Rent control continues to evolve in St. Paul

Some feel recent amendments lift controls from those who need it most

St. Paul’s rent control ordinance continues to be a work in progress as the St. Paul City Council voted last month to pass ordinance 22-37, which will make several amendments to Chapter 193A, a residential rent control section of the St. Paul Code of Ordinances. 

Chapter 193A was passed on a ballot initiative last November by St. Paul voters and went into effect in May of this year. The measure prohibits landlords from raising a property’s rent by more than 3% per year, but with “right to a reasonable return on investment” exceptions. 

Ordinance 22-37 was introduced this summer by Council Member Chris Tolbert and passed with only Council Members Mitra Jalali and Nelsie Yang voting in opposition. 

Mayor Melvin Carter’s office supported the rent stabilization proposal but assembled a rent stabilization stakeholder group of property owners, developers and renters in Feb. 2022 to suggest possible amendments. 

Meghan Daly, advocacy manager of the Minnesota Youth Collective, feels ordinance 22-37 strays from the compromises the stakeholder group reached. “We know this will have a disproportionate impact on the tenants who live in affordable housing, who are disproportionately low income, BIPOC, disabled families,” Daly said. “Our data shows [ordinance 22-37] will remove nearly 20,000 St. Paul renters from rent stabilization protections.”

Daly cited exceptions added by 22-37 to the original rule approved by voters, which allow landlords to increase rent more than 3% per year if the unit is considered affordable housing or was built within the past 20 years.

“The problem that the retroactive application is trying to solve as a policy standpoint is a bit unclear as those buildings have already been constructed,” Daly said. “They aren’t going to be unbuilt, yet they have now been exempted from rent stabilization. They don’t have to comply with the ordinance.”

Some St. Paul residents have said that the passing of 22-37 is overriding what residents passed in the 2021 election. Ward 2 Council Member Rebecca Noecker responded to these allegations in a Facebook post. 

“Some people have contacted me saying that any change to the ordinance goes against the will of the voters, and I understand that perspective,” Noecker wrote. “Since the ordinance passed last fall, I have been clear that I take the will of the voters seriously. 

“I was not willing to consider changing the policy from what voters approved until it had taken effect and unless there was evidence that the ordinance was putting critical community needs at risk,” the post continued. “Unfortunately, it has become apparent that one of our most important community needs—building more housing—may be impacted by the policy as written.”

Ward 4 Council Member Jalali was one of just two council members to vote against 22-37. In a Facebook post Jalali said 22-37, as it was written, stripped too many protections from renters.

“The most glaring [issue] to me continues to be the complete removal of rent stabilization protections for basically all types of affordable subsidized housing throughout Saint Paul, from properties accepting Section 8 voucher holders to properties funded by the federal Low Income Housing Tax Credit,” Jalali wrote. 

“In my ward, this includes major properties with hundreds of constituents living in buildings along the Green Line—residents who are overwhelmingly people of color and low-income renters. To put it very simply, I will not vote to take rent stabilization away from my constituents who need it the most.”

Juan Luis Rivera-Reyes, a coalition organizer with The Alliance, called the overall situation with 193A a “net positive” but took issue with the exemptions for rental cap increases created by 22-37.

“It’s still going to protect renters, but instead of going in a direction where it was going to expand even more protection for renters, it’s gone in a direction where it’s excluding some of the most vital renters within St. Paul in the sense that affordable housing renters are now being excluded,” Rivera-Reyes said. 

“It’s going to lead to more people being housed, more people being able to stay in their homes, more people not being displaced due to egregious rent increases—those are real increases we can call a victory, but I do need to emphasize the dialogue does need to continue.”

Rivera-Reyes noted that Dominium, an affordable housing developer, was raising rents 7.9% in St. Paul this year, which is the maximum raise a landlord can self-certify as necessary without a City inspection under 193A. Meanwhile, it was raising rents 12.5% in parts of the Twin Cities metro that lacked rent stabilization laws. Dominium did not respond to a request for verification. 

Rivera-Reyes and Daly were optimistic about changes to rent stabilization, both noting that any law can be rewritten in the future.

“I think lots of people just learned what is possible when we work together and do some direct democracy,” Daly said, referring to the passing of the ballot measure that created 193A. “And I think all of that energy—it doesn’t go away. I think people are going to keep working to create the housing stability that St. Paul renters deserve.”