Commissioner Chloe Eudaly speaking at a 2017 rally for tenant protections.
Commissioner Chloe Eudaly speaking at a 2017 rally for tenant protections. Dirk Vanderhart

The Oregon Court of Appeals ruled to uphold Portland's renter relocation ordinance Wednesday, affirming that the 2017 policy does not violate state rent control laws.

The decision follows three years of legal debate over the ordinance, which requires Portland landlords cover tenants' housing relocation fees if they've raised rent by at least 10 percent or issued a no-cause eviction. The rule, championed by City Commissioner Chloes Eudaly, requires landlords pay between $2,900 to $4,500 in relocation fees, depending on the size of the leased home.

In a lawsuit filed days after Portland City Council approved the policy, two landlords argue that the rule violates Oregon's state laws that ban local rent controls and permit no-cause evictions.

A Multnomah County Circuit Court judge dismissed the landlords' lawsuit months later—but the pair, represented by attorney John DiLorenzo, appealed the decision to the Oregon Court of Appeals.

Since the lawsuit was filed in 2017, the Oregon Legislature passed a law similar to Portland's relocation policy, which banned all Oregon landlords from raising rents more than 7 percent each year and prohibited no-cause evictions for tenants who've leased a property for more than one year. State legislators dubbed this a "rent control" bill. However, the state still prohibits rent control policies being made at the city or county level.

In the court's Wednesday opinion, President Judge Darleen Ortega backed the county court's original decision.

"We agree with the city that the ordinance is not 'rent control,' because it does not regulate the amount of rent that a landlord may charge," writes Ortega. "That it may have the effect of incentivizing landlords to keep rent increases below the 10-percent threshold does not make the ordinance a 'rent control' ordinance that is unambiguously preempted by [state law]."

In short, Ortega's saying that a government discouraging landlords from making extreme rent hikes isn't the same as a government capping the price of rent.

The ruling also upholds the ability for tenants to sue landlords in civil court for not following the city's relocation policy, and affirms that the policy is compatible with Oregon's no-cause eviction law. But, while the appeals court has ruled in favor of the city ordinance, the legal case is not entirely closed.

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In the opinion, Ortega instructs Multnomah County Circuit Court to make an official judgement in favor of the city, instead of letting the court's 2017 dismissal of the case be the final word. At the same time, the landlords' legal team isn't ready to give up. According to the Oregonian, DiLorenzo said he plans on appealing the ruling to the Oregon Supreme Court before the case is re-heard by the county judge. DiLorenzo has not yet returned the Mercury's request for comment.

Commissioner Eudaly celebrated the ruling on the relocation ordinance (or "relo") in a statement shared on social media Friday morning.

"Relo has faced multiple legal challenges from the landlord lobby, but we continue to prevail," wrote Eudaly. "Thank you to the City Attorneys who have argued this case in court. It’s gratifying to know that our policy work—the first item my office advanced in our first 30 days—has held up and that Portland renters will remain protected from price-gouging during our ongoing housing crisis.... I hope that this ruling will encourage many more jurisdictions to consider their own local Relo ordinance."