A Fair Housing Proposal in Minneapolis

Nationally 30% of adults have an arrest or criminal record. That can make it much harder to find housing. And to the degree there are racial disparities in our criminal justice system (as of 2012, black people were arrested by Minneapolis police at 6.5 times the rate of the non-black population), this results in disparities in who is eligible for housing.

In 2016, the U.S. Department of Housing and Urban Development issued legal guidance that “where a policy or practice that restricts access to housing on the basis of criminal history has a disparate impact on individuals of a particular race, national origin, or other protected class” could violate the Fair Housing Act.

According to HUD:

“But housing providers that apply a policy or practice that excludes persons with prior convictions must still be able to prove that such policy or practice is necessary to achieve a substantial, legitimate, nondiscriminatory interest. A housing provider that imposes a blanket prohibition on any person with any conviction record – no matter when the conviction occurred, what the underlying conduct entailed, or what the convicted person has done since then – will be unable to meet this burden.” [emphasis added]

Changes to Tenant Screening Practices

A proposal to change tenant screening practices from Minneapolis Council Members Lisa Bender and Jeremiah Ellison seems to have been written with this HUD guidance in mind. According to the draft ordinance, Minneapolis landlords would have two options when screening tenants. The first option would prohibit them from using any of the following screening criteria:

  • arrests without conviction
  • juvenile records
  • convictions that have been vacated or expunged
  • convictions for things that are no longer crimes
  • participation or completion of diversion or deferred judgment programs
  • misdemeanors older than 2 years
  • certain felonies older than 5 years (exceptions: arson, racketeering, and “offenses that mandate denial of tenancy in federally assisted housing,” including registered sex offenders.)
  • credit score minimum of 500 or more
  • insufficient credit or rental history
  • eviction actions that were dismissed or the judgment was in favor of applicant
  • eviction actions with no judgment or writ of recovery that are 1 year or older
  • eviction actions resulting in judgment against the applicant that are 3 years or older

Landlords also have the option to disregard the above restrictions, in order to use their own “individualized assessment.” This would require them to consider “supplemental evidence and additional information” provided by the potential tenant (such as 6 months of income stability, 6 months of positive rent payments, enrollment in school or job training). It would also require the landlord to document more specifically why an applicant was denied housing.

There is evidence for the diminishing relevance of criminal history when it comes to housing outcomes. According to a study by Wilder Research, misdemeanors become insignificant to housing outcomes after two years; felonies after five years. This matches the time limitations included in the ordinance.

Landlords have responded by saying the Wilder study was of supportive housing providers and it shouldn’t be used to draw conclusions about market rate housing.

Seattle’s fair housing law goes further than the Minneapolis proposal. It prohibits landlords from checking criminal history at all. Landlords have sued. Seattle’s law will come before the Washington Supreme Court this month.

The Minneapolis City Council’s previous big attempt to regulate tenant screening practices — requiring landlords to accept Section 8 vouchers — was struck down by a Hennepin County judge in 2018 (the decision has been appealed by the city). In that case, the judge found that landlords had a “valid business reason” for not accepting Section 8:

“In short, by participating in the Section 8 program, a landlord gives up varying degrees of control over the sale of the building, the amount and certainty of the income from the unit, the lease terms and the ability to terminate the lease for violations, access to the unit and to its business records, and must comply with new reporting and inspection requirements.”

Limiting Tenant Move-In Costs

A second proposed ordinance from Bender and Ellison would limit deposit amounts. If a landlord already requires pre-payment of the final month’s rent, they couldn’t require more than a half-month’s rent as a security deposit.

Bender described the limits on deposits as ensuring the total “move-in” costs for a tenant would be limited to 2.5 times the total monthly rent.

Pet deposit amounts would be limited to 25% of one month’s rent.

Building Owners Fight Back

Even though the proposal hasn’t yet been officially presented to the public, building owners have started a vigorous public campaign against it.

The Multi Housing Association, a statewide lobbying organization representing building owners, launched a website (“Safe Affordable Minneapolis”) to oppose the Bender/Ellison proposals. They’ve got playful yard signs with a message that makes it not immediately clear what issue they’re advocating for.

MHA’s campaign is presented as an effort to protect “responsible renters” and keep them safe from crime (“Your neighborhoods are at risk”). Building owners also claim the ordinance limiting damage deposits and pet deposits will “make it impossible for those with pets to find rental housing and limit opportunities for hard-to-house people.”

The landlord group’s press release quotes Bernadette Hornig, of Hornig Companies: “As a woman, as someone who rented for many years and as a long-time housing advocate, I was shocked by these proposals.”

The group feels “blindsided”:

“Nichol L. Beckstrand, president of the Minnesota Multi Housing Association, a statewide group that represents property owners, said that they were “blindsided” when she and other members of the group walked into a meeting with council members earlier this month to talk about the proposed ordinance.”

Council President Lisa Bender said she saw the initial meeting with landlords as a chance to listen: “We met with stakeholders and asked for feedback which we planned to incorporate before putting out a draft for public comment. I guess press conferences are one way to give feedback!”

The Response from Tenant Advocates

The Minneapolis-based tenants organization InquilinXs UnidXs por Justicia responded to the MHA’s press conference: “Although they spoke under the guise of care for renting families, their words showed that they believe that only certain people should live in Minneapolis.”

A group of tenant advocates wrote a piece in the Star Tribune about why they’re supporting the proposed ordinances:

  • “Right now in Minnesota, a landlord can file an eviction action in court the first day that rent is overdue, with no notice to the tenant. This filing stays on a tenant’s record as “an eviction,” regardless of whether the parties reach a settlement agreement, whether the tenant paid what was due or even if the tenant wins the case.”
  • “the city proposal would limit the amount a landlord can demand as a security deposit, a policy that is already in effect in half of U.S. states and many municipalities. Unfortunately, Minnesota is an outlier.
  • “Landlords still would be able to conduct reference checks with former landlords. They still would be able to confirm an applicant’s income to ensure that person can afford the rent.”