Minneapolis City Council passes tenant relocation assistance ordinance

Minneapolis tenants dealing with poor housing conditions will get some financial relief starting later this year if they have to move out of their homes.

The Minneapolis City Council passed an ordinance last month that will require landlords whose rental licenses get revoked or whose property gets condemned to either pay out of pocket for their tenants' relocation costs or face a property tax assessment later from the city. Property owners would have to pay three months' worth of rent regardless of whether a tenant is current on rent payments.

Minneapolis Council Member Phillipe Cunningham, the author of the ordinance, said that he felt a sense of "wow, we have a serious safety net gap here" when he went through his first rental license revocation process while on the council's Economic Development & Regulatory Services Committee. He said the new ordinance aims to "minimize harm" for tenants.

"As the council member in north Minneapolis that has a lot of single-family-home rentals, I know a lot of times people end up in this situation because they can't find housing anywhere," Cunningham said. "While we're holding a bad actor accountable, we're also doing harm to some of the most vulnerable in our city."

Since 2012, Minneapolis has revoked licenses that have affected 168 units, most of them belonging to landlords such as Stephen Frenz and Mahmood Khan who were cited for thousands of violations over poor housing conditions, according to city data.

Vanessa Del Campo, a mother of two living in south Minneapolis, is a tenant in one of Frenz's units. She's been living there for four years and has been dealing with a cockroach infestation and freezing temperatures due to old windows that can't keep the cold out. Tenants are hoping to buy Frenz's five buildings and turn them into permanent co-ops. Residents are waiting to hear whether they will be evicted.

"We really want to live in a place with good conditions and also have a better life living here, but unfortunately that affects our lives and kids and families because we're facing an eviction so we don't know when we're going to be out," Del Campo said through an interpreter with Inquilinxs Unidxs por Justicia (United Renters for Justice).

Cunningham said the Khan license revocation was another reason he wrote the ordinance.

"That overwhelmingly disproportionately impacted North Siders and I knew a couple of the tenants and it felt really awful to not have anything readily available to truly help them," Cunningham said. The council pieced together some things but "there wasn't anything systematic and institutionalized."

Cunningham said getting renters, property owners and housing advocacy groups together early for focus groups and feedback on the draft proposal and how it would be implemented was key.

Tenants in these situations have often "been living in substandard conditions for a long time" but paid rent out of fear of retaliation, not getting their lease renewed or eviction, said Eric Hauge, executive director for Home Line, a nonprofit focused on tenant advocacy and legal services. He said the ordinance offers further incentive for landlords to comply now that "not only are they going to face potentially losing their license but they're also going to have to throw down the money" if residents have to move.

"[Tenants] may have just paid rent this month and there's a revocation notice and they don't have money to move or anything," Hauge said. "This [ordinance] can really come as a benefit and put more of the burden on the landlord."

License revocation, condemning a property or cancellation of a license are typically the last options the city uses for holding property owners accountable, said Kim Keller, director of regulatory services for the city of Minneapolis. She said that's why the relocation assistance ordinance is "an important tool in our entire enforcement portfolio." Since landlords can appeal decisions about their rental license, it can take months to figure out if residents will have to move.

"As much as we try and work with rental property owners to resolve their issues, there are occasions where it's appropriate for them to no longer have a rental license," Keller said. "We don't want to be kept from making those hard decisions because we fear what will happen for those people living in those units."

Property owners could get behind the ordinance because it's "a reasonable governmental response that clearly aids the victims," said Cecil Smith, principal and managing broker with Cornerstone Property Professionals, a Minneapolis property management company. The Minnesota Multi Housing Association, a statewide group that represents property owners, has previously sparred with City Council members over feeling excluded in the policymaking process. But Smith said Cunningham had "a listening ear" and accepted property owner feedback, which alleviated their concerns.

"We agreed that this is outrageous and this kind of behavior needed a remedy so the residents weren't further victimized," Smith said. "We can support something like that because the residents of our housing are our customers, we're here to take care of them because they pay good rent and these are their homes."

The ordinance goes into effect June 1.

Marissa Evans • 612-673-4280