By Maria Rocha-Buschel
Although the rent freeze that stabilized tenants were desperately seeking did not pass at the Rent Guidelines Board final vote on Monday evening, the board still made history with its lowest ever increases of one percent for one-year leases and 2.75 percent for two-year leases.
The vote took place as it usually does in a packed Great Hall at Cooper Union but with some new faces on the nine-member board. Unlike in previous years, the vote did not go in favor of the chair, Mayor de Blasio appointee Rachel Godsil, who was urging the board to vote for a rent freeze.
Instead, the 5-4 vote was in favor of a proposal submitted by public member Steven Flax, also newly appointed by de Blasio, which the owner members adopted as their own. Flax ultimately decided to go in favor of his own proposal but he said that he had struggled with his vote.
“I heard what you’re saying and I know what you’re going through. I’ve developed and managed affordable housing — and you’re not going to like what I have to say,” he said as the crowd cheered him on, “but the takeaway is that it costs money to run buildings.”
Before the vote, Godsil recognized that Flax’s proposal was a historic low but argued that it was not low enough.
“I don’t think it’s supported by the data,” she said. “It doesn’t acknowledge the assumptions from previous years of expenses that did not occur. It is our goal to make sure that the tenants and owners are balanced and I don’t think this proposal does that.”
She added that on average, owners of these properties have been spending less on maintenance and operating costs in recent years, about 60.5 cents of every dollar of revenue in 2012, and net operating income has been up eight years in a row.
Magda Cruz, a Bloomberg-era holdover on the owner member’s side, argued that the increases are necessary to prevent housing inequalities.
“(A rent freeze) with rising employment and rising wages combined with improving economic conditions would only exacerbate housing inequities,” she said. “There is no precedent in the 44-year history of the board for a rent freeze. One need only look at the devastation that has been wrought on hotels and SROs with no increases.”
David Wenk, a public member who was appointed under Mayor Bloomberg and who has been on the board for the past five years, doesn’t often speak at the meetings but took the opportunity to explain his thoughts on the vote. He called the demand for a rent freeze “irresponsible,” and added that a freeze would “only accelerate the decreasing quality of affordable housing and hasten the departure of these apartments from the regulatory system.”
Tenant member Harvey Epstein, on the other hand, argued that it would be irresponsible not to enact a rent freeze.
“The owners have had net operating income for over eight years in a row,” he said. “They’re doing better and tenants are still struggling.”
The second tenant member, Sheila Garcia, called the owner’s proposal a “political stunt.”
“The fact that you proposed increases of 5.5 to 9.5 percent and then submitted another member’s proposal, all for political will, I think it’s shameful,” she said.
The tenants, sensing that Flax was struggling when it was time for him to cast his vote, attempted to sway him with chants of, “Steve, do the right thing!”
Flax conceded that he wasn’t happy with the way that his proposal had been manipulated but noted that he felt he needed to vote his conscience.
“This moment is a nightmare,” he said before casting his “yes” vote.
Last year’s increases, at four and 7.75 percent for one and two-year leases respectively, were almost double the increases from the previous year and were the largest increases since 2008. Since it was created in 1969, the RGB hasn’t passed increases less than two and four percent.
Tenants and advocates rallying outside the Great Hall before the vote were optimistic that a rent freeze would happen. Timothy Neithercott, one of the Tenants Association leaders for 128 Second Avenue, said he felt that the numbers would impact the city on a positive level.
“It shouldn’t be indefinite, but as a city we should compensate for past increases,” he said. “There are tenants who have been living here for 30 years. They’re the people who deemed this area so important culturally. If we don’t have villagers, we don’t have a village.”