Proposed Portland Measure Aims to Ban AI Algorithms for Determining Rental Prices
Proposed Ordinance to Ban AI in Rental Pricing in Portland
Overview of the Proposal
On Tuesday, a significant proposal emerged from the Homelessness and Housing Committee aimed at regulating rental pricing in Portland, Oregon. This ordinance, which has now moved to the full city council for further consideration, seeks to prohibit the use of artificial intelligence (AI) as a tool for setting rental prices.
Goals of the Ordinance
The driving force behind this ordinance is District 3 Councilor Angelita Morillo. She has described the practice of using AI in rental pricing as a form of "high-tech price fixing." The motivation for the proposal is to protect renters from escalating rents that can arise from the use of algorithmic pricing by large rental companies.
Councilor Morillo emphasized the importance of maintaining a fair market where renters have genuine choices rather than being subject to artificially inflated prices dictated by algorithms. In her remarks, she highlighted the transition from traditional methods of negotiating prices to the more advanced and impersonal strategies that technology allows today.
“In the past, you could meet in a smoky backroom and make that deal, and in the 21st century, you can do that with an algorithm,” Morillo stated.
Support for the Ordinance
The ordinance secured a vote of 3-to-1 in the committee, moving forward amidst concerns from some sectors about the potential negative impact on housing development in Portland. Supporters believe that the ordinance is necessary to safeguard tenant rights and maintain a balanced housing market. Morillo argued that large developers and rental groups abusing pricing strategies should be held accountable to ensure tenants’ rights are protected.
Concerns Raised
Not everyone is in favor of the ordinance. City Councilor Dan Ryan, who was unable to attend the committee meeting, expressed his concerns in writing. He warned about potential unintended consequences that could arise should the ordinance be enacted. He stated that if he had been present, he would have voted against the proposal.
Upcoming Steps
The ordinance is set to go before the full city council for its first reading and public testimony on April 2. This will provide an opportunity for community members and stakeholders to voice their opinions on the proposed regulation.
Broader Context
The proposed ordinance comes at a time when larger rental companies are facing increased scrutiny regarding their pricing practices. A notable case involves a federal lawsuit initiated by the U.S. Justice Department against six prominent landlords. This lawsuit claims that these companies engaged in an algorithmic pricing scheme that has affected millions of renters across the country. The situation has prompted collaboration among ten states, including Oregon and Washington, to address these practices at a broader level.
Conclusion
The ongoing discussions and votes surrounding the ordinance reflect a growing awareness of the impact of technology on everyday life, particularly in how housing is priced. With many voices speaking out, the outcome of this proposal could set a precedent for how rental markets are managed in the digital age. The focus will remain on balancing the needs of renters while ensuring the growth and development of the housing market in Portland.
