Landlords warning of dire consequences if Portland adopts new regulations on how they screen tenants and collect fees got pushback at a Portland City Council hearing Wednesday night.
The ordinance has been significantly rewritten since Commissioner Chloe Eudaly first introduced it in April, but the core remains the same.
It requires landlords to use a standard set of screening criteria that are more permissive than what the private market typically uses to review prospective tenants. For example, people wouldn’t be turned away for having a felony conviction more than 7 years old or for a misdemeanor more than 3 years old. A poor credit score also wouldn’t be disqualifying.
Under the policy, landlords could still choose their own stricter screening criteria. If they do, they would have to give applicants a written explanation for why they didn’t qualify for a unit, and a chance to file an appeal.
At Wednesday’s hearing, public testimony split evenly between supporters and opponents of the ordinance.
Many landlords warned of unintended consequences if the regulations pass. Some testified they would shift their investments to what they see as more business-friendly real estate markets.
They objected in particular to new caps on the income-to-rent ratio landlords can require: two and a half times the rent for cheaper units that meet a federal standard of being affordable to someone making 80% of the area median income, or two times the rent for more expensive units.
“We had discussions this morning. Do we move to another market? Do we move to Boise and build in Boise?” said Jim Rostel, sales director for Anchor Property Group, a Portland area company that builds and manages apartments across the city.
Deborah Imsee with the landlord lobbying group Multifamily Northwest said the Council was watering down safeguards that are intended to protect tenants “from entering into housing contracts they cannot afford” and warned the end result would be more people falling behind on the rent and more for-cause evictions.
That prompted a follow-up question.
“Do you have any data that shows that people who are paying, today, more than two times their rent are more likely to be evicted than people who have three times their rent in salary?” Commissioner Jo Ann Hardesty, who supports the ordinance, asked.
“At this time, no, I don’t have any empirical data. I do have some ways of getting at it,” Imsee responded.
Eudaly’s senior policy advisor, Jamey Duhamel, said the intent of capping the income to rent ratios is to help low wage workers qualify for housing.
Using the industry standard 3-to-1 ratio, a single worker earning minimum wage in Portland employed 40 hours a week who earns $2,166 a month would qualify for apartments that rent for $722 or less. Using the new standards in the ordinance, a person earning minimum wage would qualify for apartments renting for up to $1,088 a month.
The median renter income in Portland was $36,833 in 2016, according to the latest data from the Portland Housing Bureau.
Supporters of the ordinance who came to testify suggested it was paternalistic for landlords to oppose the bill on the grounds that it will hurt tenants, when fair housing groups and tenant advocacy organizations are backing the proposal.
Hardesty and Eudaly have accused the landlord lobby of spreading misinformation in its campaign against the ordinance. The Oregonian/OregonLive reported that Multifamily Northwest paid for anonymous robocalls that have urged people to call City Council members — a development commissioner Eudaly called disappointing.
“I am respectfully requesting that we stick to the facts, and debate this policy based on its merits,” Eudaly said.
Landlords have won a significant revision in the draft ordinance. It allows them to screen the criminal and rental histories of all household members, not just the primary applicant. Eudaly’s staff conceded that a prior version of the policy that limited screenings to one applicant conflicted with landlord’s rights under state law.
Council could vote on the ordinance when they consider it again, in two weeks. Commissioner Nick Fish and Mayor Ted Wheeler have signaled they may be willing to support it.
In an amendment, Eudaly proposed delaying the effective date of the new rules until March 31 — to give the Portland Housing Bureau and landlords more time to adapt.