather than capping a renter at a set price, under stabilization rent increases are based on a set percentage adjusted by where the tenant lives, market rates, and health of the economy, according to Apartment Therapy. However, rent stabilization also means that property owners may not make as much profit.  

The city council’s proposed amendments are centered on rent stabilization, which is more common in the U.S. and advances housing security. Gray and other advocates prefer the second charter amendment because it would give Minneapolis residents a clear path to put forward their own rent control policy.

“This means MURC could put our policy—an annual cap at 3% on rental increases with no exemptions—on the ballot in November 2022 to be decided by voters,” said Gray. “This path gives the movement more power to fight for the renter-led proposal, rather than leave the process to City Hall and the influence of the landlord lobby.”