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Rent Guidelines Board Considering Rent Freeze on 1-Year Leases

By Valeria Ricciulli | May 4, 2016 1:53pm
 Council Member Ben Kallos with protesters at RGB meeting Tuesday.
Council Member Ben Kallos with protesters at RGB meeting Tuesday.
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NEW YORK CITY — The city's Rent Guidelines Board voted Tuesday to consider rent freezes for the city's nearly 1 million rent stabilized units.

The preliminary vote to raise rents for one-year leases between 0 and 2 percent passed 5-4, with the members who represent tenants' and owners' interests all voting against it, the Board's executive director, Andrew McLaughlin, told DNAinfo.

Over the next several weeks, the nine-member board will also consider raising rents on two-year leases between 0.5 to 3.5 percent — following last year's first-ever freeze for rent-stabilized apartments.

The board based its proposal on an RGB study that showed that the price of operating for rent-stabilized apartments decreased 1.2 percent this year, mostly due to the fact that fuel costs decreased 41.2 percent. Another study found that the city's unemployment rate fell in 2015 by 1.5 percent. 

The changes would take effect on all lease renewals after Oct. 1, 2016.

Board member Sheila Garcia, who represents tenant's interest, proposed a rent decrease instead of a freeze, which is why she voted against it. 

"The data this year merits a [rent] rollback," said Garcia, referring to lowered fuel costs. "I didn't think [the rent freeze proposal] was radical enough. The board has over-compensated landlords over the years."

"We see that we are evicting less people but more people are homeless because they can't afford to live in NYC." 

Upper East Side council member Ben Kallos joined advocates calling to lower rent for rent-stabilized apartments. 

"The Mayor can't have it both ways — three consecutive years of choking off the income of the largest providers of affordable housing — rent-stabilized apartment owners — yet raise their property taxes, exclude them from water tax rebates, and expect them to repair their 75-plus year old buildings," said Joseph Strasburg, president of the Rent Stabilization Association. 

The Rent Guidelines Board’s vote only applies to the city’s rent-stabilized units, not rent controlled apartments.

There are an estimated 840,000 rent-stabilized apartments, according to an investigation from ProPublica. But roughly 28 percent of these units — or about 240,000 — are subject to preferential rent, which is when landlords lease rent-stabilized units for less money than they are legally allowed to charge. In these situations, the landlord can take away the preferential rate — if the lease didn’t say it would last for the duration of the tenancy — and hike up the rent whenever the lease is renewed.

That means thousands of rent-stabilized tenants might still see large rent increases even if there’s another freeze.

The final vote for the proposal will be held on June 27, according to the RGB's website.