Oregon Gov. Kate Brown signed into law a first-in-the-nation rent control bill Thursday and called on the Legislature to turn its attention to funding new housing initiatives.

Because of an emergency clause, Senate Bill 608′s rent control and eviction protections go into effect immediately.

“This bill is a critical tool for stabilizing the rental market throughout the state of Oregon,” Brown said. "It will provide immediate relief to renters struggling to keep up with the rising rents in a tight rental market.

The law caps annual rent increases to 7 percent plus inflation throughout the state, which amounts to a limit of just over 10 percent this year. Annual increases in the Consumer Price Index, a measure of inflation, for Western states has ranged from just under 1 percent to 3.6 percent over the past five years.

The rent increase restrictions exempt new construction for 15 years, and landlords may raise rent without any cap if renters leave of their own accord. Subsidized rent also is exempt.

The bill also requires most landlords to cite a cause, such as failure to pay rent or other lease violation, when evicting renters after the first year of tenancy.

Some “landlord-based” for-cause evictions are allowed, including the landlord moving in or a major renovation. In those cases, landlords are required to provide 90 days’ notice and pay one month’s rent to the tenant, though landlords with four or fewer units would be exempt from the payment.

The bill passed quickly through the House and Senate amid a Democratic supermajority and with only perfunctory opposition from landlord groups, who viewed it as a better alternative to removing the state’s ban on local rent control policies. The new law keeps the ban in place.

That’s also tempered excitement from tenant groups, who say the cap still allows rent increases that could impose a significant financial hardship for renting families.

Brown said lawmakers and the Oregon Housing and Community Services Department should report back on how the bill is working during the 2021 legislative session, including its impact on the rental housing supply.

Meanwhile, she said the Legislature should approve $400 million in housing-related budget requests for affordable housing development, rental assistance and homelessness prevention.

-- Elliot Njus

enjus@oregonian.com; 503-294-5034; @enjus

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