If the Colorado legislature gave an award for “Least inspiring speech in support of a really bad bill,” Rep. Paul Weissman, D-Louisville, would be the clear favorite in early balloting for the dubious honor.
Weissman was speaking last week to the House Committee on Local Government on behalf of his House Bill 1140, which would have allowed city and county governments to impose rent controls on private residential property. The measure later stalled on a 5-5 tie vote.
In our view, and that of most economists, rent control is a bad idea. In extreme cases, such as New York City, it discourages construction of needed new housing and encourages owners of existing rental properties to let them deteriorate. It also reduces the supply of rental housing by prompting owners of apartment houses to turn them into privately owned condominiums as a way of bailing out of an unprofitable rental market.
To our surprise, Weissman didn’t challenge the prevailing view that rent control laws do more harm than good. Instead, according to the official committee record, “He said that he feels rent control is a failed economic policy; however, he feels that these issues are not a matter of statewide concern.”
We beg to differ. Not about the part that declares “rent control is a failed economic policy,” of course. On that we are in hearty accord with Rep. Weissman.
But we also feel a policy that promotes poor housing conditions and can turn neighborhoods into slums is definitely a matter of state concern.
For one thing, falling values on commercial property force the state to pay more in aid to local school districts because of the rules in the Gallagher property tax amendment and the state school finance law. That, in turn, will force higher taxes or less aid to other schools — both “matters of state concern.”
Rent control also clearly violates the spirit of the Fifth Amendment to the U.S. Constitution, which prohibits private property from being taken for public use without just compensation.
Note we said the spirit, not the letter, of the law. As Rep. Bob Gardner, R-Colorado Springs, notes, courts have ruled that most rent control laws don’t technically violate the federal takings clause.
But Gardner, who voted against the rent-control bill, also noted that the Ninth and 10th amendments also give the states power to provide protections — including protections to owners of private property — beyond those granted in the federal charter. That’s exactly what the legislature did when it banned cities and counties from enacting rent controls that deny private property holders the fair use of their property without just compensation.
HB 1140 should be given a decent burial. The legislature has enough to do without reviving what even it admits are “failed economic policies.”
