Just over a week before Portland’s landmark rental screening rules are slated to take effect, a coalition of landlords have hit the city with a federal lawsuit that claims the sweeping regulations violate their rights, making property owning in Portland so risky and confusing that some threaten to leave the business altogether.
Passed by Portland City Council last June, the regulations — collectively called the Fair Access in Renting policies — eliminate the criteria landlords could potentially use to discriminate against tenants. They were crafted and championed by Commissioner Chloe Eudaly, who hailed them at the time of their passage as a way to address “the criteria that continue to be used in as a proxy for race,” namely criminal records, income requirements, and credit scores.
The new rules are extensive. In the lead up to the March 1 start date, the city has been offering classes to teach both tenants and landlords what they should be prepared for.
But landlords are arguing the restrictions are more cumbersome and confusing than what can be taught in a class. On Wednesday, Multifamily NW, a trade group representing the region’s landlords, joined two other property owners — Janet Newcomb and Jerry Mason — in filing a lawsuit against the city, alleging that the rules have made property owning in the city a minefield.
“Plaintiffs are suing the City of Portland because it has passed laws that make management of rental housing so costly, burdensome, and risky that plaintiffs will have to either raise rents — to cover the additional costs and risks — or sell their rentals,” the suit reads.
Jill Gibson, who’s representing the plaintiff for law firm Lynch Conger, said the ordinance is both exceptionally strict — with tenants able to sue if landlords misstep and exceptionally vague, with key phrases left undefined.
As an example, Gibson points to the rule that prevents landlords from processing applications for 72 hours after a rental is first advertised. But, she said, the ordinance does not define the word process, meaning landlords are confused if they can communicate with potential tenants about the property during the blackout period.
“We have heard from many housing providers that say they’re afraid of the ordinance. They’re afraid of making simple mistakes and their entire retirement is jeopardized and they don’t know they can’t comply, they don’t even understand it,” she said. “Some landlords are just getting out.”
Gibson said she did not have numbers on how many landlords have decided to get out of the business because of the new rules,
Gibson added that Multifamily NW had been trying to work with the city to get clarity on the rules. But the city had not budged, leaving the firm to file a last minute lawsuit a mere week before the package of ordinances are supposed to go into effect.
The plaintiffs are asking a judge to delay the start date of the ordinance, while the litigation is pending.
Eudaly’s office did not immediately respond to a request for comment. But it’s unlikely the pushback from landlords comes as a shock to the commissioner, who has made tenant rights her signature issue.
In her closing statements last June after the rules passed, Eudaly said her staff had spent hours working with landlords big and small “imploring them” to make suggestions that everyone could agree on.
“The gist of what we heard from most landlords is that while everyone agrees that discrimination is wrong, no one wants to be compelled to do anything about it,” she said.