Coalition forms to oppose proposed rent control measures for Minneapolis and St. Paul

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A coalition of business groups, real estate professionals and labor unions has been launched to oppose the rent stabilization poll questions that voters will weigh in Minneapolis and St. Paul in November.

Coalition members believe rent control policies could delay construction projects at a time when there is already a shortage of affordable housing in the Twin Cities, said Cecil Smith, president of the Minnesota Multi-Housing Association. , which represents developers and property management companies.

“Rent control appears to be a solution to the housing affordability problem,” Smith said. “A closer look at rent control indicates that this is not the right solution. Building more affordable housing is the right solution.

The St. Paul referendum would institute a 3% cap on most rent increases, although it would allow landlords to apply for an exemption. St. Paul’s proposal does not include automatic exemptions for new construction or for small homeowners. The Minneapolis poll question would give city council the power to adopt rent control policies in the future.

Smith cited rent control policies in cities like New York and San Francisco as examples of the failure of rent stabilization policies to keep housing affordable. He said he trusted peer-reviewed studies of economists on an analysis of the effectiveness of rent stabilization earlier this year, published by the Center for Urban and Regional Affairs at the University of Minnesota.

This academic study found that the effect of rent stabilization policies depended on both policy details and local housing market conditions, but that they were effective in “keeping rent levels below the market and moderate price appreciation ”.

The study authors also concluded that there is little evidence that rent stabilization policies lead to less new construction, but have been shown to be linked to an overall reduction in rental units. .

Advocates of rent stabilization policies say these policies are necessary to keep rental housing affordable and prevent extreme rent increases.

More than 180 cities have some form of rent stabilization, said Tram Hoang, director of the Keep St. Paul Home rent stabilization campaign. Hoang said St. Paul’s proposal is the result of “decades of community organizing” and “extensive and collaborative research”.

“This policy is flexible, fair, predictable and essential to maintaining the affordable housing we have,” Hoang said. “It will also protect local ownership and control of our communities from outside speculators and make significant gains in advancing racial equity by ending blatant rent spikes that disproportionately impact and displace households of color.”

The rent stabilization policies could scare away domestic developers who would bring projects and jobs to the region, according to Adam Duininck of the North Central States Regional Carpenters Council.

“We support the idea of ​​affordable home ownership, but this policy is far too restrictive, not well thought out, and would have a chilling effect on development and construction in Minneapolis and St. Paul,” said Duininck.

Supporters of rent stabilization aim to ensure that everyone in the city has a stable place to live, regardless of wealth or race, said Claire Bergren, Home To Stay Minneapolis campaign manager.

“We know that the people who are currently enjoying the skyrocketing rents will try to distract and divide us by saying that stabilizing rents will be somehow bad, but we know their real concern is their profits,” Bergren said. .

The election is scheduled for Tuesday, November 2. Minneapolis voters will also weigh in on a ballot issue that would reorganize the city government to give the mayor more executive power and one that would replace the Minneapolis Police Department with a new civil service department. Security in the city charter.

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