We expected today’s Loft Board meeting to be another rubber-stamp session on some version of the Interim Rent Guidelines. We had posters ready, objecting to the giant arbitrary increases in the latest proposal, and duct tape for our mouths since the Loft Board would not allow us to testify.
Surprise, surprise! The introductory comments by Chairman LiMandri referred to the many letters they had received about this issue (we get a mention) and he led the Loft Board in a long, convoluted discussion about how to arrive at fair and sensible Interim Rent Guidelines. This alone was a surprise — they went back to square one, ditching all the arbitrary reasons for percentages and time schedules from all the previous proposals.
Soon, the essential conflict came out. Are rent increases under the Interim Rent Guidelines meant to be an incentive for bringing loft buildings up to code or a gift to landlords that haven’t gotten a rent increase in a while?
If the intent is to give something to the landlords because they haven’t raised someone’s rent in a few (or many) years, then why do they deserve it? It’s not like tenants are in charge of rent increases. If a landlord didn’t raise the rent in a loft building for 10 years, it’s probably because the tenants were putting up with lousy heat, leaky roofs, and had to fix everything themselves. Maybe that landlord realized that if he tried to raise the rent and lost his tenants, no one else would move in. Does that landlord then deserve a large rent increase just because he or his tenants applied for Loft Law coverage?
NYCLT has an answer: NO.
If the intent is to provide incentives for landlords and tenants to apply for coverage and get all the way through the legalization process, rent increases should be strictly attached to guideposts in that process. A freebie rent increase just for applying does nothing to push the process along and might A) cause landlords to take the increases and do nothing or B) cause tenants to do the math and not apply.
The first part of the 6-8-6 is the incentive. It’s REALLY easy to get to – too easy, in fact. All the landlord has to do is register his building with the Loft Board and submit an Alteration Application, which is a preliminary proposal for work to be done to comply with the Article 7-B code. The application includes a full set of building plans, but it can be amended. Immediately the landlord gets a 6% increase — that should be more than enough incentive to move toward legalization!
Back to the meeting… the new Manufacturing representative, if I can be so blunt, might be our new best friend on the Loft Board. He proposed the Guidelines be set at 0%. Stay tuned.
Chairman LiMandri proposed many variations on the Interim Rent Guidelines, but it was impossible for the Board to find a rational argument for any of the proposal (kudos to him for trying to make some sense out of nonsense). In the end, two proposals will be worked up for the next meeting. ONE: 0% increases. TWO: a one-time increase for tenants that had no increase since June 2009, equal to the Rent Guidelines Board number (2.5%) minus a factor if the tenant pays his or her own utilities.
I think we hit this one out of the park. Congratulations.