OHCS Rent Increase Policy Up for Housing Stability Council Approval, But Lacks Transparency and Reporting of Outcomes.

At the scheduled Friday meeting of the Oregon Housing Stability Council this week a proposed rent increase policy is up for approval.   This is an updated policy to that proposed initially in a December 2019 Council meeting, (The policy begins on PDF page 67 of the meeting materials for the Friday meeting).

The new policy includes multiple possible procedures that vary by the threshold percentage rent increase sought, documents required for review, and review times. 

The default/simplest process would be for less than a 5% rent increase for existing and future tenants. The most complex process is for projects seeking rent increases of more than 7% plus CPI for both existing and future tenants. 

In reviewing the draft document I was surprised to find that outward looking transparency provisions were missing. 

I did not see any plan to publish regular location specific reports on the volume of applications received, outcomes of the review process, or approved rent levels that can help prospective tenants make informed decisions about where to live. 

In my earlier analysis of December 2019 proposed rent increase review procedures I made 6 specific related transparency suggestions; those suggestions remain relevant today (Note that page references and timing below relate to the earlier rent increase document and not the current document):

"Observation 1: The proposed policy briefing says (pg 71) that 600 requests have been reviewed under the former policy, but there is no data on what was requested and what was approved nor the times that it took to complete the reviews.  This information is vital to inform the decision making process. 
SUGGESTION 1. Retroactively (April 2018 to Nov 2019) and at least annually publish at the county level a summary of requests received, the existing and prospective increase rates requested, and the increase requests approved. 
Observation 2: The policy brief says (pg 91) that owners will be required to repay rents in excess of approved amounts but provides no information on how OHCS will discover excess rents. 
SUGGESTION 2: Clarify the procedure by which excess rents will be discovered, including the timing and the frequency of reviews intended to surface excess rents.
Observation 3: There is no way that I can see that a prospective tenant will know what the current allowable rent is except by contacting every project of interest. In the same geographic area, or even the same neighborhood, allowable rents for prospective tenants may differ significantly from the maximum rent using HUD income guidelines.
SUGGESTION 3:   Publish and regularly update the maximum allowable current rents for all projects (that are subject to the rent increase policy) on the web so that prospective tenants can effectively shop for the best choice/value for their needs. 
Observation 4: The enhanced review says that severe rent burdens will be part of the review criteria  (pg 79) and notes that OHCS already tracks severe rent burden data (pg 80). However, my recollection is that for 100% LIHTC projects tenant income data is not collected after the first anniversary and rent burden data calculated after the first anniversary may not be accurate if tenant income has increased.
SUGGESTION 4A: Clarify that the owner is permitted to obtain current income from existing tenants in preparing their request for an Elevated Review Rent Increase so as to accurately reflect severe rent burdens.
SUGGESTION 4B: Using the existing data source publish at least annually by county OHCS calculations of severe rent burdens for tenants of projects subject to the rent increase review policy. 
Observation 5:  I don't see any planned effort to solicit tenant or public input to the draft policy before possible adoption. 
SUGGESTION 5:  Post the proposed policy for at least 14 days on the OHCS website and solicit public and tenant input as well as other stakeholders." 

Originally created and posted on the Oregon Housing Blog.