WHEREAS, rents for residential property can rise drastically during times when housing is in short supply and the economy is strong; and

WHEREAS, in economics and law, rent control refers to the government regulation of rent to prevent unreasonable or excessive increases; and

WHEREAS, in the United States, the federal government imposed rent control (and other price controls) during World War Two, and continued it in several cities after the war because of housing shortages; and

WHEREAS, rent control was later turned over to the control of individual states and municipalities and has since ended in most locations; and

WHEREAS, proponents of rent control claim that it is necessary to prevent landlords from imposing rent increases that force the elderly and the poor to move, on the grounds that housing is an inalienable human right that is equal to the rights of landlords; and

WHEREAS, other advocates of rent control claim that maintaining a supply of affordable housing is essential to sustaining job growth, and to maintaining a community that includes senior citizens and people of all income groups; and

WHEREAS, homeowners who support rent control point to the neighborhood instability caused by high or frequent rent increases and the effect on schools, youth groups, and community organizations when tenants move frequently; and

WHEREAS, opponents of rent control claim that rent control can create housing shortages, resulting in an overall decrease in the quality of housing stock in a city, and that the benefits of rent control accrue disproportionately to the wealthy and well-connected; and

WHEREAS, opponents of rent control argue that the goal of making housing affordable and available to the poor can be accomplished by the same free market that created the housing units in the first place, or by government construction or subsidy of affordable housing projects; and

WHEREAS, opponents of rent control see rent control as a violation of the landlords' property rights that limits their ability to sell their rent controlled property, thus essentially forcing landlords to put their property to work for the state without recourse; and

WHEREAS, regulation of real property is a fact of life in modern societies, and landlords and their organizations actively use their recourse to legislatures to assert that the government has taken landlords' property without compensation, although courts generally have found that unconstitutional takings have not occurred; and

WHEREAS, while the political debate over rent control is far-reaching, the purposes and provisions of rent control laws are intended to be limited in scope, and the frequency and degree of rent increases are limited, usually to the rate of inflation; and

WHEREAS, under rent control landlords may pass along the costs of capital improvements to their properties, and tenants may be able to claim that decreased services or the lack of necessary repairs offset additional increases or justify a rent reduction; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2006, that the Legislative Reference Bureau study the constitutionality, legality, and effectiveness of rent control in jurisdictions where rent control has been established; and

BE IT FURTHER RESOLVED that in its study of rent control, the Legislative Reference Bureau consider the feasibility and potential effectiveness of enacting and implementing rent control measures in Hawaii; and

BE IT FURTHER RESOLVED that the Legislative Reference Bureau report its findings and conclusions to the Legislature twenty days before the convening of the Regular Session of 2007; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Acting Director of the Legislative Reference Bureau and the Executive Director of the Housing and Community Development Corporation of Hawaii.

Report Title:

Rent Control