(The Center Square) – After loosening the penalties, the Spokane City Council deferred a vote on Monday that could ban landlords from using “algorithmic rent setting” tools, delaying final action to next week.
Councilmember Zack Zappone proposed the ban last month after passing a few tenant protection laws last year. While those covered advanced notice of rent hikes, the right to air-conditioning and creating a rental registry, this ordinance aims to prevent “collusion” between landlords and property managers.
If approved, the ordinance would ban two or more landlords from comparing data and adjusting rents together, even if they own or manage properties in the same area. Seattle adopted a similar ban back in June, following major cities across the country, and the Legislature floated the idea earlier this year.
“We’ve done a little bit of stakeholder engagement since the last time we did an amendment on this,” Zappone’s legislative assistant, Jackson Deese, told the officials ahead of Monday’s legislative session.
The first change was defining “nonpublic competitor information,” which the ordinance would ban two or more landlords from using to adjust rents. According to the amendment, the phrase means data that is older than 180 days, otherwise unavailable to the public or relates to units owned by other landlords.
The ordinance also prohibits landlords from using algorithmic tools to “stabilize” prices. According to the amendment, “stabilize” means two or more people using nonpublic information “to coordinate the vacancy rates of residential rental dwelling units to generate favorable prices or terms of agreement.”
The last change loosens the consequences of violating the ordinance. While doing so could still result in a $5,000 fine per violation, the proposal no longer requires the city to revoke a landlord’s business license; instead, it shifts the language from “shall” to “may,” providing city officials discretion to decide.
“I’ll say, I appreciate those changes,” Councilmember Jonathan Bingle said Monday, representing half of the conservative minority and District 1. “Don’t know where I’m at on the ordinance, but also, do appreciate that it triggers an automatic one-week deferral to give people time to think about it.”
The council heard a first reading of the ordinance last week and had a final vote scheduled for Monday, but the amendment automatically pushed that to Dec. 1. Terri Anderson, interim executive director of the Tenants Union of Washington State, told the officials last Monday that the tools distort the market.
“It does not tell landlords what they can charge. It does not impose rent control,” Anderson testified last Monday. “What it does is ensure that price setting for renters remains competitive and transparent and driven by real people rather than outsource to AI and tools that undermine the free market.”
The Biden administration sued RealPage in 2024, arguing that its algorithms reduced competition and drove up prices. The Washington State Attorney General’s Office also filed a lawsuit in April, claiming RealPage is “cheating renters and pricing families out of stable housing,” according to a news release.
RealPage agreed to settle with the Trump administration on Monday after more than a year in federal court. Under the settlement, RealPage must stop using nonpublic data to set prices within 180 days.
The Washington State House of Representatives passed a proposal banning algorithmic rent fixing last March without a single Republican vote due to the significant Democratic majority. While the proposal stalled in the Senate amid a state revenue shortfall, Democrats could pick it up again next January.
“There has been a great deal of misinformation about how RealPage’s software works and the value it provides for both housing providers and renters,” Stephen Weissman, former deputy director for the Federal Trade Commission and one of RealPage’s attorneys, wrote in a news release. “We believe that RealPage’s historical use of aggregated and anonymized nonpublic data, which include rents that are typically lower than advertised rents, has led to lower rents, less vacancies, and more procompetitive effects.”
