Rent control is further weakened in St. Paul

Landlords who own newer buildings in St. Paul will be free to increase rent as much as they like, after a divided city council voted to permanently exempt all buildings built in 2005 and later from the city’s rent control ordinance.

In a statement after the vote Wednesday, Mayor Melvin Carter said he hoped the permanent exemption, which he has been pushing for almost a year, would lead to more affordable apartments long-term.

“Our housing equity goals cannot be achieved without building more homes,” Carter said in a statement.

But as Carter celebrated, council members — even those who voted for the change — said they didn’t think that allowing limitless rent increases would outweigh factors like inflation and tariffs that are still pushing up the cost of new construction.

Interim Ward 4 Council Member Matt Privratsky, who voted for the new construction exemption, said he wanted the city to now focus on changing zoning and permitting processes to speed development, saying undoing rent control alone would not be enough.

“I don’t expect this vote to unlock development overnight,” he said Wednesday as he voted — with council President Rebecca Noecker and council members Anika Bowie and Saura Jost — to let newer buildings out of rent control.

The three who voted against the change, Council Vice President HwaJeong Kim and council members Cheniqua Johnson and Nelsie Yang, were far more skeptical that undoing rent control would spur development.

“To this day, I have not seen the data delivered,” Yang said, adding that she did not think the policy would lead to many new apartments.

But tenants will feel the effect, Kim said.

“Renters are again being marginalized,” she said.

Rent stabilization was supposed to keep tenants — now, only tenants of buildings built in 2004 and earlier — from having their rent raised more than 3% a year. The policy, approved by voters in 2021, was one of the strictest in the nation. Minneapolis voters tackled the issue at the same time, directing the city to investigate it, but no policy has been adopted.

In St. Paul, exemptions are common, leaving tenants in older buildings to either swallow rent increases or work through a city appeal process, which can take months.

Wednesday’s vote was never going to affect Peyton Nordby, a 22-year-old who moved to St. Paul from Fargo a year ago, into an older brick apartment building on Ford Parkway. It’s the kind of older building where rent stabilization is supposed keep rents in check, so low-income tenants don’t have to move every year.

Nordby lives in a one-bedroom apartment with his two cats, just a few minutes’ walk from his job at a shop in Highland Village.

But earlier this year, his landlord notified him that his rent would increase by 8% next year, which will be at least a $75 increase from his current rent of $940 per month. Maybe even more, Nordby said, because he got a discounted rate last year.

A 3% increase, the maximum allowed under rent control without an exemption, would have limited the hike to about $28 a month.

“It puts me in a tough spot,” Nordby said. Rent already eats up over half his monthly income.

Worried, and feeling like the rent hike was unfair, he went online and figured out how to appeal the increase. He paid a $25 filing fee and got a hearing date.

But Nordby decided not to go to his hearing, scheduled for May 8, the morning after the rent control vote. His landlord had pages and pages of documents showing how her costs had increased, and Nordby thought he’d be outmatched.

“It’s really stressed me out,” he said.

His parents will help pay some of the increased rent, he said, while he hunts for a second job.