The St. Paul City Council on Wednesday voted to pare back the city’s rent control ordinance while passing a suite of new tenant protections.

Voters approved a 3% cap on annual rent increases in 2021, but the ordinance was later modified to include a 20-year exemption period for new housing. An amendment that passed Wednesday will now permanently exclude any units that first received a certificate of occupancy after Dec. 31, 2004.

Proponents for rolling back rent stabilization, including Mayor Melvin Carter, say such a measure is necessary for attracting new development to fix the city’s housing shortage. Opponents argue a permanent exemption will gradually shrink the stock of rent-controlled housing available to working-class families.

“Our housing equity goals cannot be achieved without building more homes,” Carter said. “I applaud the council for adopting these policies, which I proposed to advance these critical goals together.”

The council rejected two amendments proposed by Council Members Nelsie Yang and Hwa Jeong Kim to extend the 20-year exemption window to 30 years and to require construction workers on new housing to be paid the prevailing wage to qualify for the rent control exemption.

“This was a critical step in unlocking housing development in our city,” City Council President Rebecca Noecker said. “We’ve seen plummeting housing production, plummeting permits being pulled. We knew we needed to take a step to really send a strong, clear signal to the market that St. Paul is open for development.

“Amending the rent stabilization policy is just one step, and as a council, affordable housing and expanding housing is a top priority for us.”

The Oasis Center, an organization centered around housing stability, said in a statement the revised policy is concerning.

“As a provider of Housing Stabilization Services, we understand that the City Council’s recent decision to exempt newer rental buildings from St. Paul’s rent control ordinance is intended to encourage development and address the city’s housing shortage.

“That said, we’re concerned about how this change could impact the people we serve — and many other low-income and working families. Lifting rent caps on newer buildings could lead to higher rents that many simply can’t afford. This could create more housing instability or even displace families from the communities they’ve long called home. While new development is important, we hope the city and developers will keep affordability front and center — otherwise, these new units may end up out of reach for those who need them most.

“Affordability is key to creating real opportunity. We urge leaders and developers to make sure that new housing includes options that everyday families can actually afford.

“At the same time, we’re glad to see the City Council unanimously approve stronger tenant protections. These updates — including limits on security deposits and clearer rules around evictions — offer more safeguards for renters, especially during unexpected hardships.

“As these changes unfold, we remain committed to standing by our clients and continuing to advocate for policies that create more housing, more stability, and more opportunity for everyone in St. Paul.”

Mahad Omar, Oasis Center

Meanwhile, the council unanimously passed a range of new tenant protections, such as limits on security deposits and service fees and more specific steps landlords must follow before beginning the eviction process.

The new protections take effect in one year.