Lawmakers wary of proposed legislation that would allow rent control

EL PASO COUNTY, Colo. (KRDO) -- Legislation is in the works to allow local governments to enact rent control, bringing a potential solution to the housing affordability crisis. But not everyone is on board.

Colorado currently has a statutory provision prohibiting local governments from enacting rent control. State lawmakers passed the ban in 1981, and it has overcome multiple attempts to end the prohibition.

House Bill 23-1115 is the latest attempt from Colorado Democrats. If passed, the bill would end the prohibition and allow local governments to impose rent control on private residential property and housing units.

“Anybody who rents, whether you work as a server, bartender, at a grocery store or now even teachers and nurses are getting priced out across the state,” said Representative Javier Mabrey, the bill’s prime sponsor.

Rent control is implemented either statewide or by local governments in eight states — California, Maine, Maryland, Minnesota, New Jersey, New York, Oregon and Washington, D.C. However, the process varies. Generally rent control puts a ceiling on the maximum rent that can be charged for a unit, as well as the amount that the rent can be increased per year.

But not everyone agrees rent control is the best solution to address the housing crisis.

If passed, El Paso County Commissioner Carrie Geitner said she would not support any county laws allowing rent control. Her concern is that it will make housing less financially viable for developers.

“Whenever we create situations where it's just not economically viable for folks to provide housing, then they stop creating housing,” Geitner said. “When we have fewer and fewer units on the market, that leads to increased prices.”

Gavin Light, a developer and real estate investor, said there is a housing affordability crisis in Colorado Springs with rents doubling and tripling. However, he said refurbishing apartments or building houses are expensive, and the proposed legislation would cut into developers’ bottom line.

“There's going to be a lot of people that say, ‘We're not going to do this project in Colorado anymore, because the interest rates would be so much higher to finance a project because it wouldn't be as appealing for the costs of maintaining a facility.”

Mabrey said the cost to developers is due to restrictive zoning laws, not rent control.

“When you combine rent stabilization with policies that incentivize development, then you're really attacking the affordable housing question,” he said.

Geitner points to the high housing prices in the states that already have rent control as an example of why she’s wary of the legislation.

“Over and over again, rent control has been tried around the nation and it fails consistently,” Geitner said.

In a statement from Gov. Jared Polis’ spokesperson, he said, “Governor Polis is skeptical that rent control will create more housing stock, and locations with these policies often have the unintended consequences of higher rent."

However, Polis recognizes the “demand for housing continues to outpace the supply in Colorado. Colorado needs more housing options for every budget, for purchase and for rent.”