The St. Paul City Council will host a public hearing at 10 a.m. Wednesday on a proposed raft of residential tenant protections that have drawn strong reaction across the housing industry.
From limits on security deposits to eliminating credit scores as a screening tool altogether, the S.A.F.E. (Stable, Accessible, Fair and Equitable) Housing in St. Paul initiative spans five key provisions that will likely be voted upon by the council on July 1.
The overall package seems guaranteed to win the council’s approval, but changes have already begun to roll in.
In light of the pandemic and economic recession, Council Member Dai Thao on Wednesday convinced the council to delay implementation of the new rules until July 1, 2021, instead of Jan. 1.
The new timeline was approved 4-3, with Council Members Mitra Jalali, Nelsie Yang and Rebecca Noecker opposed.
Jalali said a delay on tenants rights during an uncertain time for tenants would undercut the point of the ordinance. “I’m actually very worried about missing the window where these policies would matter the most for our community,” she said.
SUPPORT FROM HOUSING ADVOCATES, OPPOSITION FROM LANDLORDS
The S.A.F.E. housing effort has drawn the backing of housing advocates, while inspiring strong opposition from many landlords who say they’ve had to raise tenants’ rents in response to rising property taxes, and the provisions do nothing to address that concern.
The St. Paul Area Association of Realtors have asked for the proposals to be put on hold for further evaluation.
Some landlords have pointed to the experience of Seattle, which approved a series of tenant protections in 2016.
At the request of the Seattle auditor’s office, the University of Washington published a partial evaluation in June 2018 that found many longstanding landlords were at least considering raising rents or selling out to larger property owners, if they had not already done so, in direct response to the new city rules.
The Seattle researchers acknowledged, however, they had little in the way of baseline data — a before-and-after snapshot of rents, property sales and screenings — to compare their findings to.
“There really aren’t good data points from other cities,” said Noecker, who called for an evaluation to be published within 2 and a half years of the ordinance taking effect in St. Paul.
‘A MAJORITY RENTER CITY’
In July 2018, the council passed a resolution committing the city to explore housing protections for tenants, reducing barriers to finding rental housing and preventing displacement.
According to statistics compiled by the city, 83 percent of black households in the city are renters, compared to 41 percent of white households.
“St. Paul is now a majority renter city, and people of color and indigenous people are disproportionately renters,” said Muneer Karcher-Ramos, director of the city’s Office of Financial Empowerment, calling housing support both an economic and racial justice issue.
“Housing is that largest single expenditure for most households … and half of our renters across our city spend at least a third of their income on rent,” Karcher-Ramos said.
AMENDMENTS ROLL IN
On June 17 council members spent the better part of four hours tightening wording in the provisions through technical amendments and debating more fundamental changes.
Kirsten Burch, the city’s Fair Housing Coordinator, said the first — and least controversial — provision calls for creation and distribution of an information packet and poster that spell out the obligations of tenants and landlords, including plain language on state statutes and tenant resources.
Under a second provision, move-in costs would be limited to no more than first month’s rent and a security deposit, which would also be equivalent to no more than one month’s rent.
There is no restriction a landlord can charge on a security deposit or pre-payment under state law, and many tenants have complained of landlords charging hefty advance sums.
At the request of Council Member Jane Prince, the council created an exception that would allow landlords to accept a higher security deposit as collateral from a renter who would otherwise not qualify for an apartment.
LIMITED CREDIT HISTORY, CRIMINAL HISTORY SCREENING
A third provision aims to increase housing access by establishing specific items that can or cannot be used to screen prospective tenants.
Credit scores and insufficient rental and credit history would no longer be used as evidence for denial, though the landlord could still pull copies of credit reports.
A landlord could look back within a renter’s history no more than three years for evidence of evictions.
When examining criminal histories, the maximum look-back period for misdemeanors would be three years, and for felonies would be seven to 10 years.
Landlords would not be allowed to reject tenants for their history of petty misdemeanors, crimes that are no longer illegal in Minnesota or arrests or charges that did not result in convictions.
JUST CAUSE: LEASE NON-RENEWALS EXPLAINED IN WRITING
A “just cause” provision would require landlords to specify in writing why they have chosen not to renew a tenant’s lease.
The provision lays out 10 allowable causes for non-renewal, including failure to pay rent, late payment of rent, exceeding occupancy limits, occupancy conditioned on employment, demolition, a government order to vacate or a building rehab.
Proponents have called the language an important safeguard against retaliation for tenants who assert their rights, but critics have expressed concern that making it more difficult to drop a tenant would have the unintended effect of causing landlords to become even choosier with whom they rent to.
The Minneapolis City Council approved a series of tenant protections last September, but did not include “just cause” language in their rules.
ADVANCE NOTICE OF SALE
The fifth provision aims to give nonprofits and other preservation buyers time to step in before affordable housing is sold to a market-rate developer.
Landlords would be required to give tenants of affordable units advance notice 90 days before a property sale. Within the first 90 days after a sale, a rent hike or another activity that might displace tenants would require landlords to pay rental or relocation assistance.
On Wednesday, June 17, council members voted 5-2 to change the definition of affordable housing in the “advance notice of sale” provision to structures with at least five units, instead of at least three units, as previously written.
Jalali and Yang, the two renters on the council, voted against the change. City staff noted that a large percentage of St. Paul’s “noahs” — non-subsidized, naturally-occurring affordable housing units — are in triplexes and four-plexes.
“This goes too far,” Jalali said. “The reasoning doesn’t rationalize the protections that are being taken away. … Keeping ‘noah’ is the thing we have the most power over as a city, and are actually the most behind on.”
Council President Amy Brendmoen, however, said limiting the advance notice of sale provision to buildings of at least five units would create clarity by putting the St. Paul regulations in alignment with Minneapolis.