SALEM — The Oregon House of Representatives passed a tenant protection bill 32-to-27 Tuesday, April 4, that lifts the statewide ban on rent control and outlaws most no-cause evictions after a six-month trial period.
"House Bill 2004 is important because it will help keep more families in their homes and help to create more stable and diverse communities," said Rep. Carla Piluso, D-Gresham, one of four chief sponsors. "It won't reverse our housing crisis over night, but it is step in the right direction."
Piluso and Reps. Karin Power, D-Milwaukie; Diego Hernandez, D-Portland; and Chris Gorsek, D-Troutdale, sponsored the legislation to address the state's affordable housing crisis. House Speaker Tina Kotek, D-Portland, declared the measure as one of her highest priorities this session.
Rep. Carl Wilson, R-Grants Pass, said the bill would be counterproductive to what the sponsors hope to accomplish.
"Just the fear of this bill alone is leading many people to raise their rents already," Wilson said.
Rep. Brad Witt, D-Clatskanie, agreed that the bill could exacerbate the housing crisis.
"Oregon's housing crisis is a supply crisis. There simply are not enough physical units to house an ever-expanding population to and in our great state, especially in the Portland metropolitan area," Witt said.
Reforming land use policies that limit housing development and "a plethora of housing regulations and restrictions" that compound the problem would be more effective, he said.
The bill allows cities or counties to impose limits on rent increases but requires those local governments to provide "a fair rate of retun to landlords" and a process to petition for rent increases greater than the limit, so landlords can recoup costs associated with repairs and improvements, Power said.
"Local control allows policymakers to create programs that make sense in their individual communities," she said.
The bill was revised substantially to address the concerns of landlords, including those of Rep. Mark Meek, D-Clackamas County, a landlord and real estate agent and investor who authored the amendment.
Meek's revisions pared mandatory relocation assistance payments to tenants from the equivalent of three months' rent to one month rent. The amendment also exempts landlords who own fewer than five units from having to pay tenants relocation fees in certain no-fault evictions. Examples include when the landlord wants to move into the property or remodel or sell it.
The changes also exempt new construction from any local rental control ordinance for the first five years the unit is occupied. The concession is meant prevent what economists say can be one of the negative side effects of rent control – a chilling effect on new development. The five years is a statewide floor, but local governments can give an exemption for longer, Meek said.
Economists widely believe rent control can inhibit growth in the number of units on the market, which is why states such as California have given new construction exemption from controlled rents.
"My goal in working on this bill was to help craft a policy that works for struggling renters, as well as landlords and investors who are trying to do the right thing," Meek said. "I believe House Bill 2004 meets that goal."