Monday, June 24, 2013

The 2013 Guidelines in Context

With one quick vote, the 2013 New York City Rent Guidelines Board process came to a close Thursday night, with the board approving apartment increases of 4% for one year leases and 7.75% for two year leases, with a rent freeze imposed for Single Room Occupancy apartments.

For those of tenants who have engaged with the process for the past third of a year, it was a startling end and a disappointing result.

In the media narrative and in the popular imagination, the RGB’s final vote is a raucous and chaotic battle between ever-warring constituencies, representing contentious democracy at its best or worst (depending on the perspective). This is a myth. The vote is shockingly dull, and executed with an efficiency born of repetition.

The scene Thursday was ritualistic: the tenant members proposed a low increase; the owner members proposed a high increase; the public members voted unanimously in between the two, appearing as magnanimously Solomonic in the process. The press played its part, reporting equally on the tenants’ and landlord’s frustrations with the result. When the vote was over, landlord representatives spoke to reporters, lit cigars, and posed for pictures with Jimmy McMillan.

The result of this process, however, in anything but dull- it is a recurring regressive redistribution of wealth from tenants to landlords. This year’s increase will be particularly painful. At 4% and 7.75%, the rent hike is not only the largest since before the recession, as reported in the press, but is also higher than the average increase under RGB Chair Jonathan Kimmel (3% and 5.88%, including the 2013 guidelines), higher than the average increase for the much-maligned former Board chair Marvin Markus (3.44% and 6.38%), and in fact higher than the average RGB increase for the board’s entire history (3.3% and 5.84%).

If there is any silver lining to the vote, it is that the Board rejected landlords’ calls for a “supplemental” or “minimum dollar” increase, which would have disproportionately stressed the budgets of low income and senior tenants. Tenant advocates wonder, however, if they are being forced into a pattern of relatively low increases with pro-landlord provisos (like the 2012 vote) followed by high increases without them (as we saw this year).

The board also chose to freeze rents completely for SROs, dispensing with the usual provision that the rent freeze applies only to buildings with a certain percentage of occupied SRO units. This is a victory for SRO tenants and their advocates, and it should be celebrated.

The SRO rent freeze should not, however, overshadow the impact the Board’s apartment increases will have on an estimated 2.5 million tenants throughout the city. In addition to being a mid-recession transfer of income from renters to property owners, this rent increase will be another constraining factor on New Yorkers’ ability to make ends meet. It will force many to chose between rent and other necessities of life, not to mention the less vital aspects of commerce that keep the city running. It is certainly no stimulus to our depressive economy.

The high increase will also encourage many tenants to sign one year leases, rather than two. Even though a two year lease presents tenants with a slight (.25%) benefit over a one year lease, many low income tenants will not be able to shoulder the up-front costs of a 7.75% increase. This adds an additional layer of regression to the 2013 guidelines, as those most equipped to save with a two year increase are those most able to pay higher up-front costs- i.e. higher income or higher net-wealth households.

Finally, this increase cements the Board’s image as a guarantor of landlord profits. Whether by inertia or design, the Board has repeatedly chosen to increase rents to cover for any perceived fluctuations in the cost of running a rent stabilized apartment. This should not be a forgone conclusion; given that landlords have many ways of making profit off their buildings- everything from commercial rents to cell phone towers to the dreaded Major Capital Improvement- there is no need to continuously fall back on renewal lease rent increases to recoup landlords for any change in costs. The board must also rethink the way it calculates these costs, as numerous reports have shown that the Price Index of Operating Costs- the board’s main tool for estimating prices for goods purchased by landlords- seems to overstate real expenses. Whether that is because landlords find a way to economize their purchases or because the prices are overstated, we do not know. All we know is that the price data overshoots the expense data, and is leading Board members to vote for inflated guidelines.

Next year will bring in a new Mayoral administration, and with it a new Rent Guidelines Board. Fixing this broken institution should be a major priority for the next Mayor, both in terms of making responsible appointments and rethinking the Prince Index of Operating Costs. The Mayor should also call on the next Board Chair to hold more public hearings at times and places convenient to the majority of rent stabilized tenants, and present a full accounting of the Board’s decision to the City Council and the public at large. While it is the State Legislature that has the power to rewrite the rules regarding the RGB, it is in the Mayor’s power to change the culture of the Board. Elected officials have spoken out against these increases, and called for Board to change its ways (see examples here, here, and here). Tenants have made their voices heard throughout this process, whether at the People’s RGB, the formal public hearing, or the vote itself. We all know this system flawed; the process must be reconsidered before the board meets again in 2014.

Testimony: Kelley Boyd

The following testimony was presented by Kelley Boyd, a tenant in Washington Heights who has been actively fighting illegal overcharges in her building:

Hello, I am Kelley Boyd and I am a technologist working in the city’s startup movement. I have lived in the Washington Heights neighborhood for over 6 years and have become very active in the community. As an entrepreneur advocate I believe the biggest problem facing our culture is the unbelievable rents in the city. We could start more businesses and bring more fiscal diversity to the city with better rent oversight. Though I believe in a free market - many landlords have gotten the benefits they signed up for whether they deliver the value the city has bargained for or not! Full disclosure - most of my knowledge / experience in this area of springs from my having filed a rent overcharge complaint at HCR. At this time that claim is still in process.
Through the experience I have learned a lot about what is happening in my building – and in many buildings in my area. People are fleeing the exorbitant rents and moving to "WaHi" thinking they are getting a great deal when in reality they are paying "market rates" and over for apartments that should be rent stabilized. The new tenants are unaware that the apartments have been illegally deregulated because of the scheming of well schooled landlords. Our area is being hit especially hard because we are a largely residential neighborhood that has not seen the turnover of other areas which means there are lots of apartments that should be in the $900 - $1200 range but are being rented at $2000 and more. The landlords know how to work and beat the system that is supposed to keep them honest by inflating improvements, claiming false improvements and just filing false documents with HCR. Even if they are not lying, cheating and stealing, LL are in an enviable position as of now. It was reported just yesterday that Manhattan rents have soared 3.5% with median rent at $3200 - rent today is just $13 shy of an all time high! 
Owners should bear their fair share of economic burden because their profits are increasing. 
I do not begrudge anyone success but I estimate my LL has collected well over a million dollars in illegal overcharge in the last 5 years, and those are just the 5 apartments in my building that I know about! Add to that he inherited the buildings and has no mortgage on them, in fact hold them in trust in Texas to better manage his tax liability. Figure that he owns three buildings with another 11 under management and you can extrapolate that there is a big number to be at years end in someone’s account... he and his kind certainly do not need your help increasing rents and making money off their
I understand that the RGB serves a wide variety of constituents and in doing so you must make determinations that are fair to large and small landlords alike, all the while keeping true to the statutes and the spirit of fairness that tenants rely on you for. It used to be “impossible” to reliably get enough information from “everyone” and their unique situation but I think in real terms it is much easier than it ever has been. As a technologist there are ways to better manage the burden of how to treat landlords and tenants fairly in this process. Small landlords who are absolutely getting squeezed with resource increases and having a tough time with outstanding building repairs and improvements should have the mechanisms in place to apply for an receive relief in the form of increases, waivers or temp variances from codes. I have absolutely no heartburn with that. But there are so many that are not really challenged in their circumstances and are taking advantage of unwitting tenants, and then more that are simply thieves. 
The RGB should embrace innovation and craft a process that allows for some kind of "means test" for buildings when rent increases are in review. In my opinion there should be NO MORE RENT INCREASES AT ALL until you have a system in place to grant increases fairly.

Thursday, June 20, 2013

Final Vote: Tonight, 5:30

After four months of presentations, analysis, testimonies, and hearings (formal and otherwise), the Rent Guidelines Board will vote tonight on a rent adjustment for over one million stabilized apartments and SROs. We hope they have listened to the many tenants who testified that the RGB's proposed rent increases are simply too high. We hope they remember the invited guests who testified that New York is facing a severe affordability crises. We hope they recall the analysis presented on this blog, arguing that the Board's own data supports the case against another high rent increase.

We hope we have cogently and persuasively made the case that tenants cannot afford the kinds of rent increases proposed by this Board, and that the hikes demanded by owner advocates are unwarranted. Countless households throughout the city are already forced to choose between basic necessities- such as food and medicine- and making the rent. These increases could push many over the edge, and into chaos. At the same time, property ownership in New York City continues to be an extremely profitable enterprise, despite the endless protestations of the landlord lobby.

For all these reasons, and for the reasons elaborated on this blog many times before, we urge the board to reject the proposed increases.

The final vote of the New York City RGB will be held tonight at 5:30 PM in the Great Hall at Cooper Union, located at 7 East 7th Street. We urge tenants to be there, bear witness, and speak to reporters after the vote about how the final guideline will affect you.

Wednesday, June 19, 2013

Testimony: Mariel De La Cruz

The following testimony was presented by Mariel De La Cruz, a rent stabilized tenant in Washington Heights and a tenant organizer in HUD-financed buildings across New York state:
My name is Mariel De La Cruz a rent stabilized tenant in the beautiful Washington Heights neighborhood in Manhattan. I have lived in the same apartment for almost exactly 19 years and wouldn't have it any other way. Now that I have grown up and have graduated Fordham College, I have come to a realization that I want to live in my neighborhood, my block, my apartment for a very long time. Many of us who attend Jesuit institutions find that they love to work with less resources themselves. Many of us go the nonprofit route, not making the big bucks. Besides what the “usual” narrative is for young people raised in Washington Heights, I work hard and I have invested my time, growth and energy to my neighborhood. Now that I take care of the bills I have been blessed enough to find full time employment, but with my many student loan payments (along with other expenses) I am still struggling to make ends meet. I am afraid that the yearly increases (especially those proposed for this year) threaten my ability to stay in the place that I know and love. 
As you all know, a rent increase from the tenants is not the only way for owners to make
a profit. There has been significant turnover in some of the units in my building, allowing for the owners to renovate the units to get the big rent increases from each of the new tenants that have moved in. In addition, there have been substantial rent increases to benefiting the landlords every year. I understand that costs for owners have gone up but like I said before owners have been getting steep rent increases every year but sadly, our incomes don’t have the privilege of doing the same. 
While most of us tenants are struggling to make ends meet, owners on average are making major profits for each rent stabilized unit they own. So what I am saying is that tenants are ever increasingly carrying the burden, while owners are and will continue to make significant revenue for each unit. This is why I believe there should be no increases this year, to ensure that tenants are not priced out of their home in this increasingly difficult time for lower and moderate income tenants in NYC. 
I ask that when you all are making your decision, you think of recent college grads like me who have full time jobs, but who are drowning in student loans that make it harder for ends to meet. I am asking you to consider some of my neighbors and family members, like my mother, who live on fixed incomes in which a rent increase would be too much to bear because their incomes don’t increase just because their rents increase. Think of those people who think of their home beyond their apartment. Please think of us.

Tuesday, June 18, 2013

Voices from the People's RGB

Many tenants and advocates were upset  that the Rent Guidelines Board chose not to hold an outer borough hearing this year. We found it unacceptable that the board would consider voting on an increase without first consulting with the communities most impacted by their decision.

So, we organized. We asked the board if they would hold a hearing in the Bronx if we provided a free room and guaranteed a good attendance; they declined. We invited them to attend our "People's RGB" in the Bronx and make it formal part of their public calendar; only the tenant members chose to attend. We tried to bring their voices into the public hearing via video testimony; we were shut down. Outer borough tenants have tried to participate in the Rent Guidelines Board process, but their efforts have not been rewarded.

Click on these names to see video clips from the People's RGB, and hear the testimonies of tenants who could not attend the one formal RGB hearing, held in Manhattan, primarily during business hours. These are the voices of outer borough tenants who cannot afford yet another RGB rent increase.

Testimony: Nicole Zinardi

The following testimony was submitted by Nicole Zinardi, Tenant Organizer at Tenants & Neighbors, who has been working in rent stabilized buildings across Brooklyn, Queens, Manhattan and the Bronx:
My name is Nicole and I am a tenant organizer at Tenants & Neighbors. I work almost exclusively in Rent Stabilized buildings. I work with tenants in buildings in Inwood, Manhattan, various areas in the Bronx including Parkchester, Pelham Bay, Norwood, and Fordham Heights, as well as in Flatbush, Brooklyn, and Jamaica, Queens. The buildings I work in vary greatly in terms of size and tenant demographics. Some are small, while the largest building I work with has 169 apartments. Most tenants at 2425 Nostrand Avenue in Flatbush are from Trinidad or Jamaica. The majority of tenants in my buildings in Harlem and Fordham Heights are African American, while 9016 171st in Jamaica is home to a mix of Hispanic, Indian, and African American residents. In Manhattan, most tenants I work with are from Eastern Europe, Puerto Rico, and states across the U.S. I work with tenants who are community organizers, musicians, researchers, receptionists, and dentists. I work with tenants who are unemployed, retired, and in school. Most are low to moderate income adults who work long hours to make enough money to support their family in New York City.

Despite differences in location, size, and tenant demographics, all these buildings share distinct troubling characteristics that render any major rent increase unwarranted, especially the increases proposed by the Rent Guidelines Board last month. The poor management, bad conditions, and rent overcharges currently festering in hundreds of buildings in the city contribute to the decline of the well-being of people and the buildings they live in as well as community vitality and cohesion. I have seen the situation expanded and prolonged by these shortcomings: tenants are forced to live with degrading physical conditions as well as the tormenting mental condition brought on by landlord harassment and illegal overcharges. Failures of landlords cannot be justified to continue through an inflated award of profit to landlord corporations.

 Tenants across the city suffer from poor building management. Buildings are managed with blatant incompetence and neglect of tenants‘ rights and needs. Conditions continually deteriorate because of under-qualified staff, and there is a lack of comprehensive communication systems between tenants and the landlord. At 3224 Grand Concourse in the Bronx, there is one superintendent for all 8 buildings. He is not qualified or certified to make the electrical and plumbing repairs he is responsible for, and there is no system for inspection or repair appointments. Tenants have had ongoing plumbing and electrical issues that have been ignored and, if fixed, not fixed sufficiently. Tenants are forced to use their own money to find other means of repair. In addition, tenants have no straightforward means of contacting their management or relaying their concerns and requests. There is no on-site management besides the super, and the management is unresponsive to phone calls.

Another aspect of poor management is lack of organization in regards to leases and rent. At 3224 Grand Concourse, tenants do not receive rent slips, and many tenants have their rent rejected for no given reason. In addition, a lot of tenants wait months to get a new lease after their last one expires. Clearly, this opens the door for confusion and rent overcharges. Management systems like this create uncertainty and frustration for tenants. It is not acceptable that tenants are upholding their end of their lease while landlords ignore their responsibility to provide management that correctly and effectively provides required services and operates a transparent system of communication and rent payment.

The conditions at 9016 171st in Jamaica, Queens highlight the horrible conditions I have seen in buildings across New York. Landlords try to save money and time by ignoring services, repairs, and maintenance. At 9016 171st Street, there are 271 HPD violations registered on this 23 unit building, 217 of which are classified as hazardous. The building has not had gas since April 3rd, which means tenants are not able to cook in their apartments; they are forced to spend money to buy meals for their families. In addition, tenants suffer from leaks and the nuisance of mice and rodents. Tenants also claim that the electricity is turned off at random times, and, like almost every single one of my other rent stabilized buildings, the heat and hot water are grossly inconsistent during the winter months, as the landlord tries to save money by keeping the temperature at well below the legal levels, especially at night and in the early morning. In addition, the landlord owes the Department of Buildings $2,500 for failure to comply with the mandated boiler conditions. The boiler is too small to provide adequate heat to all units in the building, and half of the building consistently has no hot water. Any landlord that is letting conditions deteriorate to this extent in a building does not deserve the proposed rent increase. Landlords must be held accountable and demonstrate that they are using tenants’ rent to keep the building in a legal and acceptable condition for families to live. If they are not using rent to provide required services and maintenance, it is not acceptable that those rents are raised. In addition, because of these horrible conditions, tenants are forced to use their own money for things such as space heaters, take-out meals, and the hiring of exterminators and plumbers, and they cannot afford to pay higher rents while simultaneously funding repairs and supplemental purchases made necessary by the landlord.

As you know, the system of rent stabilization creates huge incentives for landlords to raise rent in an apartment above $2500. Illegally overcharging tenants in rent works two-fold for landlords: in addition to bringing the rent closer to the $2500 mark, they force many lower income tenants out of their apartment who cannot afford the higher rent, thus gaining a further increase through the vacancy bonus, in turn bringing the rent on the unit even closer to the market rate threshold. I have seen evidence of rent overcharge in a number of the buildings I work with. Tenants are charged illegally inflated appliance surcharge fees and construction costs are exaggerated so the landlord can tack on huge IAIs to the rent. Tenants at 2425 Nostrand Avenue in Brooklyn are charged over $20 each month for an appliance surcharge, which in their case refers to the A/C unit in their apartment, the fee for which should legally be around $5. And, one tenant at 854 West 180th Street moved into an apartment with a rent of $2150. In addition to the apartment being illegally listed as market rate on the lease, the rent was a huge increase from the previous tenant’s rent of $1477.17, and there was no explanation for the increase. While there was construction done on the unit in between tenants, the landlord would have had to spend at least $41,000 on construction in order to legally raise the rent by the amount it was raised. Now, the tenant must go through the lengthy and burdensome process of applying for a rent overcharge through HCR, which may or may not deliver any results. It is unacceptable to grant landlords the proposed rent increases while they are currently collecting illegal amounts of rent. Rent increase decisions should be based on a determination of how completely legal rents are allowing landlords to fulfill their obligations to rent stabilized tenants, this determination is distorted when landlords charge illegal rents, and allowing an increase is not justified if landlords are already collecting more money than they are legally allowed.

Rent Stabilization exists in New York City for a reason-to keep acceptable and comfortable living affordable for the city’s people. Clearly, the system has a number of negative side-effects that inhibit the system’s intended goal, most prominently: poor management, bad conditions, and rent overcharges. Any one of these issues taken independently is enough justification to demand a more moderate rent increase than the one proposed. When all three of these issues clash and build upon one another, the proposed rent increase should be unthinkable.

And I can say this from first-hand experience. I have seen these buildings, I have been inside these apartments, and I have formed relationships with these rent stabilized tenants. I have experienced the worry, frustration, and exhaustion tenants struggle with on a daily basis.  Approving the rent increase will further break down the intended purpose of the rent stabilization system by allowing and strengthening these effects. To hand landlords an increase in profits under these circumstances is absurd. They first must be held accountable and prove they are capable of using their funds intended application: to foster affordability and livability for tenants in New York City.

Testimony: Michael Gillett

The following testimony was presented by Michael Gillett, a rent stabilized tenant in Sunset Park, Brooklyn who has faced repeated permanent and compound Major Capital Improvement rent increases, on top of the annual RGB adjustments:
Good afternoon Board Members and thank you for this opportunity.  My name is Michael and I'm a Rent Stabilized tenant in Sunset Park Brooklyn.  I've lived  in an 8-unit building since late 2006.  Since I've lived in this apartment, my rent has gone up over $500.  I've come here today because I'd like to express to you why it is that the magnitude of increase you've proposed for two-year leases is entirely too high and would be burdensome to me.

There are a broad range of Rent Stabilized tenants in this city.  Some have lived in their apartments for many years but a lot of us are young adults working 9-5 and have had virtually stagnant wages in this tough & persistently negative economy.  Personally, my Landlord has used at least 3 separate Major Capital Increases as a method to speed units within the building to the high-rent threshold which would remove them from rent protections.  I have been the only person to stand against them in the building.  One downstairs neighbor of mine was so intimidated and unnerved by the process that he moved his entire family out of the building when he deliberated the prospect of compounding rents + MCI charges in the years to come.  The Landlord wasted no time in getting the permits needed and then gut-renovating that apartment and charging the new tenants market rate rent.  There is also another apartment in the building with tenants paying market rent.  Considering the perpetual nature of MCI rent increases he will have permanent residual income aside from whatever increase you decide.  He also owns many buildings across Park Slope Brooklyn with tenants paying market rate rents.

Landlords have also been receiving substantial profits in recent years.  In my borough of Brooklyn, the Net Operating Income stands at approximately 33%.

I would like to board to know that if you go through with this increase, you will harm the diversity of this city.  I could not afford my apartment at market rate, and having to pay this extra money would be burdensome and could price a lot of people out of their apartments.  With this being said, I would like to strongly implore you to consider a 0% increase at this time.

Testimony: Margaret Coughlan

The following testimony was read by Margaret Coughlan, a tenant in Staten Island who, like many others, has an oppressive rent burden but is just barely disqualified for SCRIE:
My name is Margaret Coughlan. I have lived in the same rent-stabilized apartment in Staten Island for 30 years. Since I retired 4 years ago, any rent increase is of much greater concern to me than while I was working. 
I do not qualify for SCRIE.  My income is my pension and Social Security. After health insurance and taxes, my rent is 48% of my income. While I can manage, I realize that there are many New Yorkers with less income and higher rents. 
While any rent increase is of concern to me, I know that the same increase would be felt even more keenly by those less fortunate.
Thank you.

Monday, June 17, 2013

Comptroller: The Continued Decline in Affordable Housing

New York State Comptroller Tom DiNapoli has released a timely report decrying "the continued decline of affordable housing in New York City." The study details the bind facing low income New Yorkers, who must put more than half their income towards rent as a condition of staying in the city. The Comptroller writes, 
The housing burden is heaviest for low-income households. One-fifth of New York City’s households had incomes of $15,000 or less in 2011. Nearly 80 percent of these households devoted more than half of their incomes to rent, a higher share than any other income group. Even after government subsidies are factored in, more than half (56 percent) of these households had a severe housing burden, a much higher share than any other income group (see Figure 4). For households with incomes of $15,000 to $30,000, nearly 40 percent devoted more than half of their incomes to rent in 2011. 
The report also details the wide-spread deregulation of the rent stabilized housing stock. Last year, the city lost nearly 9,500 rent stabilized apartments. This report puts that figure into historical context, showing that "the share of rental units subject to some form of rent regulation fell from 74 percent in 1991 to 61 percent in 2011." While other factors are also to blame, persistent compound Rent Guidelines Board increases are certainly a major factor in this rampant deregulation.

This is the context in which the RGB makes its decision: New Yorkers are facing historically high rent burdens, and the number of rent stabilized apartments left in the city is fading fast. 

The Rent Guidelines Board has just one job: to decide the rent adjustment for renewal leases on regulated apartments in a given year. Put that way, their mission seems narrow and perhaps obscure. But, as this timely report shows, their actions have significant impacts on millions of tenants trying to keep up with the rent in a challenging housing market.

Testimony: Dale Goodson

The following testimony was submitted by Dale Goodson, a rent stabilized tenant and neighborhood activist who has lived in his apartment for over 20 years:
My name is Dale Goodson and I have lived in my rent stabilized apartment at the corner of Avenue A and 12th street in the East Village since 1991. I am now 60 and moved to New York in the mid-80's from Seattle to pursue my career as a performance artist and free-lance writer. My work has always had a topical and socially conscious bent and consequently was not always the most commercially viable. I was drawn to New York because of the vibrant mix of cultures, thriving artistic scene and an economically feasible housing environment. You didn't have to be rich to part of the fabric of the city. 
In 2000 an opportunity came up to work as a homeless outreach worker at the Port Authority Bus Terminal and that work became the focus of my life. Again, not the most financially lucrative job, but tremendously satisfying in so many other ways. Unfortunately 2008 took it's toll and the program I was working for was cut. In addition, in 2005 our building was sold and the new owners began a policy of turning vacated apartments into market rate housing for NYU students. Admittedly they have not used untoward or harassing tactics against long term tenants, but the culture of the building began to change immediately. Virtually all of the culturally diverse and senior tenants have moved out. We've are slowly turning into a college dorm. To date about a third of the 40 apartments in our building have gone market rate. Most others are still rent stabilized. 
I am now back to hunting up free-lance writing work and anything I else I can to stay afloat. The artistic scene and opportunities which once supported me have all but dried up. I have lived in NYC longer than any other place in my life. NYC is my home, but the relentless rent increases by the RGB are taking their toll. It never stops, even in the worst of economic times. I feel the vibrant cultural mix of New York is fast disappearing, giving way to a culture of the affluent. Given this trend I know of no neighborhood in the 5 boroughs I could afford to move to. Though my rent is low compared to market rate it is all that I can afford and each year becomes more and more precarious and unviable. My landlord on the other hand has an ever increasing number of market rate apartments to draw on for increased income as well as three street level businesses in the building and yet every year the RGB asks for more on his behalf. This is a destructive policy which not only brings hardship to those who can least afford it, but is fast turning New York City and the East Village in particular into a high income playground.

Testimony: Ben May

The following testimony was read by Ben May, a tenant in Washington Heights whose building was purchased by multi-billion dollar real estate investment trust:

Although I am testifying on behalf of tenants, ironically I find myself actually representing a group of landlords who are not present today. My landlords are John Harrison Streicker and his daughter Margaret Streicker-Porres. Mr. Streicker founded his real estate company, Sentinel, in 1969 and grew it into the $4.5 billion company that it is today. Sentinel owns properties in 28 states, around 10% of which are in the Northeast of the United States. Ms. Streicker-Porres founded Newcastle Realty Services, our management company and one of almost 500 subsidiaries of Sentinel, in 2004. Today Newcastle manages $400m (according to their website) worth of Sentinel's assets in the New York city area. 
When our building was purchased, for under $10 million two years ago, Newcastle promptly took away every preferential rent, and raised the rents on every non-regulated unit in our building substantially. As a result, around a dozen tenants moved out. All of those units were gut renovated and all have been since filled, at prices in most cases double or more than the prior monthly rents. In one particular case, an elderly couple in a rent controlled unit, the rent quadrupled for the new tenants. Our building of around 50 units now has approximately a half dozen one- and two-bedroom units remaining that are rent stabilized, which range in price from $900/mo to just under $2000/mo. 
I sympathize with the plight of the small landlords who have testified here today. I think however that the board may be getting a skewed picture of reality when it is the small landlords that testify and those like my landlords are not present to tell their stories. I ask that the board consider all landlords in New York City, and keep in mind that there are a large number of large, rich, powerful, and intelligent landlords in addition to the small resource-poor ones that have spoken here today. 
Finally, I find it very interesting to hear from landlords today that the only thing the board should consider is the incomes from regulated units. As far as I know, with the exception of condominiums and coops, when landlords buy and sell buildings, they are buying and selling all the units in a building simultaneously. So it seems strange to me to not consider the income of the entire building, rather than individual apartments, since the unit of ownership is the whole building, not just individual apartments within that building. 
I ask that the board consider increases on the low end of the proposed range.

Testimony: Sam Stein, Tenants & Neighbors

On Thursday, June 13th, over 100 tenants testified against the Rent Guidelines Board's unusually high preliminary guidelines (3.25% - 6.25% for one year leases, and 5% - 9.5% for two year leases), as well as their decision to jettison an outer borough hearing. We heard from apartment tenants and SRO tenants, long term residents and relative newcomers, young and old, representing diverse communities of regulated tenants from around the city. Across these differences, there was a unified message: the RGB's proposed increases are way too high. In today's economy, tenants simply cannot afford them. The board must reconsider, and reject these unwarranted increases.

We will be posting the testimonies of a few tenants who spoke out that day, starting with Tenants & Neighbors' Rent Regulation Campaign Coordinator (and rent stabilized tenant) Sam Stein. Want to share your testimony with us? Please email a copy to
Good morning. Thank you to Chairman Kimmel for holding this hearing today, and to all of you for hearing the testimony of rent stabilized tenants about the proposed guidelines for renewal lease increases. My name is Sam Stein, and I am an organizer at New York State Tenants & Neighbors, a grassroots organization that helps renters preserve at-risk affordable housing and strengthen tenants’ rights in New York. We represent approximately 2500 tenants, most of whom are rent stabilized, almost all of whom have low or moderate incomes, and many of whom are elderly people on fixed incomes. I am also a tenant in a rent stabilized apartment in Queens. 
As a representative of my organization and our members, I have attended every public meeting that this board has held over the past 4 months, and read each report that the board staff has ably produced. Based on the information presented to the board by both staff and invited experts, as well as my experience counseling rent stabilized tenants from around the city, I believe the preliminary guidelines this board has approved are far too high. 
  • As the Income and Affordability report showed, tenants are facing dire economic conditions, with unemployment rising again, wages declining, and nearly a third of rent stabilized tenants city-wide putting half their income towards rent.  
  • As the Income and Expense study reported, landlord’s net operating incomes have risen for the 7th consecutive year. 
  • As the Mortgage Survey showed, the market for rent stabilized buildings remains strong, even in light of a national housing crisis. 
  • According the RGB’s “Changes” report, at least 9,499 apartments left rent stabilization last year. That is a staggering number: it’s more New Yorkers than complained about bed bugs at the peak of that crisis; it’s more New Yorkers than were killed by cigarettes last year; it’s more New Yorkers than are on the organ donor waiting lists. It’s an ongoing crisis in this city, and one that the RGB must take into account as it considers an abnormally high preliminary range of rent increases. 
I’d like to address the public members, because how you choose to vote is of the utmost importance. Mr. Kimmel, Ms. Levy-Odom, Ms. Moore, Ms. Shine, and Mr. Wenk: on April 30th, you voted for a preliminary guideline of 3.25% to 6.25% for one-year leases, and 5% to 9.5% for two-year leases. We believe this entire range is above the level many tenants can afford, and beyond the need of most landlords. Additionally, the proposed guidelines under consideration today would send many apartments over the vacancy decontrol threshold, setting them up to leave rent stabilization when the current tenant leaves. This would impact not just the rent stabilized tenants we and our allied organizations represent; it would also disrupt the stability and change the character of the these tenants' communities, and would have broader implications for our city as a whole. As you are representatives of the public- of the New Yorkers who care deeply about their neighbors and about the communities in which they live- I would like to ask you each, personally, to vote for a significantly lower adjustment this year than what was approved at the preliminary vote. Additionally, if a proviso targeting lower rent apartments is once again introduced this year, I ask you to reject it. As data from the Community Service Society has shown time and again, these provisos disproportionately fall on the backs of the poorest, oldest and most long-term of rent stabilized tenants. The tenants we represent, and many others, simply cannot afford these kinds of increases. 
We urge the board to consider holding rents still in 2013. If you determine that this is not possible, we encourage the board to consider the lowest possible rent increase, and ask you to remember the tenants who testify here today, and the hundreds of thousands more who this rent increase would affect.

Tuesday, June 11, 2013

Testify Thursday!

The RGB has heard from their staff about economic landscape facing tenants; they have heard from invited experts from both the landlord and tenant side; they have heard from government agencies that deal with housing. Now it's time for the RGB to hear from us.

Tenants have just one chance to speak out about the board's unusually high preliminary guidelines, and this is it: Thursday, June 13th, at 49-51 Chambers Street, starting at 10 am. Registration closes at 7 pm, but testimonies will be heard until everyone who has registered has a chance to speak. You can pre-register by calling the RGB at 212 385 2934, or you can register in person on Thursday. Tenants have 3 minutes to testify. Sometimes board members- either tenant members, owner members or public members- will ask follow up questions about your testimony. Don't be nervous- we are just telling our stories, and expressing the truth as we see it.

The Rent Guidelines Board needs to hear directly from tenants about the kinds of economic straights these proposed increase could put us in. They need to hear about the difficulties we face every day just to pay the rent, and the importance of long-term tenants to our neighborhoods and our city. They need to hear about the difficulty of finding suitable housing if we can't afford to stay in our rent stabilized apartments. And they need to hear about all the ways landlords manage raise rents, on top of the increases passed by the board. Please come and share your story with the Rent Guidelines Board. This is our one chance to formally speak out against these proposed guidelines, which would push too many of our homes beyond our budgets and towards deregulation.

To RSVP, or to request additional information about the hearing, please contact Sam Stein at, or call 212 608 4320 x316. Tenants & Neighbors can help you prepare your testimony, or answer any questions you might have about the process. Tenants & Neighbors staff will be there in our white and blue t-shirts, so please look for us and come say hi when you arrive.

The RGB has proposed rent increases of 3.25% - 6.25% for one year leases, and 5% - 9.5% for two year leases. They have to hear from tenants that this is simply too high.

Thursday, June 6, 2013

200 Tenants Attend Bronx "People's RGB" Hearing

It turns out that if you hold a public hearing on rent increases at a time and place that's convenient to tenants, they show up in droves to tell their stories. Unfortunately, only the tenant members of the Rent Guidelines Board attended last night's "People's RGB" in the Bronx. It's a shame, because the rest of the board missed many thoughtful and heartfelt testimonies from tenants who will be unable to speak at the Board’s one public hearing, to be held in lower Manhattan, primarily during working hours. It may be the case that meeting halls are expensive and attendance at recent hearings has been dwindling, but CASA and Tenants & Neighbors offered the RGB a free space and a guaranteed high turnout, and the RGB still declined. The Rent Guidelines Board missed an important chance to hear from tenants about the impact their proposed guidelines would have on households across the city.

Here is the New York Times' take on the RGB's 2013 calendar:

The New York Times

Rent Board Trims Roster of Hearings on Increases

Even as many New Yorkers face substantial rent increases, they will have one less chance to complain about it.
Citing poor attendance in the last few years, the Rent Guidelines Board, a nine-member board appointed by the mayor, has eliminated a public hearing this month that has traditionally been held in the Bronx, Brooklyn, or Queens since 2005. The remaining public hearing will be held in Lower Manhattan on June 13 from 10 a.m. to 7 p.m.
The rent board is proposing to allow rent increases for tenants living in about one million rent-stabilized apartments in New York City. For a one-year lease, the proposal would allow an increase of from 3.25 percent to 6.25 percent; it would be from 5 percent to 9.5 percent for a two-year lease. Last year, it approved rent increases of 2 percent and 4 percent, respectively, after a dip in landlords’ operating costs. The board will make a final decision on June 20.
Renters outside Manhattan, and their advocates, say that many people want to testify this year because of the large increases that are being proposed, but will not be able to get to the Manhattan hearing because they cannot afford to take time off from work, or would find it difficult to travel there.
“This arrangement all but assures the working people most affected by the board’s decision will be unable to participate, and their voices will have no bearing on the final rent increase decision,” Bill de Blasio, the public advocate, said in a letter to the board. “This is not a mere inconvenience — it is a downright failure of the democratic process.”
In protest, tenant groups organized a hearing of their own on Wednesday evening in the Bronx that drew more than 180 people. Susanna Blankley, director of housing organizing for Community Action for Safe Apartments, a project of New Settlement Apartments, said they had invited the rent board to attend, but the majority did not respond. The proposed rent increases are higher this year to help cover the increases in operating costs for rent-stabilized buildings, including the cost of real estate taxes, utilities, labor and insurance, said Jack Freund, executive vice president of the Rent Stabilization Association, which represents about 25,000 building owners and managers. He noted that the price index of operating costs for rent stabilized buildings rose by 5.9 percent this year, compared with 2.8 percent last year. “It’s a necessary increase,” Mr. Freund said. “If you want to maintain that work force housing, you have to pass along the cost increases.”
Andrew McLaughlin, executive director of the Rent Guidelines Board, said the board had seen declining attendance at public hearings since the 1990s, when a few hundred people would rise to speak, and the board members would stay as late as midnight. He said that so few people attended the Queens meeting in 2010 that board members sat for an hour with no one to listen to. Last year’s meeting in the Bronx drew 21 speakers (of which 12 were tenants) compared with 55 in Manhattan, he said.
Tenant advocates say that many people do not know about the hearings because they are not well publicized, and the information is provided only in English. Mr. McLaughlin said that notices were sent out to major media outlets, community boards, council members and others, and that translations into Spanish and other languages are available through a function on its Web site.
Mr. McLaughlin added that the board, which had to cut its budget 20 percent last year, to about $450,000, saved between $4,000 and $5,000 by not renting space for the second meeting. He said that the Manhattan meeting was extended by an hour this year, to 7 p.m., and that the board would stay to listen to anyone who had registered by that time.
But renters like Alfreda Lee said it would be difficult, if not impossible, to get there in time. Ms. Lee, 59, said she answers phone calls on a domestic violence hot line in Brooklyn until 6 p.m. or later on weeknights. “We have to work full-time jobs to pay rent,” she said. “If you really wanted to hear from people, you would make it fair.”

Wednesday, June 5, 2013

Tonight: Tenants Host Bronx RGB Hearing

The Rent Guidelines Board is a public body. As such, it has a responsibility to seek input from the public, including rent stabilized tenants. This year, the RGB is holding just one public hearing, in lower Manhattan, primarily during work hours. This is not only insufficient, but unacceptable. After an offer of a free meeting space and a guaranteed turnout of tenants in the Bronx was rejected by the Board, tenants mobilized to hold their own hearing, drawing press coverage and the support of numerous elected officials. That hearing will be held tonight. Tenants strongly encourage RGB members to attend, as this is the best opportunity to hear directly from them about conditions in rent stabilized apartments, the toll of escalating rents, and the impact a high RGB increase would have on rent stabilized households. 

Information about the tenant-led hearing is below.

For Planning Purposes: Wednesday, June 5, 2013
Contact: Raymond Rodriguez,, 646-200-5309

Bronx Residents To Hold Public Hearing on Proposed Rent Increases After Rent Guidelines Board Overlooks Outer Boroughs
Board Proposes Over 6% Rent Hike Despite “No” Vote By Tenant Members

WHAT: Bronx residents will hold their own public hearing to express opposition to the Rent Guidelines Board’s proposal to increase rents between 6.25% and 9.5% on stabilized apartments. This year the RGB is refusing to hold a hearing in the outer boroughs, making it difficult for working families and tenants to provide input on the rent hikes. The Board’s two Tenant Members, who voted against the proposed increases, will facilitate the hearing.

WHO: Bronx tenants who will be impacted by proposed rent increases, RGB’s Tenant Members, the Community Development Project at the Urban Justice Center, New Settlement Apartments’ Community Action for Safe Apartments (CASA), Elected officials include: Speaker Christine Quinn, Public Advocate Bill de Blasio, Councilwoman Helen Foster, Councilwoman Annabel Palma, Councilman Ydanis Rodriguez, Assemblyman Brian Kavanaugh 

WHEN: Wednesday, June 5, 5:30PM

WHERE: New Settlement Community Center, 1501 Jerome Ave. at 172nd St., Bronx. D or 4 train to 170th St.

BACKGROUND:  The RGB, which establishes rent adjustments for 1 million dwelling units and whose members are appointed by the Mayor, recently adopted a proposal to increase rents up to 6.25% for stabilized tenants with 1-year leases and up to 9.5% for 2-year leases. The Board’s two Tenant Members voted against the proposed increases because these increases are unaffordable to tenants throughout the city, especially in low-income areas of the outer boroughs.

Traditionally, the RBG holds outer borough public hearings for tenants to share their opinions on the proposed increases, but this year the Board decided it will only hold one daytime hearing in Manhattan therefore not taking into consideration tenants from the Bronx. The Bronx, where the average family income is $38,000, has the highest concentration of rent-stabilized apartments.