Orange County rent plan could have unintended consequences, study shows

Commissioners responded to a report looking into possible effects of rent control

ORANGE COUNTY, Fla. – The Orange County Commission is set to discuss its rent stabilization plan during a Thursday meeting that aims to push back against rising rental prices and help renters avoid troubling rent spikes.

Commissioner Emily Bonilla introduced the proposal back in April, which would put a 5 percent (or the rate of inflation, whichever is less) cap on rental rate hikes in Orange County. The cap would last one year and would have to be approved by voters.

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The county paid $60,000 to GAI Consultants, an engineering consultant company, to analyze the plan and discuss their findings on its potential efficacy.

However, the report came back with several criticisms of the plan, pointing out “unintended consequences” for the measures outlined in the proposal. Furthermore, the company outlined that the causes of these rate hikes are “likely beyond the control of local regulation.”

To start with, the report indicates a general lack of housing in Orange County, stating the proposal could deter housing suppliers from creating more.

According to the findings, housing supply in Orange County hasn’t been able to match the growing demand for housing, which means that there are too many people competing for too few units.

The report goes on to say that operating costs for rental units has also been increasing, leading to higher prices for renters.

“Given almost 50 years of production history, the supply of housing has simply not kept pace with demand generated by normal population growth,” the report says. “When the need for various housing types... are matched to the total output, falling deliveries create an obvious market impact.”

GAI Consultants noted that attempts to implement rent control could actually deter developers from trying to build more housing in the county.

In the report, GAI Consultants stated that policies similar to the rent stabilization plan are already in effect in California, though residents there are still experiencing rental rate hikes and prices like those in Central Florida.

GAI Consultants also pointed out in the report that Orange County has “uncommitted” funds from the Emergency Rental Assistance Program, a federal program meant to assist people struggling to afford rent.

The report says the county received $33 million from the ERAP initially, though another influx of $16 million is expected to come in from the program later this year.

It adds that money from this program could be put toward “financial relief” for Orange County residents struggling to pay rent and other costs.

However, Bonilla stated that the county is planning to put some of that money toward affordable housing costs.

“We have a lot of things we have to pay for, but one of them that we are using $5 million toward is some of the affordable housing projects that we do have (because) their costs have gone up,” Bonilla said.

Addressing county concerns about the social impacts of rent costs, the report indicates that conditions such as homelessness or rates of eviction aren’t necessarily linked to the increase in rental costs across the county.

According to the report, a total number of 3,181 evictions were filed with the Orange County clerk of courts as of March.

In Figure 21 of the report, the company broke down the number of evictions filed with the county’s clerk of courts, showing that there was an increase in eviction-filing rates from 2020, but the number is down considerably from years prior.

Figure 21 from GAI Consultants report on Orange County rent stabilization plan (Orange County)

The report then states that the increase from 2020 is a result of COVID-19 pandemic guidelines for landlords.

“Because legislation or rules related to the COVID-19 pandemic limited efforts to evict any resident from property, comparisons with 2020 or 2021 are probably misleading,” it reads. “Eviction-related filings peaked in the years immediately following the (2007 - 2009) recession.”

GAI Consultants also included claims that homelessness rates haven’t been contingent with increases in rent costs, pointing to data from social providers and the U.S. Census about previous years, which shows an overall decrease in the number of people made homeless since 2009.

Homeless figures in GAI Consultants report on Orange County rent stabilization plan (Orange County)

The report says that, as rates have either decreased or remained steady since peaking in the aftermath of the 2007 - 2009 recession, it is safe to assume that current rates aren’t necessarily linked to the increased costs of rent in the county.

According to Commissioner Nicole Wilson, however, the numbers in the report don’t necessarily align with the county’s records.

“Even having seen the numbers for HIMS, we’ve talked to people in our own Children and Family Services Division, and they dispute those numbers,” Wilson said. “And I mean by thousands — not by tens, not by twenties but by thousands.”

“This is not just a local issue. Perhaps there would have to be some legislative agenda going through Tallahassee, and maybe there could be a federal agenda to Congress. We can’t lead our people to believe — I think that’s the saddest part of all of this, the ones who are struggling — that this county, if we just adopt a rent stabilization ordinance, that this will all just go away.”

Commissioner Mayra Uribe also commented, saying the report didn’t properly define homelessness.

“What data are we using for homelessness? Is that someone living on the street? Is that someone living in a weekly apartment? Is that someone sleeping on a couch? What really does constitute homelessness?” she asked.

Bonilla responded to the report earlier this month, stating its claims were “biased” against measures outlined in her plan.

“There were some statements that were made that there was no data or facts that were referenced to the opinionated statements to back it up,” Bonilla said, pointing to figures regarding homelessness and evictions in the county. “(The report) expresses what that person wanted the board to believe, rather than providing us with the facts.”

UCF Professor Owen Beitsch, who presented the report to the commission, replied to Bonilla’s criticisms.

“We’ve reported homeless data. We’ve reported eviction data. We’ve reported homelessness as shared with us by the school board, which different members of the commission seem to believe is a reliable source,” Beitsch said. “The data indicates from an objective, quantitative standpoint — something very different from what we are feeling emotionally.”

Commissioner Christine Moore approved of ERAP recommendations in the report alongside other measures, such as advanced notices for rent increases so that tenants would be able to prepare for spikes in rates.

However, she also stated that she doesn’t believe the county has the ability to fix the issues at their level.

“This is not just a local issue. Perhaps there would have to be some legislative agenda going through Tallahassee, and maybe there could be a federal agenda to Congress,” Moore said. “We can’t lead our people to believe — I think that’s the saddest part of all of this, the ones who are struggling — that this county, if we just adopt a rent stabilization ordinance, that this will all just go away. That’s not the truth.”

The county commission will hold a special work Thursday morning to discuss the rent plan. The session will not incorporate any public comment.

If approved, the plan would go to a public referendum on the November ballot later this year.


About the Author:

Anthony, a graduate of the University of Florida, joined ClickOrlando.com in April 2022.