Unpacking What Voters Need to Know About the Rent Control City Questions in Minneapolis and Saint Paul
Reporting by JT Pinther, Freelance Community Journalist
After rank-choice voting for their city’s mayor, voters in Minneapolis and Saint Paul will have a Rent Control City Ordinance question listed on the back of the ballot on Tuesday. The questions have been critiqued by some voters as being confusing, despite the fact the questions were co-created by many people who considered the language.
The Rent Control or Stabilization question, depending on what city you’re in, are both the results of community-led campaigns, but the similarities between the City Ballot Questions in and of themselves end at that point. No “explanatory notes” can give the full context of all that went into that Question.
Note: Rent “control” and “stabilization” are used interchangeably in this article, though Saint Paul tends to use the word “stabilization,” and Minneapolis tends to use the word “control.” But it should also be noted that other cities in the U.S. don’t necessarily use these words interchangeably.
Some context to begin with: Minnesota state law prohibits rent control measures by the government unless a city, county or town adopts an ordinance, charter amendment, or law that is approved in a general election.
In other words, a city council cannot simply enact a new rent control policy on their own in the state of Minnesota, even if the interest were unanimous. And it can’t be enacted on the state level, either. It requires a general election (large scale election as opposed to elected representatives voting) for rent control to be legal under Minnesota statute.
Minneapolis is voting on the right to write
The question on Minneapolis’ ballot sounds pretty drastic: “Shall the Minneapolis City Charter be amended to authorize the City Council to regulate rents on private residential property in the City of Minneapolis…” sounds like quite the boost in governmental oversight, to say the least. But, this question is actually asking the public’s permission to be able to consider rent control to any degree. It is asking if voters would like to lift the aforementioned Minnesota statute to allow the City Council to develop a rent control ordinance?
Proponents of this measure say the priority if this Question passes, will be to put pressure on the City Council to write a policy that will be effective and limit loopholes. No small order.
Saint Paul already wrote theirs
If you are a Saint Paul voter, the ballot question is different, because the ordinance has already been written by community members and legal experts.. The ballot question says: “The Ordinance limits residential rent increases to no more than 3% in a 12-month period, regardless of whether there is change of occupancy. The Ordinance also directs the City to create a process for landlords to request an exception to the 3% limit based on the right to a reasonable return on investment.” The ordinance would go into effect May 2022.
The “change in occupancy” language means a landlord would not be able to raise rent by more than 3% for an existing tenant, nor for a new tenant. The rent control question would not dictate what a landlord could charge in rent for a new property or even an existing one — it would simply limit the amount the rent could be increased year-over-year.
The 3% proposed is from the research, namely the University of Minnesota’s Center for Urban and Regional Affairs (CURA)’s Minneapolis Rent Stabilization Study published in February of this year.
CURA’s study suggested that rent in Minneapolis did not go up more than 3% each year on average in the last 20 years, but the increases to make this average disproportionately affected people of color:
“BIPOC renters generally, and Black renter households in particular saw a worsening of affordability for most of the study period,” the CURA study said. “Black households saw rent increases in this period while incomes fell in real dollars. White households fared best, with incomes steadily and consistently rising more rapidly than rents.”
The idea is that 3% would not affect profits for property owners, but it would still make rent increases more equitable across renter households.
“We made sure the number we chose was reflective of what renters and property owners actually experience,” said Tram Hoang, Campaign Manager for Keep St. Paul Home. Hoang was in the coalition to write the language you’ll see on the ballot.
“We aren’t doing anything new,” Hoang said. “More important is reading research about when these ordinances didn’t go well so we can avoid the same mistakes.”
Critics of rent stabilization policy often cite cities where similar efforts have been tried and have failed. “People say ‘it didn’t work in San Francisco!’ but that’s not the whole picture,” Hoang said. “If anything, it didn’t work because it wasn’t applied. [Property owners] demolished buildings that were going to be stabilized [in rent] to create new buildings. People point to that, but it worked when it was applied.”
According to Hoang, Saint Paul’s proposed policy was “designed to be as universal as possible, with as few loopholes as possible.”
Rent control would not just apply to apartment buildings
A universal policy is on the minds of Minneapolis rent control proponents as well. Qannani Omar, Housing Organizer for the Harrison Neighborhood Association, has been part of rent control campaigns in other cities in the past.
“I reached out to city planners, policy analysts and had them connect me to people on the ground,” Omar said. “What went well, what went wrong. New York City was realizing they had a lot of loopholes. They lost a lot of affordable housing.”
Omar said mistakes and loopholes are not a reason to give up on rent control. New York City property owners found a big loophole and were disseminating this discovery to fellow property owners. But a rent control policy could be written in Minneapolis to never have those loopholes to begin with.
“Landlords [in NYC] were writing tutorials for each other on the ability to raise rent because of minor cosmetic repairs (a few hundred dollars in aesthetic updates, to thousands in rent increases),” Omar said. “It wasn’t the policy, it was a weakness within the policy.”
A bulk of Omar’s work has been in education and “busting myths” for voters. “Renters are even hesitant, saying ‘but I’ve heard there’s waiting lists for years to get into affordable units,’ but no. it would apply to everyone – a universal policy for renters.”
Especially in a housing landscape like Minneapolis’, only limiting rent increases for large apartment complexes would be a missed opportunity and would miss the point of CURA’s study to begin with. “Fifty-seven percent of rental units [in Minneapolis] are single family homes,” Omar said. “That is the bulk of the housing stock. If a policy written didn’t include them, more than half of renters wouldn’t be protected. It would also disproportionately affect Black renters.”
Omar argued that there’s a way for corporate landlords to take care of their properties without price gouging, and there are small landlords who also participate in the rent control coalition.
Many property owners not in favor of limiting rent increases
Blois Olson, CEO of Fluence Media, responded to a Sensible Housing Ballot Committee media inquiry for an interview but did not provide anyone for us to interview.
According to the Think Twice St. Paul campaign website, the biggest concerns around rent control include:
- Property owners would struggle to cover inflation costs of maintenance and equipment upgrades
- Renters would be unwilling to leave rent-controlled properties
- There would be fewer places for people to rent
- Nobody knows how much rent control will cost the city
- Saint Paul’s rent control measure is unproven and untested
The Think Twice Minneapolis campaign website echoes similar concerns, but also argues the charter amendment would give the City Council unchecked power. The campaign also notes there is no plan in place to enforce rent control once it’s set. (However, the ability to even consider these plans is what Minneapolitans will be voting on in the first place.)
Costs of the campaigns, infrastructure and implementation
Hoang agreed that we do not know the cost of implementation of rent control, but she said it will be less expensive in the long run. “We have an incredible housing crisis right now,” Hoang said. “The cost to implement this is tiny compared to the hundreds of millions we are saving by not having to deal with so much displacement, homeless and housing instability.”
It is difficult to predict the cost to enforce/implement rent control in Minneapolis because the policy hasn’t been written yet.
As of Oct. 14, Keep St. Paul Home Campaign has raised more than $213k, according to the campaign finance report form submitted to Ramsey County.
As of Oct. 12, Sensible Housing Ballot Committee has raised more than $3.9M, according to the campaign finance report form submitted to Ramsey County.
What’s next if the measure(s) pass? What if one or both don’t?
“As the charter amendment stands, City Council would write the policy,” said Erin West, Lead Tenant Organizer for HOME Line in Minneapolis. “The idea is that renters in Minneapolis would be consulted. If left to the council’s own devices, they could be pressured to render an inefficient policy.”
If the Minneapolis rent control question does not pass, “I expect my work will continue to build a broad base movement in the city. We as a city are behind in renter affordability and protections,” West said. “Rent control is a cornerstone policy, but it’s just one piece of a broader platform. A lot of people say rent control is the most radical policy, but it’s really not. This only limits the increase — when builders build, they can still set high rent.”
If the Saint Paul rent control question passes, “we are going to make sure that it isn’t weakened, that the opposition doesn’t attack it,” Hoang said. She added that the infrastructure and making processes as clear as possible – both for reporting abuse and for landlords to request exemptions – is clear.
If it doesn’t pass, Keep St. Paul Home doesn’t plan on quitting. “If we have to do this again, we know what we have to watch out for. The fear mongering is meant to pit people against each other. Pitting renters against property owners, pitting renters against homeowners,” Hoang said. “They’re [doing] this so we feel we have to choose between racial equity and economic growth. But we don’t have to choose.”