By Maria Rocha-Buschel
The Rent Guidelines Board shot down the possibility of a rent freeze or rollback during the preliminary vote in a lively meeting at Cooper Union’s Great Hall on Tuesday, approving a range of 0.5 to 2.75 percent for one-year leases and 1.5 to 3.75 percent for two-year leases.
Tenant representatives Sheila Garcia and Leah Goodridge had proposed a possible rent rollback for tenants signing one-year leases, with a range of -0.5 to 0 percent, and the possibility of a freeze for residents signing two-year leases, suggesting a range of 0 to 1 percent, but the motion didn’t pass.
Tenant reps for the RGB have proposed rollbacks and freezes in previous years, although last year Garcia said that the data didn’t necessarily merit a rollback, so she and Goodridge had proposed a freeze during the preliminary vote. But this year, she said that a rollback made more sense.
“We saw the impact of the rent freeze (in the data we looked at this year),” Garcia said following the vote, referring to the freeze on one-year leases that the board had approved in 2016, noting that the board bases their analysis on data that is at least one year old and in some cases, even older. “There was an increase in Net Operating Income (in that year for landlords), most tenants are signing two-year leases and there are all these other sources of income.”
The proposal that ultimately passed at the vote was put forth by Chair David Reiss, newly appointed to the position this year but not a new member of the board.
Mayor Bill de Blasio appointed Reiss as a public member in 2017, and during the meeting for the final vote that year, Reiss and fellow public member Hilary Botein read a statement they put together arguing that state and municipal action could address some of the concerns tenants raised at public hearings, including a proposal for affordable housing that is pegged to tenants’ income, since even tenants that are rent-stabilized could end up paying more than 30 percent of their income for housing. Reiss, a professor at Brooklyn Law School who focuses on real estate finance and community development, voted against a rent freeze that year but in favor of the proposal that passed, with increases of 1.25 and 2 percent.
Also new to the board this year are public members German Tejeda and Alex Schwartz, a professor of urban policy at the New School.
Tejeda, currently the national director of financial programs at a nonprofit focused on reducing poverty by improving access to benefits and assisting low-income students, was the only member of the board besides the tenant representatives to vote in favor of the possible rollback.
Prior to the proposal from the tenant representatives and the proposal from the chair that ultimately passed, newly-appointed owner member Patti Stone and returning owner member Scott Walsh offered a proposal that included increases for two-year leases of more than 6 percent.
Stone is a member of law Rosenberg & Estis, P.C. in the Administrative Law Department and spoke on behalf of the owner representatives at the vote, proposing a range of 3.75 to 5.75 percent for one-year leases and 4.75 to 6.75 percent for two-year leases.
The proposal also included a special guideline that Stone outlined as a stipulation if the state repeals the 20 percent rent increase on vacant apartments that Democrats have been pushing for, calling for a 15 percent increase if an apartment hasn’t had a vacancy increase in the last five years, or a 10 percent increase if there has been a vacancy increase within the last five years.
Stone said that she is aware of the expense of housing for tenants but argued to the groans and grumbles of tenants in the audience that landlords are just trying to run a business and it is the fault of city and state politicians that housing prices are so exorbitant.
“Owners are people who invest their hard-earned money in a building to run as a business to support their families,” she said. “We live in a capitalist society where people go into business to earn a profit, not just to break even.”
Stone also blamed local laws issued by Mayor de Blasio that increase owners’ costs, including an allergen law and greenhouse gas emissions law, additionally pointing to increases in property taxes, water rates and an increase in the Price Index of Operating Costs since 2014 as reasons for the proposed increases in rent. She argued that higher rent increases needed to be approved because rent increases since 2014 have not been keeping pace with the increase in expenses for landlords.
Garcia took issue with Stone’s claim that rent increases were necessary because landlords are trying to run a business, arguing that it’s not the job of members of the board to ensure that owners make money.
“The purpose of our board is not to make sure that landlords continue to make profits,” she said. “Our board is mandated to actually make sure that we simulate a fair housing market, which we do not have in this city.”
Many tenants at the preliminary vote brought signs and banners, rallying in the Great Hall prior to the vote, but Cooper Square Committee organizer Jodie Leidecker went a step further and came in costume, donning a giant beard and a fedora, with her accompanying sign explaining that her version of ZZ Top is in favor of a rent freeze.
“The real reason (for the costume) is actually really boring because it’s just that I didn’t get to be ZZ Top for Halloween so I’ve just been trying to work it in somehow,” Leidecker said, noting that her sign proclaiming that “Every girl’s crazy about rent freezes” is a play on the lyrics to Sharp Dressed Man. “But I’m also wearing the costume to bring attention to this issue, which is that we’ve seen 13 years of profits for landlords while there’s a growing amount of homelessness in this city.”
The board also voted at the meeting on possible increases for class A hotels, class B hotels, lodging houses, rooming houses and single-room occupancy housing, approving a 0 percent increase with no vacancy allowance.
The final vote is on Tuesday, June 25 and the approved increases will apply to apartment and loft lease renewals and hotel lease renewals beginning between October 1, 2019, and September 30, 2020.