Gov. David Paterson proposed legislation today that would amend the state’s rent laws and help stabilize what the administration describes as a “chaotic” housing market. The rent laws apply to about 1 million apartments in New York City and other municipalities in the following counties: Erie, Rochester, Rockland, Westchester, Nassau, Albany, Rensselaer and Schenectady counties.
The rent laws are due to expire in 2011, and the governor wants to make changes and extend them for eight years. The changes would reduce the rate for deregulating apartments, give tenants more protections and align the rent laws with a recent decision by the state’s highest court.
“This series of rent regulation proposals seeks to create a rational framework for resolving issues surrounding rent regulation, while protecting both tenants and owners of New York’s regulated buildings,” Paterson said in a statement. “During these difficult times it is essential that we do all we can to preserve rent regulation while restoring certainty to the rent regulation system and making it more transparent, manageable and equitable.”
The governor’s proposal would:
— Increase the threshold for deregulating an apartment. Currently, it can be deregulated if a tenant has a monthly rent of more than $2,000 and an income in the past two consecutive calendar years of more than $175,000, or when an apartment with a legal rent of $2,000 or more becomes vacant. Paterson wants to increase the threshold to $3,000 a month, and it would be adjusted annually by the rent guideline percentage increase for a one-year lease. The $2,000 figure was set in 1993 and hasn’t be adjusted since then.
— Allow owners to increase rent when individual apartment improvements are made. Tenants living in the apartments have to consent to the work. For vacant apartments, the owner would have to notify the new tenants about what improvements had been made.
— Require owners to provide written notice to the state Division of Housing and Community Renewal that a unit has been deregulated and to the first tenant who moves in after the deregulation. Currently, tenants who move into deregulated apartments often are unaware of the circumstances surrounding the deregulation and cannot determine whether they have a right to challenge the action.
— Extend the look-back period for calculating the legal rent if a “preferential rent” below the legal rent was in effect. The look-back period would be to the last legal rent in effect before the “preferential rent” was in place. That would allow the Division of Housing and Community Renewal to determine the legal rent for the next tenant.
— Clarify that there are only six specified exceptions to the four-year period tenants can review to see if they have been overcharged for rent.
— Address a recent Court of Appeals decision that left questions about the status of thousands of deregulated apartments in New York City. Owners and tenants of the roughly 40,000 units are uncertain about their rents. The legislation would allow the state to quickly and fairly determine the legal rent. Owners would be required to give tenants notice of their new status within 90 days of the legislation’s enactment and pay any overcharge within six months.