New Rules

Portland landlords must pay relocation costs to evict tenants without cause

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Commissioner Chloe Eudaly speaks at a rally in support of her tenant relocation policy. (Jessica Floum I The Oregonian/OregonLive)

Jessica FloumBy Jessica Floum
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on February 02, 2017 at 8:13 PM, updated February 03, 2017 at 2:15 PM

Each time Coya Crespin crosses the St. Johns Bridge, she knows she’s home. She lives with her six-year-old daughter and five-month-old son in a St. Johns apartment that she’s called home for five years.

That could soon change. A California-based property management company bought her apartment complex in October. They’ve started handing out no-cause eviction notices to the more than 50 families living there.

Thanks to a Portland housing policy introduced by housing advocate and new Commissioner Chloe Eudaly and passed unanimously by the City Council on Thursday, that company will now have to pay the tenants it evicts without cause.

The rule requires landlords to pay $2,900 to $4,500 to tenants who they evict without cause or who have to move as a result of a rent increase of 10 percent or more in one year.

“This legislation provides us a chance to maintain stability with our families and gives us a chance to not be insignificant to the powers that be,” Crespin said. “All we’re asking for is a chance to stay in our neighborhoods.”

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The policy will take effect immediately and apply to all tenants, including those who have received a 90-day eviction notice within the last 89 days.

Landlords who rent only one dwelling in Portland will be exempt. Commissioner Amanda Fritz, with the votes of three other commissioners, added that clause to the rule Thursday over Eudaly’s objection.

Commissioners heard five hours of testimony on the proposed rule Thursday, nearly all of it from renters and landlords.

Tenants shared how no-cause evictions disrupt hard-working families and children’s education.

Landlords called for the City Council to table Eudaly’s proposal, arguing that the policymakers failed to consult all stakeholders, to distinguish mom-and-pop landlords from foreign investors, and to consider that small landlords will consequently sell their property, further limiting Portland’s housing supply.

Eudaly called the new rule a necessary first step to address Portland’s housing emergency.

“I cannot assert enough this is a temporary emergency ordinance,” Eudaly said. “It is not ideal. It is not perfect. This is the only tool the city of Portland has to protect renters and we are using it.”

All five commissioners acknowledged the new rule is imperfect and may have some unintended consequences. But they said it is the best way to offer immediate help to vulnerable low-income renters caught at the mercy of a red-hot rental market.

Landlords renting to tenants on a weekly basis, renting rooms in their living space or renting to tenants with the understanding that the landlord will return after a three years away will be also exempt from paying relocation costs.

In an open acknowledgment that the rule may need fixes soon out of the gate, the council unanimously backed Commissioner Nick Fish’s proposal to create a panel made up of tenants, landlords and others to study the rule and its effects and propose improvements. That group will initially operate in the Housing Bureau and its responsibilities will eventually be passed to the new Office of Landlord-Tenant Affairs that Mayor Ted Wheeler aims to create.

“I do believe this will have unintended consequences, and we’ll have some time to see that,” Fritz said.

Before taking testimony, Eudaly dismissed any hardships imposed on landlords, saying “landlords have been placing that same hardship on tenants.”

Eudaly said her 33 days as the commissioner in charge of the Bureau of Development Services have assured her that building more apartments is not an immediate solution. Economists say the tight housing supply in Portland is the primary driver of huge rent increases, and they caution that increasing costs for landlords will lead to fewer rental units coming on the market.

“If you’ve come here today to suggest we build our way out of this crisis, I can tell you today it will take decades to build our way out,” Eudaly told people who’d come to testify.

At least five landlords–many owners of one property–said they would not have purchased their property if they knew a relocation fee would be required for no-cause evictions. It came out of nowhere, they said.

Kelly Goss rents to 30 tenants in Southwest Portland. He said he hasn’t raised the rent on his properties above $650. He believes in affordable housing, he said.

Goss said the new policy will cause him to sell his properties, a move he says will make him millions of dollars and cause his tenants’ rents to spike.

“The focus should be on legislating greed rather than focus on legislating being able to manage your property,” Goss said.

Another small landlord argued the policy will increase landlords’ costs so much that they will raise rents even higher.

Eudaly called that argument a “theory,” then corrected the way the woman addressed her.

“When you address the council, I’d appreciate it if you use our title,” Eudaly told the women, who’d called her Eudaly.

Wheeler, Fish and Commissioner Dan Saltzman all dropped their jaws.

At least nine landlord and property managers asserted that the council, and more specifically Eudaly’s office, ignored their perspective and refused to listen when they called and wrote to propose solutions. Eudaly took offense to many accusations.

“I do not appreciate your characterization of my office,” she responded before Wheeler called for a break to the meeting.

The rule will likely draw a lawsuit Multifamily Northwest, said representing attorney John DiLorenzo. By imposing fees on landlords who raise rent by 10 percent of more, the rule conflicts with Oregon state law that prohibits rent control, he said.

Eudaly reaffirmed her commitment to rent control at a rally before the vote. She said she will continue to advocate for the state to lift its ban on limiting rent increases. She noted that her relocation policy is the first of many steps she plans to take to protect tenants.

“We will never stop fighting for tenants’ rights,” Eudaly said. “Keep Portland housed!”

More than 100 tenants’ rights advocates rallied outside of City Hall before the vote to support Eudaly’s proposed tenant protections and urge the city to go further. “Get your profits off our housing. Stop displacement. Stop price gouging,” the crowd chanted before cheering Eudaly up to the podium.

Eudaly called on Portland and Oregon officials to catch up with San Francisco and other cities with strong tenant protection laws and to lead the charge for others.

“My name is Chloe Eudaly, and I’m a renter!” Eudaly exclaimed to a cheering crowd.

–Jessica Floum

jfloum@oregonian.com

503-221-8306

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