By Maria Rocha-Buschel
At a Manhattan hearing of the Rent Guidelines Board, where both landlords and tenants were invited each year to give testimony on their respective suffering, Stuyvesant Town-Peter Cooper Village Tenants Association President Susan Steinberg took umbrage at one owner representative’s argument that MCIs are not sufficient rent increases.
She spoke up after Rent Stabilization Association president Jack Freund, whose organization represents landlords throughout the city, said at the hearing that Major Capital Improvements (MCIs) and preferential rent increases don’t offer enough income to sustain landlords.
“You cannot substitute MCI increases for maintenance and operating rent increases,” he said. “MCIs have nothing to do with this issue and the suggestion that preferential rents somehow should play into this, that you can eliminate the need for rent increases because owners can increase rent (with MCIs and preferential rent increases), is a ludicrous notion. Both of those suggestions, that MCIs and preferential rent increases, can somehow substitute for a necessary, across-the-board rent increase, are just laughable.”
Later, Steinberg, who said she’d originally planned to read pre-written testimony, changed her mind in order to respond to Freund.
“Perhaps he forgot that MCIs get onto a tenant’s rent in perpetuity,” she said during her testimony. “It goes way beyond recouping the landlord’s costs and if you’re a tenant living in a building and have received several MCIs that get added permanently on top of the RGB increases, that adds up really fast. Maybe it’s laughable for the landlord but it sure isn’t for tenants.”
She added that preferential rent increases also had an impact on tenants in ST/PCV in 2013 when then-owner CW Capital instituted a mid-lease rent increase, typically adding hundreds of dollars to tenants’ rent and forcing more than a thousand people to move out of the complex.
In her written testimony, Steinberg advocated for a rent rollback or at least a freeze.
Other rent-stabilized Manhattanites and local elected officials also called for a rent freeze or in some cases a rollback during the hearing that took place last Wednesday. Advocates testifying at the Custom House in Bowling Green made their requests despite the proposed increases made by the RGB last month that range from 1 to 3 percent for one-year-leases and 2 to 4 percent for two-year leases.
State Senator Brad Hoylman was among those calling for a freeze, arguing that the proposed range of increases isn’t binding.
“It does not say so in the statute,” he said. “Therefore, I am appealing to the nine of you, who care about New York City enough to spend your time on a project as thankless as this, to do the right thing and institute a continuation of the rent freeze and to extend it to two-year leases.”
The last two years in which the RGB voted for a rent freeze only applied to one-year leases and there was a 2 percent increase on two-year leases in both 2015 and 2016.
Hoylman’s deputy chief of staff Eli Szenes-Strauss delivered the testimony on Hoylman’s behalf because the senator was in Albany at the time of the hearing. Hoylman also said in his testimony that he was frustrated to learn that the suggested range from the RGB proposed increases instead of a freeze as in previous years, especially because he felt the increase was based on one statistic.
“A lot has been written this year about how the data justifies a rent increase, because the Price Index of Operating Costs increased by 6.2 percent over last year,” he said in his testimony. “If costs are going up by 6.2 percent and you’re still making a net profit of 10.8 percent, then you do not need to be saved by government.”
Both Councilmember Dan Garodnick and City Council candidate Marti Speranza submitted testimony calling for a rent freeze as well, with Speranza suggesting the possibility of a rollback.
“We continue to face a housing crisis where homelessness is increasing, apartments are being deregulated, evictions are going up and far too many New Yorkers cannot afford to live in the communities in which they work or have spent their entire lives,” she said. “While RG’s Income and Expense Study reveals that property owners’ Net Operating Income has increased for the 11th consecutive year, income for seniors and working families remains stagnant.”
Stuyvesant Town resident Marietta Hawkes urged the board to vote for a rent freeze.
“I live alone with no husband and no children so I can’t borrow from anyone if I can’t meet my rent,” she said. “I struggle check to check to pay my high rent.”
The final vote for the RGB will be held next Tuesday, June 27 at 7 p.m. in Mason Hall at Baruch College, 17 Lexington Avenue.