Monday night, the Seattle City Council’s Renter’s Rights Committee, chaired by District 3 representative Kshama Sawant, will discuss draft legislation for rent control at City Hall during a public hearing. It’s a cornerstone moment in the final months of her term and in her race to retain her seat in November.
Sawant’s draft legislation follows her six-year-old call for rent control, a 2015 City Council resolution supporting the repeal of a State-wide rent control ban, plus an April letter from the Seattle’s Renters’ Commission urging the council and Mayor Jenny Durkan to pass a rent control ordinance in Seattle.
In the letter, the commission’s co-chairs noted that “the unpredictability and rate of rent increases in the past decade has caused a massive burden on renters which has led to both homelessness and displacement of Seattleites.”
So, what does rent control mean to Sawant?
It’s an umbrella term that can mean different things depending on specific rules and regulations. Overall, rent control, in some cases also called rent stabilization, means limiting rent increases. This can happen in various ways: it can be tied to inflation, the cap can apply only per tenancy or beyond the duration of a tenancy, and come with or without restrictions on evictions. Some include only buildings of a certain age and exempt new buildings.
Here are a few more questions about the whole thing — and as many answers as we have heading into Monday night’s session.
What does Sawant propose? Sawant’s office remained tight-lipped about the details of the draft legislation ahead of the committee meeting on Monday. What is clear: rent increases would be tied to inflation (around 2% or 3% per year), and the legislation will be “free of corporate loopholes.”
What does “free of corporate loopholes” mean? In other states, landlords have found ways to work around rent control by converting rental units to condo’s, for example. Other so-called “loopholes” includes rent control not applying to ADU’s and single-family homes. Another famous “loophole” is “vacancy decontrol,” which means landlords can raise the rent after a tenant leaves a rent-controlled apartment, charging whatever they want to the next tenant.
By contrast, vacancy control caps the rent on a unit even after someone moves out, and Sawant’s legislation will likely include this. It’s not clear yet what other “loopholes” the legislation will address.
How realistic is the plan? There is one major roadblock: a state-wide ban on rent control. The bill in question, backed by pro-developer lobbyists, dates back to 1981. State legislators will have to repeal that ban. Sawant’s draft legislation says that rent control will go into effect in Seattle as soon as the state-wide ban is lifted.
So Olympia needs to be convinced. What is Sawant’s strategy here? Winning rent control in Seattle and building a “movement” will put pressure on Olympia, Sawant argues. “After our movement wins these policies in Seattle, the goal is to build mass protests for the next session of the legislature in Olympia,” Sawant notes in her Rent Control FAQ.
Sawant did not say whether her office was working with legislators in Olympia as well.
But organizers, such as Be:Seattle and the Tenants Union, part of a coalition of over a dozen groups behind the Seattle Needs Rent Control Campaign, have extended their efforts to other parts of the state, including Bellingham, Tacoma, Yakima, and other places. Since the launch of the Rent Control campaign, over 12.000 people have signed on to the petition.
“Seattle led on $15, it can lead on rent control as well,” Sawant said in an email.
Will her strategy be similar to her 15$ minimum wage strategy? Sawant’s office didn’t directly respond to a question about it. But let’s go back in time a bit, to the $15 minimum wage negotiations in 2014. The $15 Now campaign held the threat of a much more aggressive minimum-wage package ballot measure over the head of elected officials, which some say has helped speed up and expand the compromise then made.
When rent control was approved by the Sacramento City Council this summer, that was partly a compromise to avoid a more strict rent control ballot measure. It had been approved for the 2020 ballot after it received roughly 44,000 signatures.
If Olympia is convinced, how soon can the ban be repealed? State legislator Nicole Macri’s ordinance to repeal the ban died in committee last year and the earliest the legislature can restart those efforts is 2020.
By then, of course, Seattle will have a different-looking City Council, with seven seats up for re-election this November, including Sawant’s. A new council could be another potential roadblock if the Council Bill is not approved before the new council members, even if it includes Sawant, are sworn in.
Why now? The draft legislation follows an April letter from the Seattle’s Renters’ Commission urging the Council and Mayor to pass a rent control ordinance in Seattle, and ties in with Sawant’s re-election campaign call for Rent Control.
In an email, Sawant said “the legislature has failed to act,” and pointed to the affordability crisis as the reason for urgency, as well as “nationwide momentum.”
Recent state-wide rent control measures (which cap rent-rises at around 7 percent plus consumer price index, averaging 2.5% a year) have passed in Oregon and California. In June, New York lawmakers, in defiance of an intense lobbying campaign by the real estate industry, passed new rent (control) laws closing loopholes that allowed landlords to raise rents or deregulate properties. It also allowed localities in the state to adopt their own rent regulation.
What do supporters say about rent control? Supporters argue rent control gives renters stability and predictability. It also helps people stay in their neighborhoods, housing advocates say, which means people can benefit from more immaterial gains: a neighborhood support network, proximity to schools and jobs, and others.
Advocates say it’s a stopgap for the affordability crisis (rents have risen 69 percent between 2010 and 2018 in the Seattle area) and that it’s an anti-displacement tool that acts quickly. Sawant points to Berlin, Germany, where within one month of passing, the law was bringing down housing costs.
What do detractors say? Landlords and developers are among those strongly opposed, often highlighting a famous Stanford study, which concluded that rent control ultimately undermined its own goals, though the paper also said that it had prevented displacement of lower-income tenants and older people.
Economists and market urbanists argue that though the policy might help tenants in the short run, it will eventually lead to fewer rental units and higher rents. They say that it lowers incentives for developers to build more housing, which would decrease the housing stock and lead to higher rents in the long run.
Another much-heard argument against it is that it would disincentive landlords to keep up the maintenance of rental units because they can’t recoup it by raising rents.
SCC Insight’s deep dive into why rent control would be “suicide” in places with a shortage of housing can be found here.
Proponents argue that the loopholes in legislation are mostly to blame for some of the failures of rent control.
Some also say the “supply and demand” lens is too narrow. A recent report by UC Berkeley’s Haas Institute, which claims rent control disadvantages do not outweigh its benefits, noted that the housing crisis also harms the physical and mental health, for example.
Laura Loe of housing advocacy organization Share The Cities said housing stability as a public health issue is often out of view of the data-driven economic lens. “It’s not capturing the health impacts, or the fact that worker productivity could be lost as people have to transfer from close by to their work to far away (…) It’s about emotional wellbeing for kids, being able to stay in the same school, for families to be able to stay near their jobs, for people to not have to scramble,” she said. “That emotional instability [is] very hard to quantify in terms of a ‘dollars and cents’ analysis.”
What does Sawant’s D3 opponent think? Egan Orion, running against Sawant for City Council in D3, followed some of the arguments of the detractors above and said that if the policy would include new construction, it would “destroy our affordable housing future.”
Orion said he thinks Oregon’s rent control (though he calls it “stabilization”), which limits rent increases to 7% annually plus inflation and exempts new construction for 15 years, would be a “more balanced remedy” than Sawant’s plan.
Asked whether he would want to limit rent increases within tenancies or also between them, aka vacancy decontrol, he said: “I’m open to working with stakeholders to define that. There are good things about OR and CA laws but want to make sure we find the right balance for WA.”
What does Sawant say? Sawant, who has a Ph.D. in economics, agrees that the region needs more density/housing, but she doesn’t think we should wait on or trust “speculators and corporate developers” to do this and repeats her call for building social housing.
“Responsible landlords who care for their tenants and only do moderate rent increases, using rent money for repairs, will be totally unaffected by rent control,” she also says.
She also argues that as long as “Seattle is growing as a metropolitan region and remains a job creation center, developers will have an incentive to build in Seattle because they can make profits. Rent control will be no more responsible for developers halting building than will a higher minimum wage cause job losses.”
CHS will have more details of the draft legislation following Monday night’s session.
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