Austin City Council Passes Resolution to Shield Renters from Hidden Fees

Austin City Council Approves New Resolution to Protect Renters from Hidden Fees

In a recent move to enhance transparency for renters, the Austin City Council passed a resolution on Thursday that aims to shield tenants from unexpected fees related to lease agreements. The resolution was sponsored by Council Member Ryan Alter and directs the city manager to collaborate with relevant stakeholders to prepare an ordinance for landlords owning five or more rental properties.

What the Resolution Requires

Under the proposed ordinance, property owners and managers will be required to provide potential tenants with a comprehensive list of all costs upfront. This includes various fees such as application fees, utility connection charges, and recurring costs for services like pest control, trash collection, and insurance. However, fees connected to lease violations or damages caused by tenants would not be part of this requirement.

The resolution highlights concerns about a lack of mandatory fee disclosure in current lease agreements. According to the Texas Apartment Association, their lease template does have a space for listing additional fees. Still, there is no obligation for landlords to share these fees before a lease is signed.

Opposition from the Apartment Industry

During the council meeting, opposition arose from members of the Austin Apartment Association. President Theresa Ebner expressed that the fee disclosure would create complications, particularly regarding services provided by third-party vendors like pest control and trash collection. She stated, “It is standard practice in the industry to offer general cost summaries, but real-time fees can fluctuate due to changes in third-party service providers.”

Another representative, Emily Blair, mentioned that the U.S. Department of Housing and Urban Development praised the Texas Apartment Association’s template as a model for fee transparency within the industry. This approach has been recognized as a standard since 2022.

Broader Context on Hidden Fees

The resolution aligns with wider national efforts to combat hidden fees. President Joe Biden recently held a meeting aimed at eradicating concealed fees in the rental housing sector. Furthermore, the Federal Trade Commission proposed a rule last year intending to prohibit these so-called “junk fees” across various businesses, including rental housing. On a state level, legislation has been considered to also ban hidden fees.

Comments from Council Members

As the council prepared for a unanimous vote on the resolution, Council Member Ryan Alter emphasized the importance of affordability beyond just the listing price. “When you talk about affordability, it’s not just about the price of a home for renters,” he said. “It’s about what they’re paying monthly. And when these fees are hidden, whether at the leasing stage or popping up months later, that’s unfair and many people can’t afford it.”

The resolution was co-sponsored by Council Members Vanessa Fuentes, Zo Qadri, Chito Vela, and José Velásquez. They called for the city manager to return with a formal ordinance by June 2025.

Next Steps

The passage of this resolution marks a significant step toward improving housing transparency in Austin. It sets the stage for future regulations aimed at better protecting renters from surprise charges that can strain their finances. As the council prepares to work on this ordinance, it remains to be seen how landlords will respond and what adjustments they may need to make to comply with the new rules.

Austin continues to tackle housing affordability, pushing for policies that ensure a fair and transparent rental market for everyone.