Tenants, landlords tussle over tighter rent cap

By PETER WONG
Oregon Capital Bureau

Jessica Israel of Sherwood has taken her story to the Oregon Legislature, which she hopes will further tighten the state’s cap on annual rent increases – the latest battleground between tenants and landlords during this session.

The Senate Committee on Housing and Development already received hundreds of statements for and against Senate Bill 611 in advance of a public hearing Monday and a scheduled work session Wednesday. (During a work session, which is a public proceeding, lawmakers may amend and act on legislation – but they cannot accept new testimony.)

The bill proposes to change the annual cap that lawmakers approved in 2019. The current cap is the change in the Consumer Price Index plus 7%, as calculated by the Oregon Office of Economic Analysis, which came up with a permitted annual maximum increase of 14.6% for 2023. The bill proposes a new maximum of 8%, or the Consumer Price Index plus 3%, whichever is less. The current cap does not apply to buildings less than 15 years old, but the bill proposes to lower it to just three years.

Israel discussed her family’s plight at a pre-hearing briefing sponsored by the Community Alliance of Tenants, part of the Stable Homes for Oregon Families coalition of more than 30 organizations.

“The passage of this bill may happen too late to help my family,” Israel said. “But we are calling on lawmakers to support this bill to stabilize all rents in Oregon. It may not fix every issue, but it will keep more people in their homes.”

Her residence is in Cannery Row Apartments in Old Town Sherwood, which records show was purchased last fall by SR Watt Co., based in California, and property management assumed by Cushman and Wakefield.

Israel said her family got a notice three months later, as set by state law, that monthly rent would be increased by 32%, or $560 per month, and could go up by as much as 50% per month in lieu of a lease.

She has a child, she has non-Hodgkin’s lymphoma – a type of cancer that affects the body’s ability to fight disease – and her husband was injured during the coronavirus pandemic.

“How can that 32% be allowed as a rent increase? We were horrified,” she said. “We are now being priced out of the area, and pretty much out of the state as a whole.

“We do not know what we are going to do,” she added. “It is unconscionable to think that people can afford to pay that much extra per month. They are not pretending that this is due to increased costs or planned upgrades. They simply say it is the market rate.”

The companies did not respond to inquiries.

Two-bill effort

Senate Bill 611 was one of two put forth by Stable Homes for Oregon Families, which also advocated legislation (Senate Bill 799) that would have reinstated a pandemic-era requirement for a 60-day eviction notice from landlords, based on nonpayment of rent, if tenants have filed official applications for rental assistance. It also proposed to extend the actual period for evictions from three to 10 days. Landlords also opposed that bill, which the committee considered back on Jan. 30.

The Senate committee ended up increasing the permitted eviction period from three to 10 days and it was inserted into broader housing policy legislation (House Bill 2001) that now has cleared both chambers of the Legislature and awaits the signature of Gov. Tina Kotek. The Stable Homes coalition supported it, and Multifamily NW, which represents owners and managers to 275,000 rental units statewide, ended up taking no position.

As with the earlier legislation, Senate Bill 611 already has drawn a host of statements in opposition from individual landlords and Multifamily NW, which submitted a letter containing statistics to bolster its argument that any form of rent control does not achieve what its advocates seek.

The letter was submitted by its deputy executive director, Gary Fisher, who concluded:

“In summary, the facts show that rent control is at best a thin Band-Aid that will not ultimately benefit Oregonians. It is imperative that we refocus on the root causes of housing instability… Multifamily NW is eager to move beyond this well-intended but highly impractical proposal and continue to work with this committee to improve rental housing outcomes across the state.”

In a statement it issued after the Oregon Office of Economic Analysis announced the 2023 maximum cap, Multifamily NW downplayed its potential effects, saying that most rental owners seek to keep their units occupied, not empty them. A spokesman suggested then that lawmakers should revisit the 2019 law – although one of the chief sponsors of Senate Bill 608 back then was Kotek, then the House speaker.

But Kim McCarty, executive director of the Community Alliance of Tenants, said that’s not the case for every housing provider.

“The annual increase… sent shock waves through Oregon, even as many hoped that landlords would not be so cruel as to invoke it,” she said. “That hope has been dashed as reports of extreme predatory rent increases have been coming from across the state. We know that tenants across this state are in crisis… and that many are one rent increase away from losing their homes.”