A New York City Rent Guidelines Board (RGB) meeting was attempting to go about business as usual when they were interrupted by a band of protesters and City Council members upset about the proposed hikes to rent-stabilized apartments.
Councilmembers Chi Ossé, Tiffany Cabán, Sandy Nurse, Shahana Hanif, and Alexa Avilés booed throughout most of the meeting, chanted “shame on you,” and then took to the stage yelling “Rent rollbacks.” Despite the chaos during the preliminary vote, the RGB still decided to increase rents from 2–5% for one-year leases and 4–7% for two-year leases. If finalized, the decision will go into effect October 1, 2023, through September 30, 2024.
“While we are reviewing the preliminary ranges put forward by the Rent Guidelines Board this evening, I want to be clear that a 7% rent increase is clearly beyond what renters can afford and what I feel is appropriate this year,” said Mayor Eric Adams in a statement released after the meeting.
Adams asked that the nine-person board review their options and aim to “strike the right balance” for renters and building owners.
“I recognize that property owners face growing challenges [with] maintaining their buildings and accessing financing to make repairs; at the same time, we simply cannot put tenants in a position where they can’t afford to make rent,” continued Adams.
The problem is that the board has been trying to find balance since its conception, and other than a rent freeze during former Mayor Bill de Blasio’s term, has often opted to raise rents for tenants.
According to the New York University (NYU) Furman Center’s “The Economic Challenge for the Rent Guidelines Board: Balancing Long-Term Affordability in Rent-Stabilized Housing,” rent-stabilized housing is a crucial source of low-cost apartments. The majority were built in 1974. NYU estimates that about 60% of all rent-stabilized apartments are in these pre-1974 buildings.
The vote for rent guidelines for these apartments, hotels, and commercial spaces happens every year, but is a “show” in terms of demonstrations and protests against rent hikes, said a NYU researcher. Usually, rent increases happen to help building owners cover maintenance costs. In June 2019, New York State passed the Housing Stability and Tenant Protection Act (HSTPA), which curtailed some of these increases. Before HSTPA’s passage, rent-stabilized amounts could and did rise at higher rates than the RGB’s annual vote, said NYU.
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A joint statement from Speaker Adrienne Adams and Housing & Buildings Chair Pierina Sanchez said the RGB vote takes place against the backdrop of a citywide housing and affordability crisis, where median rents have skyrocketed to their highest levels.
“We urge the board to account for these economic realities, avoiding proposed increases that are counterproductive to New Yorkers persevering beyond our housing challenges,” they said. “Our city’s nearly 1 million rent-stabilized units are a significant part of New York City’s housing stock and must be preserved as affordable. Continuing to erode their affordability will only exacerbate our housing crisis and disproportionately harm working people and families in communities of color.”
Jay Martin, executive director of the Community Housing Improvement Program (CHIP), said the RGB process is clearly broken and the increases do not come close to covering the rising costs in rent-stabilized buildings.
“Even the highest end of these ranges will not put a penny in rent-stabilized building owners’ pockets,” said Martin. “Every single cent of the proposed rent adjustment will go to property tax payments, maintenance, skyrocketing insurance, and mandatory upgrades to buildings.”
Martin put the onus on elected officials to find ways to reduce the costs of operating housing and provide more financial aid to vulnerable renters.
“CHIP will continue to advocate for property tax reform, expanding vouchers, and creating a pathway for vacant units to be renovated and put back on the market. Any one of these things would reduce the reliance on the RGB’s annual decision,” said Martin.
The bottom line is that the stability of the low-cost apartments or net operating income (NOI) depends on “having sufficient rent increases” that won’t impair a building’s operations and maintenance, said NYU.
NYU suggested an automatic system that adjusts every five years—”to prevent any systemic misalignment between CPI growth and expense increases from growing into long-term problems.”
Ariama C. Long is a Report for America corps member and writes about politics for the Amsterdam News. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by visiting https://bit.ly/amnews1.