The St. Paul City Council is moving forward with a tenant screening ordinance that would change how landlords use criminal histories, past evictions or credit scores when considering new tenants.

The council, which held a public hearing Wednesday on the proposed ordinance, has touted it as another step forward for the city's efforts to build equity while also curbing longtime barriers that often make it difficult for people with criminal backgrounds or evictions, low-income households and people of color to find affordable housing in the city's tight market. More than half of the city's residents are renters.

Kristin Burch, fair housing coordinator for the city of St. Paul, told council members that steps are being taken to work with city departments and community partners to help train landlords on how the ordinance would work.

"We are laying the groundwork and will be mapping out a more detailed process for you," Burch said. "But I have laid out some steps in a process where we will be building an implementation team."

The council is slated to take the proposed ordinance up again at its July 1 meeting. If approved, the ordinance would go into effect March 1 of next year.

Under the proposed ordinance, landlords would not be able to deny an applicant on the basis of a misdemeanor if the conviction is older than three years or because of a felony older than seven years. Landlords can still deny applicants who are convicted of distributing or manufacturing controlled substances and anyone on the lifetime sex offender registration.

The ordinance also would allow denials in cases of murder, kidnapping, arson, assault or robbery, manslaughter and criminal sexual conduct convictions older than 10 years.

It would not allow applicants' eviction judgments to be considered if they happened three or more years earlier. Insufficient rental history also won't be usable as grounds for denial unless the tenant withheld information in bad faith.

The proposed ordinance also limits how credit screenings are used, including preventing landlords from denying an applicant because of insufficient credit history. It also caps the amount landlords can charge for a security deposit at a month's rent.

Eric Hauge, executive director for Home Line, a tenant advocacy group, wrote in a letter to the council earlier this month that the ordinance is taking steps to "address discrimination and power imbalances in rental housing that disproportionately impact communities of color." He said the need for these policies has become more evident in light of the coronavirus pandemic.

"We have seen a significant increase in clients inquiring about threats of eviction, lease non-renewals and notices to vacate," Hauge said. "This highlights the lack of basic protections that Minnesota tenants have to prevent involuntary displacement."

Tenants rights advocates say that the ordinance gives a nod to the idea that screenings do not always give the full context of what might have been happening in a tenant's life to cause them to pay rent late or miss bill payments that hurt their credit score.

But many property owners have said they have not felt heard during the ordinance process and fear putting their tenants in an unsafe situation. They also worry that they will not have all of the facts they need to make sound decisions that could potentially prevent a future eviction filing. The potential costs of tenant relocation, fixing up damaged units and housing court fees would drive up costs for tenants in the future, they said.

Chad Scally, a property owner in St. Paul, told City Council members during the hearing that the ordinance "will actually reduce the amount of affordable housing in St. Paul" and that there needed to be more input from property owners.

"I'm hopeful you'll see the extreme damage this ordinance will do and work with property managers in developing tenants' rights that actually help tenants," Scally said.

Opponents of the ordinance have also raised concerns about the ordinance's "just cause" provision, which would require landlords to provide reasons on why they're terminating a tenant's lease. Those grounds could potentially include reasons like nonpayment of rent, repeated late rent, renovation of the unit, too many people occupying the unit or the tenant not taking steps to renew their lease as asked. If a new owner buying affordable housing properties refuses to renew any leases without cause, they'll be required to pay relocation assistance for tenants.