I. Background:
The City has lost 230,000 rent-controlled and stabilized apartments since the 1980s. Most rent stabilized apartments are in non-coop or non-condo buildings built between 1947 and 1974. Rent control applies to tenants living since 1971 in apartments, which were built before 1947.
II. Issues:
- Apartments that were affordable revert to market rate once tax breaks and subsidies expire.
- Individual Apartment Improvements and Major Capital Improvements, which increase rents indefinitely.
- High-income decontrol allows landlords to destabilize an occupied apartment if it surpasses the $2,000 rent threshold.
III. Current Laws - Expiring June 15, 2015
Urstadt Law of 1971: State's rent stabilization law gave Albany control over the city’s rent control laws, and provides vacancy decontrol, which allows property owners to take apartments off the rent-regulated list when tenants move out.
421-a Program: A tax break for condominium development on unused or underused land. Developers are exempted from property taxes during construction and pay reduced taxes for 10 to 25 years after construction depending on the development's location and whether affordable housing is provided. If an apartment was subject to rent stabilization after July 1, 1984, the apartment will be deregulated when the tax benefit expires. Sometimes, the affordable housing is built in a different part of the five boroughs as a result of expanding the Geographic Exclusion Area to all of Manhattan, parts of the Bronx, Brooklyn, Queens and Staten Island. If an apartment was subject to rent stabilization after July 1, 1984, the apartment will be deregulated when the tax benefit expires. The owner is required to give the tenant notice in the lease of the destabilization. Apartments that were affordable revert to market rate once the tax breaks and subsidies expire.
J-51 Program: A tax break for a building that was rehabilitated or converted from another use. If the building was rent stabilized before the tax benefits were granted, the building does not become deregulated when the benefits expire.
IV. Amendments
1865-A: This legislation aims to reinstate regulation after certain apartments become vacant.
A6054: A bill that would change Major Capital Improvement rent increases from permanent to temporary surcharges
June 24th vote: The Rent Guidelines Board will vote whether to raise one-year leases by 0 to 2 percent and two-year leases by 0.5 to 3.5 percent for rent-stabilized apartments. According to DNA Info, there will be a series of public meetings prior to the vote.
Article References:
http://www.cityandstateny.com/2/83/infrastructure/high-stakes.html#.VUeP8K3QdMx
http://www.gothamgazette.com/housing/jul.02.shtml
http://observer.com/2014/11/what-hostage-taking-is-all-about-city-democrats-rally-for-rent-regulation/
http://www.nytimes.com/2011/11/13/realestate/the-421a-tax-exemption-dont-say-you-didnt-know.html?_r=0
http://www.nycrgb.org/html/resources/faq/421a-J51.html
http://www.law360.com/articles/625111/investing-in-nyc-real-estate-get-ready-for-rent-laws
http://www.nytimes.com/2015/05/05/nyregion/overhaul-of-housing-tax-abatement-is-aim-of-lobbying-campaign.html