Sustainability and Renters' Rights Committee 3/17/23

Good morning, everyone.

This is the regularly scheduled meeting of the Sustainability and Renters' Rights Committee of the Seattle City Council.

Today is Friday, March 17th, 2023, and the time is 9.31 a.m.

I am the chair of the committee, Council Member Kshama Sawant.

Would the clerk, Ted Verdone, from my office please call the roll?

Council Member Sawant?

Present.

Council Member Juarez?

Here.

Council Member Morales?

Council Member Lewis.

Present.

Council Member Nelson.

For present.

Thank you, Ted, and thank you, council members, committee members, for being here.

First, we will discuss the two points on the agenda.

First, we will discuss the legislation to cap late fees for renters at $10 a month, which my office is bringing forward alongside renters rights activists, union members, the Stay House, Stay Healthy Coalition, and Socialist Alternative.

There are currently no limits to the fees Seattle landlords can charge renters for overdue rent.

Some renters have told us they are charged upwards of $250 as soon as rent is overdue.

And many leases have clauses where landlords can charge an additional 40 or $50 every day that the rent is late.

Other renters have even faced late fees and then late fee notice delivery fees, which is an additional fee for the privilege of having to pay a late fee.

For working class renters, this is a punch in the gut for being a couple days late on rent.

And for people who are temporarily unable to pay rent, late fees can spiral out of control.

Renters do not get paid late fees when their landlord delays fixing broken appliances, heating, or mold infestations.

Yet renters have to pay rent on time regardless of whether or not their landlord completed repairs.

We cannot wait for Democrats in Olympia to defend the rights of renters.

Wednesday, March 8, was the deadline for legislation in Olympia to be voted out, and no substantive renters' rights bills were brought to a vote by the Democrats.

Even a loophole filled bill to cap late fees, which was House Bill 1124, was pushed aside without a vote.

Keep in mind that renters are being sold out by Democrats, even though they have a solid majority against the Republicans.

As of January 2023, Democrats control both houses of the Washington State Legislature.

Democrats hold a 58 to 40 majority in the House of Representatives and a 29 to 20 majority in the Senate.

and they refuse to fight for renters, instead upholding the greed of corporate landlords and property management corporations.

But it's not just about this year.

Democrats have controlled the Washington state governor's mansion for 30 out of the last 30 years, the Senate for 20 years, House for 23 years.

They have had a majority in the Senate since 2018 and in the House since 2002. So this is the fifth year in a row with a majority in both houses.

And in all that time, Democratic Party politicians have played a game with progressive activists where they propose bills for renters' rights and other things working class people need, but then never call them to a vote.

The bills die without any politicians needing to go on record having voted no.

Rents keep going up and they want us to believe nobody is to blame.

Since 1981, Washington state has banned any city from acting any form of rent control.

So this is a context in which we have brought this bill forward.

I especially thank the Stay Healthy Coalition for getting people's attention on this and really advocating for this.

And we'll hear some of that advocacy today here in this committee.

In addition, my office has prepared a frequently asked questions or FAQ document about capping late fees.

We have copies here that people can share if they would like, and also it's available online.

For today's discussion, Asha Venkatraman from city council central staff will first describe the legislation and answer questions from council members.

And then we will hear from a panel of renters, as I said, and renters rights activists.

Today's discussion will be an opportunity for council members and the public to consider the bill and have any questions answered.

I intend to bring this bill for a vote at our next committee meeting, which is scheduled for April 7th.

So I urge renters rights activists who are here today to also join us on April 7th.

The second agenda item will be to discuss and vote on the appointment of Shnadin Rajistan, I'm really sorry if I'm not saying your name right, to the Seattle Renters Commission.

The final item on today's agenda, which is also an appointment to the Renters Commission, will be removed from the agenda because the nominee has informed us that they are no longer available to serve on the commission.

Before we begin the first agenda item, we will hear public comment.

Ted, can you let us know how many people have signed up?

There are nine or 10 in council chambers and then 23 remote.

Okay.

I think it'll make sense for everybody to have a minute to speak since we have many signed up.

So speakers, each speaker will have one minute to speak.

Ted will read out the name.

Actually, yeah, let me read out the names of the speakers.

And for people speaking remotely, when I call your name, you will be prompted to unmute yourself.

When you hear that, please hit star six on your phone to unmute yourself and begin.

And so these are, Ted, these are the names of the people who are here, right?

Yeah.

And you have the names of the people online.

Yeah.

Okay.

So let's, let's start with the speakers who are in person.

I'll read out three in a row.

So you'll know to be ready.

Our first three speakers are Andra Kranzler, Marshall Bender, and Neixin Fu.

Andra, go ahead.

Good morning, Council Member Sawant, Council Member Juarez, and Council Member Morales and the esteemed committee that is here today fighting for housing rights and access to stay housed.

The rents are going up.

Income is not going up.

Landlords are denying partial payment of pledges, forcing renters to go further in their rears.

Tenants cannot handle any more increases in their housing.

Housing has to be stable.

The only way that we can do that is to stop the bad actors from acting.

The current experience that renters are having regarding...

...complexity of landlord-tenant policy that has gone into effect at the state and city levels over the past several years...

Sorry, hold on, let's figure out who's on.

Okay, people are muted again.

So it's unconscionable and we need state action.

We need county action.

And I'm really grateful that the city of Seattle and through your leadership, council members, so on, that you are seeing the people that are your neighbors who are truly struggling from the tenant loss center and just a renter in Seattle.

I really urge you to pass this.

I have a great landlord.

I don't have to worry about this, but not everybody is in that situation.

Your advocacy date today matters.

It will stand the test of time.

Thank you for being on the dissent.

Next we have Marshall followed by Nasheen and then Alejandro.

Go ahead.

Hello, I would like to thank the chamber for allowing me the moment to speak.

My name is Marshall Bender and I'm a renter living in the University District.

I'm here today to speak in favor of Council Member Sawant's bill to cap late fees for overdue rent at $10 a month.

Landlords in Seattle are given so much leeway to exploit and extract money from renters and nothing is being done about it.

When a working class person cannot pay the rent on time, they're penalized by their landlord with a late fee, simply because they don't have enough money.

The people who are disproportionately affected by this are those our city depends upon, essential workers, healthcare professionals, and more, and we must pass this law to protect all renters in Seattle.

The city council is complicit in this exploitation of our neighbors if they fail to pass this legislation through the chamber.

You may hear claims from landlords and their apologists today that capping late fees would force them to sell their properties or cause even more late payments for rent.

We all know this isn't true.

Working class people in the city, like myself, are concerned daily with how expensive the city is and how they will pay the rents, and we do so to avoid these late fees.

Regardless, we all fall through the cracks.

At the end of the day, no landlord, big or small, has a right to exploit and gouge their tenants.

Pass this bill and cap late fees or overdue rent at $10 per month now.

Thank you for your time.

We have Lachine followed by Alejandro and then Anitra Freeman.

Good morning council members, my name is nation, I'm a homeowner in Fremont in District six and I'm an organizer with tech for housing.

I'm also a landlord of a two bedroom condo.

I urge you to vote yes on the legislation from council members wants office to cap late fees at $10 a month.

I do not believe having a late fee is incentivizing rental payments when I was a renter.

Paying my rent on time was never about being worried about late fees, but rather being evicted for not paying rent.

As someone who is wealthy enough to own my primary home plus a rental, accruing late fees and notice delivery fees does not impact my day-to-day life.

But the fees do have a huge impact for someone who is already struggling to make rent.

Predatory late fees only make it harder for renters to catch up on their rental payments.

As a landlord, I would much prefer to prioritize those payments than late fees.

Prior to working on this issue, I was unaware about rental late fees as my lease was the boilerplate from the property management company.

With this knowledge, I will be working with the property management to bring my late fee down from $100 to $10 in the coming months.

I urge Seattle to follow in the footsteps of cities like Auburn and Burry and enact this common sense measure.

Thank you.

Thank you nation that is particularly appreciated, speaking from a landlord's perspective, the supporting $10 and a month late fee.

We have Alejandro and then followed by Anita Freeman and then Daniel bank.

Go ahead.

Yes, my name is Alejandro Abdullah, I urge you to vote yes.

Hi, my name is Alejandro Avila, I urge you to vote yes on this legislature to cap around the $10 an hour.

I've been here in Seattle for about about four and a half years.

Since then I've moved around all over the city.

And I've been in a lot of situations where late fee would have meant the difference between being homeless or having food on the table, or just being able to afford other bills.

So I think that this is very important, not just that, but when landlords charge crazy fees, like $250 for late fees, it doesn't take into consideration the people who cannot work possibly or are late in rent at the moment because of illness or injury.

And those people get thrown, put on the back burner and then get evicted anyways.

I have a friend who's currently going through this and that's it.

Thank you for your time.

Good morning.

My name is Nietzsche Freeman.

I'm part of an organizing effort of homeless and formerly homeless women called wheel.

And I talk with homeless women every day, including at the wheel shelters at First Presbyterian and Trinity Episcopal.

Every homeless person I talked to was housed previously.

If you're living on the margin, Anything, getting sick for a week or the car breaking down, can put you late for rent.

If you get a late fee of $200 plus a notice delivery fee of $50, you might never catch up.

And you end up evicted with thousands of dollars in debt.

There's already not enough shelter for the people who are currently homeless, and without shelter, people die.

You can save lives by voting to cap the late fees and ban the notice delivery fees.

Thank you.

Daniel, followed by Katie Wilson, and then Dee Powers.

Hi, I'm an Amazon warehouse worker.

I'm a member of Socialist Alternative, and I'm also a renter in District 3. I'm speaking in strong support for the Council Member Sawant's office legislation to cap late fees.

I've got a coworker who recently got injured at work, because that happens at Amazon warehouses.

She's on an L&I accommodation, but her hours got cut in half.

So yeah, many of us live paycheck to paycheck.

That ate through her savings pretty fast.

Recently, she actually got her headlight blown out, So she drives to work every day terrified of getting pulled over and penalized for having a broken head like that.

She can't afford to fix.

And yeah, it's halfway through the month, but she's pretty worried about how she's gonna pay rent in two weeks.

This is the reality for many working people who find themselves unable to pay rent on time.

We're working on poverty wages with uncertain work schedules during a worldwide cost of living crisis in a city where corporate landlords have blown rent prices up far faster than their wages have increased.

It's absolutely barbaric logic that these exorbitant late fees, which are punishments for being poor, are required to make us pay rent on time because there's nothing more stressful than not having your rent paid on time.

So running out of time, but absolutely vote yes to capital fees at $10 an hour, I think.

$10, thank you.

After Katie, we have Dee Powers and then Jake Pence.

Sorry if I'm saying your name wrong, go ahead.

Hello, council members.

Thank you for hearing our comment today.

My name is Katie Wilson.

I'm the General Secretary of the Transit Riders Union.

I've been helping to coordinate the Stay Housed, Stay Healthy Coalition, and I'm also a renter on Capitol Hill.

And we strongly support this legislation, both capping late fees at $10 a month, which both the cities of Auburn and Burien have already done.

And we're also working on getting more cities around the county to do the same.

So we just think that it's really time for Seattle to kind of match that standard.

Banning notice delivery fees is a really good start at addressing this increasing problem of predatory fees that landlords are charging.

We've been talking to renters in Seattle and around the county and hearing stories just like the ones you're hearing today.

It's an increasing problem.

Landlords just nickel and diming tenants at every turn.

So thank you so much council members.

legislation, and we hope that it passes in a strong form.

Thank you.

Me, Jake, and then Yuli Matthews.

Good morning, City Council members and committee members.

My name is Dee Powers, and I work with B Seattle.

I was recently rehoused just over a year ago after seven years of homelessness.

Those seven years of homelessness were in part caused because I had a financial crisis that caused me to get behind on my rent.

I got it paid up to full, but the late fees took me under and I had to move on.

I ended up on the streets for seven years.

Those same debts kept me from almost kept me from getting rehoused last year.

I had to pay them off before anything else could happen.

So I beg you for the stability of your neighbors who are rent burdened and everyone else, please cap late fees at $10.

It's hard enough out there already.

Thank you.

Hello, council members.

My name is Jake Danis and I've been a Seattle renter for over 20 years now.

I currently live on Beacon Hill and District 2 and I'm here to support the proposal to cap late fees at $10 a month and to ban notice fees.

Last summer, I received written notice from my landlord demanding that I remove the potted plants from my balcony within 10 days.

This might sound absurd, especially given that my lease specifically permits planting flowers on my balcony, but here's the kicker.

The notice fee came with a $75 notice fee.

This hefty charge, this hefty fee was charged for preparing and giving notice that the plants had to go.

A couple months ago, I received another $75 notice fee alongside a 10-day notice for the same pretext.

These are predatory fees that landlords charge simply because And today's rental market appears to be amplifying rather than correcting them.

For those living paycheck to paycheck, this can be a death blow.

Possibly skipping two weeks worth of groceries or rationing vital medications to be able to pay.

The landlords are abusing their power and it's within their current legal authority to impose these notice fees whenever they want to bank a little more profit.

Please support this legislation.

Thank you.

person speaker who signed up is Yuli and then Ted you'll read the online names.

Hi my name is Yuli Matthew.

I'm a renter in the U district and a student at UW.

I've lived in Seattle my whole life.

I just want to urge all Democrats on the Seattle City Council to vote yes on the legislation from Council Member Sawant's office to cap late fees for overdue rent at $10 a month.

Extra charges like late fees are an insult to injury on top of out-of-control rents that the majority of our city's renters struggle to pay.

Rents have been going up in the U District a lot, and a lot of us are like, we have to work multiple jobs to pay that on top of being a student.

I've worked two to three jobs at a time for my entire time at UW.

And a lot of students are becoming homeless because of like how expensive the rents are.

People sleep in Kane Hall every night and student housing is becoming more and more expensive.

So I urge the Seattle City Council to follow Berrien and Auburn and vote yes on this legislation.

The first three remote speakers are Howard Gale, followed by Kevin Bitswong, followed by Jennifer Leckish.

Good morning.

Howard Gale, a District 7 renter, speaking about landlord abuse of late fees and evictions without just cause.

Absurd and punishing late fees, which can reach hundreds of dollars, must be reined in by the council and limited to $10, which today's proposed legislation does.

However, I, along with hundreds of other renters, find ourselves almost wishing for an abusive late fee in the coming months instead of an eviction without cause, as landlords and developers have found a way, with the cooperation of SDCI, to nullify recent laws limiting rental increases and evictions.

Over the last seven months, landlords in dozens of buildings are evicting people and raising rents by 70% to 100% by simply doing trivial cosmetic renovations.

How can the council claim they are fighting homelessness while the city regularly issues permits for an end run around tenant laws that will force more people into homelessness?

How can council members feel good about providing tenant protections that now only exist on paper and not in reality?

Pass the legislation to limit late fees, but take up the urgent work to stop these renovation evictions.

Thank you.

Kevin Bitswong.

You appear to be muted.

Hit star six.

There you go.

Thanks.

I just got it.

Yeah.

Hi, my name is Kevin Bitswong.

I'm a renter and educator in the central district, and I'm calling in to urge all Democrats on the council to vote yes on the legislation from council member Selma's office to cap late fees for over a rent at $10 a month.

This legislation addresses the dire reality facing renters as the cost of living has been cranked sky high, the corporate price gouging and rental increases far outpacing the growth of our wages.

It's truly exploitative for landlords to make renters pay more when they're already struggling to pay the rent in the first place.

So fees like this are a penalty for the crime of being poor.

And I've seen how this stress affects the families of my students.

It absolutely affects their education.

And Burien and Auburn have both implemented that $10 per month limit for late fees.

And in both cities, this has been successful.

So this is an easy step for the city of Seattle to take.

And yeah, renters are often forced to accept pretty hostile terms from our landlords because, well, we need shelter.

Landlords, on the other hand, are not forced to accept high mortgage rates under threat of homelessness, right?

They have a lot more options there.

So in a city where corporate landlords have extracted too much from our renters, we need protections like this ordinance.

Please vote yes to Cat Lake via the pendulum.

Thank you.

Jennifer Lekish, followed by Barbara Finney, followed by Zeke Cohn.

My name is Jennifer Ligish.

I'm a second generation housing provider.

I have 17 families and single family homes and duplexes in the Queen Anne and Capitol Hill neighborhoods.

And I have been a long-term renter myself.

Please vote no on capping late fees at $10 per month.

Fees are designed to incentivize tenants to pay rent on time.

I know of no type of financial transaction where the lender has literally no penalty if the borrower defaults on their financial obligation.

Last month, I had a tenant who paid the rent 17 days late.

Had there been no daily penalty, there's a higher likelihood she would have never paid.

Your proposed $10 late fee cap is untested and creates a chaotic scenario where rent will go unpaid indefinitely.

A nominal $10 fee does not compel tenants to pay rent on time, let alone ever.

Substantial research should be done before considering this type of financial legislation.

Do not move forward with this legislation.

Thank you for your time.

Hi, my name is Delegate to the County Labor Council for the union of American Federation of government employees, local 3197. It represents the healthcare workers.

So the scan will be a medical center and clinics.

I urge all Democrats on the city council to vote.

Yes.

on the legislation from the Council Office of Committee Chair Shawna Sawant to cap late fees for overdue rent at $10 a month.

This is a worker's issue.

In 2019, our local unanimously endorsed a resolution in support of Council Member Sawant's comprehensive citywide rent control legislation.

Rent protections are a worker's issue even more pertinent today.

The devastating loss of affordable housing along with sky-high rents in Seattle remains a huge issue for our members, their families, neighborhoods, Seattle residents, and to the veterans who are our patients, many who are Seattle renters.

AFGE 3197 urged the council to provide urgent protection to all renters in 2019, and today urged the same.

Support this legislation.

Council stand with renters, support this legislation, renters of the majority of your constituents.

Thank you.

Zeke Cohn, followed by Celestine Berry-Smith, followed by Vinika Zhang.

Good morning.

I'm Zeke Cohn, and I'm a UW student with Socialist Alternative and Worker Strike Back.

I strongly urge you all to vote yes on the legislation from Council Member Sawant's office to cap late fees for overdue rent at $10 a month.

The most common reason for late rent payment is financial distress.

To take advantage of people who are already struggling by forcing them to pay exorbitant late fees is nothing short of exploitative.

Many landlords claim they need to charge these exorbitant late fees in order to make up for late fees on their mortgage payments.

But renters are often forced to accept horrible terms from landlords because they need that shelter to survive.

Landlords on the other hand are not forced to accept high mortgages and they could always sell their properties.

As a young adult, prospects have never been lower.

More and more now I hear my peers talk about their struggle to find affordable housing anywhere in Western Washington.

This late fee cap is needed now more than ever.

So I again urge you to vote yes on this legislation.

Thank you for your time.

Celestine.

Hello, council members.

My name is Celestine Berry-Smith, and I am the tenant services program manager at Solid Ground, calling to support the legislation being introduced today to limit excessive late fees and notice fees.

Solid Ground's tenant services program helps renters maintain stable housing by sharing education on their rights and responsibilities as renters and those of the landlord.

We provide education, counseling, and resource connection to over 750 renters at risk of eviction every year.

We see the harm that excessive late fees have on low and moderate income renters.

We served a single mother who became ill and required surgery.

She was unable to work, causing her to fall behind on rent.

The landlord charged $75 per day for late fees.

This mother shared that the late fees were detrimental to her ability to pay down the debt.

Imposing excessive punitive late fees on tenants who are already struggling to pay their rent makes it even harder for people to keep their current housing or secure future housing, pushing people one step closer to homelessness.

I urge the council to support this policy today.

Thank you for your attention to this issue and for hearing our comments today.

Phoenix, followed by Aiden Carroll, followed by Benjamin merits.

Okay, you appear to be muted.

It's star six on your phone to unmute.

There you go.

My name is so solid support for this proposed ordinance to limit excessive late fees and notice these solids ground Homelessness Prevention Program supports people at losing their housing with assistance for rent payments and associated utilities and late fees.

In 2022, about a quarter of the households we served lived in Seattle.

And over the year, over $5.8 million in public funds for renters in a region which is that could have otherwise pushed them into homelessness.

A lot of these costs include their fees.

funds into the hands of usually already wealthy landlords and companies.

Late fees should not be a way for landlords to increase their profits at the expense of renters who are already- This proposed legislation not only has to protect our city's most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most- most Thank you all for attending this Q&A.

You were difficult to hear.

It was cutting in and out.

So feel free to also send your comments in, in writing, if you like.

The next speaker is Aiden Carroll.

Hello.

I'm with the, I mean, I live in D6, so I'm with the 46th District Democrats and Stop the Sweets.

I wanted to be there in person to support the late fee cap, but I'm currently under I-5 at 42nd with members of both of the organizations trying to stop a hate group called We Heart Seattle from coming into the camp.

We think they've left for now.

This is a relevant issue and related because of course, homelessness and evictions and all.

But We Heart Seattle has been called out by city council before, but there wasn't really follow-up action.

This is not a conventional hate group.

It's sort of deceptive with regards to pretending to be helpful and then stealing homeless people's stuff or making them look bad.

But yeah, we all know that evictions cause homelessness, if we're paying attention, and that tenants need all the rights they can get in this economy for so many reasons.

So please pass this bill.

Thank you.

Benjamin, followed by Gordon Haggerty, followed by Elena Rumian-Civa.

Hi, good morning.

My name is Ben Maritz.

I'm an affordable housing provider based here in Seattle.

I'm calling in opposition to the late fee cap and in favor of policies that will help reduce the cost of renting.

My company operates about 600 privately funded apartments in Seattle, an average AMI of around 50%.

50% AMI means if you're earning around minimum wage, you can afford to live in one of our apartments.

Being privately funded means that we depend on rent to pay our bills, repay our investors, and attract capital that allows us to build more of the housing that we all want and keep rents low.

We care deeply about keeping people safely housed.

When someone struggles for rent in one of our apartments, our team leaps into action to help them.

We are experts in navigating the very complicated system of rental system rental assistance that is available in our region.

We work with our residents, we beg, we track down non-profits, we do mediation, we use the courts, all of this costs money.

If we don't have the ability to defray the cost through late fees, we'll have to pass it on to every other renter in our portfolio.

Thank you.

Good morning.

Good morning.

Can you hear me?

Yes.

Hello.

Yes.

Good morning.

My name is Gordon Haggerty and I've been a small housing provider in Seattle for over 50 years now.

I'm opposed to the $10 late fee cap bill here because late fees need to be high enough to provide an incentive to pay rent on time.

Late fees are typically around $35 plus a daily charge of maybe around $10 a day.

And that said, I can count on one hand the number of times I've actually collected late fees over my 50 plus years.

Because when a renter has trouble, they contact me and we work together on a win-win plan that typically waives the late fees altogether.

The pandemic lockdown affected a lot of our renters and we worked with each one to lower rents, work out payment plans, and we all made it through the process intact.

Back in the 70s, when I got started in housing, King County didn't have late penalties for property taxes.

After three years, they would seize the property for nonpayment.

You can guess what happened.

Most people didn't pay until the third year, and then just enough to keep the county at bay.

When the county started charging late fees, we all caught up.

This bill is fundamentally flawed, and the 2018 study on evictions is biased, and the data is not verifiable.

It also deals with real problems that renters face, but it does not mention the risks and challenges that house.

Eleanor Rumi and Siva, followed by Jessica Dyson, followed by Lana Linderman.

Yes.

Hello.

Can you hear me?

Yes.

Yes.

Hi.

My name is Elena and I'm a landlord.

uh...

in seattle i'm in favor of limiting late fees to ten dollars a month uh...

my late fee personally is that currently established at thirty five dollars and is to be collected if the payment is one week late i keep it low for the reason that it's a simple convenience if the payment is a little late i don't see it as a profit-making mechanism and uh...

i will not hurt at all if the late fee is ten dollars instead of thirty five In my view, rents are too high already in Seattle, and they're displacing people who used to call Seattle home.

I don't want the city to turn into the playground for the rich.

Late rent fees impact people on fixed incomes, specifically those on Social Security, and I don't want to hurt the most vulnerable in our community.

City Council has to take care of those who need the most assistance and cap late fees to $10 per month.

Thank you.

Jessica, followed by Lana Blinderman, followed by Emily MacArthur.

Hello, Jessica Dyson here.

And I'm born and raised actually here, raised by a mother who was a renter and struggled to keep housing.

As an adult, I was able to become a small landlord and I was committed to providing housing as affordable as possible.

That included taking losses for a number of years in order to keep the rents affordable.

I'm no longer a landlord because of that challenge.

However, I do believe in limiting excessive late fees.

I think that's critical.

But the term excessive is the key there.

Hundreds of dollars is excessive.

$10 is also excessive, excessively low.

We need to have reasonable late fee limits, such as those in Oregon where they limit it at 5%.

as per a normal business policy.

We need to be reasonable in order to keep small landlords in business providing reasonable rents for people.

Lana.

Can you hear me?

Yes.

Yeah, this is Lana Blunderman.

I'm a renter in Seattle.

Before that, I was a renter in Bellevue and Renton for a number of years, and I am calling to urge the council to vote in favor of capping the late fees.

I think that one, they are really just a tax on the poor, and they dig people further into the hole, because if you can't pay your rent, then adding the fees, especially high fees, that doesn't make you likely to pay your rent.

It's likely to get you evicted and out of housing.

And also, I feel like they're also kind of a spike fee.

I mean, if you just keep adding those fees and add delivery fees, then you're just basically making sure that people will never pay.

And I'm also thinking that landlords don't have an easy way to collect this, so this just drags on.

I think by capping them at $10 a month, we will achieve much more equity in this rent-burdened town.

Thank you.

Hannah Endrius, followed by Emily MacArthur, followed by Casey Burton.

Good morning, council members.

I'm Hannah Andreas.

I'm a renter.

I live in District 12, and I urge you to vote yes.

Please cap rental late fees.

Seattle rent is already 24% above the national average, and this is not accounting for all the other fees mentioned previously by other callers, but this would include a screening fee, security, damage, cleaning, the last month's rent paid in advance, the application holding fee, non-responsible pet fees, even delivery fees, and the list could go on.

And this is the bare minimum we could do to ensure that people are actually in fact motivated to start paying.

As you've already mentioned before, with these fees, things can really snowball past the rent that was due.

So I'm asking you once again to please vote yes to cash rental late fees.

Thank you.

Emily MacArthur, followed by Karen Taylor, followed by Casey Burton.

Hi, my name is Emily MacArthur.

I'm a renter in District 2. I'm a member of the Stay House, Stay Healthy Coalition, as well as Voters Strike Back, and I urge all Democrats to vote yes on Councilmember Sawant's $10 cap on late fees.

Working-class people are living through historic inflation.

Wages are not going up.

We're facing a tumultuous period with tens of thousands of layoffs from insanely wealthy tech corporations, many of whom are based right here in Seattle.

Banks are defaulting, and there's a forecast of a deep recession.

And we all know that the ruling class and the wealthy will always make working class people pay for their crisis.

And so this cap on late fees is urgently needed in this moment.

Late fees, as other callers have said, are a tax on the poor.

And we have already seen that this $10 a month cap has been in place in Renton and Auburn and is working effectively Some landlords have said that they need to charge predatory late fees because they get charged late fees on their mortgages.

We reject this.

We would support small landlords fighting back against powerful banks to stop these late fees.

I support Council Member Sawant's bill of rights for renters, and we need to add this essential piece.

Aaron Taylor, followed by Casey Burton, followed by Nick Jones.

Hi, my name is Karen.

I am a renter, and I just wanted to begin support of capping late fees.

One time I just wrote out the physical check wrong by a few cents, and it bounced in my bank account.

And I explained this to the landlord, and he still hit me with huge late fees.

And negotiating that one-on-one with the landlord is really hard in your personal relationships.

even if it's a small landlord, especially if it's a small landlord, but if there's just legislation about it, then that's sort of a blanket thing and it can cover it and that would be helpful.

So definitely cap late fees, minor misunderstandings can turn into really big, awful situations for folks.

Casey Burton, followed by Brett Frosicker, followed by Nick Jones.

Casey, you're muted if you hit star six on your phone.

There you go.

There we go.

Thank you so much.

I am asking the council to please pass this amendment on me, please.

If you're already behind on rent, how are you supposed to catch up if there's a huge late fee too?

Let's say you lose hours at work because of scheduling error, which recently happened to a friend of mine, or your benefits or your child supported a cost.

Things happen all the time that are out of a tenant's control.

And as we saw with the pandemic, when things happen, you might be somebody who always pays your bills, but life happens and sometimes you pay a little bit late.

Further, let's think about how high the rent is in Seattle.

If you're already rent burdened and you've got hundreds of dollars of late fees on top of that, how are you ever supposed to catch up?

Additionally, when you are in a situation where you have to deal with these late fees, let's say you move out and your deposit doesn't cover it.

And now you've got late fees stuck on your credit report for years.

Do we really want to create yet another barrier to housing for people in Seattle?

This shouldn't be another way for wealth to be extracted from the people who live in Seattle.

So please pass this front cap, or pardon, the late seat cap.

Brett Frosicker followed by Nick Jones, followed by Dr. Garcia.

Hello, I run a small property management firm.

I manage primarily single family homes and individual condos for property owners.

Almost all the property owners have mortgages and have very little wiggle room between their mortgage and the rental rate.

A token cap on late fees of $10 does not incentivize tenants to pay rent in a timely manner.

When tenants are late, owner mortgages are late, and their banks do not give them grace period and charge them late fees of over $100, which negatively affects their credit.

The unintended consequences of this cap may well result in owners pulling properties from the rental market.

I'm hearing many stories of late fees between $100 and $200.

Those are high, but a $10 cap would effectively create an environment where eviction would be the only tool left for a landlord to incentivize a tenant to pay rent at all.

Delimiting egregious late fees but dropping them to $10 may as well ban them altogether.

Thank you.

Nick Jones, followed by Dr. Garcia, followed by Sonia Ponath.

Hi, hopefully you can hear me.

My name is Nick Jones.

I'm a bringing file member of Teamsters Union 174. I'm a UPS driver speaking in my personal capacity.

I'm here to work to strike back.

I want to thank Council Member Shamal Pahas-Wan for putting forward this legislation to capitulate eight to ten dollars I think a lot of speakers have already really hit the core issues of why this is so important, especially in the middle of what continues to be a rental and housing crisis.

I mean, how many years has it been since then Mayor Ed Murray announced a homeless state of emergency that has never been really seriously addressed by the Democratic Party on the council.

We need to have serious action around this.

It's definitely a real step forward as people already spoken to.

Earlier, a landlord spoke about how they provide even affordable housing.

at half of AMI, that's over $50,000.

I barely make that as a full-time driver working 10 to 12 hours a day.

I've never made that for the majority of my adult life to see how even these small fees are going to bury people if we don't take serious action.

Thank you.

Dr. Garcia followed by Sonia Ponath.

Hi, I am speaking on behalf of the Congolese immigrant and refugee community.

A lot of immigrants are coming to Seattle from a humanitarian crisis.

As everybody knows, there is a war situation in Africa, and unfortunately, many are displaced and come to Seattle.

We are over 20,000 community members in Washington State, and people are struggling with housing.

Of course, housing is a crisis for American citizens, but especially for immigrant and refugee community.

And I just want to highlight that many are living in Seattle with unlivable conditions.

A lot of their living spaces are are riddled with fungus and different toxic situations that need to be eradicated as soon as possible.

So please, I hope you can cap late fees.

These people are working more than two jobs and they need as much support as possible.

After Sonia Ponath is the last speaker who signed up and present.

There are three people who are signed up but not present.

Beckley Elise, or Elsie, excuse me, Beckley Elsie, Emily Dabney, and William Bain.

Go ahead, Sonia.

Hi, this is Sonia Ponath.

I'm a landlord.

Previously, we had 22 units.

I'm calling in support of capping these late fees at $10.

So many times we had late rent, and we always worked it out with people.

We didn't charge fees.

Because honestly, you cannot get blood from the stone.

If they don't have the money to pay, they're not going to have more and more to pay every single day.

And yeah, $10 is still a lot to a lot of these poor communities.

the threat of being evicted should be enough.

People don't want to be evicted.

So obviously, they want to pay the rent.

And as a small landlord, evicting people costs us money.

So we don't want to do that either.

So we're not really talking about that small landlord, we're talking about huge corporations that are owning so many places, who they dictate all the you know, the contract, you can't negotiate anything.

And I cannot believe these people with 20 houses on Queen Anne.

I mean, come on, you're almost a large landlord if you own property in that area of Seattle.

So please vote yes, thank you.

That is the final speaker who is signed up and present.

Thank you, Dan and thanks to everybody who spoke in public comment, and we will now begin the first agenda item which is the legislation that speakers were speaking about in public comment, that is to gap late rent fees at $10 a month.

I will read the bill into the record.

Council Bill 120530, an ordinance relating to residential tenancy, limiting the amount of fees charged for late payment of rent, and adding a new section 7.24.034 to the Seattle Municipal Code.

The ordinance would cap late fees for overdue rent at no more than $10 a month.

The nearby cities of Auburn and Burien, as our speakers have already pointed out, have passed such a law.

Extra charges like late fees are on top of the out-of-control rents that a majority of our city's renters are struggling to pay.

While many landlords do not charge punishing late fees, and we heard from landlords today who don't charge late fees and are fully supporting this legislation, there are many landlords who do treat late fees as yet another opportunity to exploit and gouge their tenants.

I will read a few examples of these late fee stories in a bit, but I wanted to invite Asha Venkatraman first from city council central staff to introduce the legislation, what it does, and help answer council member questions.

And then we will hear from the panel of renters and renter rights activists, as I said before, and I thank you all for being here and giving your morning to this.

I know it'll take a few hours, so I appreciate your patience.

Go ahead, Asha.

Good morning Council Members, Asha Venkatraman with Council Central staff.

As Council Member Sawanth mentioned, I will go through a description of the Council Bill 120530, provide some basic regulatory background on late fees and notice fees, go through a couple potential issues for the Council consideration, talk through some potential amendments to be discussed, and then talk through next steps.

So Council Bill 120530 does two main things.

One is to limit the amount of the late fee to $10 a month and to prohibit any other fees associated with late payment of rent.

Currently, the regulatory structure of both the state of Washington and the city of Seattle does not place a limitation on the amount of fees that can be charged in relation to late payment of rent or as related to notice fees in general.

Currently, existing regulations prohibit a landlord from charging any fee for late payment of rent until the rent is more than five days past due.

And the terms and conditions of those fees need to be described in the rental agreement.

In addition, any payment that's made by a tenant towards rent has to be applied to the rent, excuse me, any payment made by a tenant has to be applied to the rent before it can be, that payment can be applied to late payments, damages, legal costs, or any other sorts of fees.

Um, but as I mentioned, no limitations on the amount of those fees.

Um, as council member, someone already mentioned, um, there were a few bills at the state level, uh, that had been being, that were discussed, um, it's related to late fees.

Um, but both of those are, uh, dead at this point.

So there isn't an issue of, um, conflicting provisions about late fees or notice fees.

As you will have seen in the memo that was circulated about this bill, it lays out a variety of structures and limitations on late fees and others jurisdictions, both within the state of Washington and nationwide.

So as was previously mentioned, Redmond and Unincorporated King County have limits of about 1.5% of monthly rent.

Burien and Auburn limit their late fees to $10 a month.

In Burien, there's no fees permitted for late rent notices.

In Auburn, there are no fees permitted for those late rent notices unless they are in writing, signed, and agreed to in the rental agreement.

I won't go through each of the state examples that are laid out in the memo, but those are provided to give a range of the sorts of maximum late fees as well as the structure for late fees.

Some jurisdictions provide just a flat dollar amount that can be imposed.

Some jurisdictions do apply a percentage of the rent that can be due, but those range based on state, and I didn't get into local jurisdictions because many of those are related to the state jurisdictions, excuse me, the laws at the state jurisdictions.

And so in, excuse me, I can pause here for questions or move into potential issues for the council's consideration.

I don't see any council members immediately jumping, so go ahead.

Okay, great.

So there are a couple issues here.

First is the impacts of the fees themselves.

And so without any regulatory limitation, a landlord does have the discretion to set a fee at any amount they like.

This is both for fees for late payment of rent, as well as things like notice preparation fees.

And as is mentioned in the memo, there are fees that can accrue to landlords as a result of late payment of rent or issuing notices.

but it's unclear to what extent the actual costs of those fees are reflected in the late fees that are charged to a tenant.

Additionally, fees can pose a burden on tenants, especially low-income tenants or tenants that are on a fixed income and can add financial stress when they're unable to pay that kind of debt and then debt accrues.

And so for those tenants that are struggling with rent, late fees can add some additional debt that can impact credit scores or impact their ability to have housing stability.

The other issue that I wanted to flag was is reflected in the small landlord stakeholder report that came out in December of last year 2022 that reflected the concerns of small landlords about the regulatory environment in general.

So there weren't, there's not any specific recommendations in the small landlord report about late fees or about notice fees specifically, but there were concerns expressed about the nature of the regulatory environment, given how many laws have passed in the past several years, both at the state and the city level, and how that has some impacts on small landlords.

are a few options laid out in the memo that are available to council members.

If the current language of the bill limiting the late fees to $10 and prohibiting other fees in relation to notices related to late payments.

If there are desires to make that more flexible or to change the amount.

For the examples that are laid out in earlier in the memo that reflect how other states tend to regulate their late fees and notice fees.

Council members can consider whether $10 is the appropriate amount if there is an alternative percentage element that can be added.

if that percentage should be applied to the whole periodic rental amount.

So what is normally charged for monthly rent or applied to rent that is past due.

In addition, in terms of the prohibition on late fee notice charges, council members may wanna consider whether there's a requirement that fees do match the cost to the landlord or just to set a cap on fees rather than banning fees altogether.

I did want to note just very quickly that the way this legislation is set up, it is specifically limiting both the amount of the late fees and fees that are associated with late payment of rent.

And so that would mean that the notices that are associated specifically with late payment of rent, not necessarily all notice fees.

I'll discuss that a little more when we get to the potential amendment phase.

But just wanted to note that the prohibition on those fees is specifically related to late payment of rent as currently drafted in this legislation.

Last item I wanted to note in terms of issues are about implementation.

The full costs of outreach and enforcement by the Seattle Department of Construction and Inspections are not fully reflected here.

And some of that is because SUCI and specifically the POTA group who would both enforce and respond to concerns about this legislation are not entirely clear about how much more This adding this piece of legislation would impact them at this point they are dealing with a lot of increase in call volumes and complexity of cases.

And dealing with a lot of the landlord tenant policy that has has gone into effect over the past couple years, in addition to receiving calls and providing guidance about.

evictions now that the eviction moratorium has been lifted.

And so there are some concerns about SDCI's ability to provide timely outreach and enforcement both to landlords and to tenants.

And so just wanted to flag that as something maybe of interest to council members as budget season approaches at the end of this year.

I can pause there before I get into proposed amendments if anybody has any questions.

Any questions, council members?

I have a quick question, Madam Chair.

Go ahead, President Morales.

Oh, thank you.

Hey, Asha, I was looking at your summary and fiscal note.

I have some more detailed questions later, but I may be the only one that doesn't know this, but I don't know what POTUS stands for.

Apologies.

It's, if I remember correctly, Property Owner and Tenant Assistance, but I will confirm that.

Okay.

And those are the folks that, when I was reading your summary and fiscal note, that are at and beyond capacity since we lifted the moratorium of fielding and responding through SDCI what renters are dealing with.

Okay.

Yes.

Thank you.

Okay, there are no questions okay I can move into potential amendments.

So as you'll see on the agenda, there are not any amendments officially proposed for a vote today, but Councilmember silence did indicate an intent to bring forward several amendments to this bill.

The first, as I mentioned earlier, the current version of this bill only limits fees in association with late payment of rent.

So the first amendment that would be considered is to expand the prohibition on fees to any notice issued to a tenant.

And so the amendment language would likely be something like a landlord may not charge a fee associated the issuance of notice to a tenant, including, but not limited to, a fee for preparing and delivering a notice regarding late payment of rent, a notice to pay or vacate, or a notice of non-compliance with a rental agreement.

So effectively, this would ban any kind of notice preparation fees that are currently in a rental agreement or would be in future rental agreements.

From a process perspective, this is a change that would require a title change, because it does broaden the scope of what is currently contemplated in Council Bill 120530. And so, this amendment may be incorporated into a piece of new legislation that would be introduced for the council's consideration in committee on April 7. The second amendment.

that could potentially move forward is to clarify language that would be on any notice that's issued to the tenants about the late fee regulations and the potential remedies.

As you'll note in the bill itself, one of the subsections talks about the notice that SCCI would prepare to ensure that tenants are aware of the regulations and the remedies available to them associated with late payment of rent and potential fees.

We're still working on making sure that language is clear to both tenants and landlords about what the regulations are and what the remedies are.

And so the plan is to have that language ready for the committee's consideration in this next iteration of the bill.

As council members have mentioned, this bill or new legislation with a title that incorporates the First Amendment I just discussed will be up again in front of this committee on April 7th, and then theoretically moving forward to a full council vote.

But in the interim between today and April 7th, we'll be working towards putting together a bill with a new title and that creates the correct notice language to go in the ordinance.

So that's all I have for you on this bill at the moment, but happy to answer any questions.

Thank you so much for going over the memo you wrote Asha and giving us the details.

And also just on Asha's last part of the presentation where she went over the proposed amendments to clarify to all the renters who are listening that the amendments are not going to weaken the legislation anyway.

It's actually strengthening because it's clarifying some important language.

Because, for example, we want all the notices that landlords would charge exorbitant fees for to be eliminated, because that's just, in my view, outrageous to charge for the piece of paper that you're delivering, where the piece of paper contains payment penalties.

So that was just an inadvertent thing that we missed, and so we want to make sure that we address that.

And as Asha clarified, Just for the legal requirements of the city, it will mean a new legislation will bring to replace this one.

But substantively, the legislation will be the same.

It will only be a little bit stronger.

Council members, if you have questions for Asha, I'm looking at the screen here to see if any Zoom hands go up.

Oh, yes, sorry.

Go ahead.

That's OK.

I know I'm happy to see you at the committee table.

I think I think we should start moving that direction.

I know it's been a while.

I'm sorry if you already covered this, but could you just talk a little bit about.

I'm sorry, I'm getting over gold.

Can you talk a little bit about how you decided on on 10 dollars?

I appreciate you offering examples from other municipalities.

So, can you talk a little bit about how you ended up on a dollar amount versus a percentage and and how you ended up on the 10 dollar amount?

Yes, I'm happy to talk about it, and also Ed and Katie, sorry, Kate, sorry, who are here, who also can speak to it.

And in fact, I was going to ask that question myself in terms of, you know, what is their advocacy reason for it.

I'll tell you from my office.

We obviously, you know, we have a long track record of fighting for and winning renters' rights, and it was very clear that we need to go for the strongest possible law that we can have for capping late fees on overdue rents.

And it was really actually quite gratifying to see that cities like Auburn and Burien, which don't usually make the news for progressive legislation, this is very important that they have done this, and this is the strongest example that we know, and so we want to follow the strongest example, not the less strong or even weak examples.

And if you look at the numbers, you know, if you look, if you hear about people who have paid percentages of rents, it actually ends up adding up to far more than $10, and $10 seems like a very reasonable amount.

But I invite Ed and Kate to also weigh in on this.

Go ahead, Ed.

Yeah, and I think that's a good question.

I hope I'm coming through here.

One thing I want to kind of note is that $10 is actually an increase in the status quo.

This is actually more of a landlord bill than it is a tenant bill.

For the last three years, there have been no late fees in Seattle at all.

So despite that, we actually are still seeing landlords charge them, but $10 is actually an increase over what the status quo is.

And this ultimately is what this ordinance is doing, is what should the perspective add, or what should be the policy going forward?

We worked on the Berrien and both the Auburn ordinance for $10.

I got to say, when we did the Auburn ordinance and $10 was proposed in that legislation, that was not a controversial ask at all from the Auburn City Council.

There was almost no pushback on that issue whatsoever.

The other thing too is there's also been a sort of general national, you know, reconciliation with what the issues are with late fees in general.

Right now at the federal government, the CFPB or the Consumer Financial Protection Bureau is reexamining Regulation Z which looks at late fees and credit cards.

Their proposal right now is to limit late fees on all credit cards to $8 and that's a regulation that would go into effect in April.

So $10, I think, is a pretty reasonable number.

We have precedent there.

We know that Burien and Auburn have not fallen apart.

And more importantly, we've had no late fees for the last three years in Seattle.

And as far as I can tell, this rental market has not imploded.

The last we know is that, you know, from the SDCI, or Department of Construction Inspection data, is that there has been, while there's been a change in registrations from smaller units to larger units, that has overall affected the number of registered units, the number of actual units is still the same overall.

So despite the fact that there's no late fees, we haven't seen a dramatic impact.

And the other thing too, for a host of reasons, despite the fact there's no late fees, evictions for nonpayment have been down.

for the last few years.

Tenants are still paying their rent.

We have not seen a real change in that behavior.

And I think sometimes sort of like the good faith that a lot of tenants are exercising really goes under, is under-emphasized in a lot of this.

I don't think late fees incentivize on-time payment.

It's a tax on the poor for the, as I think a lot of the speakers already said.

But the other thing I just also want to emphasize here is just another point on this more in general, and I'll stop talking on this.

You know, I think the, The big issue with cost overall is that late fees are something I think that are pretty well known to impact in black communities, Latino communities, lower income communities.

There was a study of some years ago that looked at What do those rent rolls actually provide in terms of the overall landlord's cost?

In a high poverty area, particularly where there's like about 50 to 60% of renters are below the federal poverty line, a landlord's rent rolls cover about a quarter of the overall housing value in a year.

So that whole house, that whole rental building is paid off in basically four years.

In higher income neighborhoods, they only get about 10% from the rent roll.

So it takes 10 years to pay off in a higher or wealthier area for that landlord.

The point is though, is that these late fees and that particularly low-income communities just pay more in general of their overall income towards rent.

They tend to pay higher late fees.

And again, I just want to emphasize, this is actually an increase on the status quo in the terms of late fees.

So $10 is actually just a big, is a very large increase over zero.

Thank you, Ed.

And also thank you for sharing how the $10 a month was not controversial in the, you mentioned in the Auburn and Buren cases.

Kate, do you want to add to it?

I just wanted to point out that we already know that there's a huge power imbalance between renters and landlords.

And there's not like an alternative.

So if a renter makes a repair request and the landlord doesn't respond within the required amount of time, the renter can't fine the landlord.

But the landlord is essentially able to fine the renter whenever they want with these notice delivery fees.

And so the $10, as Edmund pointed out, is just kind of a number to satisfy them.

But they're really the ones with all of the power.

And these high fees are just extremely punitive and so hard to come back from.

Thank you.

Thank you both for those responses.

Council Member Morales, do you have any follow-up on that?

No, that was great.

Thank you very much.

Thank you.

Other council members, Council President Morris, go ahead.

I'm sorry, I can't get to the little electronic raise hand quick enough, so I hope you can see me raise my hand.

Yeah, we can see you.

So all the talk about, you know, the renter stuff and landlord, I get all that.

I know that we had that House Bill 1124, I believe, which would have capped late fees, I think at $75.

So I wanna go back to, yes, we know what Burien and Auburn did at $10 a month.

I don't know if I agree with the status quo that it's actually more, but that's more of a different, we can agree to disagree.

But when we also, just how do we square that with when we look at Redmond and unincorporated King County that is imposing a percentage, a 1.5 percentage in that it's more progressive in that if you pay more rent, and you're late, then you pay more when you're late with your rent.

And if you make less and pay less on your rent, and if you're late paying on your rent, then you pay less.

So obviously it's a more progressive in the sense of dollars and cents, not politically.

How do we square that, Council Member Sawant or whomever would be answering this?

Why is a $10 flat fee more advantageous or if you will, better than just looking at a percentage, whether it's 1% or half a percent or 2% or whatever.

What is the policy or what is the legal and policy implications of that?

Well, I will respond because there is a lot of, I mean, it's actually not progressive to have a percentage.

And I'll have Ted and Edmund and Kate also if they want to respond.

And I know Violet has a lot to share also.

But just in terms of mathematics, one, The reason a percentage is not more progressive than $10 flat as the cap, you know, landlords are not requiring, this law is not requiring that landlords charge $10.

Just to be clear, it's saying you can't charge any more than $10 a month for late fees.

And the reason that is the most progressive policy and not a percentage, one reason why is because the rents are so high that even if you are a working class renter, you're probably paying a lot out of your paycheck.

So imagine somebody paying $2,000, 1% will be $20, which is twice the $10 cap that we are talking about.

So no, it's not progressive, simply because if you look at the numbers of the rents that people, dollars that people are paying, it doesn't work out.

The other reason it's not progressive, and I'm really glad you're asking this, President Juarez, because it helps us to clarify this.

The other reason it's not progressive is that Working class people, you know, people with lower incomes, working class and the poor, they are the ones who are going to be much more likely to be very much on the margins, you know, living literally paycheck to paycheck.

So they are the ones, if they had one small extra expense in a month, if their child felt sick or something like that and they had to pay a doctor's bill, then they are the ones going to have difficulty paying the rent on time, which is the you know, the overwhelming majority of people who are not paying, who end up not paying their rent on time, it's because of financial distress.

And so people who have higher incomes are also more likely to have a larger cushion from which to recover from if they had a financial distress.

So for both those reasons, capping it at $10 is the most progressive policy.

And if you wanted to add something, Edmund.

Yeah, Councilwoman, and I appreciate your question a lot, and I think that's a good one.

Having looked at how those different jurisdictions work in practice, where you have $10, which is a flat fee, versus a percentage, there's a lot of misleading and deceptive practices that are actually happening.

One of the reasons why is rent is a really broad definition under state law, including under those ordinances.

A rent is not just the fee that's labeled rent in your lease.

It can include pet charges.

It can include other things that are added on top of that.

Just in the way that if you go into an Airbnb rental, you'll see an advertisement for $100, and you go to book it, and all of a sudden it's $250 because of added fees.

That's what we see in a lot of leases now, just a lot of added percentage charges.

What happens then is, when you sign that lease, you might say, oh, my late fee's only 1.5% of my $1,000 rent, but you don't realize there's other charges, washer machine charges, sewage charges, utilities, which technically are rent under state law, that those get factored in, leading to a variable late fee that can be really hard for, I think, a lot of renters, even very sophisticated ones, to be able to calculate what their late fee is on any given month.

And so the result is you kind of have this sort of moving late fee.

And I want to just emphasize, I think this is something that, as I brought up, the Consumer Financial Protection Bureau is aware of in the sense of credit card regulations, where they're not saying, you know, 1.5 percent of the overall debt is what the amount of the late fee should be.

It's $8.

I think they've realized that there's some wisdom in giving that flat predictable fee because the average consumer is going to struggle with knowing how to calculate that in any given month.

And I can say in practice, I spend a lot more time doing math with a law degree than I ever thought I would just because of that stuff.

Thank you, Ed.

That was very helpful.

Can I have a follow-up, Madam Chair?

Yes, go ahead.

So if I'm understanding, I know you have an amendment, your amendment about, as you said, people should not be charged a fee for being delivered a document that they're late.

I get that.

And that would probably be categorized.

So just so I understand.

So we're saying that a flat fee.

protects us against this myriad of junk fees, quite frankly.

So you're not sitting there having to distinguish like what's a real fee and what's a real not fee that's related to someone paying their rent late.

So you don't have to go through and like have a laundry list.

These are all the things that you were trying to essentially get rid of.

And I've heard the term junk fees.

So what actually goes to the heart of a landlord who has to absorb costs if a renter is late in their fee.

And like you were saying, it could be a list of all kinds of crazy things, but then there could be some legitimate ones as well.

And you're saying this legislation is saying that $10 should just cover that.

So we're not going back and forth and arguing in perpetuity, what's a real fee for the landlord having to absorb when the renter is late in their fee.

I apologize if that's a bit circular, but that's what I'm trying to get at here.

You wanna respond?

Well, if I can respond, Council Member, if I understand your question is, you're wondering how does $10 compare to the amount that the landlord actually sustains in terms of loss due to late payment?

Right.

And so if we got into a back and forth, you know, some landlords, like you said, you listed like washer, pet, whatever, there'd be a list.

And then we'd sit there and we'd have to argue about everything on the list.

Whether if we just say, hey, it's a flat $10, this, therefore we don't have to, everyone knows what the rules are.

It's $10.

And whatever you want to include in that 10, that is your, what's being taken from you because the renter was late in paying their rent.

You have now absorbed a $10 cost.

So you get $10 to make you whole again.

That's what I'm getting at.

Does that make sense?

I appreciate the question.

I have a different assumption here that I think underlines this, which is I don't think late fees compensate for loss.

I think they're profit for a landlord.

So I don't think a landlord sits down and does their, like any developer or property management or landlord on our small time landlord sits down and says, okay, let's think about what's coming on next year.

Here's my mortgage payment.

Here are my maintenance costs.

i don't you know i think when they look at what their expenditures in the revenue they're just looking at rents I don't think you would say, well, we expect 30% of our renters to be late and all of that.

You're probably predicting that.

And your rents that you're charging probably account for some volatility there.

So my guess is that what landlords are already doing is they're already factoring in late payment when they charge rents.

That's already happening.

Tenants are already paying for that.

And so the $10 fee is just an added thing, just like how banks love overdraft fees.

you know, where they just sort of add these charges here for it, it doesn't really, they act like it's a convenience for you as a consumer.

But the fact is, it's a lot of profit for them to charge you a lot of money when you bounce a check, or you bounce a credit card or something, it doesn't go through.

I think late fees are not sustaining loss, so much as like, it's just a sort of added well, while it may be on the one hand, a way to try to incentivize, tenants to pay on time, which I don't think really is true in reality.

But I think in more really what it's doing though is just sort of added little fees that they can collect, potentially bottom, you know, help with the sort of bottom line, but it's not really helping with loss.

Again, I just, my assumption is from what I, you know, my experience from when I'm dealing with landlords both on here and elsewhere, I don't think late fees are really a big factor and ultimately compensate for the loss, and that's not how landlords and real estate investors really use them.

Okay, well I think I would have to agree to disagree, because we heard some people from public comment.

I think there's the late fee for the deterrence factor, right?

People say, look, we're going to impose a late fee to the deterrence factor so you don't pay your rent.

And that's just, whether that's right or punitive, there's questions there.

But some landlords would say, and I think we heard one in public comment, that the cost imposed on them is that they have to pay a mortgage.

and that they have, now whether we agree with that or not, I think we have to talk about it, that if you're a landlord and your renters are continually late, so you're paying these bills, and so what you're saying as a landlord is, the reason why I'm imposing this fee is because the cost that I absorb, I'm the one that has to pay the mortgage on the property, so when you're late, then I may be late.

Whether that's a legitimate argument or not, I think that is still something that we have to discuss, that it's fair to say.

You know, I don't, we may just have to agree or disagree about the rent itself, but I just wanted to clarify that point.

Thank you, President Warris.

I just want to say a few things in response, and I know Asha's Zoom hand has been up for a while, so Asha, I have noted that, and I will bring you in.

I just wanted to say quickly that Anybody is free to have any point of view, but, and so, you know, if you're saying, Council President Juarez, is it fair to say, well, you can say whatever you want to say, but, from my standpoint, fair or not has to be based on actual data.

And there is no data to support the kind of idea that you're saying that somehow late fees are necessary in order to make landlords whole.

That just is not true.

As Edmund pointed out, that is not how landlords are going to be using late fees because they're already making a big profit and the rents that they charge account for any little thing that might go wrong here or there.

And having that point of view, as I said, you can have any point of view, but is it supported by the data?

I don't think so.

This point of view that somehow if a tenant is late by a few days, it is absolute crisis and chaos for a landlord.

That's just not true.

They have a lot of cushion.

They have a lot of money to pay their mortgage payment.

And also, if they are not able to make their mortgage payments without gouging their tenants, then they shouldn't be in the business.

Somebody else should own that unit, or it should be public housing.

But the idea that they have mortgage payments to make and that's why they gouged tenants, that's just not viable.

Nobody has the right to exploit renters.

So if you're in the business to exploit renters, then yes, then it should be correct for renters to push back and which is why we have this law.

So I think I would really urge everybody to look at what actually is statistically, you know, available for us to look at and this idea that landlords are just operating in loss all the time and they're always on the edge, that's just not That's just not supported by the data.

If you look at the data on real estate profits, it is Overwhelming the amount of profit they make so that's just not true.

And then the other thing is as far as Incentive, you know, Council President Juarez, you mentioned that well, we need late fees as a deterrence and Again, there's no evidence that that is the reason why tenants are paying on the occasion that they pay late.

It is because they are in financial distress.

And as Edmund, I think, pointed out really well earlier when he spoke is that even during the, Edmund, you should correct me if I'm wrong, but even during the eviction moratorium, there's no real data to support this idea that just left and right tenants were paying their rent late.

the data supports that tenants pay their rent on time as far as they can help it.

You know, if they have the cash, they will pay it.

And then the other thing I wanted to point out is that my office did research on the Burien and Auburn situations because, you know, we wanted to see that that law has been in place for a few years, and we couldn't find anything from a Google search on any news article or anything that since this $10 law has passed, suddenly renters are not paying their rent on time in order to take, quote unquote, advantage of this liberal law or whatever.

There is no such data available.

I just wanted to point that out.

if you wanted to add anything.

Yeah, and Council Member, I'm happy to follow up with you and talk to you more about these concerns.

I agree with you that it's definitely a point worth considering.

It's definitely, I think, I see the logic in it that we need to consider what exactly the land, what the impact is on the landlord side.

But like I said, we haven't had any lay fees for the last three years and there hasn't been a large investment property foreclosure crisis in Seattle, as far as I know.

I just thought it's not happening.

But I do want to say like something that landlords tend to be very cagey about how much money they're making.

They often say, oh, we're barely getting a profit.

But why are there so many people getting into the business just doesn't make any sense.

But when you've looked at some of the data about how much rent rolls cover of the overall property, I can send you some of those, you know, in high poverty areas, those rent rolls every year pay for a quarter of the actual property of the value, which means you're paying off the entire mortgage if you're taking it off on fair market in four years.

I mean, that's just incredible the amount of money that you're making off of that.

So and again, that's just pretty common.

So I just don't know if like there's actually a really substantial loss on the landlord side.

I don't think it really is happening.

And we aren't seeing any negative effects over the last few years as far as we can tell from the zero dollar late fee.

But I'm happy to talk to you more about that council.

Thank you, Ed.

I'm sorry.

Go ahead.

I just wanted to add one point of clarification.

Evan, you'd mentioned that there haven't been any late fees for the past couple of years.

The source of that is the Seattle ban on late fees or any other charges that are associated with nonpayment of rent, which went into effect with the civil emergency.

And that protection will expire a year from the end of the civil emergency, which if I remember correctly, is October 31st of 2023. So I just wanted to make that clear.

Thanks, Asha.

Are there any other members with questions?

Go ahead, President Morris.

Thank you.

I always appreciate that you and I always have a chance to talk these things through and the questions that we're raising so we can have the kind of policy that we want, what we believe the city of Seattle, in particular, in your committee, what renters need.

So I agree with the premise that there should be a limit on late fees, just like on credit cards.

And I'm glad you brought that up as an analogy.

I don't know what good reason there is for a punitive fee on a late on a credit card or a bank fee, as you know, what happened with bank fees that they had to reel that in when people are getting charged $20 a day on their bank.

There was no reason for that except to be punitive and make money.

And then when we explored the question of what is that fee?

What is it that landlords absorb when a renter is late?

That was really what I was trying to get at, just so I understand, not that I'm taking a position good, bad or ugly, I just wanted to understand.

And so there are some legitimate discussions from the landlord point of view, whether I agree with that or not, it's just, but it still needs to be put out there.

And then the question of going back and forth between a flat fee and a percentage, I wanted to flesh that out more to understand where, you know, the folks that you have there came, like when Council Member Morales asked, how did you come to the $10, and why did that seem reasonable?

And those questions were answered for me, and I think we'll, I'll look forward to seeing your amendment on, I think you were just, when Asha was talking about the amendment on not imposing a fee for getting notice that you're late on your rent, and therefore we're charging you a piece of paper for telling you that you're late on your rent.

which I think goes under the category of probably junk fees.

So I want to thank you for that.

And I want to thank you for the opportunity to have these folks here to kind of walk us through some of the policy questions that have come up.

So I just wanted to end with that comment.

So thank you.

Thank you, President Juarez.

And yeah, I will echo what Ed Minow just said, that if there are further questions, the Housing Justice Project is happy to help.

Also, I'm sure the Tenants Union and BCL are happy to help.

And also, please reach out to Ted Verdone in my office.

You know Ted very well.

Oh, yeah.

We all know Ted.

We all know Ted.

So if our council members have further questions, if you don't mind, if you can just hold them for a little bit, because we have three panelists here whom we had told that they couldn't leave by 11, and obviously it's almost 11. So I appreciate you staying.

I know you have work and school.

But I will invite Ellen, Josie, and Ruth.

Go ahead and introduce yourself for the record, and then speak.

Oh, I can kick us off.

I'm going to do a little record myself of this.

Hi, thank you.

I want to thank you for inviting us today to come speak on this.

I'm Ellen Anderson.

I'm a student at UW and a renter in District 2, and I'm here for absolute strong support of this bill from council members who want to cap late fees for overdue rent for $10 per month.

So I'm a renter, and I will likely be forced to continue being a renter for pretty much the rest of my adult life.

And just like the majority of people my age who have grown up, you know, only knowing economic crisis after economic crisis, I currently live with a bunch of roommates because I can't afford not to.

With Seattle rents having absolutely skyrocketed over the past two decades, the cost of living crisis has only made things worse.

And I will definitely say that as a person who is struggling, our rents do not reflect that.

We don't have lower rent, unfortunately, just because we're in that position.

And as a student, the housing crisis has, I think, a particularly sharp sting.

Most of us can barely afford to buy basic necessities while also paying for school rent on top of everything else.

And yeah, so just over a year ago, me and my roommates were forced out of our home that we were renting because the basement flooded.

Unfortunately, that was also where my bedroom was located.

This flooding also ended up revealing that the foundation of our house was dangerous and incredibly compromised.

Our landlord at the time told us that this was no big deal and flooding just happens when it rains and that we should just expect this again in the future.

And overall response was just incredibly problematic.

Our landlord refused to get a serious inspection for the problem by a licensed professional and left my room in the basement with squishy molding walls and mud caked floor.

That was our entire responsibility to deal with.

And because landlords refused to make necessary repairs, he forced us to choose between sacrificing our health and safety or uproot our lives and rapidly find a new place to live.

We basically had three weeks to find a new place to live.

If we had delayed paying the rent because of this horror show that, you know, the house had become, we would have been charged huge late fees.

But for the nightmare that he inflicted on our lives, the landlord never had to pay us one cent.

So not long after moving out of that house and into the house that we're currently renting, the ceiling in my bedroom began to leak right onto my bed.

It took my landlord three months, three months to repair my ceiling and to prevent this continual leaking.

After requesting and then demanding repairs multiple, multiple times.

And that was just one of a very long list of repairs that took weeks and months.

to be addressed, some existing from the moment that we moved into our house.

Our current lease specifies that if any rent is not paid on or before the due date, tenants agree to pay a penalty of $40 for each day that the rent is overdue, including the day of payment up to a maximum of 18% of one month's rent.

All unpaid amounts will bear an interest of 12% until paid.

So that means that we would be paid, we would be charged hundreds of dollars if we're just a few days late on rent.

And then we would have to pay on top of that an additional 12% interest on that unpaid rent and fees.

A compounding late fee like that would cost more money than me and my roommates need to pay for groceries and utilities, which are also through the roof right now.

And let me assure you, we double checked, there is no clause within our lease requiring that landlords pay us $40 a day until the repairs are completed.

And if there was, he would actually probably owe us thousands of dollars.

These predatory late fees are a complete racket.

You know, we see that they're set up to scrape even more money out of the pockets of renters who are barely getting by.

It's an unbearable situation for renters like me across this city.

And the only way that we're going to change it is by getting organized.

To shift the balance of power from the wealthy corporate landlords to a grassroots movement of renters who make up the majority of people here in Seattle.

We need protections like this ordinance to cap predatory late fees at $10 a month, just like we need all of the protections that renters' movements and Councilmember Sawant's office have already won, including the Amazon tax to fund the expansion of publicly owned affordable housing.

Seattle renters also, I will say, are in huge need of citywide rent control without corporate loopholes because we can't afford late fees, but we also just can't afford the just plain rent that we have to go through every single month that just seemed to keep getting higher and higher and higher.

Will wages stay the same?

We also need a law that mandates landlords to effectively pay their tenants if they, the landlord, fails to fix serious household code violations like heating in the middle of winter.

By the tenants being able to pay less rent adjusts for a certain amount of compensation for the problems that remain unfixed.

I'm committed to fight for this law I just described for rent control and for most immediately the cap on the late fees at $10 a month.

I hope that renters, union members, and community members who are watching will join us.

Thank you.

Good morning, everyone.

My name is Josie Ebelher.

I'm a state child and family welfare social worker, a member of the Washington Federation of State Employees Union, Local 889, and a renter in District 3. I'm here today to speak in favor of the $10 cap on late fees.

Working people in Seattle are already facing a drastic increase in the cost of living, and from groceries to rent, the city is becoming harder and harder to live in.

As a social worker, I work with some of the most vulnerable people in King County, with children who may not know where their next meal is coming from or where they're going to sleep that night, and with family members who take in their grandchildren or nieces and nephews, all of the sudden having extra mouths to feed with little time to prepare financially, forcing many to decide between feeding their family or paying their rent on time.

I work with a family now who continually faces the real impacts of these late fees and unjust corporate landlords.

This family is made up of a grandmother who suddenly had to take in her three grandchildren all under the age of five.

Her rent is already half of her income, and she is now providing for three more people and balancing the new tasks of parenting and working full-time with little support.

She sacrificed a great deal to ensure that her grandchildren were not placed in the foster care system and could stay with their family and community.

But due to this sacrifice, she has gotten behind on rent, missing several months payments.

It's challenging enough to face missed payments as they stack higher and higher.

But with her corporate landlord's late fees and penalties on top of that, she has quickly gotten thousands of dollars behind, being punished by a business for putting the needs of her grandchildren first.

This continued financial stress of getting her rent together each month is not made easier when the rent is more expensive after being a few days late.

The cause of late payments is not a lack of will, but financial distress, and these fees are simply a punishment imposed on families for being poor.

If this grandmother loses her home, her grandchildren lose a home.

They could end up in an unsafe environment or in foster care on the other side of the state, far away from people that they know.

This is an issue of child safety and well-being, impacting countless families across King County who are facing evictions and housing insecurity.

A business should not be able to decide the fate of housing for a family or the fate of housing for a child.

These are real working people who are impacted by these late fees.

The story of this grandmother is repeated countless times in the families that I served and echoed in every neighborhood in Seattle.

These late fees simply add more to the crisis many working people are already in.

Capping late fees at $10 a month would relieve some of this burden and give people more room to pay their rent in full.

As a renter myself, I am fortunate that my small landlord has not put in place high fees.

When I first started working for the state of Washington, my check got lost in the mail.

I wasn't paid for almost a month, and I had just moved across the country.

Luckily, my landlord was understanding and allowed me to pay late with no extra cost.

My small, independent landlord made it clear in this action that they don't need this extra payment that might come if I'm unable to pay my rent on time.

These large fees are simply a scam, preying on the most vulnerable among us, and an added poverty tax making it harder for working people to live well in Seattle.

These exorbitant late fees being demanded by landlords are a ridiculous and unnecessary burden on working people.

I strongly support this ordinance from Council Member Sawant to cap late rent fees at $10 a month, because as a renter, you shouldn't have to be lucky to get one of the few decent small landlords.

It shouldn't depend on your luck.

All renters should be protected.

Hello, everyone.

My name is Ruth, and I'm an educator at a nearby middle school.

I've also been renting in Seattle for the last 12 years.

The second unit I ever rented in Seattle was under the ownership of Carl Haglund.

Many of you will remember Haglund as the infamous slumlord who tried to gouge his immigrant tenants while refusing to fix housing code violations.

Those tenants got organized alongside Council Member Sawant's office and the Tenants Union and defeated Haglund in his attempted rent increase.

Renters then built on this victory, and once again, with Councilmember Sawant's office and renters' rights organizations, won a law against raising rents in buildings which have major housing code violations, like rodent infestations and black mold.

We rented a little house from him starting one fall, and when winter came, we were freezing.

We realized there was no central heating in sight and called up Haglund.

When he finally came over, he unscrewed a panel of our kitchen wall to reveal a furnace that we had never been told about, and then he poked fun at us for not somehow realizing it was there and living in a house where it was so cold we could see our breath.

This and other experiences made me start to realize that a lease is an agreement between two parties, but only the renter is really obligated to hold up their end.

If I don't pay my rent, I get charged late fees and I'm threatened with eviction.

If my landlord rents a unit they know is not up to snuff or doesn't make necessary repairs, I'm lucky if I reach someone from the Seattle Department of Construction and Inspections who will actually stand up for me instead of chumming it up with my landlord when they come to investigate.

When working class people sign a lease, they are not freely making a choice.

They may have picked this unit from a few options, but the landlord is firmly in the position of power.

Shelter is our most basic and human need, but there is a separate class of owners who arbitrarily decide whether or not we'll be able to access it.

So renters are already in this extremely compromised position, and we're effectively forced to accept any conditions presented in our leases.

Landlords know all this and take advantage of the vulnerable situation renters are in.

Considering the power landlords hold over us, folks who are being exploited by them don't want to rock the boat by addressing predatory conditions in their lease.

We should be able to rely on our government to protect us instead of having to take things into our own hands when the stakes are so high.

When I rented from Carl Hagelin, I was 19 years old, hardly on an equal footing with him.

Late fees are not regulated in any way right now, and most landlords are happy to take advantage of this.

In my current lease, I'm subject to a $75 fee if my rent is not submitted by the third of the month, and then an additional $25 fee every day after that.

That's not even the highest of what renters experience, but it means that if there's some small hiccup and I get paid on the fifth one month, I'm suddenly paying $100 more than I budget for.

With this legislation passed, I would only be out $10.

A huge number of working-class people are already living paycheck to paycheck and are not able to build enough savings to handle emergency expenses.

So say my car breaks down and I need to repair it in order to get to work.

I'm now choosing between paying my rent and getting to my job where I make the money to pay my rent in the first place.

Landlords can choose to be forgiving but again renters are completely at their whim.

Late fees on their own are not grounds for eviction, but it's not too tough to see how a person trying to catch up on their late fees just gets further and further behind on their rent and still ends up evicted and possibly without housing at all.

I know the council is well aware of the thousands of our neighbors who are living on the streets of Seattle, by the way, often doing the best they can in encampments that are being sadistically destroyed by the city.

The truth is that many renters are only one or two missed paychecks away from losing their homes and having this reality be their own.

I would say that's plenty of incentive to pay your rent.

I have to urge the council to vote yes on this legislation without watering it down.

Working class people in Seattle have it hard enough with the cost of living and rent prices increasing all the time.

If we barely have money for our rent, we certainly don't have money for rent plus these completely arbitrary and unregulated late fees.

Thanks for your time.

Thank you, Ellen, Josie, and Ruth for sharing the stories and also talking about, you know, what, sharing with us also what's on your own leases with your landlords.

And Josie, in your case, talking about the people you're serving.

in your capacity at work, and how then that was a real life example of a grandmother having to take care of her grandchildren, and it immediately brings to light what kind of impact this can have in the far-reaching impact of children, actually, and little children, as you said, all under five, ending up in foster care, possibly, if this lady is pushed out of her home.

So thank you for sharing those powerful stories.

And I again really appreciate the patience of all the panelists.

It has been a good discussion though and I appreciate council member questions as well and responses from Kate and Edmund because I think that helped clarify a lot of things.

It is taking up a little bit of time, but I wanted to, sorry for this, but Shnadheen, this is about the second agenda item, but our person who's here has to leave quickly.

So, what I want to do is just welcome you to speak, and then we'll go back to this agenda item, and then we'll do the vote on that other item as scheduled, if that makes sense.

So, Shnadheen, if you can unmute yourself and go ahead.

Good morning, everyone.

I'm Schneideen Sandia-Registon.

I am a legal analyst at Brooks Running, and I serve as the ERG co-chair as well.

I applied for the Seattle Renters Commission sometime last year because I was just really upset with my rental situation and really wanted to be a part of the change I wanted to see.

And I applied, did the interviews, and yeah, I'm just pending appointment and looking forward to working with everyone and hopefully making meaningful changes.

Thank you, Shandiin.

Before you go, can you just say a little bit about maybe just your thoughts on the discussion so far on this particular legislation and also what you hope to accomplish by being on the commission?

Yeah, this was a very fruitful discussion for me.

This is actually my first council meeting that I'm sitting into.

Just hearing everyone's stories is honestly so empowering and it makes me, it drives me even more to be a part of this.

It's honestly disheartening to hear these stories about how landlords are treating their tenants, how unfair these practices are, and, you know, the situations that people are in.

Um, as far as like serving on the commission, I do really want to be a part of meaningful changes.

There's a lot to learn and, um, be a part of, um, but I really want to.

Make this more of a renter's market so they can easily rent and, you know, be able to benefit from this lease agreement as opposed, um, instead of just living there, but actually having a good quality of life in their homes and have a good relationships.

between them and their landlords.

Thanks so much, Nadine.

I really appreciate that.

And really, I think with what you just said, you explained really well why you should be on renters commission.

That is what we want.

At least that's what my office wants, that we want real advocates who are driven to advocate for the interests of renters.

Council members, do you have any questions for Nadine before we go back to the other item?

President Juarez?

President Juarez, did you want to speak?

Oh, no, I'm sorry.

No, I'm good.

You just came off.

Yeah, you came on camera, so I was wondering.

I don't see any council members.

their Zoom hands up.

So, Shraddini, you're free to go.

I really appreciate you coming here and sharing your thoughts.

That was very important.

And also, thank you for your patience.

Thank you, everyone.

Bye.

Bye-bye.

So, Violet...

Sorry.

I didn't want to take you...

Yeah, take you back like that.

Yeah, please introduce yourself and go ahead.

Violet Lalitai.

the Executive Director of the Tenant Union of Washington.

Yeah, I mean, you know, we're in hours of support of legislation that help tenants.

And I think the misconception is, why is it so low, you know, $10?

I think with the outrageous, so let me explain.

We have a hotline that tenants call in all the time.

And one of the things that we get complaints about is the outrageous, you know, fees for being late on their rent.

And I think one of the things that I wanted to share is sometimes people get behind on rent.

It's not always the case that landlords always say that the tenants does not want to pay the rent.

They actually do.

So when they get behind, there's circumstances that happen.

It actually becomes a more dire situation when they get charged for the late fees.

they get charged for, you know, the rent that they're behind already.

And I think that's the point that I wanted to bring forth in all of this.

It's great that everybody is testifying on behalf of this to support this legislation.

Burien and Auburn have this.

I think the $10, because landlords would say, that's, you know, that will put us behind.

You know, the banks will come after us.

You know, the bailout for banks are the federal government, as we all know.

And so, is it putting them behind?

I think we also have to equate the fact that the rent is outrageous.

The rent is outrageous.

We've been working on a bill that did not go through, you know, and it's to cap rent.

And I think we're at the point where it's not only affecting the city of Seattle, but it's throughout our state.

And I think these fees, $10, is something that, and I'll give you an example.

Sarah, she let me explain her story.

I remember taking a call from Sarah, and Sarah is a senior citizen who got behind on her rent.

There were circumstances that she had to pay extra.

She does get $600 a month, and she lives on subsidies.

Well, some of the money that she depends on, she had to use it for other things.

And so, that bought on a late, charge from her landlords.

Now, just imagine $600 is your income.

We're talking about below poverty.

And to actually charge you $50 and get threatened to get charged on top of the $50, that's almost a third of her income she gets monthly.

And I think we missed the point of, oh, the poor landlords.

I think the businesses, and I'm, I'm just gonna say it.

With all of this stuff that, if you want to be a landlord, this is part of what you are supposed to do, like repairs.

And I think that the thing that we hear on our hotline is, well, we pay for all of this repair.

That is your, you know, RCW 59-618-060 says you're responsible.

So you have these.

There's also things called admin fee.

I don't even know what that is.

I'm not even kidding you.

We get complaints about admin fees.

What is admin fee?

And when I ask properties, what is admin fee?

You want to hear something?

They don't even know what admin fees are.

So you have the rent increases, the charges to the tenant.

I can tell you the many tenants that does call our hotline.

And then we do organize the building.

They do want to pay their rent.

And I think the landlords is, oh, they just want a free ride.

They don't.

I think everybody wants to pay the rent and stay in their place.

We get a lot of tenants call on our hotline.

And the most outrageous case that just happened last year in November was $75 a day, a day.

And you know what the landlord told me when I called him, because I always get into it with landlords, I don't really care.

But you know what he said to me?

He said, because they didn't pay their rent on time.

And I said, how do you consciously charge somebody $75?

That's almost the equal of the rent they're paying monthly that's outrageous already.

And I remember, you know, I get creative.

We will make sure that we let everybody know that you're doing this.

You know, I have to be creative as a director on how we deal with these predatory landlords that does this.

And, you know, fortunately, they took those fees away, but this shouldn't be.

Shouldn't be like this for all tenants.

And so that's why we support the cap on $10.

And like Edmund said, I like it because there's us in the community who hear these stories day in, day out, and on our hotline.

And there's also why this is important, Edmund and Kate talking about that and Shama's office.

So let's pass this.

And if there's anybody at the council members that want to ask me questions on the hotline that we serve every day, my number is posted on our website.

Thank you so much, Violet.

That was very helpful to hear because, obviously, you in tenants' union get to hear from many, many renters, and that's not a window we get to glimpse through, so that was very useful.

Go ahead.

I just wanted to...

Introduce yourself for the record.

Sorry.

My name is Kate Rubin.

I'm the co-executive director of BC Atoll.

I just jumped right into it.

We've used the term that landlords are nickel and diming us to death.

I feel like that's not even as descriptive as it actually is.

It's not nickels and dimes.

This is hundreds of dollars coming from poor people who don't have extra hundreds of dollars to pay.

It's actually to the landlord's benefit in many of these situations if their tenant is late because they are earning so much extra money.

They are getting so much extra money from this person's hardships.

So capping it at $10 a day and eliminating these creative fees, such as the notice delivery fee, is so necessary.

During public comment, Howard mentioned that landlords are getting very creative in finding new ways to either nickel and dime their tenants or to get them out so they can put renters in who will pay three times the rent.

The rent evictions is a big problem.

So we need to do everything we can to protect renters because we can't rely upon the landlords to make the ethical decision.

During public comment, there was also a landlord, Gordon, who mentioned, who was against this legislation, but mentioned that he had only charged one renter a late fee in the many years that he had been a landlord.

And I want to say, good for you, Gordon.

Not all landlords are like that.

You can't trust them to have empathy.

And certainly, when there's things like a language barrier, they're even less understanding towards their tenants.

So we need legislation that protects everyone.

Thank you so much, Kate.

And the whole point is to have laws that protect renters, not having to rely on the empathy of this or that landlord.

In fact, if we've seen anything from the so-called housing market, we've seen that it's very much lacking in empathy towards renters who are now the majority of our city.

I had one question for Edmund, and I'll keep looking for questions from council members.

Please feel free to ask questions of the panelists, and we won't go for too long because people have already waited for a while.

I just wanted to add one thing.

In terms of whom we're talking about, obviously the majority of the city is renting, but it's not, I wanted to clarify that we're not, obviously the crisis is the most acute for the people who are the lowest income, and so that often means refugees, as Dr. Garcia said in public comment, people of many communities of color.

If you look at the eviction numbers, for example, it shows you that Black women-led households or low-income households are the most affected.

But I wanted to give a sense, make sure that all council members have a sense of how big crisis is for people in general.

We are no longer, in this economy, we are no longer talking about the poorest people.

If you look at this article, I have two articles.

One is from the Washington Post that was published in December 2018. which is titled, Living Paycheck to Paycheck is Disturbingly Common.

And it is a report from the Federal Reserve at that time.

And so the reason I'm using this is because I'm going to also use a report that's more recent, but this was even before the pandemic and the recession at that time.

So it's from 2018, and it says four in 10 adults say they couldn't produce $400 in an emergency without sliding into debt or selling something.

And this is from 2017 data.

And the point about this is who are we talking about?

We're talking about professors, real estate agents themselves.

You know, these are not the big landlords, but these are people who are, you know, working in the real estate market because they need a job.

farmers, business executives, computer programmers, store clerks.

You know, the article says, what do you think all these people have in common?

Well, what they have in common is that they're living paycheck to paycheck.

So we're talking about people who are in very precarious conditions, and this is a lot of people in the United States.

And then fast forward to February 8, 2023. This is an article I believe from the Seattle Times in which it talks about, it's a national newswire article, in which they look at data in 2022. This is Bureau of Labor Statistics data.

that found that given the cost of living crisis, you know, the inflation rate that is prevalent, unprecedented inflation rates, the new study has found that more people are having to spend all their income on necessities, and they are counting on their next salary to meet the cost they'll incur until then.

And we're talking about, look at the numbers, 64% of Americans, according to this study, will be living paycheck to paycheck by the end of this year.

So this is 64% of the richest country in the history of humanity.

This is the extent and depth of the crisis we're talking about.

And I just wanted to underscore one other point in relation to this is, as Emily MacArthur in the public comment mentioned, we're also in a period where there's massive tech layoffs.

So we're going to see people who otherwise we might have thought of as comfortably living, you know, people with maybe six figure salaries or very good salaries overall, Many of them are getting laid off right now, but more are going to be laid off in the next few weeks.

Meta just announced that they're going to be doing a big round of layoffs next month in April.

So we're talking about a big proportion of the population of renters that is going to be suffering and we absolutely need to eliminate.

any, you know, all of these things.

And ultimately, the problem is the skyrocketing rent.

That's the problem.

We're not even addressing that.

This is a small piece of the puzzle.

So I hope council members will take into account how important this is to do.

And the other point I wanted to mention is, thanks to Adam Zimkowski in my office, community organizer in my office, he did a bit of just very, very simple math, and he said, if your rent is more than $666 per month, then 1.5% is going to be more than $10.

So for everybody in Seattle who's renting, and if your rent is more than $666 a month, then $10 flat rate of late fee is going to be much more progressive than anything, any percentage will be.

So I think that's very useful.

Mathematics, thank you, Adam, and it's very simple.

You can do the math.

So renters, if you're watching this, you should do the math.

How much?

1.5% for you will be.

And obviously from the math and given that virtually nobody has that rent, you're going to be paying more than $10.

So I think it's a very strong argument mathematically for the legislation that is in front of us.

One question for Edmund is, how does late fees affect the credit score of renter if in any way?

Yeah, that's a good question.

It's also a question that we don't know the full answer to.

I mean, so first of all, any debt that you owe can always be reported to a debt collector or to a consumer report in any way.

What we don't know is to the extent in which a lot of, say, national corporations, property management companies have kind of collected that data on their own and set up their own internal databases that they allow people to subscribe to.

So to give you an example, we'll have a renter that was maybe renting in Seattle 10 years ago or, you know, five years ago, fell behind on their rent, had a lot of late charges, other things that were accrued.

They'll then call us because they've since moved to Georgia and they're saying all this information that they've found in or that from like five years ago in Seattle is now being reported there and now they can't find housing in Georgia.

This is actually just a bigger trend over the last 15 years, which generally we've seen just a lot more data collection of renters every time, you know, does it, do you pay your rent on time?

All of that information is getting more collected, more aggregated.

We've seen just sort of like kind of tech take over the real estate market and property management.

And the result is that a lot of tenants just find themselves shut out just because of one bad circumstance.

So it obviously has an impact on your credit score, it has an impact on your consumer report, but to the extent that that information's being gathered and used in other ways, frankly, it's just almost like an industry secret at that point.

Right, thank you for explaining that.

So, sorry, President Morales, did you mean to speak or?

I'm sorry.

I'm good.

Okay.

I don't see any other questions from council members.

Do our panelists have any more thoughts to share?

Yeah, I guess my hope today is that this legislation go through, and I think it's us thinking about, you know, everybody's thinking about the ins and outs, or we're against the landlords.

It actually protects a lot of the families, mostly below poverty.

$10 is actually a huge number to people who are getting income of $300 or $400.

I want you to see the picture of that.

I came today to share a lot of stories.

We get a lot of stories about these fees.

And what it does is you get behind on rent, you're charged these fees, it actually pushes you back.

to where it's a huge effect on, and it leads to eviction.

It does, it really does.

And I think we have to see the ugliness of these fees.

And so I wanted just to share that.

Yeah, I think that's important to note that in one of the worst situations it could actually lead to eviction because ultimately if you're not able to pay all this accumulated amount plus your rent.

That's non-payment of rent is obviously the most common reason for people to get evicted.

So there is a connection.

And ultimately, whether you're paying rent or late fee, it's coming from the same part of money, which is your meager paycheck.

Or if you're a social security recipient.

And in fact, I wanted to share what quickly one, you know, we have a community petition where people can say, you know, that they support this and also share their own story.

And in fact, one of the stories is from a recipient of Social Security retirement benefits, and this is the person who exists on those dollars, which obviously we know are not far from lavish.

And they say that their rent is due on the first of each month.

This sets them up for a perpetual late fee of $50 per month because their check will never arrive before the deadline to pay without penalty, which is the fifth.

And they say, I have asked several times to change my due date to the 15th.

but it's not being changed, and they say that, you know, this means that I'm always having late fees, and, in fact, they say that they have paid over, they estimate that they have paid over $3,600 in late fees so far, all because a landlord won't even accept a mid-month payment as an on-time payment.

So, you know, this also answers the question that we have heard, actually, from some landlords who are opposing this legislation.

They say, well, why don't tenants just negotiate correct terms with the landlord, well, there you go.

Even when they are asking to have a different kind of arrangement, they're not getting it.

Yeah, totally.

I'm glad you brought that up because landlords will say, we'll negotiate with your landlord.

They have.

That's the first thing they do, negotiate, I can't pay this.

And so you have these landlords.

There are some good landlords that I've met, but we don't have enough in the state of Washington, mostly in Seattle.

And I say that because I'm on the hotline and in these buildings.

and hearing from the community, mostly in the black and brown communities who are feeling this, our most marginalized and vulnerable communities that feel this.

These fees, people think it's just $10.

It actually is a huge deal to our below poverty tenants, to people who live actually sometimes on the street, you know, so yeah.

Thank you, Val, and thank you all panelists for sharing your thoughts and insights, both renters and renters rights activists who are here.

I really appreciate it.

And we will, as I mentioned, bring this legislation for a vote at our next committee meeting on April 7th.

I would really request all the panelists who are here today to be available for that committee meeting, because I'm sure there will be more questions then.

So I really appreciate you all being there.

So April 7th, if you can come, yeah, be here by 9 o'clock, and the committee will start at 9.30.

So you are free to stay or go depending on what you have going on in your day.

I really appreciate all this time.

You've been very, very generous and it has been extremely helpful.

Thank you also to council members for asking questions.

Before council members go and we adjourn, we have one other quick agenda item which is appointment 02498, appointment of Nidine Sandhya Rajistan as member of Seattle Renters Commission for a term to February 28, 2024. This is an executive appointment, but because there has been turnover in the Department of Neighborhood Staffing to the Seattle Renters Commission, it's just us talking about this nomination from the committee.

And Shanine already introduced themselves, and it was really, really useful to hear her thoughts on this appointment.

And I can just add that, as she said, she's a legal specialist with an interest in local government and policies.

And as a renter, she has seen how shockingly expensive housing has become, and she has volunteered for the Seattle Renters Commission because she would like to be a part of advocating for policies to defend the interests And we already heard from her own words how she would like to use her position.

So if council members are okay, I will move appointment 02498 for a vote.

Second.

Thank you.

Ted, please call the roll.

Council Member Sawant.

Yes.

Council Member Juarez.

Aye.

Council Member Morales.

Yes.

Council Member Lewis.

Yes.

Four in favor.

Thank you, council members, for that vote.

That will now go to the full council on March 28th for our final vote.

I really appreciate you all staying here.

It was a slightly longer committee, but obviously there was a lot to get into.

Again, thank you for all the questions and comments, and we will be back on April 7th at 9.30 a.m.

Meeting adjourned.

Thank you.

Thank you.

Thank you, President Borges.