Five meaty referendum questions face Portland voters on Nov. 8. Four of them are citizens’ initiatives steered by the Maine chapter of the Democratic Socialists of America, a left-wing labor-oriented political organization that is critical of market-based solutions to social problems. A fifth ballot question – slotted as Question A — was drafted by short-term rental owners and acts as a sort of countermeasure to Question B, which would abolish non-owner-occupied short-term rentals like Airbnb and VRBO and enact stronger restrictions and fees on owner-occupied rentals.
The DSA now only supports three of their four proposals, having stepped away from Question E, which would restrict the size (and number) of commercial cruise ships that can dock at Portland’s harbor.
Question A: An Act to Regulate Short-Term Rentals in Portland and Prohibit Corporate and Absentee Operation of Short-Term Rentals in Portland
…or, Airbnb Restrictions Version One!
This question was advanced by a group called The Committee to Keep Portland Local — incidentally a group of Airbnb owners — and is the only question not to originate from the DSA’s Campaign for a Livable Portland.
If passed, the policy would retain the already existing 400-unit cap on non-owner-occupied short-term rentals, or STRs, adding a few small tweaks. First, it would prohibit corporate and non-local owners from registering short-term rentals in Portland. Second, it would prohibit evictions of tenants in at-will leases for the purpose of immediately converting the property to short-term rentals — closing a loophole that some landlords found around previous eviction laws. Third, it would prohibit affordable and workforce housing to be used as an STR. And fourth, it would increase penalties for disorderly properties and violations of the city’s regulations.
But there’s more! A clause in the proposal would insulate those currently holding short-term rental licenses from any future amendments to the city’s policy.
Question B: An Act to Reduce the Number of Short-Term Rentals in Portland
…or, Airbnb Restrictions Version Two!
If passed, this proposal would restrict short-term rentals in Portland only to those that are owner-occupied, tenant-occupied, or located in two-unit buildings occupied by the owner.
Question B would effectively accomplish a big portion of the plank of Question A – forbidding corporate landlords – by reducing the city’s cap on non-owner occupied mainland short-term rentals from the current 400 to 250 (or 1 percent of the long-term rental stock, whichever is fewer). Those units would, theoretically, be restored to the rental housing market. Question B would also increase the annual fee for owner-occupied STRs to $250 and non-owner-occupied units to $750, require STR owners to notify all residents within 500 feet, and increase penalties and strengthen enforcement of violations. would require logging complaints and only permits the city to revoke STR registrations.
Question C: An Act to Protect Tenants in Portland
or, Rent Control 2.0!
Question C aims to protect Portland tenants by ensuring they receive 90-day notice for lease termination and/or rent increases. Landlords already are required to give tenants 90-days notice, but many have found ways around that by letting leases expire. Doing so shifts residents into “tenancy-at-will” status, which are no longer subject to 90-days notice. Passing this would close that loophole.
The ballot question also aims to discourage no-cause evictions by limiting the ability for landlords to enact five-percent rent increases only in cases of voluntary rental turnovers — not evictions. It also restricts deposits to one-months’ worth of rent, bans application fees and limits the amount of standard annual rent increases a landlord is allowed to impose.
It aims to give tenants more protections when they advocate for themselves in court as well as more authority to the city’s rent board to ensure landlords receive fair return on their investment but also that tenants’ complaints receive a fair hearing. It also sets a $25,000 fee for converting a rental unit to a condominium.
Question D: An Act to Eliminate the Sub-Minimum Wage, Increase Minimum Wages, and Strengthen Protections for Workers
…or, that Dang Tip Credit Question!
Perhaps the most hotly debated proposal from the DSA, Question D would raise the minimum wage in Portland from its current figure and incremental track — $13 per hour before hitting $15 per hour in 2024 – to one that pays $15 an hour come January 1, with incremental raises of $1.50 to reach $18 per hour by 2025. This change would directly impact roughly 17,800 workers in Portland, according to a study by the Maine Center for Economic Policy.
It would have the greatest ramifications in the restaurant industry. If passed, the measure would phase out the current tipped wage system, eliminating the “subminimum wage” or “tip credit,” established by the federal Fair Labor Standards Act in 1938 as a benefit for employers whose workers generally receive a substantial portion of their income from tips. Employers are required to make up the difference if a server’s hourly wage dips under the minimum. In other words, tipped workers would earn the above minimum wage along with their tips.
Seven U.S. states (Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington) and much of Canada do not have a tip credit.
Proponents of eliminating the tip credit argue that it will raise wages and provide stability for some of the city’s most precariously employed and low-paid workers, especially at a time of surging rental prices and other cost-of-living increases. Servers and bartenders, who are predominately women, also say a reliance on tips can subject them to emotional abuse and sexual harassment from customers.
The Maine Center for Economic Policy study, released in August, found that it would also “help to close existing pay disparities, as women and people of color are more likely than white workers to be paid less than $18 an hour.”
Opponents of eliminating the tip credit argue that it will create burdensome payroll costs in a hospitality industry that already runs on thin profit margins, forcing them to raise prices, enact service charges or cut workers’ shifts. They also warn — often speculatively — that customers will stop tipping, or tipping as well, if they know servers and bartenders make the minimum wage anyway.
A 2016 study from the U.S. Census Bureau concluded that servers in areas with no tip credit “do not make more in total hourly wage” than they do in the current system, though it increases the portion of that wage that comes from employers.
While much of the question’s heat is concentrated around the restaurant industry, the ballot question would extend the $18 per hour minimum wage for a growing sector of other workers who don’t receive a minimum wage, like taxi and rideshare drivers, personal shoppers and delivery workers. It would create a department of Fair Labor Practices to ensure wage and worker safety laws are being enforced.
A yes vote would mean you agree to support raising the minimum wage to $18 per hour over three years, while a no vote means the top minimum wage would remain $15 per hour by 2024 and tipped workers would continue to earn below minimum wage.
Question E: An Act to Restrict Cruise Ships in Order to Reduce Congestion and Pollution
…or, Cruise Ships Begone!
This question aims to restrict cruise ships coming into Portland by limiting the number of passengers who can disembark from a ship on a given day to 1,000 people. It would go into effect in 2025.
This is a question the DSA no longer supports. Instead, the group is working on a “compromise” with a longshoreman’s union and the City Council’s Sustainability and Transportation Committee that would reduce carbon pollution from large cruise ships while expanding “high-road job opportunities on the working waterfront,” according to Wes Pelletier, chair of the Maine DSA’s Campaign for a Livable Portland.
Correction: This article has been updated to reflect the cap on short-term rental stock should Question B pass, which would bring the number of short-term non-owner occupied mainland rentals to 250 or 1 percent of the long-term rental stock.