BOISE — A pitch to regulate rental application fees got a warm welcome from Boise City Council.
On Tuesday, council members expressed support for Councilwoman Lisa Sanchez’s proposed ordinance aimed at protecting renters in the application process. Council will hold a public hearing on the ordinance after more details are worked out.
Sanchez’s proposed ordinance includes a $30 cap on rental application fees, a requirement that landlords only advertise and take applications for units that will be available in 30 days, and a requirement that landlords provide a receipt for how the fees would be used.
Under the proposal, if a unit had an applicant and a deposit placed, it would no longer be advertised, and any other applicants would have to agree to be put on a waitlist.
The ordinance would also prevent property managers from charging application fees for residents moving from one unit within a complex to another within the same complex. Any landlord that breaks these laws would be subject to a $100 fine. The first offense would be an infraction, but the second one and onward would be a misdemeanor.
Sanchez said the aim of this code change is to relieve some of the pressure on renters in Boise who have faced rental hikes, application fees and historically low vacancy rates as the population has boomed. Although the city is severely limited by Idaho state code in how much it can regulate the rental market, rental application fees can legally be capped by the city.
“We do want to give folks some time to file those complaints, but primarily what we want to do is educate housing providers and renters so everybody knows their right sand there is a structure in place they can comply with,” Sanchez said.
A big question among council members is whether to go with the proposed $30 cap or set a limit based on the cost to complete a background check. City council members left this up to Sanchez, who will bring back a suggestion at next week’s meeting.
Some council members suggested the cap be enough to cover the background check but not labor costs. The idea is that the law would keep up with actual costs of background checks over time, but still prevent landlords from profiting off of applicants.
“If you’re a landlord, part of your work is to do these applications, and your costs should be part of your business and not part of the application, I think,” City Council Pro Tem Elaine Clegg said. “I would be more comfortable with an actual cost number, but still some sort of cap on it. With labor on it you could absorbently charge labor and anything you wanted.”
One other issue this proposal will attempt to address is landlords who are charging “administration fees” on top of their application fees. Under the proposed code, rental application fees are defined as any cost renters have to pay in order to try to rent a unit.
The Idaho Apartment Association, a lobbying group that represents property managers statewide, opposes any kind of cap on rental application fees.
Paul Smith, executive director, said this could discourage property managers from doing background checks at all and make neighborhoods more dangerous.
“Cities that have banned or capped application fees see that it acts as a disincentive and landlords won’t do a background check, so they move meth cooks, domestic violence situations and other criminals into properties, and the city goes, ‘Oh my gosh, what have we done?’” Smith previously told the Idaho Press. “Any kind of ban or cap on fees has the potential to hurt communities.”