Economics instructor and councilmembers weigh tradeoffs of rent stabilization in Hagerstown town hall

Stacy McGee, an economics instructor at HCC, told the March 3 Hagerstown work session that blunt rent ceilings can produce unintended consequences by reducing the number of rental units available and lowering incentives for maintenance. “The market reaches equilibrium — the price at which the number of buyers equals the number of sellers,” McGee said, arguing that strict price limits can create shortages and encourage under-the-table payments.

McGee framed alternatives to flat rent control: exempt new construction, allow limited pass-throughs for improvements, permit annual cost-of-living adjustments, use vacancy decontrol and expand incentives such as low-interest or gap financing to enable property rehabilitation. She also recommended increasing housing supply through regulatory streamlining and targeted programs, noting federal and state tools such as low-income housing tax credits and gap financing can play a role.

Councilmembers and staff pressed for local data and practical measures. Council members noted tenant-bill-of-rights distribution gaps and suggested giving new utility customers a printed copy so renters receive it automatically. Staff and council discussed using the city’s vacant-structure registration to identify properties for targeted rehabilitation and for better coordination with local landlords and nonprofit partners.

Members raised concerns about outcomes seen elsewhere. McGee cited Montgomery County and San Francisco as examples where rent limits were linked to higher evictions, falling permitting and reduced housing supply; she urged Hagerstown to plan for side effects if it pursues restrictions. A town-hall attendee’s comment captured a common local sentiment: “Don’t punish the good landlords,” reflecting resident and owner concerns raised at the forum.

The council did not vote on an ordinance at the meeting. Instead, staff will gather more information, explore possible incentives and convene additional conversations with landlords, developers and community groups to develop policy options and implementation safeguards. The town hall drew more than 40 written comments and public participants representing both tenant and landlord perspectives.

What’s next: staff were asked to return with material on tenant-bill-of-rights logistics, vacancy registration enforcement options, and funding avenues to support rehabilitation and rental assistance. The council agreed the conversation should continue in follow-up sessions.