South Portland council approves rent control, homeless shelter ordinances

SOUTH PORTLAND — The City Council gave final approval Tuesday night for a rent control ordinance that the city won’t enforce or apply to new construction, but it will give tenants added protection from exorbitant rent hikes and evictions without cause.

The new ordinance gives renters a stronger legal defense if a landlord violates the 10% annual rent cap, city officials said, but the city doesn’t plan to hire staff to enforce the cap or establish a rent control board to review complaints.

Apartments line Wainwright Circle in Redbank Village in South Portland. Gregory Rec/Staff Photographer

“The city is not in a position to hire new staff,” Mayor Kate Lewis said Wednesday. “This is a local law. It’s enforceable. The city will not be the enforcer. As conflicts arise, tenants would have to go through the normal legal channels. Their rights have been expanded.”

The council voted 4-3 on the rent cap, with councilors Misha Pride, Linda Cohen and Richard Matthews opposed. The council also unanimously approved ordinance changes that allow homeless shelters to be established in South Portland.

Faced with skyrocketing rents in some apartment complexes last spring, the council enacted a six-month eviction moratorium and a 10% annual cap on rent increases, which have been extended through May.

City officials have not presented the long-term rent cap as rent control – Lewis called it “a modest stabilization ordinance” – in part to avoid generating controversy like the tougher rent control ordinance in neighboring Portland, as well as the unintended consequences often attributed to rent caps, including forced rent increases and stifled housing development.

Portland’s rent control ordinance was passed via a citizen’s initiative in 2020 and further amended by voters last November. Overseen by a rent board, it limits annual rent increases to 70% of the rate of inflation, plus additional increases that can be sought in a limited number of scenarios, including 5% when a tenant voluntarily moves out. Rent increases also are limited to no more than 10% annually.

Portland city councilors voted this week to put a citizen-initiated referendum on the June ballot to eliminate the 5% cap.

South Portland’s rent control law caps annual increases at 10% for landlords or companies that own more than 15 rental units in the city. It also allows them to reset rents to market rates when units are vacated, but only once in a 12-month period.

The ordinance also prohibits landlords from reducing services as a way around the rent cap, which goes into effect on May 27 and will be on the books for seven years. It doesn’t apply to government-subsidized units and nonprofit property owners.

Councilors supporting the long-term cap said it’s geared to prevent price gouging by landlords without the unintended consequences feared by opponents, who also noted that the city’s recent housing needs assessment didn’t recommend rent control.

The cap applies to about 25 landlords that own more than 15 rental units each, according to city records. The largest include Redbank Village Apartments (502), 350 Clarks Pond (256), Olde English Village (204), Cortland Associates (188), Riverplace Properties (136), Sable Lodge (130) and Liberty Commons (120).

RULES FOR SHELTERS

The council also unanimously approved several ordinance changes that “expressly permit” homeless shelters to operate in South Portland.

City Manager Scott Morelli recommended the changes after several hotels in the city became temporary overflow emergency shelters for Portland’s Oxford Street Shelter during the COVID-19 pandemic and the state recently offered grants to establish more long-term shelters across the state.

The council added “shelter” as an allowed property use that provides temporary or transitional housing for people experiencing homelessness. It also divides shelters into three sizes:

• Large-scale shelter accommodates 40-100 people and requires special-exception approval from the planning board.

• Medium-scale shelter accommodates nine-39 people and requires special-exception approval from the planning board.

• Small-scale shelter accommodates up to eight people and is added to the city’s current definition of “community home,” which is a licensed single-family property that houses individuals with disabilities.

The total citywide occupancy of all large- or medium-scale shelters is capped at 200 people, which would allow four 50-person shelters or two 100-person shelters, for example. There is no limit on the number of small-scale shelters.

Like community or group homes, small-scale shelters are allowed wherever residential development is allowed.

Large- and medium-scale shelters are allowed in the Commercial General, Commercial Suburban, Professional Office and Light Industrial zoning districts. Medium-scale shelters also would be allowed in the Limited Business, Main Street, Village Extension, Broadway Corridor, Mill Creek Core and Meetinghouse Hill commercial districts.

Performance standards for large- and medium-scale shelters include a variety of design and operational features, such as personal storage, food, laundry facilities, designated smoking areas, outdoor areas, security, on-site support services, lighting, fencing, parking, waste management and access to public transit.