Upstate rent control set to become an option

CAPITOL — Rent control became a potential option for upstate communities this week, as state leaders agreed on a sweeping overhaul and expansion of the tenant protection provisions.

On Tuesday, leaders of the state Assembly and Senate announced a package of bills that would dramatically strengthen and make permanent New York City-area rent control, create extensive new rights and protections for tenants, and potentially extend that protection upstate for the first time.

The proposals include a mechanism by which individual municipalities can opt-in, provided the vacancy rate in the housing stock they wish to regulate is less than 5 percent.

Gov. Andrew Cuomo this week said he’d sign the legislation into law if the Assembly and Senate approve it and send it to him. He said he had advocated for the best possible tenant protections, and believes this is the best bill the Legislature could pass.

He also said he’d advocated for municipalities be given autonomy on the mater, and the legislation accomplished this.

Some of the new tenant protections include:

Barring landlords from creating tenant blacklists.
Limiting security deposits to one month’s rent.
Adding multiple protections for tenants during the eviction process.
Creating the misdemeanor crime of unlawful eviction for using force or a lockout to effect an eviction, and authorizing a fine of up to $10,000 per violation.
Requiring landlords to provide advance notice that they’ll raise the rent more than 5 percent or that they won’t renew a lease.
Giving tenants in an eviction procedure more time to get a lawyer, pay back rent or fix their violations of the lease.
Expanding the ability of a court to stay an eviction for up to a year if the tenant can’t find a similar dwelling in the neighborhood or would suffer extreme hardship.

Tenants of mobile and manufactured homes also would get some new protections:

Rent hikes would be limited to 3 percent, or up to 6 percent if justified.
New rent-to-own protections would help tenants attempting to buy their residences.
A homeowner’s bill of rights would be required as a rider to all leases.
Eviction protections would be strengthened, including for seasonal residents.

Here are some Capital Region perspectives on upstate rent control:

ASSEMBLYMAN PHIL STECK

Assemblyman Phil Steck, D-Colonie, said he’ll vote for the measure, even though he sees it primarily affecting downstate; he’s not aware of any Capital Region municipalities clamoring to impose rent control.

The problem in New York City, he said, is “too much money chasing too few apartments.”

The problem upstate, he said, is not enough income to afford high rents — and that cuts disposable income, which harms the economy.

“I think we do have [that] problem in the Capital District,” Steck added.

There’s a push for rent control in some upstate communities, he said, particularly Rochester, but the legislation as proposed is an opt-in measure, so the Legislature is not forcing it on any upstate community.

SEN. GEORGE AMEDORE

As an executive with his family’s housing development company, state Sen. George Amedore, R-Rotterdam, will see firsthand the results of any upstate rent control law.

For that reason, he said he probably has a better perspective than any of his colleagues on the legislation, which is “very unfortunate, to say the least.”

“We don’t need New York City dictating our policies upstate,” he said. “We don’t have a housing crisis here like they do in New York.”

Amedore said that crisis was created by rent control itself, but he expected the expanded rent control measure to pass, nonetheless.

“Any upstate member voting for this type of policy is really doing a disservice to the residents of upstate New York,” he said. “I think these laws, these restrictions put burdens on landlords that will further discourage any landlord from making needed improvements to their buildings.”

Amedore acknowledged that there would be local control over rent control, via the opt-in provision, but predicted officials would opt in their municipalities so as to build constituencies and voting blocs for themselves.

“I can see it now,” he said. “Allow the free market to work it out rather than socialized programming dictating rents.”

JAMES FLACKE

Better Neighborhoods Inc. Executive Director James Flacke said he can see both sides of the rental housing issue because BNI is on both sides of the issue: It operates a dozen rental apartments and annually counsels about 250 households that are approaching or have reached a crisis point with their housing.

“If you look at it from a pure data standpoint, about 53 percent of Schenectady residents are what is referred to as “cost-burdened” on their rent and housing expenditures” — paying more than 30 percent of their income for housing. “For a lot of people, housing security is a significant issue in their life.”

He added: “There’ll be a lot of discussion as to how this can be implemented to help people … I think it’s too early to judge how it’s going to work out.”

Flacke noted that the dynamics in New York City are different from upstate New York.

The fundamental determinant of affordability is income, he said, and most upstate cities have a lot of people without a lot of income. “Even modest residences can be unaffordable to someone who makes $20,000 a year.”

Consider also that most upstate cities have older housing stock, which requires expensive maintenance paid for with tenants’ rent checks, he said. But also consider that some landlords aren’t maintaining their aging properties, so claims that they won’t be able to do so under rent control are meaningless.

PHIL BARRETT

Albany Mayor Kathy Sheehan declined comment for this story, Schenectady Mayor Gary McCarthy did not return a call and email seeking comment, and Saratoga Springs Mayor Meg Jelly was traveling and unable to comment.

But rent control will no longer be just an urban or big-city issue if the new legislation is signed into law, because any municipality that has a vacancy rate under 5 percent could opt in.

That could include popular suburbs like Clifton Park, even though rent control is unlikely to gain approval.

“I don’t know why it would work in upstate New York,” Clifton Park Town Supervisor Phill Barrett said, pointing out that most upstate cities — Saratoga Springs perhaps an exception — have a vacancy rate well over 5 percent, thanks to historically shrinking populations.

“It seems to me that this is targeted at the suburban communities, since it won’t be applicable in upstate cities,” Barrett said.

He didn’t know Clifton Park’s vacancy rate offhand but said “I would surmise that it’s very low.”

Barrett said if there’s a housing crisis in the densely populated areas downstate, it’s worth considering that those also are the areas with rent control.

“Does that mean it’s not working? It doesn’t appear to be,” he said. “If it’s not working, why spread it?”

Barrett called rent control just the latest misguided initiative out of the state Capitol.

“We’ve seen an avalanche of legislation from Albany with the basic goal of injecting government into our lives at an unprecedented level,” he said. “It’s a very, very concerning trend for the future of New York state.”

SUNRISE DEVELOPMENT

A local rental real estate developer/manager who has opposed rent control proposals as they worked their way through the Legislature continued to do so as they stood poised on the brink of passage.

“Essentially what’s proposed is going to give tenants more rights than property owners,” said Jesse Holland, president of Sunrise Management & Consulting. The Albany-based company owns and/or manages more than 1,500 rental units, many of them in the Capital Region, and has consulted in the development of projects totaling several thousand more units.

Holland bases his opinion on three basic points:

— Price controls reduce income, which in turn reduces value. He suggested also that limiting rental price growth will shift some property tax burden onto individual homeowners.

— Communities will be affected if landlords can’t evict problem tenants, because the tenants’ negative impacts also can’t be removed.

— A patchwork of upstate communities that have opted in to rent control or might do so in the future will discourage investment and development.

At a forum Sunrise hosted last week on the multifamily rental market, Holland said he hoped legislators would take the time to appreciate the differences between upstate and downstate.

SEN. JAMES TEDISCO

State Sen. James Tedisco, R-Glenville, said rent control upstate would be a disincentive to investment, and the goal of making apartments more affordable would be better accomplished through income tax rebates.

“Upstate rent control brought forth by the downstate majorities and supported by the governor is another bad radical, liberal, socialist idea that will lead to more disinvestment in the upstate economy and more individual and small business migration out of New York state!” Tedisco said via email.

“The marketplace and competition will keep investment viable for developers and units available and affordable for most renters but this proposal will only incentivize individuals to go elsewhere to develop housing opportunities.”

MICHAEL PIETTE

Attorney Michael Piette of Bond Schoeneck & King said he and his firm represent municipal clients, landlords and developers that would be affected by rent control.

He hasn’t heard from them, and he hasn’t contacted them, because the legislation’s final form hasn’t been released.

“I think the initial reaction would be panic,” Piette said.

“It will not apply upstate in the first instance,” he added. “It requires that the local legislative body make a determination that a housing emergency exists — a vacancy rate under 5 percent in one or more classes of housing … I think for the most part everybody should focus on what the vacancy rate is.

“We have some municipal clients we expect will be contacting us in the near future.”

Piette doesn’t offer an opinion on the concept of upstate rent control.

“I could see both sides of the equation,” he said. “Historically it’s been much more a landlord-controlled market.”

MIKE SACCOCIO

Mike Saccocio, CEO of the City Mission of Schenectady, said he has seen the impact of housing costs on less affluent people of his city but doesn’t have a clear idea of how to fix the situation, or whether rent control will help.

“Landlords have legitimate expenses,” he said, but “I also know the working poor can’t afford the rent.”

He added: “My instinct would be it’s more complex than just legislation, it’s going to take a community coming together to solve it.”

Saccocio noted that the Mission is adding more units of transitional housing for its residents who are ready to return to independent living.

“The fact that we have 24 apartments and are building 10 more is the hard evidence that at the City Mission we recognize that the cost of rents is more than entry-level employees can handle,” he said.