By Adam Pagnucco.
In separate press releases, County Executive Marc Elrich and most members of the county council have announced their intent to introduce competing rent control bills. This sets up a long-anticipated legislative battle which will rage for months to come.
The first bill, referred to as anti-rent gouging legislation, would limit rent increases to eight percent plus the increase in the consumer price index (CPI). It would exempt new construction for 15 years and provide “an allowance for building owners undergoing major renovations or financial hardship to ensure safe and dignified housing.” The bill is paired with promises of tens of millions of dollars in rental assistance. The bill’s sponsors are Council Members Natali Fani-González, Gabe Albornoz, Marilyn Balcombe, Sidney Katz, Dawn Luedtke and Andrew Friedson.
The second bill, referred to as the Housing Opportunity, Mobility and Equity (HOME) Act, would limit rent increases to the current voluntary guideline (which is based on the rental component of the local CPI) or three percent, whichever is lower. It would exempt new construction for ten years “and units connected to government programs, healthcare facilities, nursing homes, and owner-occupied units.” The bill also includes “an excise tax on rental units that remain vacant for more than a year” and promises funding for affordable housing. This bill’s sponsors are Council Member Will Jawando and Kristin Mink and County Executive Marc Elrich.
I will have a lot to say about these bills and rent control in general very soon. But for the moment, let’s review what the two sides have to say. Following are the press releases on the competing bills.
*****Press Release 1*****
From the Offices of Councilmembers Fani-González, Albornoz, Balcombe, Katz, Luedtke and Vice President Friedson
Councilmembers Unveil Tenant Assistance and Protection Package to Address Growing Crisis in Housing Affordability
Comprehensive proposal makes historic new investments in rental assistance, introduces legislation to combat rent gouging, boosts access to homeownership and supports income-restricted affordable housing
ROCKVILLE, Md., March 2, 2023—Councilmembers Natali Fani-González, Andrew Friedson, Gabe Albornoz, Marilyn Balcombe, Sidney Katz, and Dawn Luedtke today announced a bold new proposal to alleviate pressures on the County’s most vulnerable renters. Like most similar jurisdictions throughout the country, Montgomery County faces a housing affordability crisis.
The County has a tremendous housing challenge, with 41,000 housing units needed by 2030 to accommodate population growth and alleviate pressure on county renter households that are cost burdened. Based on a County-specific study, extensive research including from the NYU Furman Center, and the real-world experiences of other jurisdictions across the country, particularly Oregon, Minnesota, and California, the Tenant Assistance and Protection Package will provide direct assistance to the most vulnerable residents, protect against rent gouging, provide access to homeownership to build generational wealth, and increase supply of income-restricted affordable housing.
Anti-Rent Gouging Legislation
The first component of the Tenant Assistance and Protection package is anti-rent gouging legislation that eliminates excessive rent increases in a way that doesn’t threaten new housing construction which is essential for Montgomery County to meet its regional targets. The legislation would cap maximum rental increases in multi-unit buildings at eight percent plus inflation (based on the consumer price index). The legislation provides for a 15-year exemption for new construction and provides an allowance for building owners undergoing major renovations or financial hardship to ensure safe and dignified housing.
$30 Million in Rental Assistance
Essential support for renters in need of financial assistance is also a key component of the comprehensive package that would increase Montgomery County’s Rental Assistance Program to $30 million. This additional $18 million investment represents a 150 percent increase from pre-pandemic levels. This puts more resources directly into renters’ hands who need it the most.
The sponsors of the Tenant Assistance and Protection Package are calling on County Executive Marc Elrich to include these funds in his recommended budget, due for submission to the Council on March 15.
$4.5 Million in Homeownership Access
With the goal of increasing homeownership opportunities in historically underserved communities and to help residents build generational wealth, the package includes $3 million in funding to support first-time homebuyers, with $1.5 million allocated homeowners who are most at risk of losing their homes. This $4.5 million in funding would come from the 2022 American Rescue Plan Act.
Concurrently, led by Chair Andrew Friedson, the Planning, Housing and Parks Committee is developing a new revolving affordable housing fund with a goal of reaching $50 million. This fund will support nonprofit housing providers modeled after the successful Housing Production Fund created in 2022 and augmented in 2023.
This comprehensive package of robust rental assistance, increased affordable housing production, and anti-rent gouging regulations follows research and lessons learned from other jurisdictions to target support and protections to the most vulnerable residents without discouraging desperately needed investment in housing production and building maintenance.
# # #
*****Press Release 2*****
From the Offices of Councilmembers Will Jawando and Kristin Mink
Councilmember Will Jawando, Councilmember Kristin Mink, and County Executive Marc Elrich Spearhead the Housing Opportunity, Mobility and Equity (HOME) Act
ROCKVILLE, Md., March 2, 2023—On Tuesday, March 7, Montgomery County Councilmember Will Jawando, Councilmember Kristin Mink, County Executive Marc Elrich, and community organizations will hold a press conference discussing the introduction of the Housing Opportunity, Mobility, and Equity (HOME) Act.
The HOME Act helps keep renters in their homes by preventing rent gouging, reducing displacement, and creating cost predictability for renters and landlords. The Act sets a limit on the allowable annual rent increase for units to follow the Voluntary Rent Guidelines (VRG) or 3 percent, whichever is lower. The Act would exempt certain buildings from rent increase requirements, including newly constructed units for ten years and units connected to government programs, healthcare facilities, nursing homes, and owner-occupied units. The HOME Act also permits landlords to request a fair return increase, establishes an excise tax on rental units that remain vacant for more than a year, and funds affordable housing acquisitions.
“With our renting population and income inequality both continuing to increase, this is a common sense measure to provide stability and consistency for everybody, our renters, landlords and developers,” said Councilmember Jawando. “We need more housing and renter protections and can accomplish both. While we’ve made progress, too many renters are facing potential displacement or eviction as a result of exorbitant rent increases.”
“Renters in Montgomery County face enormous uncertainty in their housing costs. Temporary rent stabilization protections expired last August, and the number of evictions scheduled here have increased tenfold since this time last year,” said Councilmember Mink. “We’re now averaging well over 300 evictions scheduled every month, compared to 35 last February. The HOME Act directly addresses this crisis by providing predictability in housing costs for renters, with a cap that’s in line with regional standards as well as long-standing standards set by Montgomery County, all while ensuring landlords maintain fair returns on their investments.”
“Over the last year, we have received reports of rents around Montgomery County increasing in excess of 10 and 15 percent per month – that is not affordable,” said County Executive Elrich. “Ultimately, rent stabilization is about stable homes, stable communities and equity. This bill gives renters protection from unnecessary rent increases awhile ensuring that property owners are able to maintain their property and continue to earn a profit. It is absolutely the right thing to do. I want to thank Councilmember Jawando and Councilmember Mink for sponsoring this legislation. I support this bill, will advocate for its passage, and look forward to signing it into law.”
Community advocates and organizations will join Councilmembers Jawando and Mink and County Executive Elrich to provide remarks on the bill and take questions from the press.
WHO: Councilmember Will Jawando
Councilmember Kristin Mink
County Executive Marc Elrich
Community Advocates and Organizations
WHEN: Tuesday, March 7, 2023 at 12 p.m.
WHERE: Steps of the Council Office Building, 100 Maryland Ave., Rockville, MD
Members of the media are welcome and must RSVP to Councilmember Jawando’s Communications Director, Morgan Wright, at Morgan.Wright@montgomerycountymd.gov.
Press are encouraged to contact both Councilmember Jawando’s and Councilmember Mink’s offices (councilmember.mink@montgomerycountymd.gov) for comment before the press conference.
# # #