Council hears staff briefing on state rent‑stabilization law and impacts on Olympia code; manufactured‑home preservation options requested

Krista Lanson, senior housing program specialist, briefed the Olympia City Council on House Bill 1217 (referred to in the briefing as the rent‑stabilization bill) and its effects on both residential tenancies and manufactured‑home tenancies. Lanson said the city will hold two additional tenant‑protection study sessions: a review of the first year of rental‑registry implementation on Aug. 19 and a tenant‑screening briefing on Sept. 16.

Lanson summarized key state changes: for residential tenancies the law caps annual rent increases at “7% plus CPI up to 10%” during a 12‑month period (the July‑to‑July implementation is phased and the cap is set at 10% for 2025), extends rent‑increase notice to 90 days and requires a state rent‑increase notice form, prohibits increases in the first 12 months of tenancy, and requires the state Department of Commerce to create an online landlord resource center. Lanson noted the rent‑cap provisions for typical residential tenancies expire in July 2040.

For manufactured‑home tenancies (where residents own the home and rent the lot), Lanson said the state law is stricter: a 5% annual cap on lot‑rent increases, a prohibition on increases during the first 12 months, caps on move‑in fees and security deposits (one month’s rent, two months if a pet), and capped late fees on a stepped schedule. Those manufactured‑home provisions do not expire.

Lanson presented three local policy options for residential rentals: (1) keep Olympia’s current relocation‑assistance and notice provisions (the city currently requires tenant relocation assistance for rent increases totalling 7% or more within 12 months and longer local notice in some cases); (2) remove the local relocation‑assistance requirement to align strictly with state law; or (3) a middle ground that retains relocation assistance for properties exempted from the state cap or for increases above the state threshold. Staff recommended a middle ground that clarifies the relationship between city code and state law and preserves protections for tenants in some exempt circumstances while reducing confusion.

Council members asked procedural and substantive questions. Council Member Megan Gilman asked why staff had proposed some policies that are now more protective at the state level; Lanson said the state law supersedes and staff recommended not pursuing local versions that are weaker or redundant with the state law. Council members asked about enforcement and whether tenants would know whether to contact the state Attorney General or city staff; Lanson said staff could update local templates and outreach materials to make notification and enforcement pathways clear.

Lanson also summarized staff proposals presented earlier in the year for manufactured‑home communities—tenants had asked for relocation assistance if lot rents increase by 7% or more and for six months’ notice for large increases, tenant‑rights information at new or renewed leases, and exploration of zoning changes to preserve manufactured‑home park land. Staff noted the state legislation did not address zoning or park‑preservation approaches. Council members and staff discussed practical preservation tools: zoning changes, deed restrictions/easements tied to compensation, tenant opportunity‑to‑purchase models or community land trusts, and regional funding sources such as the Thurston Regional Housing Council Opportunity Fund. Several council members asked staff to pursue more detailed options on manufactured‑home protection and recommended referring the topic to the Land Use and Environment Committee for deeper study and possible future action.

There was no formal vote. Staff asked for direction on whether to return with code amendment drafts to align city rules with HB 1217, and whether to explore manufactured‑home preservation (including the possibility of a zoning‑oriented approach or alternatives such as deed restrictions, land trusts or acquisition strategies). Council members generally favored sending the rental‑code alignment to the Land Use and Environment Committee for further consideration and requested follow‑up materials and timelines; staff said manufactured‑home preservation work could become a 2026 work‑plan item depending on council direction and capacity.