NYC’s rent laws poised for major reform after Democratic wins in state Senate

By the time election results began airing on the mounted television at Patsy’s Pizzeria in Morris Park, where Democratic state Senate candidate Alessandra Biaggi held her election night viewing party, the candidate’s triumph was a foregone conclusion. The district that Biaggi will represent—the 34th, covering neighborhoods like Morris Park, Riverdale, and Throgg’s Neck—leans heavily Democrat, and her unexpected primary win against Senator Jeff Klein on September 13 was the real heavy lift. But that didn’t stop supporters, family members, and friends from erupting in applause every time her name appeared on screen, showing she had secured 70.66 percent of the vote.

One attendee, clad in a blue t-shirt that read “VOTE BIAGGI,” was Barry Soltz, a former tenant association president at the nearby Janel Towers. Tenants at his building, once a Mitchell Lama housing complex, have been protesting Klein since 2010, when he first formed the Independent Democratic Conference, the breakaway group of senators that entered into a power-sharing agreement with Republicans who controlled the state Senate. The complex is currently facing a major capital improvement, part of a program that allows permanent rent increases to subsidize fixes within units. Legislation to make those increases temporary thanks to the IDC.

Soltz invited Biaggi to an October 26 town hall where she met with tenants about housing concerns. “Everybody that met her loved her,” he said. But he said her success rested on whether New York state’s Senate could turn for Democrats, and at that point in the evening, the outcome was still unclear. “I still don’t know what the state senate’s looking like,” Soltz said, nervously eyeing the screen.

Hours later, the results were in: New York’s state Senate is now securely under Democratic control, with at least 36 candidates from the party winning on election night.

The new Democratic majority is a big win for tenants’ rights advocates, who are now poised to deliver on long sought-after reforms that hinged on the Senate—which has been under Republican control for a decade—going blue. New York’s rent stabilization laws are up for renewal in June 2019, and loopholes that have dogged advocates for years are in sight of finally being closed or amended. Among them are vacancy decontrol and bonuses, preferential rent, and major capital improvements, all of which contribute to the loss of rent-stabilized apartments in New York City.

And newcomers who unseated former members of the IDC—including Biaggi, Jessica Ramos in Queens, and Zellnor Myrie in Brooklyn—say they are particularly attuned to the anguish of renters, something that has lead to excitement among tenant’s rights advocates.

Biaggi, a former Deputy National Operations Director for the 2016 Hillary Clinton campaign, has lived with her parents to save money—she told The Cut she has over $180,000 in student loan debt—but at her election watch party, Biaggi told Curbed she was going to start looking for a place to rent. “I have to find a place that’s affordable, that’s the challenge,” she explained.

Ramos, who will represent District 13 in Queens, is a renter who lives with her husband and two sons in Jackson Heights. A former Director of Latino Media under Mayor Bill de Blasio, she was among the constituents who confronted Senator Jose Peralta at a heated February 2017 town hall about his joining the breakaway IDC. Her anger over Peralta’s defection led her to run against him and ultimately win the district, which covers Astoria, Woodside, Jackson Heights and Corona.

In addition to being a renter, Myrie is the president of his building’s tenant association in Prospect Lefferts Gardens, as well as a lawyer and activist who has logged pro bono work for indigent clients. Myrie grew up in affordable housing in Flatbush, and helped author the Tenants Bill of Rights while legislative director at New York City Council. He too says he was driven to run when he learned his state senator, Jesse Hamilton, had joined the IDC, and defeated him months later.

Each of these insurgent candidates hammered their IDC competitors for taking large sums of real estate money and for failing to close rent loopholes, despite assurances to advocates that they would do so. State Sens. and IDC members Marisol Alcantra and Jose Peralta even penned an op-ed in Spanish-language newspaper El Diario, pledging to fight on behalf of tenants against the loopholes. Along with Hamilton, they co-sponsored Senate legislation to end preferential rent loopholes—an empty gesture, since the Republican-controlled Senate, which relied on the IDC to tip the scales, refused to put it to vote. Subsequently, each of the IDC challengers drew substantial support from tenant unions who mobilized their frustrated membership.

“Alessandra, Jessica, Zellnor—they understand these issues that a lot of legislators only understand because somebody explained it to them,” says Michael McKee, the treasurer of TenantsPAC, a group that funds candidates who support pro-tenant positions.

Scott Heins

The loopholes they may now seek to change have all existed as bills of some kind in the Senate, but have mostly never received votes. Take vacancy decontrol: Created by a 1994 law passed by the City Council, the practice allows landlords of rent-stabilized apartments asking at least $2,000 to hike that number by a certain percentage each year. If the renter makes $250,000 a year or more, the rent hike can happen upon lease renewal. An additional loophole in the law allows landlords to hike rents further by making small improvements and claiming large repair costs, retroactively pushing rent past the $2,000 minimum. Once the unit meets a threshold of $2,733 it is permanently deregulated.

Of the units that were permanently deregulated in 2017, 53 percent were due to high-rent vacancy decontrol, according to the New York City Rent Guidelines Board, and the practice is a prime reason for the net loss of 147,512 rent-regulated units since 1994. (Hand in hand with this loophole is the so-called eviction bonus, which gives landlords an automatic 20 percent rent increase once an apartment has been vacated; a bill to overturn this also exists in the Senate.) A bill to end vacancy decontrol, introduced by Andrea Stewart-Cousins, the incoming majority leader, has been in committee since 2017.

Advocates are also pushing to for an end to preferential rent hikes, which allow landlords who are offering a rent below the legal minimum to kick it up to market rate (and sometimes above) upon lease renewal, at a rate of increase otherwise not permitted by law. Attempts to repeal the 2003 law that created this loophole have passed the State Assembly on six occasions and have only been put up for vote in the Senate once, in 2010, when the body was controlled by Democrats. The latest version of this reform, passed by the State Assembly in May, would put a cap on such increases without ending the practice outright.

The major capital improvements program is also a target of tenant advocates; it allows landlords to permanently raise rents up to six percent per year in order to fund building-wide upgrades, which some tenants and advocates say are minor or unneeded. At a town hall at PS/IS 30 in Bay Ridge, for instance, one woman complained of a foul-smelling carpet being lined in her building as well as repairs to an intercom system she says was not broken, both of which justified a hike in rent.

Allowing all of this to happen is the Urstadt Law, a 40-year old piece of legislation that prohibits the City Council from meaningfully regulating rent laws in NYC, shifting power to the state. Enacted in 1971 by Governor Nelson Rockefeller’s housing commissioner Charles Urstadt, the law prohibits cities with a population over 1 million (of which New York state has only one) from enacting rent and eviction laws more stringent than those passed by the state. Legislation to repeal the law, introduced by Senator Liz Krueger in 2017, currently exists, but both incoming state Senators and tenant groups are mixed on where it falls on the list of post-election priorities after the elections. Groups like ANHD and the Met Council support its repeal, but say it lies below closing rent loopholes and expanding eviction protection. Biaggi, Ramos, and Myrie also support repealing the law, while Robert Jackson, the former City Council member who unseated Alcantara in the 31st District, has prioritized its repeal.

Instituting these reforms could have tremendous impact on the city’s housing stock and stem displacement, and the stakes have never been higher: The city is in the midst of an affordable housing crisis—from 2006 to 2016, the share of rental units affordable to low-income people decreased 12.9 percentage points—and the number of New Yorkers in homeless shelters increased 77 percent between 2007 and 2017, according a Furman Center study.

Thomas Angotti, professor of Urban Planning at Hunter College, says that the subverting of rent regulations by landlords and developers has “undermined affordable housing while leading to a boom in new market-rate, luxury housing, which “disproportionately affects low-income communities of color.” Closing the loopholes is a good first step, Angotti says, but stronger eviction protections across the board need to be put in place. He advocates for “community based agents” to enact rent protections in collaboration with tenant advocates and neighborhood organizations.

Tenant advocates see two main roadblocks to meaningful rent reform: Governor Andrew Cuomo’s veto pen, and an influx of cash from the real estate industry. Many believe Cuomo used the IDC, which reportedly convened with his blessing, as a foil to avoid progressive legislation, including rent reforms.

And the Real Estate Board of New York has kicked up its donations to Democrats this election cycle. A Wall Street Journal analysis found that REBNY had increased statewide donations to Democrats from $57,000 to $236,750 between the 2016 and 2018 election cycles, a hedge that Democrats were likely to take control of the Senate. In a statement to the WSJ, REBNY president John Banks said, “We have what we think are solid working relationships with both sides of the aisle,” adding, “Obviously, if this blue wave is what it is, we’ll have to build new relationships with new legislators.”

McKee says he’s not surprised by the increase in donations and is aware that even the most progressive politicians are susceptible to an influx of cash down the line. “We’ve been double-crossed in the past where candidates we helped elect voted against us,” he says. “Real estate money is a big issue.”

For this reason, Housing Justice For All, the coalition behind recent town halls in Brooklyn, has been trying to get politicians to sign pledges at public events. These affirm that candidates will “stand on the side of tenants, not landlords,” and that they will fight to close loopholes and expand good cause eviction protections. The pledges are mostly symbolic but advocates hope the candidates will feel more obligated to honor an oath signed in public than an assurance made behind closed doors.

Andrew Gounardes, who is running to replace Republican Senator Marty Golden, signed the pledge at the October 30 town hall. Golden’s district, which encompasses the immigrant enclave of Bay Ridge, was one of the most competitive races in the state. Gounardes declared victory late on November 6 with 49.8 percent of the vote. Once in office, he’ll be expected to fight for reforms for tenants statewide. At an earlier town hall in Flatbush hosted by the same coalition, Myrie also signed a pledge presented by Housing Justice For All.

“It is very inspirational to stand in this room tonight and see how many people are here,” Myrie said at the event. “And let me tell you why: We have a fight on our hands in the next legislative session.”

Jhodie Meade, a stay at home mother and member of the Crown Heights Tenant Union, attended the Flatbush town hall. She lives in a rapidly developing block just down the street from the Bedford Union Armory, in a regulated apartment that has been in her family for 27 years. She pays preferential rent but fears an increase will drive her family out. Unlike more active tenant advocates, she knows little about the IDC, the incoming candidates, or Myrie. She felt reassured that he signed the pledge, but is hesitant in her optimism.

“They pledged to fight on our behalf,” she said. “I would like to believe that is what they’ll do.”