Opponents, supporters of rent control in St. Paul demand answers

St. Paul residents on opposite sides of the rent control debate had a similar message for Mayor Melvin Carter this week: They want more information about how the city's new policy is going to work.

The 3% cap on annual rent increases is set to take effect May 1. But 100 days after voters approved the measure, many questions about how the law will be administered and enforced have yet to be answered.

"Right now, because we're not hearing anything about what's going to be happening when this is in effect on May 1, that silence is getting filled with a lot of fear and a lot of nonsense and a lot of misinformation about what this policy does and what it's going to look like," said Margaret Kaplan, president of the Housing Justice Center and an organizer for Housing Equity Now St. Paul (HENS), the coalition of activists that petitioned and campaigned for rent control.

At a news conference Wednesday, members of HENS said they've heard from more than 60 St. Paul tenants facing exorbitant rent hikes from landlords trying to raise rates ahead of May.

Mai Cha Vang, whose family rents a duplex on St. Paul's East Side, said they received notice recently that the out-of-state landlord who purchased her building was going to increase the unit's rent from $1,350 to $1,850.

"There is nothing to protect my family right now, or another family, from rent hikes," she said at the news conference.

Meanwhile, opponents of rent control have said if Carter does not change the ordinance, St. Paul will lose proposed housing developments and exacerbate its affordable housing crisis. In a forum hosted by civic organization St. Paul STRONG on Tuesday night, executives from two Twin Cities-based developers said investors have backed out of ready-to-go projects after the rent control ordinance passed.

"Why would somebody build here versus somewhere else [that's less of a financial risk]?" asked Bob Lux, founder and principal of Alatus, which placed its 304-unit Lexington Station project on hold after an equity partner pulled out.

Kamal Baker, Carter's spokesman, said the mayor anticipates having updates to announce "in the coming days." City officials have said they are working to launch a rent control website and convene a stakeholder group to recommend ways to improve or enhance the ordinance.

Carter has also said he plans to ask the City Council to approve an amendment to the ordinance that exempts new housing construction, and Baker said Wednesday that the mayor "is open to additional recommendations from the council."

"I have a lot of concerns about [the ordinance]," Carter said in an interview last month. "I'm concerned about the impacts on mom-and-pop landlords. I'm concerned about the impacts of no vacancy decontrol [the ability to raise rents more once a tenant moves out]. I'm concerned about whether 3% or 3.5% or 4% is the right number."

J. Kou Vang, president and CEO of St. Paul-based developer JB Vang, said his company has two projects with the equivalent of about 260 units on pause because investors have backed out.

"It's going to be hard for us to attract market rate stuff," he said, unless St. Paul exempts new housing construction from rent control.

Advocates pushed back on those claims, saying that such an amendment would incentivize developers to pursue tear-downs that displace tenants.

"Voters decide elections. Landlords and developers do not," said Javier Miranda, a renter who lives in the St. Anthony Park neighborhood. "Therefore, the city must implement rent stabilization according to the will of the people, without blanket exemptions."

HENS organizers also called for strong penalties for landlords raising rents by more than 3%, a registry to track landlords, a rent stabilization board and more tenant protection laws.

"The biggest thing that the city could do today — that would stop particularly the most egregious rent increases — is to communicate about the plan for implementation of the policy," Kaplan said.