by Scott McClallen
Updated Minneapolis Renter Protection Ordinances that restrict landlords from screening tenants by credit score, criminal background and eviction history goes into effect in June 2020 for landlords who own 15 or more units, and December 2020 for those with fewer units.
The ordinance gives property owners two options to screen potential tenants: using “inclusive screening” criteria or conducting an “individualized assessment.”
The ordinance caps a maximum security deposit of one month’s rent and bars landlords from rejecting tenants for evictions older than three years.
The ordinance prevents landlords from denying applicants for misdemeanors older than three years, a felony record dating back seven years, and other serious offenses older than 10 years.
Landlords can conduct an “individualized assessment” and reject applicants if that landlord requests additional information about those incidents and if the landlord provides a written reason to the city.
The law allows landlords to reject applicants who have been convicted of murder, manslaughter, kidnapping, or first-degree criminal sexual conduct within 10 years.
“This ordinance provides a necessary protection for residents by ensuring they are not exploited with excessive move-in costs and have a fair opportunity to access housing,” City Council President Lisa Bender said in a post-vote statement.
Barbara Jeanetta, executive director of Alliance Housing, a nonprofit, affordable-housing owner and manager in Minneapolis, told The Center Square that Alliance switched to “minimal screening” criteria in 1991 and haven’t had additional problems.
“The market had gotten totally out of whack and landlords were screening tenants out for incidents that were 20 years old,” Jeanetta said. “So I applaud Bender and Ellison for bringing this forward, and honestly, the ordinance considered still screens a whole lot more than we do. And we run very successful properties.”
For scattered-site properties, Alliance screens recent arson convictions and level three sex offenses because those properties are residential.
Alliance screens apartment buildings by requiring no felonies in the past 12 months or active warrants, and about a year’s worth of good housing history if they have had an eviction in the previous five years.
Jeanetta said that income is a more important factor than credit score.
“We don’t even check credit because those credit scores are all over the map,” Jeanetta said. “And usually, even if someone’s not paying their credit card bill, they’re probably paying their rent. People are pretty wise in what it takes to keep a roof over their head.”
Jeanetta said that sometimes credit scores don’t include context such as drug addiction, a rebound after serving jail time, or who’s held a good job for five years.
“I didn’t think it was useful to be screening out things and not ever giving someone a second chance for things that may have gone wrong in their life years ago,” Jeanetta said.
Jeanetta told the city council that Alliances’ vacancy and rent losses are lower than the industry standard, with an average tenant tenure of four years.
One landlord told the Star Tribune that the new screening requirements would leave him “at a loss for how we’re supposed to figure out who the good tenants are and who the bad tenants are.”
Another landlord told the city council that the ordinance would raise rents because of additional insurance and business costs.
The Seattle Times reported that the Pacific Legal Foundation, a nonprofit public-interest law firm, is suing the city of Seattle, Washington over similar rental regulations.
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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.