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Kshama Sawant proposes cap on rent increase in Seattle

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(The Center Square) – Seattle City Councilmember Kshama Sawant is proposing an ordinance that would prevent monthly rent from increasing by more than the rate of inflation.

As of July 13, the State of Washington prohibits any regulation of the amount of rent that a landlord can charge. Sawant’s office acknowledges that rent control as described in the proposed legislation would not yet be permitted in the City of Seattle. However, if the state-level prohibition is repealed, the ordinance would go into effect between the time of the repeal and 18 months after, according to the council bill.

Sawant’s legislation is targeting landlords who gouge rent, but more specifically corporate landlords who she said have raked in astronomical profits from rent increases.

“54% of all apartments nationally are owned by corporations who own 100 or more rental apartments, so we are talking about giant corporations,” Sawant said at a Sustainability and Renters’ Rights Committee meeting on July 12. “If you are a small landlord – and you don’t gouge your tenants, then this law will not affect you.”

The Washington Business Properties Association estimates that more than 20,000 units of rental housing may not be built by 2030 if a 7% annual cap was placed. More than 45,000 units are considered vulnerable by the association during the same time period as operating costs grow.

“This kind of rent control scheme is putting future development and existing housing stock at risk,” CEO and Executive Director of the Washington Business Properties Association Chester Baldwin said in a statement. “The financial impacts are staggering with losses of $5 million in property tax revenue every year and possibly $50 million in lost sales tax revenue.”

The Seattle Department of Construction and Inspections would have the authority to use warnings, citations and notices of violation to enforce Sawant’s Council Bill 120606, if passed. Citations are $500 for the first violation and $1,000 for each subsequent violation in a five-year period. The Seattle City Attorney’s Office can also pursue criminal penalties.

Council Bill 120606 would also establish a citywide Rent Control Commission. The group would meet on a quarterly basis to make recommendations to the city about rent control policies and regulations, including any changes to the calculation of the maximum annual rent increase. Each Seattle City Council councilmember would appoint five renters who live in their corresponding district, along with one landlord who owns or manages at least one rental property in the district. The resulting 42-member Rent Control Commission would comprise 35 renters and seven landlords.

The Seattle Department of Construction and Inspections indicated in a fiscal note that setting up staffing and infrastructure for the rental registration and inspection program would cost over $5 million and take over two years to stand up.

Discussions on Council Bill 120606 will continue at the next Sustainability and Renters’ Rights Committee meeting on July 21.

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