Sawant Brings the Fight for Rent Control into City Hall

Not the first time Sawant has been alone at the table. Seattle Channel

On Monday evening Seattle City Council Member Kshama Sawant introduced a rather ambitious piece of legislation that aims to stabilize the city's sharply rising rents. Since 2010 rents in the greater Seattle area have risen 69%, and wages have not exactly been keeping up for anyone who doesn't run a hospital empire . Though a 69% raise does sound pretty...nice.

No other council members joined Sawant at the table during the special meeting of the Human Services committee, though her own staff and representatives from tenants rights organizations Be:Seattle and the Tenants Union contributed to a roundtable discussion of the proposal.

I've asked fellow committee members Bruce Harrell, Debora Juarez, and Teresa Mosqueda how they feel about Sawant's bill. I'll update this post when I hear back from them, but I'll take their absence as a clear enough message.

Though she doesn't appear to have the support of her colleagues, Sawant, who has been using her re-election campaign to build a rent control movement, boasts 12,000 signatures and 18 organizational endorsements in support of the policy.

A Sawant spokesperson said she intends to bring the rent control bill for a vote alongside the economic evictions bill she's been talking about, in case anyone was wondering what happened to that idea. That bill would require landlords to pay relocation assistance to tenants facing 10% rent hikes.

If Sawant was looking for a full vote on these bills soon, the timing here isn't exactly ideal. She dropped the bill the day the council goes into budget mode until November and then essentially goes on vacation until January. Sawant said her office "prepared the rent control draft legislation as rapidly as possible" and stresses that the work of "building of a powerful movement that can overcome what will be fierce opposition from the real estate corporations" will be the "most crucial part of winning rent control."

Whether she's still leading that movement from her seat on the council will be up to voters in November. Her opponent, Egan Orion, has been inconsistent on his support for the idea. He's told Capitol Hill Seattle Blog that he thinks rent control is "horrible," but more recently he called Oregon's rent control legislation a "more balanced remedy," though didn't advocate for any specific proposals. Orion didn't immediately return my call, but I'll update this post when I hear back.

Update: Over the phone, Orion reiterated his earlier stance on rent control, calling it "not very good policy" in general. He predicts small landlords dropping out of the market, the increased prevalence of large property management companies, and landlords "maxing out" the allowed rent increase every year. He also criticized the timing of her announcement: "She’s been running on rent control since the last election, and all of a sudden she pulls it out six weeks before the election?" He proposes " something similar to Oregon’s law, plus a emergency fund to pay rent for tenants who've suffered a job loss or family emergency.

Anyhow, during public comment a barista named Chris said she came to the meeting out of "desperation," claiming her rent in a shared three-bedroom apartment in the Central District rose $500 over the course of the last three years. "This city just simply doesn't care about us," she said. "This has to end, and rent control can stop landlords and developers from pricing us out of our homes."

Representatives from a local American Federation of Government Employees union said universal rent control would stanch the "rapid loss of affordable housing" across the city, which they say "profoundly affects the veterans" they serve.

A couple landlords spoke in opposition of the measure. "I agree with one thing—rents are way too high," said Richard Frith, a landlord of 37 years. Frith argued high rent was only a "symptom" of greater income inequality, and emphasized the need to tax capital gains. Nancy McKinnon, who identified as a small landlord, pointed to failures in other cities and agreed with Frith about the need to tackle the "larger" problem of income inequality.

Sawant emphatically agreed with the call to tax the rich, and she emphasized the fact that rent control was only “part of a comprehensive policy program that has to include a major expansion of publicly owned social housing" to deal with the problem of high housing costs. She also welcomed input from small landlords and invited those with questions and ideas to contact her office.

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In her effort to keep landlords from price gouging, Sawant's proposal anticipates many critiques of rent control but also raises many questions, not least of all the question of why we're considering rent control at all since the state banned it in 1981 after a Republican-led legislature passed "a bill backed by pro-developer lobbyists." Here are the highlights, the details, and some answers.

Highlights and Some Details

• Sawant’s legislation restricts rent hikes to inflation for Urban Wage Earners (CPI-W) + 0%. Compared to other states that have recently passed rent control laws, that's pretty hardcore. Oregon caps rent hikes at inflation + 7%, and California caps rent hikes at inflation + 5%. However, a lot of landlords in Seattle—the nice ones—aren't raising rents much pass inflation anyway, which was just over 3% last year.

• The bill only allows landlords to charge more than inflation in certain cases. Those cases are "natural disaster" or "large and unusual changes to the taxes or other legal obligations applied to renters and property owners." That last condition is vague, and I want to know more about it. What is an "unusual" change to taxes that would justify a rent hike?

• Landlords who violate this law get treated like bosses who steal wages. If landlords get caught charging more than they should, they owe the tenant triple the rent overcharged plus 12% annual interest.

• All rental housing would be subject to rent control. Many cities exempt new construction from rent control, but that decreases the stock of rent-stabilized housing over time, which sucks. Sawant's proposal would constantly add new rent controlled units to the market, which does not suck.

• Once an apartment is rent controlled, it stays that way. California and New York have allowed for vacancy decontrol, which lets landlords raise rent beyond the cap when a tenant living in a rent controlled apartment moves out. Decontrol incentivizes landlords to kick out long-term tenants so they can jack up the rent of the vacant apartment and make more money. Under Sawant's legislation, they couldn't do that.

• Developers have to replace what they bulldoze. The bill includes a "one-to-one replacement provision," which requires developers to replace any rent controlled units they knock down. During the meeting, one member of Sawant's staff gave the example of a landlord redeveloping a 10-unit apartment building into a 100-unit apartment building. That developer would have to include 10 units at the old rent in the new development, but they could set rent at any price they want in the other units.

• We'd have a rent control board in each district. The rent control boards—composed of five renters and one landlord—would keep policies updated and would handle emergency exemptions.

Okay, So What's the Problem?

• Landlords generally argue they need to raise rents in order to maintain units, keep up with rising property taxes, and make a lot of profit, so inflation + 0% is a non-starter for them. But it's not at all uncommon for the rent to jump 10% one year and yet still have the same god damn broke-ass washers and dryers in the laundry room three years later, plus slumlords exist even without rent control, so threats of landlords letting apartments fall apart may be overblown. And, incidentally, when Rep. Nicole Macri introduced a bill to lift Washington state's ban on rent control in 2018, one developer told her they assume 3% annual rent increases in their 15 or 20-year models. Developers ultimately want predictability in expenses over time, so Sawant's proposal aligns with at least one developer's assumption of annual rent increases.

• Won't rent control scare off developers? Though some urbanists hold up their Econ 101 books and argue that rent control scares away developers, which would reduce the housing stock and exacerbate the housing crisis, a recent study out of Berkeley said such fears are "generally not supported by research." Moreover, some analysts argue that the housing market is incredibly segmented, and that increasing the supply of luxury apartments doesn't actually lower rents for the people who need to see them lowered, and so even if rent control did scare off developers of luxury apartments, then who the fuck cares? Go find us some developers of middle and affordable housing, please. Or so some argue.

• Others, such as former city council candidate Logan Bowers, warn that landlords faced with these restrictions will start converting their apartments into condos, which will increase the types of displacement Sawant seeks to remedy. A Stanford study of rent controlled apartments in San Francisco found that "landlords actively respond to the imposition of rent control by converting their properties to condos and TICs or by redeveloping the building in such as a way as to exempt it from the regulations," which ended up reducing the supply of available rental housing by 15%. So it is a concern!

• Is this good politics? During the meeting, Sawant acknowledged that she was literally "the only council member who was at the table" when she introduced her rent control legislation and reiterated her familiar theory of change. "We are going to need to build a huge momentum in City Hall.” In an earlier meeting, she cited her early support for $15 minimum wage as another issue where the rest of the city eventually joined her and organizers at the table.

Recent rent control victories in California, Oregon, and New York (plus Berlin and Paris) suggest the idea could gain popular support here, which might help Sawant in her re-election campaign in District 3.

But Sawant's legislation, if passed by council members who actively organize against her and signed by Amazon's mayor, will only go through if the legislature lifts the statewide ban.

Washington State Senator Rebecca Saldaña, who introduced the bill to lift the ban in the Senate, suggested that a bill's success in Seattle can be hit or miss in the legislature. "I've come to know that at the state level sometimes [a proposal's success in Seattle] is helpful and sometimes it gets people more stuck in their places." She added that she's "interested in looking at statewide rent control" but admits she hasn't looked into it too deeply.

In a text message, Rep. Macri said lifting the ban might be harder than just trying to pass a statewide rent control measure. "Statewide ban on rent gouging (capping annual rent increases at some amount over inflation) resonates a lot more with legislators than allowing cities to tailor their own policies," she said.

If the bill passes, Republicans and Democrats (many of whom are landlords themselves) opposed to the idea could use Sawant as a socialist boogeyman to block an effort to win rent control statewide. And if the measure fails in Seattle, they'd get to dismiss the bill as too socialist even for the socialist hellhole. But if enough people in the state already think passing legislation to end rent gouging is a good idea, then none of that might matter.