Wrongheaded ordinances being drafted by two Minneapolis City Council members to limit the ways landlords screen prospective tenants would harm, not benefit, the city’s rental housing landscape. Though the goal is to improve access to housing, the regulations most likely would do the opposite.
Despite pressure from well-intentioned but misguided affordable-housing advocates, Mayor Jacob Frey and other members of the City Council must ensure that the screening and security deposit proposals go no further.
Council President Lisa Bender and Council Member Jeremiah Ellison have proposed prohibiting landlords from rejecting applicants for felony convictions if the cases are more than five years old and for misdemeanors more than two years old. Property managers could not deny rental units to applicants with arrests that did not result in convictions, or those with expunged or vacated convictions, or those who committed crimes as juveniles. Also off-limits would be insufficient credit history, credit scores lower than 500 and eviction judgments more than three years old.
A second draft ordinance from the two council members would limit the amount that a property owner could charge for a security deposit.
In other words, Bender and Ellison want to require private building owners to take on more risk — a City Hall overreach that would make Minneapolis less attractive to rental-housing owners and developers. And they want to create new disincentives to entry into the market at the same time the city’s rental occupancy rates are sky-high.
The city’s low eviction rate would likely go up if landlords are forced to accept higher-risk tenants only to have to go through the high cost of eviction later. Faced with the new regulations, some landlords would no doubt pass along the real and projected costs of the higher risk by raising rents — undercutting the city’s efforts to promote more affordable housing.
And some of the lower standards fail to consider the rights of existing tenants who want to live in buildings that are safe, quiet and secure. They hold their landlords accountable for doing a thorough job of screening and selecting tenants.
Affordable-housing advocates argue that too many potential renters are denied units in Minneapolis because of unnecessary hurdles, misleading court records and discrimination. But members of a trade organization, the Minnesota Multi Housing Association, who met with the Star Tribune Editorial Board said that’s not a full picture of the situation, and that they share the city’s goal of providing more affordable housing.
With Minneapolis suffering, in the words of the ordinance, a “persistent low vacancy rate,” it appears renters who meet current standards are filling the available space. These mandates will merely displace some of them, while making supplying the additional affordable housing that’s needed in Minneapolis a less-appealing proposition.
The MHA members acknowledge that there are bad landlords who discriminate, mistreat tenants or violate rental license rules. But such landlords are a small minority of all property managers, and it’s up to the city to do a better job of regulating them.
Bender, Ellison and other city leaders should collaborate with responsible property owners and landlords on more-effective solutions to the city’s rental-housing issues, such as helping low-income residents rebuild their creditworthiness, creating an emergency fund to help struggling renters stay in their homes and providing more transitional housing.
Yes, we understand that Bender and Ellison want to help less fortunate residents find housing, and that’s a worthy goal. But they need to realize that even the most well-intended regulations can have negative consequences.