Call to Action!
Senate Financial Institutions & Insurance Committee to hear Rent Control bill on Tues, Jan. 30 @ 8 am
On Tuesday, January 30 @ 8 am, the Senate Financial Institutions and Insurance Committee will hear SB 6400 which would end Washington's ban on rent control and allow cities to enact rent control. This comes on the heels of rent control receiving a hearing in the House Judiciary Committee this past Tuesday. RHAWA had a strong showing of members at the January 23 hearing and we need to continue that momentum as we approach cutoffs for bills to receive votes.
We need landlords to attend this hearing and voice your strong opposition to the proposed bill. Carpools are being arranged for the trip down on our Connect member discussion forum. Click here to log-in and find a carpool down to Olympia.
Two ways to comment on this issue
Why does RHAWA oppose rent control?
Resources on rent control
Make your voice heard by contacting the sponsor of these bills:
HB 2583 Sponsors - State Reps:
Nicole Macri - 43rd district
Mia Gregerson - 33rd district
Noel Frame - 36th district
Gerry Pollet - 46th district
Laurie Dolan - 22nd district
Strom Peterson - 21st district
Sherry Appleton - 23rd district
Sharon Wylie - 49th district
Eileen Cody - 34th district
Gael Tarleton - 36th district
June Robinson - 38th district
Beth Doglio - 22nd district
Timm Ormsby - 3rd district
SB 6400 Sponsors - State Senators:
Rebecca Saldana - 37th district
Marilyn Chase - 32nd district
Bob Hasegawa - 11th district
Sam Hunt - 22nd district
Patty Kuderer - 48th district
Background on Rent Control
During the 1970s and 1980s, five states and the District of Columbia adopted various forms of residential rent controls, and after decades of experience with rent controls, most have abandoned them. In fact, as of 1996, 31 states had passed laws prohibiting local governments from adopting residential rent controls.
The imposition of controls on rent is of state-wide significance and is preempted by the state under RCW 35.21.830, which mandates that controls on rent for residential structures is prohibited, with specific exceptions which primarily deal with public housing.
In 1999, a bill was introduced to remove the statewide ban on rent control. It did not receive a hearing. Subsequently, the Seattle City Council adopted a legislative agenda for the 2001 session which sought to "repeal or modify RCW 35.21.830 to allow local control of rent laws." Seattle Council again staked out its desire to implement rent control in 2015 when it passed another resolution calling for the State Legislature to repeal the ban on rent control at the local levels. Individual members on Seattle Council have also voiced support for increased authority for local jurisdictions to set landlord-tenant laws.
Arguments for RHAWA Position
Market Place Implications
By distorting the market signals needed to maintain equilibrium in the market place, rent controls discourage new housing construction during periods of shortage.
In rent-controlled cities, real estate lenders either refuse to make mortgages, or charge higher interest rates, because they view the ability of a property to generate rents, the underlying security for repayment of a loan, as impaired.
Rent control schemes based upon a "reasonable return" on investment spur existing rental property owners who bought many years ago to sell out, with the new owner able to justify higher rents due to a higher purchase price.
Rent controls reduce property tax collections due to depressed assessed valuations reflecting the constrained income-generating potential of rental units, while increasing demand for public housing units.
Rents are economic incentives to attract new production of rental housing, as well as maintain existing housing stock. Rent controls lead to the deterioration of existing housing units because controlled rents rarely cover all the costs of prudent property management, especially reserves for major repairs such as new roofing, re-painting and replacing aging appliances. Building owners, forced to defer maintenance and improvements on their investment, cannot contribute to a vital, sustained economy.
Rent controls also impose high administrative costs on local jurisdictions. Cities imposing rent controls must create bureaucracies to administer them.
Rent controls have many side effects, including adverse consequences, for those they are intended to help most: low-income renters. Studies have shown that rent controls aggravate poverty and, over time, benefit the affluent. When rent is eliminated as a basis for distinguishing among potential tenants, owners rely more upon non-price factors such as credit-worthiness.
Because of rent controls, housing shortages are prolonged, leaving many poorer people permanently displaced. They are forced to relocate to remote locales in search of housing and then make longer commutes into the inner city to work, increasing demands on mass transit and exacerbating existing transportation congestion.
Tenant mobility is reduced in rent-controlled jurisdictions. Typically, people trade up to bigger and better housing as they get older. Tenants in rent-controlled units tend to stay in them even as their personal incomes grow over the years. Over time, the occupancy demographics of rent-controlled units shifts to the affluent — as housing opportunities for new, and low-income renters are unavailable due to a lack of new supply.