Olympia City Council looking at new rules for rental housing

‘These are the same provisions the activists have attempted to pass on the state level,’ said one landlord

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The Olympia City Council on Tuesday approved the amendments to the city ordinance code on rental housing, including limits to move-in fees, rent increase notification, and pet damage deposit.

The council members passed the OMC Chapter 5.82 Rental Housing Code amendments on its first reading.

The proposed amendments will be on the city council meeting agenda tomorrowfor second reading.

“For now, they took the first step toward approving. The ordinance does not move forward until an approval of the second reading,” said Strategic Communications Manager/deputy PIO Carrie Mc Causland in an email to The JOLT.

In a presentation at the city council meeting on Tuesday, Aug. 10, Olympia Housing Program specialist  Christa Lenssen identified three proposed amendments:

  • 82.040 Rent Increase Notification
    • requires 120 days' notice for rent increases over 5%
    • requires 180 days' notice for rent increases over 10%
  • 82.050 Pet Damage Deposits
    • capped at 25% of monthly rent
    • allows for three consecutive monthly installments
  • 82.060 Limits to Move-in fees
    • prohibits collection of non-refundable fees at the beginning of the tenancy

Lenssen explained the ordinance would allow landlords to charge of a non-refundable move-in fee. "But we could require landlords to charge equivalent of one month's rent at move-in whether they decide to use that as a security deposit or a last month's rent …there would be flexibility in how that is charged, but the amount would still be one month's worth of rent."

She said it would prohibit any non-refundable fees such as an administrative fee but would allow for a security deposit or last month's rent in the amount of one month's rent.

Research led to these amendments

According to Lenssen, the amendments resulted from three-years of research and community engagements by city housing staff.

She said they conducted research on peer-city policies regarding rental housing and statewide law changes. The research included interviews of staff from peer cities, one-on-one interviews with tenant advocates and landlords, developed online surveys for tenants, landlords and interested third parties, and conducted four focus groups including tenants, advocates, landlords.

She said they received 200 responses from renters who participated in the survey. About 50% said they pay approximately 30%-50% of monthly household income for rent, not including utilities, while more than 30% said they spend more than 50% of their earnings on monthly rent payments. About 80% said they earn $75,000 or less in their households, and 80% said it’s "a lot harder to pay rent."

Councilmember Dani Madrone said the ordinance aims to provide relief for renters. She said it would take a long time to build the housing needed to meet the community's demand.

"This one action is not a complete solution. It is one of the many strategies to address the issues we face around housing in our community," Madrone said.

Madrone is also the chairperson of the Land Use and Environment Committee, who steered the staff to develop the house rental code amendments.

"These are the first changes we might make in city policy so that housing providers are … accountable as a business," Pro Tem Clark Gilman commented.

High cost of housing affects school enrollment

Mayor Cheryl Selby said the high cost of housing in Olympia resulted in the low enrollment in the Olympia School District.

She said OSD Supt. Patrick Murphy informed her of the steep drop in enrollment.

"Some of them were due to COVID, but a large part of it is they believe that the cost of housing in Olympia, and young families cannot afford to live in the city anymore necessarily," said Selby, quoting the OSD superintendent.

Mixed reaction from the public

Rep. Andrew Barkis, who operates a property management business in Olympia, strongly opposed the rental housing code amendments as he described them as “bad and ill-timed.” He said putting new regulations for housing providers has to stop. “We already have significant tenant protections in place. The last two years have been extremely difficult on housing providers,” he told The JOLT.

He said those regulations have caused housing providers to sell their properties and put them out of business. “This does not help our housing supply shortage. These are the same provisions the activists have attempted to pass on the state level and when unsuccessful they go to the local level.”

Public commenter Alyssa, who claimed to be a housing provider in Olympia for 24 years, urged the council members to consider the consequences before enacting the proposed amendments.

“We provided housing. Unfortunately, it's become very antagonistic,” Alyssa said of the laws and regulations about rental housing. “They exacerbate the antagonism by limiting the move in costs.” She added it does not keep housing affordable.

She said her risks had increased substantially, which meant increasing the overall rent. “That doesn't help you. It doesn't help me, it doesn't help anyone.”

Another commenter, Jane Totten, shared the same sentiment, saying she provided affordable housing in Olympia. “But after the new laws and regulations were made during the pandemic, I could no longer be an affordable housing provider. And I had to adapt to the new rules, laws that the state put in.”

Totten warned that if the city continues to pass more laws and rules on housing providers, it will result in fewer affordable housing units available.

Commenter Christina said housing providers are local, small investors. She pointed out that the Olympia housing survey showed that 32% of landlord-respondents own one to five units. She said that besides the increasing property tax, some small property owners have to deal with increasing maintenance costs and building supplies. “I hope you proceed with caution. More property owners will leave and probably sell the property. And when we have no supply, we will have the demand and prices will continue to rise.”

A suggestion from a local landlord

"It’s a delicate balance. The city wants to help renters, and that’s understandable. But, you don’t want the city to take steps that would have the unintended consequence of causing small landlords to exit the market,” thus removing housing from the rental stock, Olympia resident David Hanig told The JOLT.

“If the city is interested in retaining small housing providers, one option to consider is applying greater  regulatory oversite to larger landlords, They have the infrastructure and capacity to manage a more complex regulatory environment,” Hanig added.

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  • Honestyandrealityguy

    Sometimes, I feel sorry for the landlords. Many have saved their money to put a down payment on a rental. They need the rent in order to make their payments, plus taxes, plus insurance, plus some maintenance, sometimes utilities, and more. When their rents are paid, if their savings have been leveraged into the rental, the landlord loses everything. I believe common sense needs to be considered in dealing with some people who refuse to pay rent and leverage the rules to their favor. Just my opinion.

    Monday, August 15 Report this

  • JulesJames

    The 180 day notice for rent increases over 10% is fair -- it discourages economic evictions. But the 120 day's notice for rent increased over 5% pretty much guarantees annual 4.9% rent increases for everyone every year. Capping the "Pet Damage Deposit" and eliminating "Non-Refundable Deposits" are improvements for all good tenants and competent landlords.

    Tuesday, August 16 Report this