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As inflation hits, Oregon lawmakers consider more state rent control limits

Oregon State Capitol building, May 18, 2021. Oregon's unique tax law sends money back to taxpayers whenever personal income tax revenues come in at least 2% above initial projections during a two-year budget cycle.
Kristyna Wentz-Graff
Oregon State Capitol building, May 18, 2021. Oregon's unique tax law sends money back to taxpayers whenever personal income tax revenues come in at least 2% above initial projections during a two-year budget cycle.

Oregon’s current law limits rent hikes to 7% plus inflation. In some recent cases, that’s resulted in 14% increases.

The residents of a 55-and-older mobile home park pooled together their resources to help pay the way for Robbin McMain to make the five-hour drive from Brookings to Salem on Monday so she could urge lawmakers to further limit how much landlords can raise rents.

“I came here today to explain to you that myself and my neighbors are scared, stressed,” she said.

The mobile home residents have turned their thermostats down as low as they can and still survive. They disconnected their television services, cut back on groceries and canceled trips to see the grandchild, McMain said.

Two years ago, a corporation bought the mobile home park, McMain said. The company raised the rent on the residents, most of who live on a fixed income, by 14.6%.

In 2019, Oregon became the first in the nation with statewide rent control. The current law prohibits raising the rent by more than 7% per year, plus inflation. At the time, landlords worried it would only be a matter of time before state lawmakers tried to further lower the cap. They were right. But what most people couldn’t have anticipated was the spike in inflation, which has allowed some landlords — including McMain’s — to increase rent by more than 14%.

Senate Bill 611, currently under consideration by the Oregon Legislature, would revise that to limit annual rent increases to 3% plus inflation or 8% total, whichever is lower. The proposed legislation would also require landlords to cover three months’ rent if a tenant has to relocate through no fault of their own. The current law requires one month of rental assistance for a no-fault eviction.

So far this legislative session, lawmakers have shown a remarkable amount of bipartisanship in their efforts to solve Oregon’s housing crisis. Both conservatives and progressives have agreed housing is the paramount issue in this session. Legislators have already passed a $200 million dollar housing package.

But rent control is a different story.

Senate Majority Leader Tim Knopp, R-Bend, said the policy simply doesn’t work.

“(Democrats) want to double down on more government interference and regulation and what they will end up getting is a problem that is ten times worse and hurts more Oregonians because no one will want to invest in multi-family development here,” Knopp said. “We need to understand we’re here (with a housing crisis) because of Democrat-imposed policies that have led to a shortage of housing being built.”

Shortly after taking office, Gov. Tina Kotek, a Democrat, called on the state to play a more aggressive role in building housing. Oregon is more than an estimated 100,000 housing units short of what’s needed. Kotek called on Oregon to produce 36,000 new housing units a year, up from the 22,000 or so builders now create annually.

Molly McGrew, with Multifamily Northwest, which represents residential property managers, owners and vendors, said an even tighter rent control policy would make it harder to reach the governor’s housing supply goal.

“It sends a signal to investors that Oregon isn’t open for business … I noticed that Washington state did not pass their rent control law and instead went ahead full speed addressing the supply issues,” she said. “And I think that’s something that Oregonians need us to do as well as that is the only way we can ultimately reduce the cost.”

Others urged lawmakers to consider bolstering rental assistance for people on the verge of homelessness, rather than placing restrictions on landlords.

Catherine Chambers, a renter in Salem, is 67. She worked for the same company for three decades and now lives on a fixed income. She volunteers for the Humane Society and she’s active in the South Salem Neighborhood Association.

“And sometime in the next year, you may see me on your drive to Salem standing on the street corner or living in a tent, because I am not joking when I say people like me are going to be the new face of homelessness in Oregon,” Chambers told lawmakers. “I wake up every day and go to sleep every night worrying about keeping a roof over my head.”

But when costs go up, real-estate broker David Weislogel, noted in written testimony, they go up for everyone.

“Reasonable controls and reasonable tenant protections are necessary and I understand the need for some guardrails, but it sure feels that only one side is being considered when crafting these bills and it’s now the owner’s, developer’s and manager’s side,” he wrote. “This is not sustainable.”

The measure is scheduled for a work session on Wednesday.

Copyright 2023 Oregon Public Broadcasting. To see more, visit Oregon Public Broadcasting.

Lauren Dake is a JPR content partner from Oregon Public Broadcasting. Before OPB, Lauren spent nearly a decade working as a print reporter. She’s covered politics and rural issues in Oregon and Washington.