With all the changes made last month by the State Legislature in tenant protections and rent regulations, the nine-member New York City Rent Guidelines Board (RGB) appointed by the mayor remains intact. That is the entity which sets rent increases for leases expiring in any given year.
For hundreds of thousands of tenants facing lease renewals between October 1, 2019, through September 30, 2020, the RGB has set the increases at 1.5% for a one-year lease renewal and 2.5% for a two-year lease renewal.
The question for tenants is, which one is best? It’s all about short-term and long-term dollars and cents. But it is not that simple.
To some extent clairvoyance is required, but that function does not appear on any calculator. What do I mean?
One thing is a certainty: you will save money in the first year if you opt for a one year renewal. But what about the following year? Well, if the guidelines remain the same next year, then a tenant will be spending more money in the second year if they opt for consecutive one-year renewals as opposed to a two-year lease renewal at 2.5%.
Tenants asked for, but did not receive a rent freeze, at the final vote of the Rent Guidelines Board on Tuesday night. (Photos by Maria Rocha-Buschel)
By Maria Rocha-Buschel
The Rent Guidelines Board voted to increase rents on rent-stabilized apartments by 1.5 percent on one-year leases and 2.5 percent on two-year leases at the final vote in Cooper Union’s Great Hall on Tuesday night. Chair David Reiss put forth the proposal that ultimately passed, citing a slight increase in real estate taxes and possible impacts from the rent regulations that just passed in Albany.
Reiss noted that while the 2019 price index for operating costs and taxes went up for all owners, the ratio of expenses to revenue is “healthy” enough for owners to maintain buildings, making a larger increase unwarranted.
Tenant representative Sheila Garcia expressed the usual disappointment at the lack of a rent freeze, noting that she and fellow tenant member Leah Goodridge felt that the research from the RGB supports a rent freeze.
“I think there would be a chance (for a rent freeze) if people weren’t afraid to do what the data actually states,” she said. “The landlords cry wolf and people fell for it again. They saw the winds around the rent laws as a wind that tenants would be okay and that’s not true. They’re still going to have MCIs and there are still going to be other increases that landlords use as loopholes.”
Tenants rally outside the governor’s midtown office in support of the proposed rent laws on Wednesday. (Photo by Anne Greenberg)
By Sabina Mollot
Although nothing is yet a done deal, on Tuesday night the State Assembly and Senate announced that the package of bills aimed at repealing vacancy decontrol, among other tenant protections, is being pushed forward by both chambers. A vote is expected to take place on Friday, and Governor Andrew Cuomo has said he would sign such a bill if it passes in both chambers.
The package’s protections for tenants, if signed into law, would:
Make the rent regulations permanent, instead of sunsetting every four years
Repeal vacancy deregulation and high-income deregulation, which has applied to residents whose household incomes were at least $200,000 for two years
Repeal the vacancy bonus, which allows owners to raise the rents by 20 percent every time an apartment turns over
Repeal the longevity bonus, which allows owners to raise rents on an apartment for new tenants based on the length of the previous tenancy
Prohibit Rent Guidelines Boards from setting additional increases based on the current rental cost of a unit or the amount of time since the owner was authorized to take additional rent increases, such as a vacancy bonus
Before I became a state legislator, I was one of two tenant representatives on New York City’s Rent Guidelines Board, the entity responsible for setting the rents for the city’s million-plus units of regulated housing stock. During my tenure, I worked closely with advocates to push through two consecutive rent freezes––the first and second in the Board’s 50-year history.
Freezing rents for two years in a row provided much-needed relief for over a million rent-stabilized tenants––relief these working class New Yorkers still need today. Unfortunately, since 2016, the Board has voted twice to raise rents; they look poised to do so again this year. I don’t believe the data support increasing rents.
New York City is in the midst of a homelessness crisis of historic proportions not seen since the Great Depression. According to the U.S. Department of Housing and Urban Development, our city is home to the largest homeless population of any city in America: tonight, some 60,000 New Yorkers will sleep in shelters.
Those lucky enough to have a home face challenges: in an annual report produced by the RGB, a majority of rent-stabilized tenants were shown to be rent-burdened and a third are severely rent-burdened, meaning they pay 50 percent or more of their incomes towards rent. Rent-burdened tenants face serious difficulties meeting their everyday needs for nutritious food, healthcare and education and the health outcomes of children that live in rent-burdened households are worse than their non-rent-burdened counterparts, according to Pew researchers.
Based on the annual landlord-friendly rent increases tenants received for 20 years from the Giuliani and Bloomberg administrations, I would think that Rent Guidelines Board members are appointed by the mayor. If so, why is the RGB, under our current mayor, discussing any rent increases at all? If they are considering landlord expenses in their deliberations, they should take into account the fact that landlord expenses were much, much lower than the yearly rent increases they received for 20 years from the Republican administrations. Tenants should receive the same treatment at landlords. Thus, they would not have to suffer any increases for 20 years.
If only the Democrats in power in New York and the House of Representatives in DC did not suffer from wimped-out disease. What are they afraid of? If they don’t act with strength and courage now, they won’t have a job anymore. I say rent freeze and impeachment. Now!
Tenants wave signs while calling for a rent freeze or rollback. (Photos by Maria Rocha-Buschel)
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 Jewish festival of Passover is just around the corner. Families will gather at the Seder table where the ancient and traditional question will be asked “Why is this night different from all other nights?” But for tenants in New York City the most pressing question is: Will this year be different from all other years… and if so why?
Every spring around this time the Rent Guidelines Board meets to recommend rent increase adjustments for rent stabilized apartment lease renewals and vacancy allowances for new leases during the next 12 to 24 months beginning on October 1.
Moreover, some tenants also get notified of additional permanent rent increases from major capital improvement (MCI) work done in their buildings. Sometimes those MCIs amount to little more than necessary longterm maintenance which is required to keep buildings in good repair. Yet the owner can reap significant profits from tenants who continue to pay for those projects long after the owner has recouped the costs for their MCI project.
There is reason to believe that much of this may change this year.
Spring has sprung and every four years in New York means one thing: that government decisions made at the city and state levels will be directly impacting the affordability of over a million stabilized apartments.
The city’s Rent Guidelines Board is beginning the process of debating what this year’s increase will be for renters with its first meeting of the year set for this Thursday. The final vote will be made in late June.
The rent regulations that affect the city, made in the state’s capital, are also set to expire on June 15. Though they’re expected to be renewed, lobbying from both the real estate industry and tenants has already begun to hammer out the details.
Both parties will of course have their hands full in terms of advocacy. What this means for tenants, who don’t necessarily have the time to be in two places at once, is that they should prioritize Albany. So states Michael McKee, treasurer and spokesperson of Tenants Political Action Committee (PAC).
Waterside Plaza as seen from Stuyvesant Cove Park (Pictured last August) Photos by Sabina Mollot
By Maria Rocha-Buschel
The City Council voted last Thursday to approve an agreement that will protect longtime Waterside Plaza tenants against substantial rent increases as part of a lease extension between the property and Housing Preservation and Development.
The agreement will allow tenants who have been living at the property since before Waterside left the Mitchell-Lama program and will be retiring soon to receive rent protections. City Council Member Keith Powers, who has been working with Assembly Member Harvey Epstein and the Department of Housing, Preservation and Development on negotiations for the deal for over a year, was able to negotiate an additional year with HPD so that tenants have until 2020 to retire and qualify for the rent protections, compared to 2019 when the plan was first announced.
“It’s not huge but it at least gives people who might be affected a better idea of how they should plan,” Powers said after the Council vote of the additional year.
Tenants protest the dearth and death of affordable housing at the final vote of the Rent Guidelines Board. (Photos by Maria Rocha-Buschel)
By Maria Rocha-Buschel
The Rent Guidelines Board approved 1.5 and 2.5 percent increases for rent-stabilized tenants in the board’s final vote at Cooper Union’s Great Hall last Tuesday evening. The event attracted the usual crowd of chanting tenants, most calling for a rent freeze at the vote and pre-event rally and some even hoping for a rollback, but the increases proposed by RGB chair Kathleen Roberts passed in a narrow 5 to 4 vote.
While the annual vote usually ends with a proposal that is a compromise between high increases from the board’s landlord representatives and low increases, or often a rent freeze, from the tenant representatives, a public member voted differently than members in the same position have in the past.
Rodrigo Camarena, who Mayor Bill de Blasio appointed this year, voted with the tenant representatives for a rent freeze while the other public members, as well as the owner members and the chair, voted against the measure.
“For the vulnerable, for the displaced, for fairness, I vote yes,” Camarena said when casting his vote.
It is said that a good deal is one in which neither party is entirely satisfied. More about that in a moment.
Rent regulations in New York City has been a thorny issue for decades. So a little recent history. The Rent Guidelines Board (RGB) was established in 1969 and modified by the passage of the Emergency Tenant Protection Act of 1974. There are nine members of the RGB all appointed by the mayor. Of the nine, two are from the real estate industry, two representatives of tenant groups and five “public members.”
The RGB will meet on June 26 to set rent increases for leases that will expire beginning on October 1 through September 30, 2019. Currently, increases are set at 1.25 percent for a one-year lease and two percent for a two-year lease. Based on the proposals that have been recommended for public comment by the RGB, next year’s guidelines will be similar. There have been years where the rent increases rose into the double digits and there have been years that rents have been frozen. Generally speaking whatever the RGB decides, both tenants and owners cry foul. This year will be no different.
The fact is that try as they may, the RGB satisfies nobody. Moreover, it is difficult to do any planning because nobody knows what the rents will be set at from year to year. It is also a very dubious claim that the decision by the RGB is tied to any real economic data in terms of owners’ costs or profits and certainly not taking into consideration the financial burdens on tenants. In short, it is an arbitrary and often political process.
In the ‘90s, New York’s legislature sold out tenants and tipped the scales in favor of big landlords by passing the Rent Regulation Reform Act. This piece of legislation passed in both houses, its sponsors claiming to be sticking up for the mythological “mom and pop” landlord, whose profits were supposedly being squeezed by rent regulation.
Among the most damaging provisions of the act was the invention of “vacancy decontrol” which, since its inception, has eroded New York’s stock of affordable housing by jacking up rents on units if tenants leave or are forced out by unscrupulous landlords seeking to cash in on another perversity of the act: the vacancy bonus.
The assault on tenants has not abated. In response, community groups have had to rise to the occasion and tirelessly defend tenants against the bad actor landlords playing with a stacked deck. I am proud to have been fighting to keep tenants in their homes for decades and as your new Assembly Member, I am eager to continue the fight having acquired a different set of tools to work with and new opportunities to win victories for tenants. The struggle is the same, but my election to the Assembly will afford new ways to achieve our goals.
Small business owners have even fewer protections than residential tenants –– they are at the mercy of their landlords, who have no constraints on how much rents can be raised.
Tenants at this year’s preliminary vote for the Rent Guidelines Board (Photo by Maria Rocha-Buschel)
You know spring has sprung when the stories start coming out about jet-setting tenants who Airbnb their rent-stabilized apartments while only paying a few hundred dollars in rent or less.
Just one example is the recent tale in the New York Post about a woman paying $100 for her stabilized digs that she inherited after moving in on an older, dying man.
She convinced the elderly gent, the tenant of record, to adopt her as his daughter despite being close to retirement age herself.
It’s an intriguing tale that makes one feel sorry for the poor landlords of stabilized properties.
Meanwhile, these stories about unicorn-rare rents are, we suspect, planted by groups representing landlords as the Rent Guidelines Board gears up to decide how high of an increase the city’s tenants in roughly one million rent-stabilized units will be hit with. And it will be an increase rather than a freeze, based on last month’s preliminary vote.
I wish I could share everyone’s enthusiasm for Mr. Epstein’s winning our Assembly seat.
He becomes my fourth representative in fewer than 19 years.
I write because he was pitching perfect games vs. the Rent Guidelines Board.
Why do we need him in Albany?
More could be done in Albany to strengthen rent laws, but not from New York City’s delegation to the State Assembly.
It may be Mr. Epstein has the necessities to be a Democratic leader in due course. But given that’s he was doing uniquely well fighting the Rent Guideline’s board, I wouldn’t have moved him to where he won’t be able to do as much.
Rent Guidelines Board’s two tenant members Sheila Garcia and the newly-appointed Leah Goodridge (Photo by Maria Rocha-Buschel)
By Maria Rocha-Buschel
New Rent Guidelines Board tenant representative Leah Goodridge is, first and foremost, a native New Yorker.
“Because I’ve seen the changes in the city over a number of decades, (joining the board) was definitely something I was interested in,” she said. “Being a native New Yorker has allowed me to really see the city and be connected to it where I care deeply about its future and its past.”
Goodridge, a supervising attorney at Mobilization for Justice, told Town & Village that tenant advocacy in her career impacted her decision to join the board as well but seeing so many changes for tenants throughout her life emphasized for her the importance of the work that the board does.
“(The RGB) plays a huge role in affordability, which is one of the main issues in New York,” she said. “I’m from Brownsville, I live in Bed-Stuy now and I’ve seen the neighborhoods change dramatically. People are being priced out.”