Olympia staff outline renter-protection proposals including income-to-rent cap, manufactured-home protections and rent-to-own pilot

Crystal Lenson, senior housing program specialist for the City of Olympia, briefed the council on current renter protections and a set of policy proposals staff plan to bring forward for council consideration.

Lenson reviewed tenant protections already adopted by Olympia: limits on certain landlord fees, extended notice requirements for rent increases (Olympia requires 120 days' notice for increases over 5% or cumulative 7% in 12 months, and 180 days for increases of 10% or more), relocation assistance rules in specific circumstances, a rental housing registry with annual registration and five‑year inspections and protections against landlord retaliation. Staff reported that registrations have reached an estimated 80–85% of rental units in the first year.

Staff presented proposals the Land Use & Environment Committee reviewed in November and November-to-February community outreach that staff said would be scheduled for council consideration, unless council directs otherwise. Key proposals described:

- Income-to-rent screening: staff proposed capping landlord screening requirements so landlords could not require tenants to earn more than 2.5 times the monthly rent. Tenants may use combined household income or a single eligible household member to meet the ratio; voucher holders' eligibility would be evaluated using the tenant portion of rent, consistent with state law. Staff said the change aims to reduce barriers for cost-burdened renters who would otherwise be rejected during application screening.

- Manufactured-home community protections: staff said they heard residents' top concerns are rising lot rents, lack of transparency from owners, and displacement risk. Proposals include requiring six months' notice for rent increases of 7% or more and providing relocation assistance when tenants move because of such increases. To better align with typical apartment costs, relocation assistance in these cases would be set to 2.5 times the HUD area fair market rent rather than the lower lot rent. Staff also suggested zoning changes to discourage redevelopment of existing manufactured home parks to nonresidential uses; Lenson said zoning changes would require Planning Commission review.

- Rent-to-own pilot and tenant purchase supports: staff described risks tenants face in informal rent-to-own agreements (liability for repairs, unclear title, eviction risk) and proposed a pilot that would allow an exemption from the rental registry only when safeguards are in place. Staff identified mitigation steps: a pre-agreement home inspection, appraisal and title search, and access to qualified legal services to draft/ review agreements. Staff said they are seeking guidance on whether to develop a pilot scope and budget and noted potential options such as reimbursing tenant legal fees up to a set amount.

Lenson also said staff will present tenant-screening policy options to the Land Use committee in May and continue work on tenant opportunity to purchase and other tools to expand affordable homeownership. Staff noted that several state legislative proposals could affect the local policy choices and that staff are tracking bills including recent rent stabilization proposals.

Councilmembers voiced support for several elements and requested additional detail in some areas: zoning changes for manufactured-home communities should go through Planning Commission review, staff should continue to estimate program costs and possible funding, and pilot designs should include outreach to determine local demand. Council gave direction for staff to continue refinement of the proposals and to bring refined ordinance language, budgets and implementation plans back for consideration.