Orange County voters will be asked if they believe controlling rent is a worthy attempt to address the affordable housing crisis in Central Florida.
The Orange County Board of Commissioners voted Tuesday, Aug. 9, to put a rent stabilization ordinance on the ballot come November.
The proposed ordinance prohibits landlords from increasing rents on residential units located in a multifamily structure with four or more units in excess of the existing rent multiplied by the Consumer Price Index for a period of one year.
As explained by the U.S. Bureau of Labor Statistics, the CPI measures “average change over time in prices paid by urban consumers for goods and services as published by the U.S. Department of Labor’s Bureau of Labor Statistics.”
In addition, landlords are prohibited from increasing rents on said units more than once in a 12-month period.
The limitations on rent increases apply regardless of a change in tenant occupancy.
Although the ordinance will apply to only certain types of rental units, it will impact all rental units in Orange County’s 13 municipalities.
Of the approximately 584,000 total housing units in Orange County, about 230,000 are rental units, according to an analysis by the CoStar Group.
However, several types of units will be exempt from the ordinance including seasonal or tourist rentals (timeshare/hotel/motels); second housing units (accessory dwelling units); units located in luxury apartment buildings (as defined by Section 125.0103, Florida Statutes); dwelling units located in a single-family home/townhome/condo/mobile home; units that a government agency or authorities own; dwellings located in cooperative apartments occupied by a holder of a proprietary lease; dwelling units located in a disability facility, hospital, nursing home, assisted care community or other health care facility; rental units for which the landlord receives federal, state or local housing subsidies; rental units that are currently under rent control (local/state/federal housing subsidy); and new rental units that have received a Certificate of Occupancy on or after the effective date of the ordinance.
In addition, the board said it will adopt a resolution with rules establishing a process by which landlords can request exceptions to the limitations on rent increases based on the opportunity to receive a fair and reasonable return on investment.
The proposed ordinance was passed, 4-3, with county commissioners Nicole Wilson, Mayra Uribe, Maribel Gomez Cordero and Emily Bonilla in favor.
Wilson said she has heard commentators call the proposal a “rent freeze” but that the ordinance is far from the rent control measures used in other states and cities.
“Florida law prohibits rent control except under temporary, and narrowly applied circumstances, so the first big difference I try to point out is that this measure, if passed, is only applicable for one year,” Wilson said. “If there is a will to reinstate the ordinance, it would have to go back to Orange County voters in another referendum.”
Wilson said even if the ordinance passes, it will not be a panacea.
“At best, this is a slight tap on the brakes for renters who are experiencing rent increases at breakneck speed,” she said. “It will sunset after a year — or go back to the voters, so we have to move quickly on the other strategies to increase supply and provide relief. I have been trying throughout to address the barriers to good housing development through code updates. I am a huge proponent of inclusionary zoning and mixed-use redevelopment. I also believe parking minimums are bad for housing and bad for our environment.”
Mayor Jerry Demings, Victoria P. Siplin and Christine Moore opposed the ordinance.
Demings said the county is in need of dollars to help the crisis and he does not believe the rent stabilization will accomplish what most think it will.
“I think what has really worked for our community is the fact that we have provided that rental assistance, that is what has kept people in their homes and that’s what will keep people in their homes,” Demings said.
Not all are in favor of the proposed rent stabilization ordinance, and the referendum has generated a multitude of varied opinions.
Elvis Johnson, a 35-year Orlando landlord, said he isn’t sure what the county is trying to accomplish with the proposed ordinance.
“It seems very confusing, with a lot of biased loopholes,” he said. “It sounds like an empty political promise and unfair rule that hurts the chosen few landlords and doesn’t really protect the proper people.”
In addition, two Orlando-based real-estate industry associations, Florida Realtors and Florida Apartment Association Inc., filed a complaint, with the help of Miami-based law firm Shutts & Bowen LLP, against Orange County and Orange County Supervisor of Elections Bill Cowles in the Ninth Judicial Circuit Court of Florida Monday, Aug. 15.
According to the complaint, the associations charge that the ballot measure violates state law and seek an injunction to prevent the county from holding the referendum on the ordinance to cap rent increases.
Amanda White, government affairs director at the Florida Apartment Association, weighed in on the pending litigation.
“Last week, despite feedback from experts and professionals in the rental housing industry, the Orange County Commission voted to move a fundamentally flawed rent control measure to the General Election ballot,” she said. “Throughout several workshops, FAA and even the county’s own hired experts pointed out the realities of Florida law and the fact that Orange County’s proposal failed to meet the high bar established under statute. It is unfortunate that a majority of the Orange County Commission disregarded the law and instead moved to place this measure on the ballot.”
According to Florida Statutes (125.0103) controls on rents cannot be established, except in the case of a declared housing emergency.
The state statutes only allow for that period to last for a year, even in a declared emergency, and it must be found “that such controls are necessary and proper to eliminate an existing housing emergency which is so grave as to constitute a serious menace to the general public.”
The associations are requesting the court to take the following actions: A declaratory judgment that the ordinance is invalid, a declaratory judgment that the wording set to appear on the November ballot is “defective” and “misleading,” and a permanent injunction preventing Cowles from conducting the referendum or tabulate, report or certify any votes cast in the rent stabilization referendum.
Orange County Government officials said the county does not discuss pending litigation.
Orange County currently is experiencing a housing emergency as evidenced by a shortage in housing units, as well as by increasing population, housing prices, rental costs and eviction rates.
To support renters, the County Commission voted unanimously to put a Rental Notices Ordinance in place to protect tenants by requiring landlords to give a 60-day written notice for rent increases of more than 5%, on July 26.
The ordinance is effective throughout all of Orange County, including all 13 municipalities.
Additionally, the commission said it is bringing back a revamped Emergency Rental Assistance Program 2 in August and a Tenant Bill of Rights work session in September.
The commission is also continuing to explore discussions regarding local strategies to expand housing supply such as the State of Development Activity in August, the Affordable Housing Trust Fund Plan Update in September and specific strategies to increase housing supply in November.
The commission passed the rent stabilization ordinance to combat the issue.
A referendum on the ordinance will be held at the next general election Nov. 8.
Orange County said the ordinance may be enforced by code enforcement officers, including county and municipal code enforcement officers, and any law enforcement agency having jurisdiction. Violations could result in fines of up to $500 and 60 days in jail. Additionally, the county could impose civil fines through its code enforcement board or special magistrate or issue civil citations through its code enforcement citation program.
Tenants may also seek relief through private civil action.
If passed, the ordinance will expire one year after the effective date.