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A Huge Victory for Tenants in Court Case Ruling Against Unjust RGB Rent Hike

January 28, 2010


Tenants protest RGB hearings in 2009. (Photo by Housing Conservation Coordinators.)

For the past two years, the NYC Rent Guidelines Board (RGB) has outrageously imposed minimum, flat rent increases to tenants who have been in their apartments for longer than six years. When a tenant moves from a stabilized unit, landlords are allowed to jack the rent on apartments through an allowed “vacancy increase”–so we can assume the pro-landlord RGB thinking was that when tenants don’t move very often, landlords are missing out on the extra increase opportunity.

In 2008, the RGB set increases at 4.5% (for one-year leases) and 8.5% for two-year leases–unless you lived in your apartment for six or more years; if so, your increase was 4.5% or $45 (whichever was greater) for a one-year lease or 8.5% or $85 (whichever was greater) for a two-year lease. In 2009, the RGB set increases at 3.0% (for one-year leases) and 6.0% for two-year leases–unless you lived in your apartment for six or more years; if so, your increase was 3.0% or $30 (whichever was greater) for a one-year lease or 6.0% or $60 (whichever was greater) for a two-year lease.

I am very pleased that yesterday, as the NY Daily News (“Judge throws out minimum rent increases imposed by Rent Guidelines Board“) and the New York Times City Room Blog (“Ruling Could Mean Lower Rents for 300,000 Tenants”) reported, Manhattan Supreme Court Judge Emily Jane Goodman ruled that the practice was unlawful and “penalizes tenants failing to move in a city that has virtually no affordable housing.” This is a just and long-overdue decision and we have the Legal Aid Society to thank for representing a class of tenants in bringing this suit (the Legal Aid Society’s press release is linked here).

The minimum increases on long-term tenants are a poor tax. For tenants whose rents are lower, the increases were startling. An example that was cited in the lawsuit filed by the Legal Aid Society, was Mr. Paul Hertgen, an unemployed Staten Island tenant who is normally a truck driver. Because of the 2008 guidelines, his rent increased from $685 to $770–a 12% increased as opposed to an 8.5% increase that he would have paid were he not an 18 year long-term tenant.

Long-term tenants are the people who live their whole lives in their communities – in these homes they are born, marry, raise families, and grow old. Helping families to stay in the homes should be the purpose of our public policy–but the RGB seems to think that it has the opposite responsibility. When the RGB decided to pick on long-term tenants, they de facto declared war on our communities.

For the past two years, I have testified against these minimum increases to long-term tenants. (See the Publications 2009 and Publications 2008 sections of this blog to download copies of those testimonies.)

Landlord representatives have predictably said that they will appeal the decision, so we will have to wait to see the outcome of that before tenants can apply for their refunds–but those refunds are estimated to be as much as $100 million citywide.

The fact that this lawsuit had to be filed at all underscores the urgent need for serious reform of the RGB. The basic equation is simple: In New York City today, landlord incomes are going up, even while low-income New Yorkers are paying unsustainably large portions of their income in rent. The RGB’s own data from 2005 shows that rent stabilized New Yorkers spend close to 40% of their household income on rent. Over one third of New York City renters spend at least half their income on rent. According to the U.S. Department of Housing and Urban Development, “the generally accepted definition of affordability is for a household to pay no more than 30 percent of its annual income on housing. Families who pay more than 30 percent of their income for housing are considered cost burdened and may have difficulties affording necessities such as food, clothing, transportation, and medical care.”

Continuing to allow the Mayor to control the majority of appointments to the Board is a deeply flawed model, he has demonstrated time and again that his appointees will only serve the interests of landlords. For these reasons, I am a co-sponsor of legislation (A.5282), with my friend Assembly Member George Latimer, to bring comprehensive reform to this body.

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Written by Micah · Filed Under Blogroll, Community 

Comments

2 Responses to “A Huge Victory for Tenants in Court Case Ruling Against Unjust RGB Rent Hike”

  1. Samantha Cook on March 10th, 2010 2:26 pm

    Dear Micah,
    Thank you so much for standing up for the rights of tenants. I just recently was supplied with my lease renewal only to discover the exorbitant $30-$60 hike in my rent, which because of the recent underemployment has already started looking higher than I can afford.
    I would love to find out how to get active on this. If you can point me towards grassroots community coalitions regarding this obscene rent hike, please do so, and again, thank you.
    Sincerely,
    Samantha Cook

  2. Micah on March 10th, 2010 3:11 pm

    Samantha,

    Thank you for your comment. There are a number of good pro-tenant organizations out there, but you might start with Tenants & Neighbors, a very active group which was a plaintiff in the court case: http://www.tenantsandneighbors.org.

    Best,
    Micah

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