Portland City Council to Consider Limits on Security Deposits and Screening Criteria/Background Checks

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By Gordon R. Friedman – The Oregonian/OregonLive

Published 8-20-18

The Portland City Council will soon consider an ordinance to cap what landlords can charge for security deposits and limit how they may use renters' credit and criminal conviction history to deny them tenancy.

"Screening criteria and security deposit reform" will be the subject of an upcoming council agenda item, Commissioner Chloe Eudaly wrote in an August 14 post to her Facebook page. The ordinance is scheduled for a hearing September 20, said Eudaly spokeswoman Margaux Weeke.

It is exactly the kind of move that Oregon landlords feared when they banded together to try to raise $2 million to fight those and other restrictions they say will undermine their businesses.

Policymakers in other cities have also explored regulating security deposits, citing mounting pressures on renters who struggle to save up cash for move-in fees. New York City's comptroller in July introduced a deposit-limiting measure. The Seattle City Council adopted a similar ordinance in December 2016, and landlords filed a lawsuit to challenge it.

In Portland, landlords may currently charge what they like as a security deposit, and there are few regulations over how deposits must be returned after a tenant vacates. That would change under Eudaly's ordinance. In the Facebook post, Eudaly described one an effect of the ordinance as "limit security deposit requirements."

 

The ordinance would also change how landlords may use information about potential tenants. Property owners typically perform criminal records and credit history checks on rental applicants. Some renter advocates have described the background checks as offering landlords a pretense for discriminating against those with criminal pasts or poor credit.

 

Eudaly said in her Facebook post that changing how landlords may use information about rental applicants to deny them tenancy is in part intended to "reduce barriers to housing" and "prevent discrimination."

According to a draft of the ordinance provided by Eudaly's office, she has considered establishing a system that requires landlords to approve tenants on a first-come, first-served basis, though a minimum credit score would still be allowed.

To deny applicants, landlords would be required to rank applicants on their credit history, criminal convictions and housing record and give them a chance to provide favorable information.  

The draft ordinance includes a list of crimes that are not to be judged by landlords as meaning a tenant convicted of them would likely harm the property or cause the premises to be unsafe, if the applicant was sentenced at least three years prior or released from prison one year prior. The list includes felony assault and battery, felony burglary or breaking-and-entering, stalking and misdemeanor domestic violence, dealing or manufacturing illegal drugs, and non-forcible sex offenses, among others.

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