St. Pete City Council members fear ‘extremely likely’ lawsuits over rent control

ST. PETERSBURG — A state law enacted almost 50 years ago that defined luxury rentals as buildings with average rents of $250 may be the biggest impediment to installing rent control.

In today’s world, that could mean a rent of $1,150. That drew scoffs from the larger-than-normal audience gathered Thursday morning to hear the city legal department’s highly anticipated presentation on rent control.

The legal opinion they heard dissuaded members of the City Council’s Housing, Land Use and Transportation Committee. They voted 3-1 against advancing a “statement of belief” to the entire City Council that the city has a housing emergency.

State law exempts “luxury rentals” from rent controls. But St. Petersburg’s rapidly rising rents have made even modest apartments far from exclusive neighborhoods charge monthly rents higher than $1,150.

Even if the city pursued rent control through the narrow legal path allowed in state statute, city attorneys said it could make St. Petersburg susceptible to lawsuits the city would be “extremely likely” to lose with damages of up to tens of millions of dollars.

“I think that there will be very high risk that we would lose, to be perfectly blunt about it,” said city attorney Joseph Patner. “Frankly, you can look at it as poison pills, you know, not to be pejorative, but in the statute, it’ll be very difficult for us to prevail on an attempt to defend any ordinance that implemented what they call rent control, rent stabilization.”

This is how it would work if the City Council were to proceed: the City Council would have to make findings and hold a properly noticed meeting establishing a housing emergency, the definition of which city attorneys said was open to interpretation. Their analysis found that a housing emergency was used in the context of war, particularly World War II, when rent control was enacted in several places to help with the war effort.

A referendum would be put to voters, likely on the November ballot. If approved, it would expire in one year and could only be renewed with another referendum. It also wouldn’t be imposed on second homes, seasonal or tourist units or residential “luxury apartment buildings,” defined as buildings in which average rent in 1977 was $250 per month.

Attorney Brad Tennant said, according to the consumer price index, that would be $1,150 today. He said the city would argue that adjustments would have to be made to further account for inflation.

Patner said the statute specifies that the burden of proof lies with the city rather than the lawsuit’s plaintiff, a first in his 30-year career defending civil lawsuits.

Council Chairperson Gina Driscoll, who is a renter, said she feared that rents below $1,150 would continue to increase between now and November, so rent control wouldn’t apply to those landlords.

“We could actually see this backfire this year and put us in an even worse position,” she said. “I don’t want to pay tens of millions to landlords in litigation. I’d rather use that same money to help renters long term.”

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Assistant City Administrator Rob Gerdes said the city’s position is not to pursue rent control. He said the city will have an update in March about the results for the first two years of the city’s 10-year housing plan.

Before he was even sworn in, Mayor Ken Welch told the Tampa Bay Times that he had already received calls about state lawmakers warning him about pursuing rent control and reparations.

“We do believe that really there is just too much risk,” Gerdes said. “We would prefer to look at the current solutions we’re working on and expanding those. Solutions we know are legal and can help our residents in the city.”

Gerdes said the city has distributed $16 million in rental assistance to households under 80 percent of the area median income of $72,700 in Tampa Bay. Those funds are now down to $200,000, but he said the city is working with Pinellas County to secure another $20 million.

Council member Richie Floyd, the first Democratic Socialist elected in Florida in recent history, said rents in his district of North Kenwood and Disston Heights have increased 30 percent on average this year. He said the consumer price index does not define the price of housing.

“I feel like people in here are looking for the downside instead of any honest upside at all. And I’m disappointed in that,” Floyd said. “The emergency is that we’re facing widespread displacement. People who have lived in the city and have made it their home for generations are being kicked out. … It’s not going to stop. The market has failed. It’s failed to provide for human need.”

Floyd proposed for the whole council to have the chance to declare a housing state of emergency, which wouldn’t be the first step toward enacting rent control, but would give “a statement of belief of what the situation is that we’re in right now.” He was the lone yes vote. Committee members Driscoll, Brandi Gabbard and Ed Montanari voted no.

Gabbard said council members received 294 emails calling for a housing state of emergency. She said the city should work on immediate actions to help people, get serious on rezoning, focus on housing-first policies for city-owned land and better use the $45 million allocated to the city from the American Rescue Plan Act.

“We need to stop battling Tallahassee and we need to stop getting ourselves into potentially frivolous lawsuits,” said Gabbard, a Realtor who served as the past chairperson of the Board of the Pinellas Realtor Organization. She was interrupted by a man leaving the meeting who said, “We’re all going to be homeless.”

Gabbard instead proposed that the city reevaluate how it spends federal dollars for rental housing assistance for households making under 60 percent of the area median income. That vote passed unanimously.