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The annual rate-setting meeting of the city’s Rent Guidelines Board last week proceeded as expected, with tenant activists protesting noisily and the Board nonetheless voting in the highest rent increase of the past few years for New York’s almost one million rent-stabilized apartments. The panel of nine mayoral appointees approved increases of 7.25 percent on two-year leases and 4.25 percent on one-year leases.
Tenants also protested the Urstadt Law, the 1971 rule preventing the city from creating rent regulations more restrictive than those at the state level. The law was named after Charles Urstadt, housing commissioner under Gov. Nelson Rockefeller. Many city dwellers think the fate of city rent protections and evictions should return to local government’s jurisdiction, thus restoring “home rule.”
A renewed focus on the issue of home rule has some tenant organizers feeling a sense of hope despite the unwelcome rent hikes. They see the impotence of their protest as proof that “the board is a sham, that nothing will change, that it’s just for landlords,” said Jumaane Williams, executive director of the tenants’ rights group Tenants and Neighbors. Williams said that with the RGB the question is never “if there’s going to be an increase [in rents], just — how much is that increase going to be?”
Thus tenants are turning their attention to the lack of home rule, and the recent vote is a catalyst for greater organizing. “Support for home rule is picking up steam,” he said. This spring, City Council passed a resolution in favor of home rule.
Williams also thinks now there’s “an opportunity to pull unregulated tenants into the fray” with home rule. This is critical, he said, because unregulated tenants, whose rent can be raised any amount, are paying on average 70% percent more rent than protected tenants.
Support from Mayor Bloomberg and Attorney General Eliot Spitzer, as a gubernatorial hopeful, will be key. Williams says what’s different now from the tenant mobilizations of the past, particularly in 1997 when rent regulations were seriously in jeopardy, is “that the dynamics of the state legislature are changing and continue to change,” plus there’s the prospect of a Democratic governor in November.
RGB Chairman Marvin Markus said the board as a whole has no position on home rule. “It’s a complicated issue on many matters, including the commuter tax, and all localities are creatures of the state,” he said. “Ultimately home rule is secession. It’s not the only home rule issue [the city is] dealing with.”
Local organizers may do well to look to the handful of other places with rent stabilization-type rules to learn what models are succeeding. California, New Jersey, Maryland and the District of Columbia also use some form of rent protection.
The city of Santa Monica, Calif. takes rent control seriously. “We are a very aggressive rent control district…we’ve probably been sued more than any other rent control district [in the country] or on par with them,” Rent Control Board Chief Counsel David Daniels said.
Santa Monica’s regulations began in 1979 and currently cover almost 30,000 units. Unlike New York, all five of its Rent Control Board members are elected by the public. Adjustments are made on an annual basis using an analysis of several factors, including rising operating costs and inflation.
For 2006, the board approved a 4% increase, with a maximum adjustment of $54, among other measures. “We’re all about fair return, but not excessive fair return,” Daniels said.
That may not sound like a New York City philosophy, and neither is Santa Monica’s system of dealing with its equivalent of Major Capital Improvements. In Santa Monica, the onus is on the owner to prove he “no longer receives a fair return” because of capital improvements. Each individual landlord must petition the city and must open his books for review.
Closer to home, in New Jersey about 120 municipalities have rent control, “more than in any other state in the country,” according to Matt Shapiro, president of the New Jersey Tenants Organization.
Though the laws and the average increases vary widely from city to city, a 1973 court decision gave the municipalities the right to enact “rent leveling” if the state chooses not to interfere, Shapiro said. And the state tends to take a hands-off approach.
That’s the way Shapiro prefers the situation. “You have a better shot with home rule because it’s your responsibility… tenants would probably be worse off with a state law,” he said.
As for the future, Shapiro said he’s not “totally down, but we see the trends … tenants can fight for their rights but there’s a lot of apathy.” About two-thirds of the cities have vacancy decontrol regulations. “If nothing changes, vacancy decontrol will effectively eliminate rent control in New Jersey over time,” he said, referring to the phenomenon whereby vacant apartments can return to market rates.
The District of Columbia recently experienced its first change in rent control laws in 20 years. Previously, the city operated under a complicated system of rents separate from legal rent ceilings per unit. The change “demystifies the parallel universe” that used to exist, said Shaun Pharr, senior vice president for government affairs at the Apartment and Office Building Association of Metropolitan Washington.
“The old system was paper-intensive for everyone and confusing for tenants,” Pharr said, whereas the new system “substitutes in its place predictability” and also carves out greater protections for elderly and disabled tenants. Adjustments are based on the last rent charged and the consumer price index plus two percent. There is no income eligibility requirement for the city’s 101,000 rent-controlled units.
In Massachusetts a move is underway to reclaim past rent protections. The state enacted rent control in 1970, but those laws expired in 1975. Through home rule, Boston, Cambridge, Somerville and Brookline continued the protections, though Boston eventually permitted vacancy decontrol as units became vacant. Then in 1994, voters statewide approved a referendum to repeal those cities’ rent laws, affecting about 45,000 tenants.
Kathy Brown, a coordinator with the Boston Tenants Coalition, is working to bring the laws back.
“It may be dead right now, but rent control was one of the hottest issues during the past city council race” in 2005, Brown said. Her organization has been working to pass the ‘Community Stabilization Act,’ which would ensure some tenant protections — though not rent control, she pointed out — and would also “allow for foreclosure protections, more mediation in landlord-tenant disputes and exempt small buildings with seven units or fewer if the landlord also lived on the premises.”
Thomas Champion, a spokesman for the formerly rent-controlled city of Somerville, says, “You have to balance the legitimate rights of landlords and tenants and assure their needs, but with [the end of rent control] the question has not gone away.”