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Georgia lawmakers want to cap rent increases — not cap prices — in a bid to lift the rent control ban

Georgia lawmakers want to cap rent increases — not cap prices — in a bid to lift the rent control ban

State Senator Donzella James (D-Atlanta) last week introduced legislation to overturn Georgia’s nearly 40-year-old ban on rent regulation, allowing local governments to curb price-gouging at a time when landlords are turning rents with abandon increase.

But if Senate Bill 125 gets the unlikely approval of the state’s mostly Republican and pro-landlord legislation, local rent regulations shouldn’t resemble the old rent control laws that set price caps in hyper-expensive cities like New York, James told the Atlanta Civic Circle in an interview.

She said she knows many lawmakers and landlords who hear the term “rent cap” and imagine derelict tower blocks full of low-income tenants — in other words, concentrated poverty — while landlords fear a slump in profits.

Distinguishing potential local regulations from this stereotypical New York model will be key to lifting the state’s ban on rent controls.

Instead of capping rents, James said they envision capping the rate at which landlords can increase prices each year. “We just have to do something to protect citizens,” she said.

Historically, there has been little appetite for rent stabilization under Georgia’s Gold Dome, but James said the financial strain the COVID-19 pandemic has placed on households across the state should make SB 125 attractive to politicians who have settled in the past have resisted similar efforts.

“Everyone knows someone who had this problem [affording rent] in the communities they represent,” she said of her fellow MPs.

In addition, the surge in interest from foreign investors in the housing markets in the Atlanta area and across the state has drawn the attention of legislators who have traditionally aligned themselves with the interests of landlords. You see private equity and hedge funds buying up dozens of residential properties and then letting them sit vacant until they appreciate enough to convert or upgrade them into luxury rentals.

“These owners have no sympathy because they’re millionaires,” James said. “If they kick the person out and can’t fill [a unit], they will just write it off as a tax loss. Sometimes they just raise the rent for everyone.”

James said some of her Republican peers have expressed cautious support for the legislation, but none have officially endorsed it.

Atlanta Mayor Andre Dickens has also expressed support for the James legislation and, if its bill passes, local legislation limiting rent increases.

Dickens has said his government would consider a citywide inclusion zoning policy — regulations that require developers to provide a certain number of rental units at affordable rates in new housing projects — if state lawmakers remove the key obstacle, Georgia’s rent control ban .

Some critics of rent stabilization have said that state law precludes this type of zoning. Currently, the only inclusion zones in the greater Atlanta area are fast-developing counties, where developers will receive increased density if they agree to set aside a certain amount of affordable units.

The Georgia Code currently prohibits rent regulation very specifically: “No county or local authority shall make, maintain or enforce any ordinance or resolution that would in any way regulate the amount of rent to be charged for a privately owned single family or multi-family dwelling . Family apartment for rent.”

“I disagree with the state’s decision at the time to ban rent controls nationwide,” Dickens said at a news conference earlier this month. “I think the jurisdictions can make their own decisions.”