City Attorney's Office

Landlords Sue City Over Restrictions on Move-In Fees

RHA officials argue the council's ordinance is reducing options for affordable housing.

By Hayat Norimine May 31, 2017

Council arfqmm

Sean Flynn, president of the Rental Housing Association, once officiated his tenant's wedding. He says he misses the days when landlords and tenants knew each other—and he blames Seattle's affordable housing crisis in part because of its own laws that, he argues, push small landlords out of the picture. 

RHA, representing landlords, on Tuesday sued the city of Seattle for an ordinance council members passed in December restricting security deposits and move-in fees. The organization is seeking a permanent injunction to invalidate the legislation.

The RHA argues that the bill violated a 1981 state statute, which prohibits cities from controlling or regulating rent, and the state Constitution (Article I, sections three, five, and 16). The city attorney's office declined to comment pending litigation. 

In a strongly worded speech at a press conference Tuesday, Flynn said the city's been obstructing its only option for "organically affordable" housing. (RHA's average membership adds up to roughly 5,400, and the average member owns less than three units, according to its officials.)

"This city council never has missed a chance to lambast, demonize, and to finally hold small landlords responsible for the problems that they did not create," Flynn said Tuesday. 

The ordinance, sponsored by Kshama Sawant, was intended as relief for tenants who have seen their rents rise and faced financial obstacles to move. Typically rental units can demand first and last months' rent, a security deposit, and other move-in fees, making it challenging for tenants to find other options when they face rent hikes. 

RHA spokesman Sean Martin, however, said two-thirds of its members already don't charge last months' rent, and the policy is something big developers—who own hundreds of units—can handle, at the expense of small landlords.

Flynn argues that the "cocktail of ordinances" the city's passed is having the inverse effect for which it was intended, driving out the middle part of the market. For one thing, the legislation provides the option to spread out a security deposit over six months; RHA officials said that creates more risk for landlords, and to compensate for that risk, they would more likely charge last months' rent when they previously didn't.

"This is not a landlord-tenant problem," Flynn said. "This is a city planning problem."

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