Testimony: Proposed Changes to Rent Stabilization
Thomas J. Waters
Testimony of Tom Waters Housing Policy Analyst, Community Service Society
Public Hearing on Proposed Changes to Rent Stabilization
New York State Assembly Committee Housing
Thank you for this opportunity to comment on the vital issue of rent and eviction protections for tenants in New York State. The Community Service Society is an independent nonprofit organization that addresses some of the most urgent problems facing low-wage workers and their communities here in New York City, including the effects of the city’s chronic housing shortage.
Unaffordable rents and evictions cause an enormous amount of harm, including homelessness, disruptions that may lead to job loss, disruptions in schooling, and disruptions of neighborhoods. To address this crisis, the Community Service Society endorses the Universal Rent Control platform of the Upstate Downstate Housing Alliance. We also strongly support the Home Stability Support proposal for expanded rent assistance subsidies for families receiving public assistance and the rest of the alliance’s End Homelessness platform.
In this testimony, I will be focusing one plank: Good Cause Eviction protections, which would provide much-needed relief to large numbers of currently unregulated tenants in New York City, in the three suburban counties covered by the Emergency Tenant Protection Act, and in the rest of the state.
More than 2 million renter households around the state live in houses or apartments not subject to rent stabilization – that includes tenants in buildings of fewer than six apartments in New York City and the ETPA counties, tenants in apartments that have been deregulated, and the nearly one million tenant households in Suffolk County and upstate beyond Bear Mountain.
Many people in New York City underestimate the prevalence of renting in the rest of the state. It is true that homeownership is the dominant form of tenure in the less dense parts of the state, but more than a third of the state’s non-New York City households live in Census tracts with a density of at least 500 dwellings per square mile, and renters make up more than 40 percent of the households in those areas. Renters make up 60 percent of households in upstate and Suffolk areas with at least 1,000 dwellings per square mile – and that covers much of Buffalo, Rochester, Syracuse, and Albany as well as many smaller cities.
These tenants are affected by the state’s housing crisis just as badly as those who benefit from rent stabilization. Of those living in areas not eligible to opt in to rent stabilization, 44 percent of tenant households pay more than 30 percent of their income in rent, including 74 percent of the 850,000 upstate and Suffolk county tenant households with incomes below twice the poverty line. That compares to 46 and 78 percent of the New York City equivalent households.
Some of these households are best protected by amending the ETPA to allow local jurisdictions to opt in to rent stabilization if they have a rental vacancy rate below 5 percent. But even maximal use of rent stabilization would leave hundreds of thousands of tenant households unprotected. Many tenants in many parts of the state live in buildings with fewer than six apartments, and they also deserve some form of protection. Rent burdens are also just as severe in areas with higher vacancy rates, and some jurisdictions will not consider rent stabilization a practical option if they are small or have a low number of renters.
For many tenant households the best policy answer is not to strictly regulate rents but rather to prohibit evictions without good cause. Assembly Bill 5030-A, by Pamela Hunter, would prevent evictions not justified by non-payment of rent, damage to the house or apartment, creating a nuisance, or similar reasons. It would also require that landlords always offer tenants a renewal lease and forbid the renewal leases to demand an “unconscionable rent.” This is necessary because landlords could otherwise evade the intent of the law by offering renewal leases with rents so high that they were effectively not offering a renewal. It would apply to all rented houses and apartments – except apartments in two- or three-family houses where the owner also resides.
Under the proposal, a rent would be considered unconscionable if it represented an increase by more than 1.5 times the rate of inflation as measured by the Consumer Price Index and if the landlord could not provide a reason – such as a property tax increase or a major new expense – to justify it. In keeping with the intent to regulate evictions rather than rents, this generally means a higher increase than those that have been allowed by rent guidelines boards under rent stabilization.
Unlike rent regulation, these Good Cause Eviction protections depend completely on action by tenants. The only regulator involved is the court system. Tenants who believe they have been evicted without good cause would have to go to court and show that their eviction was not justified under one of the reasons specified by the law. In the case where a landlord has offered a lease with a rent increase greater than 1.5 times inflation, the tenant will have a “rebuttable presumption” that the eviction is without good cause, which the landlord can rebut by showing a good reason for the large increase.
Good Cause Eviction is weaker than true rent regulation, because of the higher allowable rent increases, because of the landlord’s ability to justify higher increases in court, and because of the tenant’s need to initiate enforcement in court rather than being able to rely on a regulatory agency. Nevertheless, it would provide real protection to more than 1.6 million households who are currently subject to arbitrary eviction.
The tenants who would benefit from Good Cause Eviction protections are most concentrated in high-renter cities that are not subject to rent stabilization, especially Rochester, Syracuse, Albany, and Troy, but the proposal would also help almost 600,000 households in New York City that live either in deregulated apartments or in small buildings, as well as almost 180,000 households in the three suburban counties eligible to opt in to rent stabilization. In Manhattan, the houses and apartments that would be affected are found both in Manhattan, where there are many deregulated apartments and in the lower density areas at the fringes of the city where there are more small buildings.
The Community Service Society has produced estimates of the number of affected units for each Assembly District in New York City and included them on our district housing fact sheets found on our web site at www.cssny.org/housingfactsheets.
For these reasons, the Community Service Society of New York urges you to establish Good Cause Eviction protections throughout New York State by passing Assembly Bill 5030-A.