Tuesday’s election painted a clear picture. Voters rejected leftist policies and government overreach. Even in New York City, voters, especially voters of color, rejected politicians that pander to their financial concerns with policies that don’t help.
The candidates for Mayor should take note. We are seven months from the June primary and the winner of the Democratic primary will be positioned to be the next mayor. Some candidates have already been doubling down on the idea that elected officials should expand the power of the government to ignore laws and implement class warfare on voters.
Specifically attempts to pander to renters by promising to freeze rents on rent-stabilized apartments, which is in clear violation of state law that mandates that the Rent Guidelines Board follow a specific process. If the RGB freezes rent at a mayor’s demand, they not only will be making a mockery of the rent stabilization law, they will likely be violating the U.S. Constitution.
The mayor appoints the nine members of the Rent Guidelines Board. Five public members, two tenant members and two owner members. They are required by law to look at a host of factors before they adjust rents. These include the economic condition of the industry, taxes, water and sewer rates, inflation, insurance costs, maintenance costs, and the cost of living for renters.
Only after evaluating all of this information, and hearing testimony from the public, are the Rent Guidelines Board allowed to make a final decision on rent levels. If the mayor that appointed the board has publicly stated that they MUST freeze rents before they have complied with the law, then the RGB would be in clear violation. Don’t take our word for it: The New York State Attorney General makes this claim in various legal documents.
We welcome a debate about rent-stabilized housing in the mayor’s race. We actually think preserving the majority of affordable housing in the city should be a top topic. We are very interested in what candidates have to say about proposals that help us cover the cost of operating this housing in ways that don’t raise rents. But they have to be real world solutions to real world problems. Problems like; the RGB adjusting rents by less than inflation.
Under Adams’ administration, the RGB has been worse for building owners than any other mayor in history. They have adjusted rents downward by 4.2% in three years, when factoring in inflation. Under the de Blasio administration, rents were adjusted downward by half as much annually as the Adams’ administration, at a rate of only 0.69%.
You may ask how this happened when the rents were increased. It’s simple: costs went up twice as fast as rents.
When the government does little to nothing to reduce the cost of providing housing, and then adjusts rents below inflation, buildings are defunded. The result of this is what we are seeing in The Bronx, Northern Manhattan, parts of Brooklyn and Queens: values of buildings have plummeted by up to 80%; access to capital to make renovations or repairs has disappeared.
Currently, more than half of the apartments in these buildings have rents that do not cover operating expenses per unit. This is why violation counts are increasing. Major regional banks that financed these buildings are failing. And it is why thousands of apartments are sitting empty, because the building does not bring in enough revenue to pay for repairs and maintenance on the apartment so it can be rented out again.
Thousands of buildings, housing hundreds of thousands of renters, are failing and they need help, not rhetoric. Mayoral candidates need to explain how they are going to make sure these buildings are maintained.
Are they going to stop raising property taxes on these buildings? Are they going to direct the Water Board to stop raising rates that the Independent Budget Office said were irrational? Are they going to fight back against insurance companies that jack up liability coverage on buildings with low-income tenants? Are they going to allow rents to cover significant renovations in thousands of vacant apartments.
If a mayoral candidate’s platform is simply freezing rents, without doing anything to lower operating costs, then they are condemning hundreds of thousands of tenants to live in deteriorating conditions. That’s like providing candy for rotting teeth.
And if the idea is that the city is going to step in and take over these properties, then candidates should clearly explain how they intend to find billions of dollars in added revenue to cover the cost shortfalls. And do so without raising rents.
New York City needs a mayor who will usher in an era of government responsibility and advance policy grounded in fact and data, not vibes and ideology. Anyone pledging to trample on the integrity of the RGB and pander instead of lead should be rejected by the voters.
Jay Martin is the Senior Vice President of External Affairs for the New York Apartment Association.
