Shelter Shorts

New York’s Rent Regulations Expire; Compromise Reached

Their worst nightmares realized, 2.5 million tenants watched rent regulations expire at 12:01 a.m. on June 16, leaving New York City and State without rent protections for the first time since World War II. Having flexed their political muscle, state legislative leaders and Governor Pataki then held a marathon all-night session to hammer out a compromise, which the legislature approved on June 20.

The new laws, according to The New York Times, the Daily News, and other news reports, extend for six years rent regulations for almost all current tenants of rent-controlled and rent-stabilized units. Once apartments become vacant, however, landlords can increase rents by 20 percent for new tenants – up from the previous ceiling of 9 percent. The new laws also permit increases above the initial 20 percent in cases where previous tenants had occupied the unit for eight years or more and in cases where rent was less than $300. New York City’s Rent Guidelines Board retains control over annual increases for tenants remaining in regulated units.

While this agreement does allow greater rent increases, it provides more protection than the vacancy decontrol plan proposed by the Republicans, which would have allowed landlords to charge market rate rents when rent-regulated units became vacant. The new law also retains succession rights, which allows tenants to pass along rent regulated apartments to family members, but limits them to one generation, and to immediate family members, not aunts, uncles, nieces, or nephews. The agreement came down in favor of landlords on one hotly contested issue requiring tenants to place monthly rent in escrow accounts during disputes with landlords.

The only tenants in rent-regulated apartments who will lose protection immediately are those whose household income exceeds $175,000 for two consecutive years and whose rent is more than $2,000 monthly. This amounts to roughly 1,300 units in New York City.

Initial reaction to the new regulations was mixed, with tenant advocacy groups and landlord groups alike offering both positive and negative comments.

(Read the full story of the fight in Shelterforce #94.)


Business, Banks, and Foundations Partner with CDCs

With cutbacks of federal programs in full swing, recent weeks have seen something a trend in foundations and corporations announcing multi-million dollar collaborations to support affordable housing and community development.

In May, for example, a group of foundations, corporations, and banks announced the Neighborhood 2000 Fund (212-454-3487), a four-year, $15 million effort to support 50 CDCs working to revitalize  New York City neighborhoods. Before the end of 1997, Neighborhood 2000 expects to begin making grants of up to $75,000 annually for four years to selected CDCs. After the first four years, the fund’s planners envision generating ongoing funding through a tax credit program. The initiative’s lead agencies include Banker’s Trust, the Rockefeller Foundation, and LISC. The New York Community Trust will administer the fund.

Another community development funder, Bank of America Community Development Bank, recently pledged $1.1 million to begin the Bank of America Leadership Academy. Over the next three years, 105 CBO senior staff will participate in a workshop series focused on affordable housing production, economic development, asset management, organizational development, collaboration building, and leadership development. The Development Training Institute (410-338-2512), designed and will conduct the workshops at its Baltimore campus.

The National Equity Fund (NEF), a LISC affiliate, announced in June that several dozen corporations will invest $300 million for affordable housing development through the Low Income Housing Tax Credit. NEF, which uses the credit to create annual corporate investment funds, will fulfill the commitment to provide equity to nonprofit developers in New York City, Newark, Philadelphia, Chicago, Detroit, Cleveland, Indianapolis, Atlanta, and several other cities.


Rev. William Cunningham, a 67-year old Roman Catholic priest, civil rights advocate, and founder of one of the nation’s largest anti-poverty programs, died in Detroit on May 27. Father Cunningham founded the nonprofit organization Focus: Hope in the aftermath of Detroit’s 1960s race riots, The New York Times reported. The organization, which started with a few high school student volunteers, now has thousands of volunteers, 800 employees, and a $71 million annual budget. Focus: Hope distributes food to 47,500 people a month and trains more than a thousand, mostly black youths each year as engineers and factory technicians. It operates its own factory as a training ground and sells auto parts to Detroit’s Big Three – General Motors, Ford, and Chrysler – which have become active supporters. Yet Father Cunningham periodically criticized the auto industry for not doing enough to promote racial harmony. At a conference of almost 1,000 auto makers and auto parts executives, he denounced the scarcity of blacks in the audience. For years, Father Cunningham was also critical of the Detroit-area Catholic Church for not actively encouraging mostly white parishes to work with mostly black parishes to prevent racial violence.

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Shelterforce is a nonprofit publication, published by the National Housing Institute. We are not beholden to a particular program, theory, approach, or constituency. We are dedicated to being useful to our readers and to fostering strong, vibrant, just, healthy places for everyone.

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