HOW DOES THE ORDINANCE WORK?
The ordinance has four components that provide the necessary protections for renters to be secure in their homes, while ensuring landlords can make a reasonable profit.
- Rent stabilization for large landlords: The majority of tenants are covered by rent stabilization, meaning that the rental increase on their apartment can only increase according to the rate of inflation (together with property tax rate, or investment in the unit). Rent stabilization does not apply to small landlords (those with five or fewer units).
- Just cause protections: All tenants with leases are covered by just cause protections that prevent arbitrary evictions. Tenants can only be evicted for specified reasons, such as destruction of property, harassment of other tenants, or failure to pay rent. Unfortunately, tenants-at-will (who do not have formal leases) are excluded from these protections under Maine law.
- Development exemption: all units built after Jan. 1, 2017 are exempted from the rent stabilization ordinance. Units in older buildings brought onto the market are exempted for five years. This provides an incentive for new units to be built and increase the supply of workforce housing.
- Tenant/landlord board: The tenant/landlord board (often called the Rent Board) is responsible for publishing the allowable rent increase each year, settling disputes between tenants and landlords, and making exceptions to rent stabilization for landlords who display financial need.
- Statistics on rents and vacancies for each neighborhood: The ordinance requires the city to publish statistics on the overall vacancy rate and rental prices of differently sized units (1 bedroom, 2 bedroom) for each of the city’s neighborhoods.
- Sunset clause: After seven years, the ordinance will either be renewed by the city council, or go back out for referendum for a public vote.
WHICH PROPERTIES ARE COVERED BY THE PROTECTIONS?
Several types of units are exempt from the rent stabilization part of the ordinance:
- Units owned by landlords with fewer than 6 total units
- In-law units (like a converted garage, basement or home addition)
- Government-run or assisted affordable housing units
- Special housing such as dormitories, assisted living, and convents
- Units built after January, 1, 2017
Just cause protections cover all tenants in non-governmental units, except for at-will tenancies.
WHAT ABOUT TENANTS-AT-WILL?
Unfortunately, tenants-at-will are a special class under Maine law and so we cannot as a city change their status. The city council can take steps to incentivize landlords providing leases, so please talk to your city councilor.
WHAT CIRCUMSTANCES ALLOW LANDLORDS TO FURTHER RAISE RENT?
In most years, landlords may only increase the rent once a year according to the rate of inflation (local CPI). If the city increases property taxes or municipal utility rates change, the tenant/landlord board will establish rental increases to cover a substantial fraction of these expenses.
If a landlord makes a necessary improvement to a property (installing a new water heater or more insulation), but the costs cannot be recouped based on the current rental price, they may apply for an exception from the tenant/landlord board. In nearly all instances, these increases can only amount to 10% of the current rent.
Landlords who require further rental increases to ensure a fair rate of return will be allowed these increase by the tenant/lanlord board.
CAN I SEE THE COMPLETE ORDINANCE?
The complete ordinance can be read here: [full referendum]