Freeze rents or repeal vacancy decontrol for rent-stabilized apartments — that’s one of the largest policy issues being batted around by Democratic primary candidates in the 33rd District state Senate race.
Incumbent Pedro Espada Jr. chairs the state Senate Housing Committee and has proposed a rent-freeze bill. Mr. Rivera, who has the support of tenant groups, is behind repealing vacancy decontrol — a law that allows landlords to deregulate apartments when the rent reaches $2,000 per month.
In 2009, Mr. Espada reportedly said he would support the repeal of vacancy decontrol. But by the time Mr. Espada returned to the Democrats as their majority leader, following his defection to Republicans for 31 days, he had changed his mind.
Instead of repealing vacancy decontrol, Mr. Espada killed the bill and introduced a “rent freeze bill.”
So, what are the real differences between the proposals?
The Tenants Political Action Committee, which has endorsed Mr. Rivera in the race, is advocating, along with other tenant groups, for the passage of a bill that would repeal vacancy decontrol. Mr. Rivera supports the bill.
As it stands, when a tenant moves out, owners are allowed to increase rents and bring apartments closer to the $2,000 decontrol mark. When an apartment is decontrolled, landlords can charge market rates. Tenant advocates claim vacancy decontrol gives landlords an incentive to harass tenants so they will move out, and point to rapidly shrinking numbers of apartments that offer any form of rent or eviction protection.
“We’ve lost something like 300,000 apartments already to vacancy decontrol and every month we lose more,” Michael McKee, a board member of Tenants PAC, said.
In addition to halting deregulation, Mr. McKee said the bill would re-regulate approximately 275,000 to 280,000 units — about 95 percent of deregulated housing stock.
But Curtis Tucker, director of legislative policy for Mr. Espada, said repealing vacancy decontrol wouldn’t provide significant protection to renters in districts like the 33rd because so few apartments have reached $2,000.
“We feel that the repeal of vacancy decontrol is not the answer to creating more affordable housing,” he said.
The group Housing Here and Now’s analysis of the U.S. Census Bureau, 2008 New York City Housing and Vacancy Survey showed that 71,600 apartments in the 33rd state Senate district were regulated. But Mr. McKee said landlords often charge less than market rates for deregulated apartments in neighborhoods where tenants cannot afford them.
“The dirty little secret that they will not acknowledge is that there are a lot of de-regulated apartments all over the 33rd Senate District, even though no one’s paying $2,000 a month,” Mr. McKee said.
Instead of repealing vacancy decontrol, Mr. Espada has proposed a now-amended bill that would entitle renters making less than $45,000 and spending at least a third of their income on rent to keep current rates for five years. Though tenant advocates have also called for a rent freeze, they view Mr. Espada’s bill as phony.
“What the bill is, is a decontrol bill disguised as a pro-tenant bill,” Mr. McKee said.
Tenant groups’ beef is that in addition to freezing rents, the proposal would allow landlords of rent-regulated apartments who have received certain tax breaks in the past to return the money and then deregulate apartments in their buildings. Money paid back would be used to help fund the bill.
The bill would effectively reverse the widespread implications of an October 2009 state appeals court ruling in favor of tenants from Stuyvesant Town and Peter Cooper Village that Tishman Speyer had illegally deregulated apartments because it had received the tax breaks.
“We think the elimination of the uncertainty, and allowing the landlords the opportunity to pay back the benefits would be helpful to the real estate industry, the city tax base ... ” Mr. Tucker, who is Mr. Espada’s legislative director, said. He helped pen the legislation.
“This is very serious and it sounds great when you hear about it,” Mr. McKee said of the bill, “but it’s totally cynical and insincere.”
The ruling in the Stuyvesant Town case flew in the face of a 1996 state Division of Housing and Community Renewal advisory letter that had interpreted rental law to mean that landlords who already owned rent-stabilized apartments when they received the tax break could deregulate apartments without constraints.
“We said at the time this is wrong. This is not what the law said,” Mr. McKee said.
Mr. Espada’s bill is currently out of the Housing Committee and in the state Senate Finance Committee, according to Mr. Tucker, but Mr. McKee contends that, “nobody in Albany takes this bill seriously.”
“It will never happen because it will cost the city hundreds of thousands of dollars in lost tax revenues,” he said.
When asked why, if the rent-freeze bill is pro-tenant, Mr. Espada has enjoyed so much financial support from real estate interests while Mr. Rivera has been endorsed by the Tenants PAC, Mr. Tucker said he didn’t know.
He also said he was not aware that Mr. Espada had ever changed his position on repealing vacancy decontrol and that such a bill does not have enough support in the Democratic conference to pass.