A pair of companies based in Bloomington and Minnetonka on Thursday filed a federal lawsuit against St. Paul, arguing the city's new rent control ordinance violates their constitutional due process and property rights.
In a 59-page complaint, attorneys for Woodstone Limited Partnership and the Lofts at Farmers Market LLC asked the court to stop the city from enforcing a 3% annual cap on residential rent hikes voters approved last fall.
Woodstone Limited Partnership owns an interest in an apartment building in St. Paul's Highland Park neighborhood, while the Lofts at Farmers Market LLC owns an apartment building in Lowertown.
The complaint lists lost revenue, as well as a lost ability to enforce leases and seek redress in court, among the harm the two companies say they have suffered as a result of the law.
"Affordable housing is a community-wide problem that property owners, like Plaintiffs, as opposed to the community at large, are being forced to subsidize and remedy," the complaint said, while arguing the law violates the Fifth Amendment.
It also argues that the ordinance violates the Fourteenth Amendment because it is not tied to inflation. Additionally, the lawsuit characterizes the city's process for property owners to seek exemptions as complicated and arbitrary, alleging that St. Paul does not have enough staff or resources to handle requests.
In all, the complaint lists six counts against the city, including alleged violations of the state constitution, and seeks a jury trial.
"The purpose of the ordinance is to create more affordable housing for people in St. Paul. This … has the opposite effect," Joseph Anthony, an attorney for the property owners, said in an interview Friday.
