Owen v. City of Portland

661

Argued and submitted May 4; decision of Court of Appeals affirmed, judgment

of circuit court vacated, and case remanded to circuit court for further

proceedings November 4, 2021

Phillip E. OWEN,

an individual;

Owen Properties, LLC,

an Oregon limited liability company;

and Michael L. Feves, an individual,

Petitioners on Review,

v.

CITY OF PORTLAND,

an Oregon municipal corporation,

Respondent on Review.

(CC 17CV05043) (CA A165633) (SC S068000)

497 P3d 1216

The city enacted an ordinance requiring landlords to make relocation

assistance payments to tenants in some circumstances, based in part on rent

increases; the ordinance also created a cause of action for tenants against land-

lords that violate the ordinance. Plaintiffs challenged portions of that ordinance

as preempted by a state law regarding rent regulation by local governments and

as beyond the city’s constitutional home-rule authority. The trial court entered

summary judgment in favor of the city, and the Court of Appeals affirmed.

Held: (1) The city’s ordinance does not “control[ ] the rent that landlords may

charge for the rental of any dwelling unit,” ORS 91.225(2), and is therefore not

preempted; and (2) the ordinance’s creation of a cause of action is permissible

under the city’s home-rule authority and the state constitution.

The decision of the Court of Appeals is affirmed. The order of the circuit court

is vacated, and the case is remanded to the circuit court for further proceedings.

On review from the Court of Appeals.*

John DiLorenzo, Jr., Davis Wright Tremaine LLP, Portland,

argued the cause for petitioners on review. Kevin H. Kono

filed the briefs for petitioners on review. Also on the briefs

was John DiLorenzo, Jr., Portland.

Denis M. Vannier, Office of the City Attorney, Portland,

argued the cause and filed the brief for respondent on review.

______________

* Appeal from Multnomah County Circuit Court, Henry C. Breithaupt,

Judge pro tempore. 305 Or App 267, 470 P3d 390 (2020).

662 Owen v. City of Portland

Sara Kobak, Schwabe, Williamson & Wyatt, PC, Portland,

filed the brief for amicus curiae Oregon Realtors. Also on the

brief was W. Michael Gillette, Portland.

Emily M. Matasar, Beery, Elsner & Hammond, LLP,

Portland, filed the brief for amicus curiae League of Oregon

Cities. Also on the brief was Chad A. Jacobs, Portland.

Emily Rena-Dozier, Oregon Law Center, Portland, and

Diane D. Nguyen, Legal Aid Services of Oregon, Portland,

filed the brief for amici curiae Oregon Law Center and Legal

Aid Services of Oregon. Also on the brief was MariRuth

Petzing, Oregon Law Center, Portland.

Phil Goldsmith, Law Office of Phil Goldsmith, Portland,

filed the brief for amicus curiae Oregon Trial Lawyers

Association.

Before Walters, Chief Justice, and Balmer, Nakamoto,

Flynn, Nelson, and Garrett, Justices.**

BALMER, J.

The decision of the Court of Appeals is affirmed. The

judgment of the circuit court is vacated, and the case is

remanded to the circuit court for further proceedings.

Garrett, J., dissented and filed an opinion.

______________

** Duncan, J., did not participate in the consideration or decision of this

case.

Cite as 368 Or 661 (2021) 663

BALMER, J.

At issue in this case is a challenge to a City of

Portland ordinance requiring landlords to pay reloca-

tion assistance to displaced tenants in certain circum-

stances. Plaintiffs are landlords that rent property in the

city. Plaintiffs filed a declaratory judgment and injunction

action against the city contending, as relevant here, that

ORS 91.225 preempts the ordinance at issue and that the

ordinance impermissibly creates a private cause of action

that a tenant may bring against a landlord that violates the

ordinance. On review, we conclude that ORS 91.225, which

prohibits municipalities from “enact[ing] any ordinance or

resolution which controls the rent that may be charged for

the rental of any dwelling unit,” ORS 91.225(2), with certain

exceptions, does not prevent municipalities from enacting

other measures that may affect the amount of rent that a

landlord charges or may discourage a landlord from raising

its rents. We further hold that ORS 91.225 does not preempt

the city’s ordinance. We also reject plaintiffs’ contention

that the ordinance impermissibly creates a private cause of

action.

I. BACKGROUND

The Oregon legislature enacted what is now ORS

91.225 as a temporary measure in 1983. Or Laws 1983,

ch 708, §§ 3-5. The legislature made that measure perma-

nent in 1985 with some amendments. Or Laws 1985, ch 335.

As now codified, ORS 91.225 reads:

“(1) The Legislative Assembly finds that there is a

social and economic need to insure an adequate supply

of affordable housing for Oregonians. The Legislative

Assembly also finds that the imposition of general restric-

tions on housing rents will disrupt an orderly housing mar-

ket, increase deferred maintenance of existing housing

stock, lead to abandonment of existing rental units and

create a property tax shift from rental-owned to owner-

occupied housing. Therefore, the Legislative Assembly

declares that the imposition of rent control on housing in

the State of Oregon is a matter of statewide concern.

“(2) Except as provided in subsections (3) to (5) of this

section, a city or county shall not enact any ordinance or

664 Owen v. City of Portland

resolution which controls the rent that may be charged for

the rental of any dwelling unit.

“(3) This section does not impair the right of any

state agency, city, county or urban renewal agency * * * to

approve rent increases, establish base rents or establish

limitations on rents on any residential property for which

it has entered into a contract under which certain benefits

are applied to the property for the expressed purpose of

providing reduced rents for low income tenants.

“* * * * *

“(7) * * * The electors or the governing body of a city or

county shall not enact, and the governing body shall not

enforce, any ordinance, resolution or other regulation that

is inconsistent with this section.”

ORS 91.225 (emphases added). ORS 90.100(38) defines “rent”

as used in ORS 91.225 as, in relevant part, “any payment to

be made to the landlord under the rental agreement, peri-

odic or otherwise, in exchange for the right of a tenant * * *

to occupy a dwelling unit.” The statute does not define “con-

trol” or “rent control.”

Thirty-two years after the legislature enacted

that statute, the city sought to address the displacement

of residential tenants from rental properties. In 2017, the

city council passed Ordinance 188219, which amended the

Portland City Code to require landlords to pay a sum for

“relocation assistance” to tenants in certain circumstances,

including when a landlord increases the rent of a unit by

10 percent or more within a 12-month period and the tenant

gives notice that they intend to terminate the agreement.1

1

The relevant provision of Portland City Code (PCC) 30.01.085 (2017),

amended by Ordinances 188519, 188558, 188628 (2017), 188849 (2018), 189421,

189726 (2019), as established by the ordinance here reads, in part:

“If, within 14 days after a Tenant receives an Increase Notice indicating a

Rent increase of 10 percent or more within a 12 month period[,] * * * a Tenant

provides written notice to the Landlord of the Tenant’s intent to terminate

the Rental Agreement * * *, then, within 14 days of receiving the Tenant’s

Notice, the Landlord shall pay to the Tenant Relocation Assistance in the

amount that follows: $2,900 for a studio or SRO Dwelling Unit, $3,300 for

a one-bedroom Dwelling Unit, $4,200 for a two-bedroom Dwelling Unit and

$4,500 for a three-bedroom or larger dwelling unit.”

The ordinance also requires relocation assistance payments when a landlord

evicts a tenant through a “no-cause” eviction. “No-cause” eviction occurs when

a landlord ends a tenancy without any predicating misconduct by the tenant.

Cite as 368 Or 661 (2021) 665

The amount of relocation assistance required varies from

$2,900 for a studio to $4,500 for larger units. The ordinance

permits a tenant to bring an action against a landlord that

fails to comply:

“A Landlord that fails to comply with any of the require-

ments set forth in this Section 30.01.085 shall be liable to

the Tenant for an amount up to 3 months Rent as well as

actual damages, Relocation Assistance, reasonable attor-

ney fees and costs (collectively, ‘Damages’). Any Tenant

claiming to be aggrieved by a Landlord’s noncompliance

with the foregoing has a cause of action in any court of com-

petent jurisdiction for Damages and such other remedies as

may be appropriate.”

PCC 30.01.085(D) (2017) (emphasis added).

Plaintiffs filed this action seeking a judgment both

declaring portions of the ordinance to be invalid and perma-

nently enjoining enforcement of the ordinance. Plaintiffs con-

tended, among other things, that portions of the ordinance

were preempted by ORS 91.225 and that others exceeded

the city’s authority under its charter in violation of the state

constitution. On cross-motions for summary judgment, the

trial court held that “[i]f the legislature had intended to pro-

scribe ordinances that had the indirect effect of controlling

rents it could have said so,” and further held that because

ORS 91.225 had more than one plausible construction, that

ambiguity should be resolved in favor of the local home-

rule jurisdiction. The trial court accordingly denied plain-

tiffs’ motion for summary judgment and granted the city’s

motion. Plaintiffs appealed, reprising several of their argu-

ments that the ordinance was invalid.

The Court of Appeals affirmed the substance of

the trial court’s decision. The court concluded that the trial

court properly granted the city’s motion for summary judg-

ment and denied plaintiffs’ motion, but it also held that the

trial court’s general judgment dismissing the complaint was

No-cause evictions are permitted only in certain circumstances, such as in week-

to-week tenancies, in the first year of month-to-month tenancies, or at the end

date of a fixed term tenancy. ORS 90.427. Plaintiffs challenged that provision of

the ordinance in the trial court and the Court of Appeals but were unsuccessful.

In this court, plaintiffs do not renew their claim regarding the “no-cause” evic-

tion provision of the ordinance, and we do not discuss it further.

666 Owen v. City of Portland

not the proper disposition of plaintiffs’ declaratory judgment

action. Owen v. City of Portland, 305 Or App 267, 286, 470

P3d 390 (2020). Accordingly, the Court of Appeals vacated

the judgment and remanded the case to the trial court,

directing it to issue a judgment declaring the respective

rights of the parties. Id. at 286-87. We allowed plaintiffs’

petition for review.2

II. PREEMPTION AND THE TENANT

RELOCATION ASSISTANCE ORDINANCE

The first issue is whether the ordinance’s require-

ment that landlords pay relocation assistance to tenants

in certain circumstances “controls the rent that may be

charged” for purposes of ORS 91.225(2) and is therefore pre-

empted by that statute. The ordinance requires such pay-

ments to tenants whose rent has increased by more than

10 percent in 12 months and who choose to relocate rather

than pay that higher rent. For the reasons discussed below,

we conclude that ORS 91.225 does not preempt the ordinance.

A. State Law Preemption

Article XI, section 2, of the Oregon Constitution pro-

vides “home rule” for cities and towns that adopt municipal

2

In 2019, while this case was pending in the Court of Appeals, the Oregon

legislature adopted a statute providing that landlords may not increase rents

in a 12-month period more than seven percent plus that year’s increase in the

regional Consumer Price Index (CPI). ORS 90.323. The city now argues that that

statute renders “any continued impact of the Ordinance on plaintiffs speculative,”

and that, as a result, plaintiffs lack standing and review should be dismissed as

improvidently allowed. The city points out that, in 2020 and 2021 respectively,

according to the Oregon Office of Economic Analysis, the maximum allowable

rent increases were 9.9 percent and 9.2 percent. The city argues that state law

“now generally bars landlords from raising rents in an amount that might trigger

the requirements of the Ordinance.”

We disagree with the city’s argument. Although ORS 90.323 may in some

years prevent landlords from increasing rents to levels that would trigger the

ordinance, the CPI could also increase three percent or more in a given year, in

which case a landlord could increase rents above the 10 percent threshold. For

example, from September 2020 to September 2021, the relevant CPI increased

5.3 percent. See U.S. Bureau of Labor Statistics, Consumer Price Index, West

Region—September 2021 (Oct 13, 2021), available at https://www.bls.gov/regions/

west/news-release/consumerpriceindex_west.htm (accessed Oct 29, 2021). We do

not find, given the variance in annual CPI changes, that the impact of the ordi-

nance on plaintiffs is so speculative as to divest them of standing to seek a decla-

ration invalidating the ordinance.

Cite as 368 Or 661 (2021) 667

charters.3 Gunderson, LLC v. City of Portland, 352 Or 648,

659, 290 P3d 803 (2012). Portland has adopted such a char-

ter. Laws adopted pursuant to that home-rule authority

cannot conflict with state legislation. “[H]ome-rule munici-

palities possess authority to enact substantive policies, even

in areas also regulated by state law, so long as the local

enactment is not incompatible with state law.” Id. (internal

quotation marks omitted). The analytical process for deter-

mining whether state law preempts a local law in Oregon is

well established:

“[B]oth municipalities and the state legislature in many

cases have enacted laws in pursuit of substantive objec-

tives, each well within its respective authority, that were

arguably inconsistent with one another. In such cases,

the first inquiry must be whether the local rule in truth

is incompatible with the legislative policy, either because

both cannot operate concurrently or because the legisla-

ture meant its law to be exclusive. It is reasonable to inter-

pret local enactments, if possible, to be intended to func-

tion consistently with state laws, and equally reasonable to

assume that the legislature does not mean to displace local

civil or administrative regulation of local conditions by a

statewide law unless that intention is apparent. However,

when a local enactment is found incompatible with a state

law in an area of substantive policy, the state law will dis-

place the local rule.”

LaGrande/Astoria v. PERB, 281 Or 137, 148-49, 576 P2d

1204, aff’d on reh’g, 284 Or 173, 586 P2d 765 (1978) (citations

and footnote omitted).

The question, then, is whether a local law is “incom-

patible” with state law, “either because both cannot oper-

ate concurrently or because the legislature meant its law

to be exclusive.” Id. To protect the constitutional interests

of municipalities in exercising their home-rule authority,

the state must be particularly clear when preempting local

legislative authority, and we interpret local enactments to

3

Article XI, section 2, provides, in part:

“The Legislative Assembly shall not enact, amend or repeal any charter

or act of incorporation for any municipality, city or town. The legal voters

of every city and town are hereby granted power to enact and amend their

municipal charter, subject to the Constitution and criminal laws of the State

of Oregon.”

668 Owen v. City of Portland

function consistently with state law if possible. Id. Here,

plaintiffs have the heavy burden of showing that state

law preempts the city’s ordinance. See Rogue Valley Sewer

Services v. City of Phoenix, 357 Or 437, 454, 353 P3d 581

(2015) (“A party that challenges a home-rule city’s authority

as preempted by state law is required to show that the leg-

islature ‘unambiguously’ expressed its intent—a high bar

to overcome.” (Quoting Gunderson, 352 Or at 663.)). Because

the ordinance was promulgated under Portland’s constitu-

tional home-rule authority, the state statute’s preemption

of the ordinance must be unambiguous; if there is ambigu-

ity, the ordinance is not preempted. Cf. State ex rel Haley v.

City of Troutdale, 281 Or 203, 211, 576 P2d 1238 (1978) (leg-

islative intent to preempt certain local construction stan-

dards was “not unambiguously expressed” and therefore not

preempted).

There is no evidence, nor do plaintiffs contend, that

the ordinance and ORS 91.225 cannot operate concurrently.

Thus, the question boils down to whether the legislature

“unambiguously expressed its intent” to preempt laws like

the ordinance, and we turn to that issue. Rogue Valley Sewer

Services, 357 Or at 454 (internal quotation marks omitted).

B. ORS 91.225’s Text in Context

To interpret ORS 91.225, we begin by examining

its text in context. See Eugene Water and Electric Board v.

PERB, 365 Or 59, 68, 442 P3d 596 (2019) (statutory inter-

pretation “typically involves examining the text in context,

and considering any pertinent legislative history, to deter-

mine legislative intent”). The parties’ arguments and our

analysis focus on the operative text in subsection (2)—“a city

or county shall not enact any ordinance or resolution which

controls the rent that may be charged”—but also touch on

subsections (1), (3), and (7).

Plaintiffs contend that the text of ORS 91.225(2)

plainly preempts “[a]ny local enactment that exerts influence

over the rent that may be charged.” 4 Specifically, plaintiffs

4

Plaintiffs inconsistently articulate which local laws they assert are pre-

empted by ORS 91.225. That is unfortunate, because the proper understanding

of which laws are preempted is a central issue in this case. Plaintiffs variously

describe the state statute as preempting local laws that “exercis[e] influence”

Cite as 368 Or 661 (2021) 669

assert that the legislature’s use of the phrase “ordinance or

resolution which controls the rent,” ORS 91.225(2) (emphasis

added), instead of the more colloquial phrase “rent control”

used in subsection (1), indicates that the legislature intended

subsection (2) to have a broad preemptive effect. Plaintiffs

further contend that subsection (7), which bars the enact-

ment and enforcement of ordinances, resolutions, or other

regulations that are “inconsistent” with ORS 91.225, is a

“catchall” provision that has independent preemptive effect.

Plaintiffs’ core argument is that ORS 91.225 preempts any

local law that “exercises influence” over the rents that land-

lords charge and that the ordinance here does so.

The city contends that the text and context of ORS

91.225 indicate that the legislature primarily intended to

bar local measures that constitute “rent control,” which

the city understands to be “government regulation of the

amount a landlord may charge for rent.” In the city’s view,

ORS 91.225 preempts only local laws that legally bar land-

lords from setting their rent at whatever rate they wish. The

city specifically interprets the language in subsection (2)

barring any local law that “controls the rent that may be

charged” to preempt only local legislation that regulates the

“price demanded” or “charged” by landlords for their rental

units. The city observes that the ordinance does not regu-

late that price and that landlords are free to adjust rents

in response to market conditions after complying with the

ordinance’s modest procedures. The city rejects plaintiffs’

claim that subsection (7) expands the scope of what con-

stitutes “rent control” or laws that “control[ ] the rent that

may be charged.” Instead, the city argues, subsection (7)

adds only a bar on “enforc[ing]” those laws preempted by

subsection (2) or “other regulation” that controls rent. At

bottom, the city argues that ORS 91.225 preempts only

local laws that regulate the price that landlords may charge

over, “regulate,” “exert[ ] influence” over, “exert restraining influence” over, “pro-

duce the effect of influencing,” and simply “influence” rent. That shifting lan-

guage elides the critical difference between laws that “control” and laws that

merely “influence,” and many of plaintiffs’ proposed interpretations reach beyond

what the definitions of the statute’s words allow. As discussed below, we reject

the conclusion that the legislature intended to preempt all local laws that might

have some influence on the rents charged by landlords but that do not reach the

level of controlling the rent.

670 Owen v. City of Portland

for their rental units, and that the ordinance here does not

do so.

We begin our statutory interpretation with the

operative wording of ORS 91.225(2) and examine first the

word “controls.” As a verb, “control” here means “to exer-

cise restraining or directing influence over : regulate, curb.”

Webster’s Third New Int’l Dictionary 496 (unabridged ed

2002). Applying that definition, we understand subsection (2)

by its plain meaning to refer to local laws that “regulate”

or “exercise restraining or directing influence over” the rent

that landlords may charge. Id. (emphases added). We reject

plaintiffs’ assertion that subsection (2) refers to all local

laws that may “exercis[e] influence”—any influence—over

rent amounts. Whether a law “exercises influence” gener-

ally is different from and broader than whether it controls

by exercising “restraining” or “directing” influence.5

A useful comparison is the express exception in sub-

section (3) to the statute’s preemption of any local law that

“controls the rent” in subsection (2). Subsection (3) permits

local authorities to “approve rent increases, establish base

rents or establish limitations on rents” for certain afford-

able housing properties. ORS 91.225(3). The acts that “con-

trol[ ] the rent” in that subsection are the “approv[al]” of

rent increases and “establish[ment]” of maximum or mini-

mum rent amounts, all of which do not merely influence, but

directly regulate, rent. The use of those phrases in subsec-

tion (3) does not necessarily mean that those are the only

examples of laws that might “control[ ] the rent” under sub-

section (2). But those words support our understanding of

“control[ ] the rent” to refer to laws which exercise “restrain-

ing” or “directing” influence over rents, and not to all laws

that might have an influence on rents.

5

The dissent asserts that the word “control” “connotes purposive action,” and

that ORS 91.225 therefore preempts any local laws “aimed” at controlling rent.

368 Or at 688 (Garrett, J., dissenting). The dissent purports to explain that con-

notation with legislative history indicating that the legislature was concerned

with local attempts to enact rent control. But the dissent does not point to any-

thing in the operative wording of the state law that would preempt local laws

regarding rental properties because they were “aimed” at a particular purpose.

None of the definitions discussed disclose any such connotation, and absent clear

direction from the legislature, we decline to read that meaning into the statute.

Put another way, the legislature could have barred local laws that were enacted

for the purpose of controlling the rent, but it did not do so here.

Cite as 368 Or 661 (2021) 671

Although subsection (1) is a statement of legislative

findings and not an operative statutory directive, it sup-

ports our understanding of the phrase “controls the rent” in

subsection (2). “Control” as a noun, which is how it is used in

subsection (1), means, among other things, “the regulation

of economic activity esp. by government directive <price ~s>

<wage ~s> <rent ~>.” Webster’s at 496. As a phrase, “rent con-

trol” means “government regulation of the amount charged

as rent for housing and often also of eviction.” Id. at 1923;

see also Black’s Law Dictionary 1166 (5th ed 1979) (defining

“rent control” as “[a] restriction or limitation imposed in cer-

tain cities upon the maximum rent that may be charged on

rental property”). Along with declaring “rent control” to be

a matter of statewide concern, subsection (1) also describes

the potential negative impacts of imposing “general restric-

tions on housing rents.” Although “rent control” and “general

restrictions on housing rents” are not necessarily equivalent,

we understand those phrases to refer to similar concepts.

Based on the above definitions and other language in the

subsection, we interpret “rent control” in subsection (1) to

mean, as commonly understood, “regulation of the amount

charged as rent” for a dwelling unit. Webster’s at 1923.

Regarding the distinction between the phrases “con-

trols the rent” and “rent control,” we reject plaintiffs’ argu-

ment that the legislature’s choice of active verb over phrasal

noun in subsection (2) expands the preemptive reach of ORS

91.225. Plaintiffs offer no definitions of “control” as a noun or

a verb that support their claim that the verb in subsection (2)

has any broader meaning that the noun in subsection (1).

They instead rely on an implicit sense that “rent control” has

a collectively understood colloquial meaning (one that they

do not articulate) that should not restrict the meaning of

“controls the rent,” and they point to cases where this court

has previously interpreted the nominal and verbal forms of

a word differently. E.g., State v. Glushko/Little, 351 Or 297,

311, 266 P3d 50 (2011) (differences between “consent” as a

noun and as a verb); State v. Bray, 342 Or 711, 719 n 6, 160

P3d 983 (2007) (differences between “display” as a noun and

as a verb). In both of those cases, however, the dictionary

definitions of the words at issue were different depending on

whether the word was used as a verb or as a noun.

672 Owen v. City of Portland

Here, in contrast, the dictionary indicates that the

noun “control” and the verb “to control” have substantially

the same meanings. We agree with plaintiffs that the form

of the words that the legislature chooses in drafting a stat-

ute can be significant, but plaintiffs do not substantiate

their claim that the switch from noun to verb is significant

here. Furthermore, consistent with plaintiffs’ argument, we

do not restrict our understanding of “rent control” to mean

only laws resembling the early generations of rent control

practices, where local governments sometimes established

maximum rents for thousands of individual housing units

based on considerations of land cost, unit size, utilities,

taxes, a rate of return on the landlord’s investment, and so

on. See generally Kenneth K. Baar, Guidelines for Drafting

Rent Control Laws: Lessons of a Decade, 35 Rutgers L Rev

723 (1983) (comparing the stringent first generation of post-

war rent control with the more permissive second generation

and reviewing various components of rent control regimes

and related statutes). We agree that this statute might pre-

empt more than one type of ordinance, but the fact that rent

control can be structured in multiple ways does not resolve

whether the ordinance here controls the rent and does not

lead us to alter our understanding of ORS 91.225. We sim-

ply understand “rent control” to mean any law which, as the

legislature put it, “controls the rent.” ORS 91.225(2).

We also consider the possibility raised by plaintiffs

that, although the legislature may have been responding to

perceived problems with direct government regulation of

rent levels and rent increases, it used the broader wording of

“controls the rent” in ORS 91.225(2) to encompass local ordi-

nances or policies that go beyond those traditional aspects

of “rent control.” See South Beach Marina, Inc. v. Dept. of

Rev., 301 Or 524, 531, 724 P2d 788 (1986) (“The legislature

may and often does choose broader language that applies

to a wider range of circumstances than the precise problem

that triggered legislative attention.”). We agree with plain-

tiffs that ORS 91.225’s preemption is not necessarily limited

to only forms of rent control that were common in the 1980s.

But the principle set out in South Beach Marina, Inc. does

not mean that we should reach beyond the text and context

of ORS 91.225 for a broader meaning of “rent control.”

Cite as 368 Or 661 (2021) 673

We next consider the phrase, “the rent that may

be charged.” ORS 91.225(2). As noted above, “rent” is statu-

torily defined, in part, as “any payment to be made to the

landlord under the rental agreement, periodic or otherwise,

in exchange for the right of a tenant * * * to occupy a dwell-

ing unit.” ORS 90.100(38). ORS 91.225 does not define “may”

or “charged.” Neither the city nor plaintiffs offer any specific

interpretations of the word “may” in this phrase but, as used

here, “may” has two potentially applicable meanings. In this

grammatical context, “may” could mean “have permission

to” (or “have liberty to”), Webster’s at 1396, thus describ-

ing the rent that landlords have permission, or liberty, to

charge. Alternatively, “may” could mean “be in some degree

likely to,” id., thus describing the rent that landlords are in

some degree likely to charge.

We readily conclude that the first meaning of “may”

(“have permission to”) applies in this statute for two rea-

sons. First, as discussed, ORS 91.225(2) is explicitly limited

by subsection (3), which permits local authorities to “approve

rent increases, establish base rents or establish limitations

on rents” for certain affordable housing properties. Those

exceptions describe situations where local authorities have

permission to regulate what rent amounts or changes are

permitted. Thus, subsection (2) likely refers to situations

where, in contradistinction to the exceptions, local author-

ities may not regulate what rent amounts or changes are

permitted.

Second, the alternative definition of “may,” which

must apply under plaintiffs’ view of the statute, is not plau-

sible in the context of ORS 91.225. If the statute barred any

resolution or ordinance that regulated or exerted restricting

or directing influence over the amount of rent that landlords

might “be in some degree likely to” charge, it would likely

bar any local law potentially affecting the housing market,

from trash collection or compost ordinances to city efforts

to support local businesses and industries and thereby

encourage more people to move to the city, all of which could

affect the rents landlords might “be in some degree likely

to” charge. We do not believe ORS 91.225’s preemptive effect

extends so far.

674 Owen v. City of Portland

We next consider plaintiffs’ argument that ORS

91.225(7) reinforces their interpretation that ORS 91.225

broadly preempts ordinances that influence rent. That pro-

vision provides, in part, that “[t]he electors or the governing

body of a city or county shall not enact, and the governing

body shall not enforce, any ordinance, resolution or other

regulation that is inconsistent with this section.” Plaintiffs

argue that, for subsection (7) to have any substantive mean-

ing, the only “plausible interpretation” of that subsection is

one that gives it independent preemptive effect. Plaintiffs

contend that subsection (7) therefore reaches beyond subsec-

tion (2) to preempt any laws “inconsistent with” ORS 91.225

as a whole. Whether a law is inconsistent with ORS 91.225,

however, depends on the meaning of that statute itself. The

Court of Appeals concluded that “ORS 91.225(7) only rein-

forces the prohibition on rent control by explicitly prohibit-

ing local electors from enacting and local governments from

enforcing local rent control regulation.” Owen, 305 Or App

at 279. We agree. Subsection (7) does not expand the reach

of ORS 91.225 to have the “broad preemptive effect” that

plaintiffs seek. If it has any independent meaning at all, it is

simply to reinforce the clear, but limited, preemption in sub-

section (2) by barring enactment and enforcement of local

rent control regulation, and subsection (7) does not alter our

understanding of ORS 91.225 as a whole as applied to this

ordinance.

Particularly when considered in light of our cases

holding that state law can preempt home-rule authority

only when, and to the extent that, the party urging preemp-

tion can demonstrate that “the legislature unambiguously

expressed its intent—a high bar to overcome,” Rogue Valley

Sewer Services, 357 Or at 454 (internal quotation marks

omitted), plaintiffs’ argument based on the text and context

of ORS 91.225 is unavailing.

C. Legislative History

Having analyzed the key terms of ORS 91.225 in

context, we turn next to that statute’s legislative history for

further clarification. Plaintiffs assert that that legislative

history supports interpreting ORS 91.225(2) “as preempt-

ing all forms of rent control, not only express caps on rent.”

Cite as 368 Or 661 (2021) 675

Relying on the brief of amicus curiae Oregon Realtors, plain-

tiffs assert that “ ‘rent control’ covers a wide range of local

enactments targeted at restricting a landlord’s right to set

rent charges at free-market levels.”6 We examine the legis-

lative history presented by amicus and come to a different

conclusion.

Amicus reviews testimony before the legislature

on the topic of rent control before ORS 91.225 was enacted.

That testimony, amicus emphasizes, referred to a wide

range of potential rent control measures. Amicus also cites

two California Court of Appeal cases discussing a complex

rent control ordinance in Los Angeles. Based on the variety

of potential forms of “rent control,” amicus concludes that

ORS 91.225 does not preempt solely laws setting direct lim-

its on allowable rent amounts. But the fact that the legisla-

ture heard testimony regarding various local government

efforts to affect, influence, or regulate rental rates and the

rental housing market generally does not mean that the

statute that the legislature subsequently passed responded

to or addressed that testimony. At most, we can infer from

the range of testimony that members of the legislature were

made aware that there were multiple methods for munici-

palities to affect rental markets. Indeed, the fact that legis-

lators were likely aware of the broad range of local measures

that might affect rental markets but nonetheless chose only

to preempt those laws that “control[ ] the rent that may be

charged” appears to support the city’s argument that the

legislature intended to preempt only traditional forms of

rent control, and not all measures that might influence

rental markets.

Amicus Oregon Realtors also contends that relo-

cation assistance to displaced tenants was part of local

6

Plaintiffs do not define or offer any criteria to determine what would be a

“free-market level” for rent. Given the existing regulatory framework for housing

aside from the city’s ordinance, we question whether such “free-market levels”

are meaningfully attainable. The law review article amicus cites for support of

this concept refers to the “fair market rental” of a property, a different phrase

from “free-market level,” and one that allows for the possibility of some regula-

tion impacting that market. Richard A. Epstein, Rent Control and the Theory of

Efficient Regulation, 54 Brook L Rev 741, 746 (1988). Moreover, nothing in ORS

91.225 suggests that “free-market” rents were the goal of the statute, and we

reject plaintiffs’ invitation to read that into the statute.

676 Owen v. City of Portland

rent control laws in effect in other jurisdictions when the

legislature enacted ORS 91.225, and that the legislature

therefore intended that statute to preempt relocation assis-

tance as well as rent control. Amicus cites as examples

laws from Washington, D.C. and Santa Monica, California.

Rental Housing Conversion and Sale Act Amendment Act of

1981, 28 D.C. Reg. 2824 (Aug 1, 1981); Santa Monica, Cal.,

Municipal Code §§ 4850 - 4862 (1986) (Ordinances 1374CCS,

1375CCS), renumbered as §§ 4.36.010 - .150 (2021).

That argument is unpersuasive. Amicus does not

offer any evidence from the legislative history indicating

that those laws were on the minds of the legislators when

they drafted ORS 91.225. We cannot infer from those laws’

mere existence in 1985 that they informed the legislature’s

choice of statutory wording. Based on our review of the

legislative history, the only indications that those exam-

ples were raised before the legislature were brief mentions

by a representative of the Oregon State Home Builders

Association during a 1985 hearing that Santa Monica had

extended rent control to commercial buildings, Testimony,

House Committee on Judiciary, HB 2505, Apr 30, 1985,

Ex K (testimony of James Irvine, Oregon State Home

Builders Association and The Multifamily Housing Council

of Oregon), and that Washington, D.C. was attempting to

end its rent control program. Minutes, House Committee on

Judiciary, Subcommittee 2, HB 2505, Apr 30, 1985, 8 (so

stating). Moreover, that hearing postdated the enactment

of the temporary 1983 precursor to ORS 91.225, where the

terms “rent control” and “controls the rent” were first used,

suggesting that the cited testimony, and the example of the

District of Columbia law, did not affect the wording used by

the legislature.

Even if those examples of relocation assistance were

on the minds of the legislators who enacted ORS 91.225,

they do not support plaintiffs’ or amicus’s arguments. The

District of Columbia law, for example, was not a “rent con-

trol” law. Our review of that law beyond the excerpt pro-

vided by amicus indicates that it was named the “Rental

Housing Conversion and Sale Act Amendment Act of 1981.”

28 DC Reg 2824. That law required payments to tenants

who were displaced when, as that law’s title suggests, their

Cite as 368 Or 661 (2021) 677

rental buildings were converted to cooperatives or condo-

miniums. That law did not require payments when tenants

were displaced by rent increases—in fact, that law did not

mention rent increases at all. Moreover, the law is now cod-

ified in chapter 34 of the district’s real property code, DC

Code sections 42-3401.01 to 42-3405.13, whereas the dis-

trict’s “rental stabilization program” is codified separately

at chapter 35, subchapter II, id. §§ 42-3502.01 - 42-3502.24.

ORS 91.225 itself contemplates permissible condominium

conversion ordinances, implicitly distinguishing them from

laws which control the rent. ORS 91.225(4) (permitting condo-

minium conversion statutes to include a certain type of time-

limited rent restriction). Even if we were to assume that the

District of Columbia housing conversion law could be consid-

ered a “rent control” law that influenced legislature’s choices

in drafting ORS 91.225, that law is not similar enough to the

ordinance here to even suggest that the legislature intended

to preempt laws like the Portland ordinance at issue.

The Santa Monica ordinance cited by amicus

requires landlords to pay a relocation fee to displaced ten-

ants in certain circumstances, such as when the landlord

withdraws certain rent-controlled units from the market

or seeks to recover possession of the unit for personal or

family use. Santa Monica, Cal., Municipal Code § 4.36.020.

Nowhere does that ordinance refer to rent increases or pro-

vide for payments to tenants displaced due to rent increases.

Neither the District of Columbia nor Santa Monica law is

the kind of tenant relocation assistance that plaintiffs here

contend is rent control.

Nonetheless, amicus seems to argue that, because

some cities had some other versions of rent control—the

District of Columbia at the time limited annual rent increases

to a certain percentage of existing rent and Santa Monica

imposed rent freezes and ceilings at various times—then

the relocation fees at issue here must also constitute “rent

control.” That argument is unpersuasive. We do not agree

that, because some jurisdictions provided for various kinds

of relocation assistance in circumstances not involving rent

increases, that the legislature necessarily considered all

relocation assistance payments to constitute “rent control.”

678 Owen v. City of Portland

No legislative history offered by either party pro-

vides much help in answering the specific interpretive

question in this case. The legislature did not appear to con-

sider whether ordinances that do not directly prescribe or

prohibit rent amounts, but that would nevertheless impose

some costs and procedural requirements on raising rents in

certain circumstances, constitute “rent control” under ORS

91.225. Thus, we rely on our understanding of ORS 91.225

based on its text and context and turn to the ordinance at

issue.

D. Whether the Ordinance Controls the Rent or “Effectively”

Does So

We now consider whether the city’s ordinance runs

afoul of ORS 91.225’s preemption of local laws. The ordinance

could do so if it regulates or exercises restraining or direct-

ing influence over the rents that landlords may permissibly

charge. Alternatively, plaintiffs argue, the ordinance could

do so if it “effectively” constitutes rent control, which plain-

tiffs contend also would be preempted by the statute. We

address those possibilities in turn and conclude, for the rea-

sons discussed below, that the ordinance does neither.

First, we examine whether the ordinance here “con-

trols the rent that may be charged” by landlords by exer-

cising restraining or directing influence over the amounts

that landlords have permission to charge. ORS 91.225(2).

The city’s ordinance neither mandates nor forbids land-

lords to set their rents at, above, or below a certain amount.

Portland landlords retain their legal ability to set rents as

they see fit. Landlords are free to change the rent to any

amount whenever a tenant moves out. Landlords may also

increase the rent 10 percent or more and avoid the relocation

assistance payment if their tenant decides to stay and pay

the increased rent. The ordinance here does not prescribe

certain rent amounts or prohibit increases, actions which

would likely constitute rent control, but rather mandates

a payment as a procedural requirement that is triggered

primarily by tenant displacement and by, in part, in some

cases, some rent increases. The ordinance does not control

the rent that landlords may charge.

Cite as 368 Or 661 (2021) 679

Although not challenged by plaintiffs in this court,

there are also other conditions under which landlords may

be required to pay relocation assistance, such as following

no-cause evictions. And even in cases where there is a rent

increase of 10 percent or more, the relocation assistance pay-

ment is not triggered automatically by that rent increase,

but rather by the tenant’s subsequent decision to relocate.

In short, there are no circumstances in which the rent for a

particular property is subject to approval or disapproval by

the city. Rather than restricting the particular amount of

rent that a landlord may charge—a restriction that, depend-

ing on how it were structured, might well be preempted by

ORS 91.225—the ordinance establishes a procedure that

allows a landlord to charge the rent that it deems appro-

priate, but conditions certain rent increases on payment of

relocation assistance to a departing tenant.

Plaintiffs contend that the characterization of the

required payments as “relocation assistance” is a mislead-

ing “label” deployed by the city to circumvent ORS 91.225.

Plaintiffs argue that the payments are in fact “significant

penalties” imposed “to prevent landlords from raising rent.”

They support that argument by asserting that “the payment

is only ‘relocation assistance’ if the recipient uses it as such,

but there is no requirement that the recipient do so,” and

that recipients “may place the money in a savings account,

use it for groceries, gift it to a family member, or put it to

any other use the recipient sees fit.”

That argument misses the mark for several rea-

sons. First, just as plaintiffs argued regarding the legisla-

ture’s use of “control” as a verb, the operative word choices

here are significant. The ordinance’s required payments are

not identified as “penalties,” but rather as “relocation assis-

tance.” Despite plaintiffs’ assertions that the ordinance is a

prohibition in all but name, attaching a condition to certain

actions that displace tenants is not the same as prohibiting

those actions and then imposing a financial penalty for vio-

lations of that prohibition.

Even if the “label” of “relocation assistance” were an

unreliable indicator of the ordinance’s meaning, the required

payments are in fact not penalties because they are not paid

680 Owen v. City of Portland

to the city for the purpose of punishing landlords, but rather

are paid to displaced tenants to alleviate relocation costs

imposed by displacement as a result of steep rent increases.

See Ordinance 188219 § 1(13) - (14). Plaintiffs assert that

the city covertly intended its ordinance to discourage rent

increases, rather than aid tenants. That assertion is belied

by the city’s extensive studies of the rental housing mar-

ket, tenant displacement, and homelessness. That work,

outlined in the briefs of the city and amici supporting the

ordinance as well as the ordinance itself, id. § 1(1), provided

the factual underpinning for the 17 specific findings in sec-

tion 1 of the ordinance about the importance of helping ten-

ants displaced for economic reasons to locate new housing.

Id. § 1. The city’s expressions of its intent in and for the ordi-

nance are more persuasive than plaintiffs’ assertions that

the city was simply trying to impose rent control through

other means.7

Additionally, whether tenants who receive these

payments use those specific funds for relocation costs or

other purposes is immaterial. Even if the relocation assis-

tance payment itself were not used for the inevitable costs

of relocation, those funds could be used to offset such costs

paid from other sources. Whether the relocation assistance

payments mingle with tenants’ other assets does not under-

mine the city’s policy of assisting displaced tenants.

Finally, plaintiffs’ argument is implausible in prac-

tice. By suggesting that the city cannot address tenant

7

Indeed, the very discussions in the Portland City Council that plaintiffs

argue show that the city was trying to engage in “rent control” actually demon-

strate the opposite: The city council understood that, because of state preemp-

tion, it could not control the rents that landlords charged. Commissioner Eudaly,

speaking in support of the proposed ordinance at a city council meeting on

February 2, 2017, said, “This is a temporary emergency ordinance intended to

stabilize or assist renters at risk of involuntary displacement during our housing

crisis. We hope that it will be short lived. But that will—that will require the state

legislature to overturn the ban on rent control and give the city back its regula-

tory tools.” Audio Recording, Portland City Council, Ordinance 188219, Feb 2,

2017, Part 21 of 27, at 11:16 (comments of Commissioner Chloe Eudaly), https://

www.portlandoregon.gov/auditor/article/622981 (accessed Oct 29, 2021) (empha-

sis added). She understood, of course, that the relocation assistance would be a

disincentive for raising rents, as well a source of financial assistance to renters

displaced for economic reasons. But any actual local control over rents or rent

increases would, she recognized, require a change in state law.

Cite as 368 Or 661 (2021) 681

displacement and homelessness in a way that may also

affect the rental market, plaintiffs seem to imply that a

municipality must choose the narrowest method available

to address social or economic problems in that municipal-

ity. (The dissent similarly suggests that, to avoid preemp-

tion, the city should have used “other means” to enact a

relocation assistance program. 368 Or at 693 (Garrett, J.,

dissenting).) That implication is dubious. Elected officials

may enact a law with consequences that extend beyond that

law’s immediate purpose; that a law has a secondary con-

sequence, even an anticipated one, does not mean that the

lawmaker enacted it for that reason. Were that not the case,

then under ORS 91.225 no Oregon municipality could enact

or enforce any local law that might tend to have any effect

on rental markets, which would be a far-reaching effect

unsupported by the text or legislative history of ORS 91.225

and one that was certainly not unambiguously expressed in

the statute. In sum, considering the text of the ordinance,

the ordinance’s stated purposes, and the implausibility of

plaintiffs’ alternative interpretation, the mere fact that the

ordinance may discourage landlords from raising the rent in

certain circumstances does not by itself lead us to conclude

that the ordinance is an impermissible end run around ORS

91.225.

We turn to plaintiffs’ remaining argument that,

even if requiring relocation payments based on rent

increases does not control the rent explicitly, it effectively

does so by imposing a prohibitive cost on landlords that seek

to increase rents. We question whether such an ordinance

would be preempted by ORS 91.225 on the sole ground that,

although not constituting “rent control,” the ordinance none-

theless “effectively” controls the rent because of its conse-

quences in the rental market and therefore is the equivalent

of controlling the rent. The legislature could have, but did

not, unambiguously indicate in the statutory text that it

intended to preempt laws that might have similar effects on

rental markets as laws which actually control the rent. Even

so, assuming without deciding that an ordinance that was

“effectively” “rent control” or “effectively” controlled the rent

would be preempted, we conclude that Portland’s ordinance

would still be valid.

682 Owen v. City of Portland

We recognize that the ordinance may create a disin-

centive for qualifying rent increases, but contrary to plain-

tiffs’ argument, the ordinance does not prohibit landlords

from imposing such increases. As noted above, there is no

legal prohibition in the ordinance on setting rents at any

amount. Thus, to rise to the level of an effective prohibition,

any economic disincentive would need to be so substantial

that no rational landlord would raise the rent for an existing

tenant more than 10 percent in one year. But that is not the

case here.

Based on market rates for rental units in Portland,

landlords whose rent increases trigger the relocation assis-

tance payments under the ordinance can recoup their costs

quickly. The city’s reported 2020 average rent for studios

was $1,196 per month. See Portland Housing Bureau, State

of Housing in Portland 41 (Dec 2020), https://www.portland.

gov/sites/default/files/2021/phb-soh-2020-web-part-2.pdf

(accessed Oct 29, 2021). If a landlord renting a unit at

that rate increased the rent exactly 10 percent in one year,

incurring the $2,900 relocation assistance payment, and

then increased the rent 9.9 percent the following year, the

landlord could recoup the relocation payment and receive an

additional $1,533 over those two years. Or, if the landlord

felt that the market could bear a 20 percent increase, and

the existing tenant leaves and is paid the relocation assis-

tance, the landlord could recover all but $30 of the reloca-

tion assistance payment in the first year. The landlord in

that situation could recover $2,840 in additional revenue

the following year, or $4,545 if it raised the rent again by

9.9 percent.

Thus, although the ordinance may well have the

effect of altering a landlord’s calculus regarding how much

it will increase the rent in any given 12-month period (and,

as the dissent points out, strategic landlords may in some

cases raise rents by 9.9 percent to avoid paying relocation

assistance, 368 Or at 692 (Garrett, J., dissenting)), the ordi-

nance does not amount to a de facto prohibition on rent

increases in excess of 10 percent. Increases beyond that

amount are contemplated and permitted by the ordinance,

conditioned only on the payment of the prescribed relocation

Cite as 368 Or 661 (2021) 683

assistance, and only when those rent increases are followed

by the tenant’s departure.

We conclude that Ordinance 188219 is consistent

with ORS 91.225 and that it neither “controls” the rent nor

“effectively” does so, in violation of that law. Therefore, ORS

91.225 does not preempt the ordinance.

III. PRIVATE CAUSE OF ACTION PROVISION

We turn to whether the private cause of action cre-

ated by the ordinance violates Article VII (Original), section 9,

of the Oregon Constitution and is therefore void. Because

municipal law is a valid source of Oregon law and state

courts are courts of general jurisdiction, we conclude that

it does not.

Oregon circuit courts “ha[ve] general jurisdiction,

to be defined, limited, and regulated by law in accordance

with th[e] Constitution.” Or Const, Art VII (Original), § 1.

In interpreting this and other constitutional provisions, this

court has explained that “[n]othing in the text of Article VII,

section 1, or Article VII (Amended), section 1, imposes any

limitations on the exercise of ‘judicial power.’ ” Couey v.

Atkins, 357 Or 460, 510, 355 P3d 866 (2015). The constitu-

tion provides that circuit courts have the authority to hear

all claims arising under any source of law unless jurisdic-

tion is exclusively vested in some other court:

“All judicial power, authority, and jurisdiction not

vested by this Constitution, or by laws consistent there-

with, exclusively in some other Court shall belong to the

Circuit Courts, and they shall have appellate jurisdiction,

and supervisory control over the County Courts, and all

other inferior Courts, Officers, and tribunals.”

Or Const, Art VII (Original), § 9; see also State v. Terry, 333

Or 163, 186, 37 P3d 157 (2001), cert den, 536 US 910 (2002)

(“Under the Oregon Constitution, circuit courts have subject

matter jurisdiction over all actions unless a statute or rule

of law divests them of jurisdiction.”).

Circuit courts in Oregon have long heard claims

originating from a variety of sources. See, e.g., Barcik v.

Kubiaczyk, 321 Or 174, 179, 895 P2d 765 (1995) (federal law);

684 Owen v. City of Portland

Schultz v. First Nat. Bk. of Portland et al, 220 Or 350, 358-59,

348 P2d 22 (1959), reh’g den (1960) (Nebraska law); State

Land Board v. Rogers, 219 Or 233, 241, 347 P2d 57 (1959)

(Bulgarian law); State v. Sanchez-Llamas, 338 Or 267, 108

P3d 573 (2005), aff’d sub nom Sanchez-Llamas v. Oregon,

548 US 331, 126 S Ct 2669, 165 L Ed 2d 557 (2006) (interna-

tional law). Those sources include city ordinances. See, e.g.,

Brennen v. City of Eugene, 285 Or 401, 591 P2d 719 (1979)

(city employee held liable in tort for violating a duty cre-

ated by city ordinance); Lange v. Minton, 303 Or 484, 738

P2d 576 (1987) (injured person could bring action against a

dog owner for violating a city ordinance prohibiting animals

“running at large”).

Here, the ordinance provides that “[a]ny Tenant

claiming to be aggrieved by a Landlord’s noncompliance

with the [ordinance] has a cause of action in any court of

competent jurisdiction for Damages and such other reme-

dies as may be appropriate.” PCC 30.01.085(D) (2017). The

Court of Appeals has previously held that “it is within the

judicial power of the circuit court to adjudicate a private

dispute that arises under Oregon municipal law.” Sims v.

Besaw’s Café, 165 Or App 180, 189, 997 P2d 201 (2000).

Plaintiffs argue, however, that Sims was wrongly decided or

was at least overbroad, and that the ordinance here imper-

missibly enlarges common law and statutory duties and lia-

bilities by requiring state courts to resolve disputes arising

under municipal law. Plaintiffs thus contend that the city

is attempting through the ordinance “to assert authority

over state courts by requiring them to hear a new munici-

pal cause of action, thus expanding state court jurisdiction

beyond its constitutionally and statutorily defined limits.”

We conclude that the ordinance validly creates a cause of

action that may be heard in state courts and does not violate

the constitution.

In Sims, the Court of Appeals considered a Portland

ordinance that prohibited employers from discriminat-

ing against current and prospective employees on several

grounds. That ordinance provided a cause of action to people

harmed by that conduct, which could be heard in “any court

of competent jurisdiction.” 165 Or App at 184. The plaintiff

Cite as 368 Or 661 (2021) 685

filed an action against the defendants in circuit court for

employment discrimination based on that ordinance. The

city, which intervened, argued that the plaintiff was enti-

tled to a declaration that he could litigate his municipal law

claim in state court. Id. at 183.

The Court of Appeals explained that “[t]here have

been instances in which Oregon cities have exceeded their

authority by enacting ordinances that purported to give

state courts authority to perform functions that they have

not been authorized by state law to perform,” id. at 186, such

as when a city attempts to give the circuit courts appellate

jurisdiction over municipal court or city commission deci-

sions. See, e.g., La Grande v. Municipal Court et al., 120 Or

109, 251 P 308 (1926) (holding that the city could not des-

ignate the circuit courts as the appellate court for the local

municipal court without state authorization); Lines v. City

of Milwaukie, 15 Or App 280, 515 P2d 938 (1973), reh’g den

(1973), rev den (1974) (holding that a city lacked authority

to designate the circuit courts as the appellate court for

the city civil service commission). The Court of Appeals in

Sims distinguished those cases, noting that “in contrast, the

Portland ordinance does not purport to confer any jurisdic-

tion on state courts or to assign any function to them,” but

“provides only that people harmed by violations of it shall

have a cause of action in any court of competent jurisdic-

tion.” 165 Or App at 186 (internal quotation marks omitted).

The Court of Appeals concluded that “Oregon municipal law

is also a source of law that an Oregon circuit court can apply

in adjudicating a private dispute,” and that “it is within the

judicial power of the circuit court to adjudicate a private dis-

pute that arises under Oregon municipal law.” Id. at 189.

Sims is consistent with this court’s decision in

Covey Garage v. Portland, 157 Or 117, 70 P2d 566 (1937). In

Covey Garage, this court considered a Portland ordinance

providing that any person injured by “the carelessness, neg-

ligent [sic] or unlawful act” of the driver of a rental car was

“authorized to institute an action” against the licensee of

that rental car (or their surety or insurer). 157 Or at 120-21

(internal quotation marks omitted). In doing so, it purported

to create a cause of action that was not previously available

686 Owen v. City of Portland

in tort or otherwise. In challenging that ordinance, a rental

car company argued that the ordinance was preempted by

state law in the field of vehicle regulation. This court held

that, under its home-rule authority, the city had the “power

to adopt the ordinance” so long as “it conflicts with neither

a constitutional provision nor with a statute, and if it consti-

tutes a proper exercise of the city’s police power.” Id. at 123.

The cause of action created by the ordinance was therefore

enforceable in state court and not ultra vires.

Sims and Covey Garage are also consistent with

Portland v. Western Union Tel. Co., 75 Or 37, 146 P 148

(1915). In that case, this court considered a Portland ordi-

nance requiring messenger businesses to post a bond for

the faithful delivery of goods and packages, and further

granting any person aggrieved by a failed delivery “a right

of action upon the bond in the name of the city.” Id. at 39.

Although an action in tort by a customer against a messen-

ger company would likely have been available at common

law, an action upon the bond in the city’s name would not

have been, and the ordinance therefore created a cause of

action. This court upheld that ordinance as “consonant with

the powers and purposes of the city of Portland, consistent

with the laws and policy of the state, and * * * a proper exer-

cise of the police power enacted for the purpose of regulating

and not restraining occupations.” Id. at 43. Based on those

cases, Sims was correctly decided, and home-rule munici-

palities in Oregon are not generally barred from creating

causes of action in areas within their regulatory authority.

As the city points out, plaintiffs identify no statute

or rule of law that affirmatively divests the circuit courts

of jurisdiction over claims arising under municipal law.

The city correctly argues that the legislature knows how to

divest circuit courts of jurisdiction when it so chooses. See,

e.g., ORS 197.825(1) (divesting circuit courts of jurisdiction

to review local land use cases); ORS 109.741 (divesting cir-

cuit courts of jurisdiction over certain child-custody mat-

ters). The legislature did not do so in ORS 91.225 or in any

other statute cited by plaintiffs.

With no affirmative divestment of jurisdiction to

cite, plaintiffs argue that the ordinance at issue here is

Cite as 368 Or 661 (2021) 687

invalid because it has no express state law authorization.

We reject that argument. Under the home-rule provisions

of the Oregon Constitution, municipalities do not require

the acquiescence of the state to legislate within their own

jurisdiction. See City of Portland v. Jackson, 316 Or 143, 149,

850 P2d 1093 (1993) (“The people of Oregon, by amending

Article XI, section 2, gave to the people of a municipality

(acting through their local government) the right to pass

laws, and restrict their own individual freedom and the

freedom of others within their jurisdiction, subject only

to the ‘Constitution and the criminal laws of the State of

Oregon.’ ”). The private cause of action established in the

ordinance to seek redress for violations of the ordinance is

permissible, and the circuit court has jurisdiction over such

actions.

The decision of the Court of Appeals is affirmed.

The judgment of the circuit court is vacated, and the case is

remanded to the circuit court for further proceedings.

GARRETT, J., dissenting.

ORS 91.225 prohibits cities and counties from

enacting any ordinance that “controls the rent.” From the

statutory text, legislative history, and surrounding context,

it is clear that the legislature’s concern was that local gov-

ernments, faced with rising rents due to inadequate hous-

ing supply, would try to address that problem—and thereby

exacerbate it—by interfering with the setting of fair market

rates for rent.

The City of Portland, having declared a “Housing

State of Emergency,” enacted Ordinance 188219 (“ordi-

nance”), which provides that, if a landlord raises the rent by

10 percent or more in a 12-month period and the tenant sub-

sequently gives notice of an intent to terminate the lease,

then the landlord must make a cash payment to the tenant

in an amount ranging from $2,900 to $4,500, depending on

the size of the unit. Portland City Code 30.01.085 (2017),

amended by Ordinances 188519, 188558, 188628 (2017),

188849 (2018), 189421, 189726 (2019). Although the ordi-

nance does not create “rent control” in the typical form, it

nevertheless imposes an adverse financial consequence

688 Owen v. City of Portland

on a landlord for no reason other than its decision to raise

the rent. Because I believe that effort to restrain rent falls

within the scope of what the legislature prohibited in ORS

91.225, I respectfully dissent.

I begin with the relevant text of ORS 91.225:

“(1) The Legislative Assembly finds that there is a

social and economic need to insure an adequate supply

of affordable housing for Oregonians. The Legislative

Assembly also finds that the imposition of general restric-

tions on housing rents will disrupt an orderly housing mar-

ket, increase deferred maintenance of existing housing

stock, lead to abandonment of existing rental units and

create a property tax shift from rental-owned to owner-

occupied housing. Therefore, the Legislative Assembly

declares that the imposition of rent control on housing in

the State of Oregon is a matter of statewide concern.

“(2) Except as provided in subsections (3) to (5) of this

section, a city or county shall not enact any ordinance or

resolution which controls the rent that may be charged for

the rental of any dwelling unit.”

The question is what is meant by the phrase “controls the

rent” in subsection (2). I agree with the majority’s textual

analysis of that phrase: ORS 91.225 preempts “local laws

that ‘regulate’ or ‘exercise restraining or directing influence

over’ the rent that landlords may charge.” 368 Or at 670

(emphases in majority).

I also agree with the majority that that definition

is not enough to resolve this case. One could interpret

“regulate” and “exercise restraining or directing influ-

ence over” narrowly to mean that the only type of prohib-

ited ordinance is one that directly prescribes the amount

of rent that may be charged. Alternatively, one could

understand those terms more broadly to encompass ordi-

nances that have any restraining, limiting, or directing

influence on rent. I agree with the majority that the most

expansive understanding of those terms is not what the

legislature had in mind. Id. The word “control” connotes

purposive action; thus, the statute is naturally read to pro-

hibit local measures that are aimed at restraining, lim-

iting, or directing rent (and are calculated to have that

Cite as 368 Or 661 (2021) 689

effect1), and not to prohibit all local measures that could

have an effect, however indirect, on landlords’ costs or on

the rental market generally.

That understanding follows from the legislative his-

tory, which reflects a concern that local governments, faced

with a problem of high rents, would be tempted to simply

restrain them instead of taking longer-term actions geared

toward increasing the supply of affordable housing. The leg-

islative record is replete with testimony to the effect that

the promised benefits of suppressing rent below fair market

levels are, at best, transient and that “rent control, in the

long run, makes affordable housing less available for lower-

income renters.” Testimony, House Committee on Judiciary,

HB 2505, Apr 16, 1985, Ex E (testimony of Debbie Wood,

State Housing Council). That is because actions taken by

government to keep rent below fair market rates reduce the

“incentive for developers to develop and maintain rental

units.” Id. As the potential profitability of housing develop-

ment is artificially suppressed, investors will opt out and

spend their money where it is not so suppressed, compound-

ing the very problem of short supply that led to rising rents

in the first place. As another witness put it,

“[a]lthough the imposition of rent controls has in most

cases been in response to a ‘housing shortage’ and the sub-

sequent spiral of rising rents, the experience of cities in

which rent control has existed for a period of time strongly

supports the conclusion that rent control not only does not

alleviate the problem, it actually leads to greater pressures

on the rental housing market and has a severe economic

impact in the communities in which it is imposed.”

Testimony, House Committee on Judiciary, HB 2505, Apr 30,

1985, Ex K (testimony of James Irvine, Oregon State Home

1

The majority misinterprets what I mean by saying that “control” connotes

purposive action. 368 Or at 670 n 5. I do not contend that ORS 91.225 preempts

any ordinance that might have been enacted for the subjective purpose of try-

ing to control rent, regardless of what the ordinance actually does. To be pre-

empted, an ordinance must satisfy two conditions: It must be directly targeted at

restraining the amount of rent that a landlord charges, and it must be calculated

to have that effect. To put it differently, another case might present the question

whether a city that deliberately tried to control fair market rents through a com-

pletely ineffectual means (such as the imposition of a one-dollar fine on landlords)

could be saved from preemption by its own ineptitude. This is not that case.

690 Owen v. City of Portland

Builders Association and The Multifamily Housing Council

of Oregon).

In response to those concerns, the legislature pro-

hibited cities and counties from enacting “any ordinance or

resolution which controls the rent that may be charged for

the rental of any dwelling unit.” ORS 91.225(2). As noted

above, I agree with the majority that “controls,” in this

context, encompasses ordinances that regulate or exercise

restraining or directing influence over the amount of rent

that a landlord may permissibly charge. The crucial ques-

tion, however, remains whether ORS 91.225 prohibits only

the direct prescription of rent, or whether city ordinances

may violate the statute through less direct means.

The majority opinion is elusive on that point. On the

one hand, it seems to conclude from the text, context, and leg-

islative history that preemption applies only to ordinances

that “prescribe certain rent amounts or prohibit increases.”

368 Or at 678. On the other hand, the majority proceeds to

consider whether a city could violate ORS 91.225 through

an ordinance that “effectively” does the same thing—and it

seems to answer that question “maybe, but not in this case.”

368 Or at 681-82.

There should be no doubt that a city can violate

ORS 91.225 through means other than “prescrib[ing] cer-

tain rent amounts or prohibit[ing] increases.” 368 Or at 678.

Those types of prescriptions and prohibitions are commonly

known as “rent control.” If the legislature had prohibited

“rent control,” perhaps it would be reasonable to infer that

the legislature was concerned only with what most people

think of when they hear that phase, i.e., the model exempli-

fied in New York and San Francisco, where rents are set by

city regulators. But the legislature did not do that; it pro-

hibited ordinances that “control[ ] the rent.” ORS 91.225(2).

That choice of language is significant because the phrase

“rent control” appears in the previous subsection of the stat-

ute, where the legislature stated its prefatory findings. ORS

91.225(1). Having specifically called out the concern about

“rent control” in subsection (1), the legislature could eas-

ily have repeated that phrase in subsection (2), the opera-

tive provision of the statute, which states what cities and

Cite as 368 Or 661 (2021) 691

counties are prohibited from doing. That is, if the legislature

had been content to prohibit cities and counties from setting

up rent-regulation boards, it could have done that. But legis-

lators, being students of human nature, knew that prohibit-

ing a single means to an undesired end can be a roadmap for

evasion. Instead, they chose to prohibit any ordinance that

“controls the rent.” ORS 91.225(2). That choice alone signals

that the legislature did not want the preemption inquiry

to turn on whether cities had chosen a specific mechanism.

That signal is amplified by the warning in subsection (1)

about “the imposition of general restrictions on housing

rents.” ORS 91.225(1).

However, even if the phrase “controls the rent”

should be understood to mean exactly the same thing as

“rent control,” that still does not mean that the only way

that a city can violate the statute is by fixing rents at cer-

tain levels. Given its stated purpose, the prohibition should

be understood to cover local ordinances that “regulate”

or “exercise restraining or directing influence over” the

amount of rent—either by direct prescription or prohibition,

or through less direct measures that are nonetheless cal-

culated to “regulate” or “exercise restraining or directing

influence over” the rent by directly attaching adverse conse-

quences to the setting of rents at levels that the city does not

favor. Consider two hypothetical ordinances:

(1) “No landlord shall raise rent by more than 10 per-

cent in a 12-month period.”

(2) “Landlords may set rents at whatever levels they

choose, but those who raise rent by more than 10 percent in

a 12-month period shall pay a fee to the city in the amount

of $25,000 per affected unit.”

The difference between those two ordinances is no

difference at all when it comes to real-world consequences.

The legislature cannot have intended to treat them differ-

ently. The majority somehow resists that conclusion; it only

begrudgingly considers the possibility that ORS 91.225 pre-

empts ordinances that “effectively” control the rent even

without a direct prescription or prohibition. 368 Or at 681.

Then, “assuming without deciding” that the answer is yes,

the majority goes on to conclude that Portland’s ordinance

692 Owen v. City of Portland

does not do so, essentially because the financial conse-

quences that the city has chosen to impose are not suffi-

ciently harsh to deter landlords from setting rents at their

desired levels. 368 Or at 681-82. The majority is incorrect.

In the majority’s hypothetical example, if the mar-

ket would support an increase of 10 percent in the rent

for a studio apartment, a landlord who raises the rent by

exactly 10 percent for one year, and then increases that rent

9.9 percent the following year, would recoup the $2,900

“relocation assistance” payment and earn an additional

$1,533 over those two years. From that, the majority infers

that the $2,900 payment is not enough to interfere with the

setting of market rent. The flaw in the majority’s reason-

ing is that no rational landlord would do what the majority

proposes. Instead of raising the rent 10 percent in the first

year, the landlord would raise the rent by 9.9 percent in both

years, earning nearly the same amount of increased rental

revenue and avoiding the $2,900 “relocation assistance”

payment altogether. The difference between 9.9 percent

and 10 percent may seem trivial, but economically it will

make sense for many landlords to raise rent no more than

9.9 percent even where the market would support increases of

11 percent, 12 percent, or more. Moreover, because of

the compounding effect, the difference between annual

increases of 9.9 and, say, 12 percent will lead to highly

disparate results over time. The majority dismisses all of

this as simply “altering a landlord’s calculus regarding how

much it will increase the rent,” but that is the entire point.

368 Or at 682. A landlord that must alter its rent-raising

calculus solely to avoid a city-imposed financial penalty2 has

had its freedom to set rents “restrained” just as if the city

had enacted an outright prohibition.

The majority’s argument also fails to take the city

at its word. The city made no bones about its intent to dis-

courage landlords from raising rents in amounts higher

2

The majority makes much of the difference between a “penalty,” as plain-

tiffs call it, and a “relocation assistance payment,” as the city calls it. 368 Or at

679-80. The terminology is irrelevant, as is the use to which the money is put.

What matters is the indisputable fact that the city has imposed a cost on land-

lords that is tied directly to their decision to raise rent and thus restrains their

freedom to do so.

Cite as 368 Or 661 (2021) 693

than what the city considered acceptable. At the February 2,

2017, Portland City Council meeting discussing the ordi-

nance, Commissioner Eudaly, the lead sponsor, framed it as

a deterrent when she said, “there’s an easy way to avoid relo-

cation assistance. Do not no-cause evict your tenants and

don’t raise their rent 10 percent or more per year.” Audio

Recording, Portland City Council, Ordinance 188219, Feb 2,

2017, Part 21 of 27, at 11:40 (comments of Commissioner

Chloe Eudaly), https://www.portlandoregon.gov/auditor/

article/622981 (accessed Oct 29, 2021). The deterrent pur-

pose and effect of the ordinance was further confirmed when,

three years later, the city’s mayor described the relocation

assistance program as “one tool we have to keep rent levels

stable.” Audio Recording, Portland City Council, Ordinance

190122, Sept 16, 2020, Part 1 of 3, at 2:43:13 (comments

of Mayor Ted Wheeler supporting an amendment to lower

the 10 percent threshold for relocation assistance payments

during the COVID-19 public emergency), https://www.

portlandoregon.gov/auditor/article/751848 (accessed Oct 29,

2021). Even putting those comments aside, the purpose of

discouraging rent increases is amply demonstrated by the

fact that, if the city had been concerned solely with provid-

ing assistance to displaced renters, other means were avail-

able. The city could have required payments to all renters

who terminate their leases without regard to the amount of

any rent increase, or whether it had been increased at all.

Or the city could have imposed a surcharge on all leases to

fund an assistance program for displaced renters. Instead,

the city required the “relocation assistance” payment only

from landlords who raised the rent more than a threshold

amount. This court should assume the city knew what it was

doing, and I see no reason for this court to question the city’s

economic assumptions about what would work. Certainly,

there is nothing in the record that gives this court a basis

for confidently stating that the penalties the city chose to

impose are too modest to make a difference.

In my view, the text of the ordinance and the cir-

cumstances surrounding its adoption permit only one con-

clusion: The city, as a means of “stabilizing” rising rents,

intended to deter landlords from setting rents at fair mar-

ket levels and selected a coercive tool to accomplish that

694 Owen v. City of Portland

objective. That is what the 1985 Legislative Assembly feared

cities would do. The ordinance is a measure that “controls

the rent” and is preempted by ORS 91.225(2). Because the

majority concludes otherwise, I respectfully dissent.