Incoming Minneapolis council sounds note of caution on rent control

With rising rents and a looming eviction crisis, Minneapolis voters told the City Council last month that the city should adopt a rent control policy.

But a majority of the City Council, including newly elected members, say they want to proceed with caution and design a policy that protects vulnerable tenants but is also workable for developers and landlords.

"The people have spoken clearly that there has to be some type of rent control or rent stabilization, and we were elected to thread the needle," said Council Member-elect Michael Rainville, who unseated incumbent Steve Fletcher, a proponent of a 3% cap. "I just look across the river at our friends in St. Paul and I just think maybe they went too far."

St. Paul's rent control measure, also approved by voters last month, is considered the strictest in the country. It caps rent increases at 3% annually and makes no exemptions for new construction or inflation. The measure has prompted big developers, including Minneapolis-based Ryan Cos. to pause major St. Paul projects, jeopardizing hundreds of new affordable housing units.

Rainville and other more moderate council members contend it's too risky for them to go down the same path amid a dire need to maintain and boost affordable housing stock. They will face spirited opposition from newly elected Democratic Socialists Jason Chavez, Aisha Chughtai and Robin Wonsley Worlobah, who centered their campaigns on the issue and say they are bent on creating a similar policy to St. Paul's in Minneapolis to make headway on racial equity and prevent displacement. They are the only three on next year's council who have publicly expressed support for a 3% cap on rent hikes in Minneapolis, though they would allow for inflation.

"This is not [a policy] that we need to weaken … and I'm also not interested in passing meaningless policies," said Wonsley Worlobah. She ousted Cam Gordon, one of the council members who crafted the rent control charter amendment in Minneapolis.

The debate over how Minneapolis should implement rent control is expected to take center stage at City Hall next year, after seven new and six returning council members take office in January.

The debate will also include how the "strong mayor" system that recently went into effect will influence the council's ability to pass a policy now that city staff – whom they have relied on to study different potential ordinances – report directly to Mayor Jacob Frey. Frey opposes rent control and the council would need nine votes to override any veto.

The City Council in August failed to override Frey's veto of a second rent control proposal that would have given residents the right to petition the council to create an ordinance. Frey said then that it was crucial to block Minneapolis' resident-led measure because it would have outsourced city leaders' core responsibilities to an interest group.

Frey supported the charter amendment that passed, but said he did so to allow the public process to move forward and that he believes restricting a landlord's ability to raise rents would worsen the housing shortage.

Incoming Council Member Elliott Payne believes city policies "tend to reflect the interests of homeowners and especially the interests of landlords" more than residents. His first priority is to protect residents from being displaced and he says rent caps can do that, adding that the housing stock debate is a separate policy challenge.

Payne said he will evaluate if a 3% cap is right for Minneapolis.

Newcomers LaTrisha Vetaw and Emily Koski, who both oppose rent control, said putting regulations on an already tight housing market can suppress the supply of new housing and drive away landlords and developers. The city, they said, should create more opportunities for residents, particularly people of color, to become homeowners.

Vetaw and Koski defeated incumbents Phillipe Cunningham and Jeremy Schroeder, who both supported capping rents.

Koski says she's not a "hard no" and is willing to compromise. She wants the City Council to study the effects of rent regulations and also include the perspectives of developers and landlords whose voices she said have been left out of the discussion.

"We get to take that time to really look into the specifics and really include all voices and we have not done that," said Koski, whose 11th Ward is mostly occupied by owner-occupied single-family homes. "We don't want this to be a battle."

But time is running out, said Jennifer Arnold and other members of tenant advocacy groups who staged a rally outside the Hennepin County Government Center on a recent Tuesday. They are pressing incoming and returning council members to move quickly on the issue.

"There's a mandate for a policy and the time is now for a policy to be written," said Arnold, co-director of Inquilinxs Unidxs Por Justicia (Renters United for Justice) and founding member of the Home to Stay coalition. "[Residents] are threatened every month with rent increases, and evictions and the push to move out of the city. We don't need more studies, those have been done. We need to produce the policy."