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Minneapolis officials get an earful about proposed rules on renter screening, security deposits

South Minneapolis apartments
MinnPost photo by Peter Callaghan
The offices of City Council President Lisa Bender and Council Member Jeremiah Ellison — who are sponsoring the proposed changes as part of a broad push to strengthen renter protections.
Following a series of protests by landlords and rallies by renter-rights groups in Minneapolis, city staff are preparing to release new drafts of ordinances that would change how property owners can screen prospective tenants while also establishing limits for security deposits.

The offices of City Council President Lisa Bender and Council Member Jeremiah Ellison who are sponsoring the proposed changes as part of a broad push to strengthen renter protections are writing new language based on a flood of public feedback from landlords, renters and colleagues that followed the release of draft ordinances, Bender said Thursday. 

Along with emails from residents and input from city officials in other metros, she said they are considering comments from the city’s citizen-led Advisory Committee on Housing, which met Thursday in City Hall to formalize its recommendations for the proposals and forward that feedback to council members.

In addition to the cap on security deposits, the proposed policy package would limit what aspects of renters’ credit, criminal and eviction histories landlords could consider. Supporters of those provisions argue the changes are necessary because the current process can include facts that are not indicative of a person’s ability to be a good tenant, though landlords can use that information to deny applications. 

“Everybody deserves housing,” said committee member Brenda Marcos. “It doesn’t matter where you’re coming from, who you are you deserve safe and affordable housing.”

Meanwhile, a group of property owners has pushed back against both proposals, describing them as a misguided effort to increase renters’ access to housing — one that could have unintended consequences for the city’s housing market and tenants’ safety. They want the council members to step away from the initiatives all together.

Our primary responsibility is always the safety of all of our residents and the continued financial viability of our property,” said Cecil Smith, a property owner who is also a part of the city’s advisory committee. “That [proposed change] imposes a one-size-fits-all solution that doesn’t understand that screening criteria are there to manage risk.”

What’s being proposed

Under the current tenant-screening proposal, property owners would not be able to use felony convictions that occurred more than five years ago, or misdemeanor offenses that are more than two years old, to determine applicants’ eligibility. They also wouldn’t be able to use vacated or expunged convictions; arrests that did not result in convictions; or juvenile convictions. 

There is data to suggest that crimes more than 5 years old made no impact on people’s ability to be a good tenant some of those lower level offenses should no longer apply,” Ellison, whose Ward 5 covers much of north Minneapolis, said in an interview last month.

Under the proposal, however, property owners would maintain the ability to deny tenants with certain high-level criminal convictions, including sex offenses against minors and crimes involving methamphetamine. Ellison said he and Bender are open to adding to that list of exceptions.

MinnPost photo by Jessica Lee
Advocates for renters rights shared personal stories of how existing screening policies have barred them from housing in front of City Hall on Thursday.
The ordinance would also prohibit landlords from denying people due to their lack of credit, as well as implement protections for prospective tenants with a minimum credit score of 500. Property owners also wouldn’t be able to consider previous eviction judgements technically called unlawful detainer (UDs) that are three years or older.

Landlords would have the option to not adopt the screening standards if they conducted individual assessments, which would have to consider additional information from applicants before making decisions. According to the draft ordinance, that could include information such as documentation proving six or more months of job or income stability; the completion or enrollment in job training; six or more months of on-time rent payments; the completion of credit counseling, or “any other evidence that the applicant believes mitigates the significance of the specific barriers identified in an applicants history.” The advisory committee on Thursday requested more clarification on that part of the proposal.

As part of a separate proposal, the council members also want to disallow landlords from collecting security deposits that are more than half one month’s rent in cases where applications already require first and last month’s rent, as well as deposits that are more than one month’s rent in cases where applicants don’t have to pay last month’s rent. The ordinance would also allow tenants to pay security deposits in installments over a three-month period in some cases and prohibit landlords from collecting more than 25 percent of one month’s rent for pet damage deposits.

Landlord group: proposals don’t get to the root of housing issues

Opposition to the possible changes is being spearheaded by the Minnesota Multi Housing Association (MHA), which advocates on behalf of some 1,900 property owners and whose campaign against the proposals features hot pink, yellow and orange yard signs calling for SAFE & AFFORDABLE NEIGHBORHOODS MINNEAPOLIS. 

Leaders of the group argue that if the city limits the criteria available to screen potential tenants, some landlords will find alternative ways to bar applicants. They also say the proposals could raise the costs of insurance, further restraining housing development.

Smith, who previously chaired the MHA, said the group understands the challenges for people hunting for housing in today’s market, and that some of those people face barriers due to their credit and criminal histories. But the proposed ordinances do not get to the root of those issues, he said, which is a lack of affordable housing that fits all lifestyles. 

“Rather than just changing the entire market by adjusting the screening criteria … we need to get production going,” Smith said. “Right now, we have either homelessness or an apartment and there may be some sort of transitional housing in between, but there is no spectrum of housing opportunities.”

Chloe Jackson
MinnPost photo by Jessica Lee
Chloe Jackson, a long-time renter in south Minneapolis and leader of the renters advocacy group InquilinXs UnidXs por Justicia, said she’s received requests from landlords for two times their normal security deposit, as well as first and last month's rent, due to her low credit score — a result of student loans and medical bills for her son.
As owner of Cornerstone Property Professionals, a Minneapolis real-estate property company, Smith said he considers applicants’ criminal history within a window of five to 10 years of incarceration. He said he screens for high-level offenses, including arson, sexual misconduct and behaviors that would make neighbors feel unsafe or nervous. Smith also stressed that landlords already must follow federal standards that ensure the protection of certain classes defined under discrimination laws.

In terms of how landlords use credit scores to determine eligibility, Smith said every property manager “manages their own risk” and sets their own criteria for credit histories, though he emphasized that credit scores below 500 carry a 70 percent chance of delinquency, according to the Federal Deposit Insurance Corporation (FDIC).

Advisory committee weighs in

Bender  and Ellison are making the push for changes, in part, as a response to the city’s shifting demographics. Renters now making up 53 percent of all households in Minneapolis, and the shortage of housing at all income levels is raising prices and competition among prospective tenants.

Those trends led to the creation of the 21-member advisory committee appointed by Mayor Jacob Frey and the council, and includes experts in business and homeownership disparities. Each member serves a two-year term, and the committee meets monthly to discuss possible ideas for the mayor and City Council to consider while writing new housing policies.

On Thursday, some committee members said they want council members to think bigger about how they can eliminate housing barriers for certain groups of people, such as victims of domestic violence, or implement pilot programs to test new ideas.

Cecil Smith, a property owner who is also a part the city’s citizen-led Advisory Committee on Housing.
MinnPost photo by Jessica Lee
Cecil Smith, a property owner who is also a part the city’s citizen-led Advisory Committee on Housing.
Smith has advocated for market-driven solutions instead of the current proposals. He said the city should focus on removing regulatory barriers that keep alternative forms of housing such as co-living buildings where tenants share bathrooms and other amenities, tiny houses and home sharing from having a stronger role in the market. He also advocated for the launch of an online system for submitting all applications for low-income housing. Portland, for example, uses a program called OneApp that screens renters against landlords’ individualized sets of criteria to show the tenants where exactly they qualify.

“The intention of the ordinance is to go against egregious practices, but the scope of the ordinance makes [the screening criteria] too restrictive,” he said.

Dr. Brittany Lewis, who is a senior research associate at the University of Minnesota’s Center for Urban and Regional Affairs (CURA), is a member of the committee, too. In her remarks Thursday, she pointed to her findings in a 2019 CURA report that studied the disproportionate impact of rent hikes and evictions in north Minneapolis neighborhoods; The communities account for only 8 percent of Hennepin County’s rental units, but they tally half of the county’s eviction cases, the study showed. 

She also questioned how, or to what extent, the city would enforce the ordinances. During background checks, for instance, property owners could uncover felonies that are more than five years old, and they could find reasons to deny those applicants on a different basis.

“On paper all of this sounds good,” she said. “But in reality there are evictions records still showing up … same with criminal background.”

For Marcos, another member of the advisory group, the debate is personal. About three months ago, as she was filling out applications for new housing in Minneapolis, she said landlords repeatedly denied her because of a felony on her criminal record, which she said she received as a victim of sex trafficking 18 years ago in Texas. 

On Thursday afternoon, shortly before the advisory committee meeting, she joined about two dozen supporters for a rally near the light-rail platform outside City Hall.

“I’m a survivor of sex trafficking and homelessness,” Marcos told the crowd. “I live in a small little room that I rent for $750 a month because it was all I could get. …I have a lot of things going in my life I’m a student at Metro State but I can’t rent your apartment? It’s so sad. And I can see why people would go, ‘What’s the use of trying?’ and, you know, a lot of people give up.”

What’s next

In their recommendations to Bender and Ellison, several members of the advisory committee voiced support for the draft ordinances as they are written, or asked for minor technical clarification on certain details including if, or to what extent, the policy changes would affect public housing.

Bender said city staff anticipate releasing new versions of the draft ordinances before the end of the month. After that, the council will schedule a public hearing on the proposed changes. The council president said she hopes to finalize the policies in late summer or fall.

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Comments (12)

  1. Submitted by Vonnie Phillips on 07/12/2019 - 01:32 pm.

    One thing that can bridge the gap with landlords and potential tenants, are programs, especially those with Section 8 and section 42 housing vouchers, teaching how to be a good tenant, which I have yet to hear or read anything on this topic from the Minneapolis City Council. As a minority that was once poor in my life, when I was a tenant, I was very conscience to ensure that I left the apartment that I rented better than I found it when I moved in. I live in South Minneapolis, the litter itself is disturbing, shameful, whereas trash containers are in plan view, however, using the back and front yards as a dumping ground is preferred, litter is in plan view; tenants gather round their HOME where they Live and don’t even pick it up. It goes far beyond paying the rent, but also being proud of where you live, the space that you rent is your home, but lack of care of that rented space is what drives unfounded perceptions, and these perceptions are imputed to good and responsible people that want to be good tenants, but not afforded and denied opportunities to rent because of landlord unfounded perceptions, which has been built up over a period of time. Has the City of Minneapolis discussed programs for tenants on how to be a GOOD NEIGHBOR, NO THE CITY HAS NOT. Sometimes a political incorrect conversation needs to take place to address issues to solve problems, which the City is not willing to engage in.

    • Submitted by Kamille Cheese on 07/12/2019 - 06:19 pm.

      Bravo! As a FORMER rental property owner, although not in this state, the idea of programs for tenants are valuable for both tenants and landlords. Tenants need to understand that landlords have obligations as to expenses incurred to rent property such as mortgages, insurance, property taxes, up-keep, etc. We decided to sell all 3 properties because of expenses going out and only excuses for rent not coming in timely and in full. We tried to work with tenants as best we could. I would never provide anything for rent ever again.

    • Submitted by lisa miller on 07/13/2019 - 02:22 pm.

      Section 8 here has a program that encourages renters to save and offers financial planning with incentives. The county economic assistance also offers financial planning when people seek out emergency assistance to pay down utility/rent bills which they can access once a year if they financially qualify.

  2. Submitted by Dennis Wagner on 07/12/2019 - 08:02 pm.

    As noted above, what is the renters responsibility to be a good tenant? Not even in the discussion, its everyone else’s problem! Very good comment VP.

  3. Submitted by Linda Rolf on 07/12/2019 - 10:54 pm.

    It is commendable that the MCC wants to remove barriers to renting for those with criminal histories or low credit scores but the main problems are the cities’ high occupancy rates and that rents are continually being raised due to the luxery appartments that are sprouting up all over Minneapolis. If there are no apartments to be had, then everyone’s out of luck.

    • Submitted by Pat Terry on 07/15/2019 - 04:30 pm.

      Completely wrong. Rents are going up because there is a housing shortage and low vacancy rates. The addition of new housing is a solution to the problem, even if the new housing is not affordable to all.

  4. Submitted by joe smith on 07/13/2019 - 07:23 am.

    So now housing is a human right? Having owned rental properties here in Twin Cities, I found having good renters a breeze to deal with and bad renters a disaster (a string of bad renters). I sold my units a few years ago because it wasn’t worth the headache anymore. Bottom line for renters is simple, you do not own the property, so please pay rent on time and respect the place where you are staying. Not that hard!

    • Submitted by Dennis Wagner on 07/16/2019 - 08:00 am.

      You know, it depends on your perspective, there are American Indian tribes that still live like integrated communities, no homelessness and everyone gets to see the doctor, not saying that they have single family condo’s and premium health care. Point is that perhaps instead of spending $3/4 T on defense every year, or a $T & 1/2 on billionaire tax breaks we could invest in some alternative ideas. But then you have to be somewhat open minded and care a little about your fellow American/planet earth neighbor to do things like that.

  5. Submitted by Kathie Noga on 07/13/2019 - 03:47 pm.

    The one which I think is the most unfair is the credit score. There are many people who pay their rent faithfully every month, but their credit score has been effected by the recession in 2008. I have exemptions from creditors because I have used a number of human service programs since that time, so I have not paid some credit card debt because of this. I have always paid my landlords, though. Many people in that category. However it would be hard for me to get another place because the credit score problem even though I am a model tenant. Housing is a human right, yes. I have friends who are good landlords and I have friends who are for renter’s rights. I think we can make the system fairer. I have seen some landlords who do not fix items in apartments. Not good. Some landlords are doing okay with this. I think we need to build more public housing, coops for ex-offenders, coops for others who fall through the crack of the system, housing supported by city, county and non-profits which address housing rights.

    • Submitted by Michael Ofjord on 07/13/2019 - 05:46 pm.

      I like some of Ms. Noga’s ideas such as coops and nonprofits for those who can’t find rent for whatever reason. Of course, there needs to be education and listening by both tenants and landlords. As has been stated with other articles, the elephant in the room is wages not keeping up with housing costs over the past several decades. I would also note for those who believe there is no responsibility put on tenants, those who applied for Section 8 housing have mandatory meetings, which includes tenant responsibility.

    • Submitted by joe smith on 07/13/2019 - 06:03 pm.

      Kathie, housing is no more a human right than healthcare. They both are services we pay for. Doctors go to Med school come out and start a business, houses are built by workers and we pay for the right to own or rent their work. BTW, your bad credit falls off report in 7 years, so the folks screwed by the 08 subprime loan debacle are free of that negative score.

  6. Submitted by mark leighton on 07/14/2019 - 02:38 pm.

    I have been fortunate to always , but hard to pay my own way. The problem of affordable housing is very complicated. There are good people and bad people people and people who own and people who steal.
    The real story is become responsible as a citizen do right and earn your own way.

    Govt regulating rental, business, Contruction etc only gets in the way of the right way


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