Democratic Gov. Jared Polis has vetoed a bill that would have made Colorado the first state to ban landlords from using rent-setting algorithms, which many advocates have blamed for driving up housing costs across the country.
RealPage is the target of a federal lawsuit filed last year that accuses the real estate software company of facilitating an illegal scheme to help landlords coordinate to hike rental prices. Eight other states, including Colorado, have joined the Department of Justice’s lawsuit, though RealPage has vehemently denied any claims of collusion and has fought to have the lawsuit dismissed.
Critics say RealPage software combines confidential information from each real estate management company in ways that enable landlords to align prices and avoid competition that would otherwise push down rents. RealPage’s clients include huge landlords who collectively oversee millions of units across the U.S.
The Colorado bill, which recently passed the Democratic-led Legislature along party lines, would have prevented the use of such algorithms.
In a veto letter Thursday, Polis said he understands the intent of the bill but that any collusion among landlords would already violate existing law.
“Reducing market friction through legitimate means that do not entail collusion is good for both renters and landlords,” Polis wrote. “We should not inadvertently take a tool off the table that could identify vacancies and provide consumers with meaningful data to help efficiently manage residential real estate to ensure people can access housing.”
In a statement, RealPage applauded Polis’ veto, calling it an example of “courageous leadership.”
“This is the right o