Luis Ferré-Sadurní

Another real estate agent warned a white homebuyer about gang violence in a mostly minority neighborhood, but she appeared to steer a black buyer with a comparable budget toward homes in that neighborhood.

All told, real estate agents treated people of color unequally 40% of the time compared with white people when they searched for homes on Long Island, one of the most racially segregated suburbs in the United States.

Those were among the findings of a three-year undercover investigation published this past weekend by Newsday, a Long Island newspaper, which exposed widespread evidence that discriminatory, and potentially illegal, home-selling practices are helping to keep the area’s neighborhoods segregated.

Newsday did the sort of undercover testing that government agencies and nonprofit groups are supposed to do to enforce fair-housing regulations meant to prevent disparate treatment based on racial and other factors.

The newspaper recruited a diverse group of people, some of them actors, to pose as first-time homebuyers, outfitting them with hidden cameras to capture their interactions with real estate agents. It is legal in New York to record a conversation or phone call if the person making the recording is a party to the conversation.

Over 16 months, the would-be homebuyers conducted about 100 tests. They got help from housing experts and recorded 240 hours of video that the newspaper turned into a 13-article series and a 40-minute documentary. More than 50 reporters, producers, editors and other Newsday employees worked on the project.

The newspaper contacted 93 real estate agents at some of the area’s biggest firms. Two testers — of different races, but of the same gender and about the same age, with similar income and housing preferences — would independently approach the same agent to test whether they were treated differently based on their race.

The results were startling, even though Long Island is a part of New York where redlining, zoning regulations and other forces have long perpetuated racial divides.

“Black testers experienced disparate treatment 49 percent of the time — compared with 39 percent for Hispanic and 19 percent for Asian testers,” Newsday reported.

In some cases, agents did not show listings to black testers if they had not been preapproved for a mortgage. The same agents would accommodate white testers who did not meet that condition.

The federal fair-housing law, passed in 1968 as part of the Civil Rights Act, prohibits discrimination in housing based on race, religion and other factors.

The Department of Housing and Urban Development is responsible for enforcing the law, mostly through its regional offices and through grants to nonprofits to investigate complaints, conduct tests and educate buyers and renters.

In New York, state agencies also enforce the law, with the state’s 133,000 licensed real estate brokers and agents responsible for abiding by fair-housing standards.

The enforcement process, which can be slow, starts mostly with complaints, but undercover tests are often the most effective way of proving disparate treatment. Newsday found that tests were used only sporadically because they are time-consuming and expensive.

Records show few examples of the state imposing heavy penalties, like fines, on agents found to have discriminated, Newsday found.

Government officials said they were examining what Newsday had uncovered.

“We are reviewing this report, but make no mistake: Every complaint received is thoroughly investigated and we urge any New Yorker who believes they have been the victim of housing discrimination to contact us immediately,” Richard Azzopardi, a spokesman for Gov. Andrew Cuomo, said in a statement.

Olga Alvarez, a spokeswoman for the federal housing department, said that the agency was examining Newsday’s findings.

“Combating housing discrimination is at the forefront of our department’s enforcement priorities,” she said.

Ken Zimmerman, a distinguished fellow and fair housing expert at New York University’s Furman Center, said that Newsday’s findings were a “modern manifestation of what has gotten in the way of the legal mandate and policy aspirations of the Fair Housing Act.”

“There needs to be more investment in uncovering intentional discrimination, as these tests reflect,” he added.

Real estate agents are barred from talking to clients about the backgrounds of people who live in neighborhoods and they are required to provide equal guidance about areas in which they may want to live.

Newsday found that agents ignored those rules repeatedly.

Agents overwhelmingly directed white buyers to Merrick, a hamlet in Nassau County where most of the residents are white. When discussing Brentwood, a predominantly black and Hispanic hamlet where gangs like MS-13 are active, an agent told one black tester that residents there were the “nicest people.”

The same agent emailed a white tester to “please kindly do some research on the gang related events in that area for safety.”

White customers were often given more listings than minority testers, Newsday found. And in a quarter of the cases, agents appeared to unlawfully steer buyers to different communities based on their race or ethnicity.

“This investigation brought to light what too many people of color in our state know already,” Sen. Kirsten Gillibrand, D-N.Y., said in a statement, “that discrimination is real and targeted, and rears its head in every aspect of their lives.”

This article originally appeared in

What Happens When Black People Search for Suburban Homes

One Long Island real estate agent told a black man that houses in a predominantly white neighborhood were too expensive for his budget. But the same agent showed houses in the same neighborhood to a white man with the same amount of money to spend.

In 2016, New York City renters paid more than $500 million in security deposits, money that largely sat untouched in low-interest bank accounts, according to the city comptroller. Security deposits remain a steep financial barrier for low-income tenants and young renters with minimal savings, even though state lawmakers recently limited the deposits to the equivalent of one month’s rent.

Now, a spate of startups is offering cheaper alternatives, envisioning a rental market without security deposits as a way to lower housing costs, curb inequality and put money back in people’s pockets.

Rhino has helped pioneer an insurance option: Tenants pay a nonrefundable monthly fee (about $13 for a $3,000-a-month apartment) instead of a deposit, and Rhino insures the apartment, paying the landlord for any damage.

The model seeks to simultaneously protect landlords and benefit renters by lowering upfront costs and freeing up money renters can save or invest.

“The idea was pretty simple,” said Ankur Jain, 29, the chairman and a co-founder of the company, which is based in Manhattan. “Security deposits have been vastly overlooked for the past few decades, and as rents have gone up, security deposits have become a much bigger barrier than they used to be for renters.”

But the idea has drawn some skeptics who are troubled by the prospects of unleashing a new type of insurance industry within an already ruthless real estate market notorious for unscrupulous landlords who prey on vulnerable tenants.

The startup is now focused on building political support for local policies nationwide that would require landlords to accept alternatives to security deposits and give renters more flexibility. The push comes amid a worsening housing crisis and a surge of tenant-friendly laws from California, which recently enacted statewide rent control, to New York, where lawmakers passed landmark tenant protections last summer.

Rhino was partly funded by Kairos, a venture-capital fund that Jain said he started to address social issues. The company has partnered with some of the city’s major landlords, including L+M Development Partners, Brodsky, Stonehenge and Monihan Realty, to build a portfolio of 110,000 apartments whose tenants have the option of enrolling.

Jain, an entrepreneur who founded a technology company that was acquired by Tinder in 2016, would not say how many renters have signed up. But he said Rhino had saved New York City tenants more than $60 million in security deposits since it started in late 2017 and $60 million nationally in 2019.

“We felt that there wasn’t enough being done in the political or private sector to tackle some of the big financial barriers facing our millennial generation, like student debt, housing and health care,” Jain said.

As rents have climbed, so has the number of companies offering alternatives to security deposits: Jetty, Obligo, SureDeposit and TheGuarantors offer similar services with varying coverage and price plans.

David R. Jones, the president of the Community Service Society, an anti-poverty group, said that security deposits were an extraordinary burden for low-income people, but that he was concerned private companies could exploit susceptible tenants.

“I am pretty wary when private institutions get involved in these types of things,” Jones said. “There has to be a profit motive here. I’m a little concerned that you’re dealing with extraordinarily vulnerable populations who don’t always read the fine print.”

Some elected officials were cautious about fully embracing the approach.

Julien Bonneville said he founded TheGuarantors in 2016 to guarantee leases for low-credit tenants and international students. But last year, the company unveiled a service to replace security deposits whereby tenants pay a fraction of the deposit upfront (from 7-18%) and the company insures damages up to the amount of the deposit.

He said the key to protecting renters was to make sure they know their obligations when using alternative products.

“This is growing fast,” he said. “In the future, hopefully, this will become the new standard, so landlords don’t use outdated ways of collecting security deposits such as cash.”

Jain said the policies his company advocates, including allowing renters to transfer security deposits between landlords when they move, could help free up billions of dollars tied up in security deposit accounts nationwide.

The City Council recently introduced a few bills aimed at lowering upfront costs for renters, including one to cap broker fees at one month’s rent and another that would allow renters to pay security deposits in six monthly installments. In addition, the tenant protections passed in June included a $20 maximum for application fees.

Councilman Keith Powers, a Democrat who represents parts of Manhattan, said an insurance plan like Rhino’s offered renters more options, but “it’s a new idea and I haven’t studied it enough.”

“I think there is a huge opportunity right now, based both on technology and on good policy, to revisit all these upfront costs to offer flexibility and choice,” said Powers, a co-sponsor of the recently introduced bills.

In a statement, Ben Carson, the secretary of the Department of Housing and Urban Development, expressed support for deposit insurance.

Rhino covers damages up to a certain amount and pays landlords for the typical wear-and-tear of a unit. A tenant is still liable for nonpayment of rent and any reckless, negligent or intentional damage to an apartment, Jain said. The monthly premium decreases when a renter renews a lease and proves to be a reliable tenant.

For property owners, offering no security deposits can be an effective marketing tool to attract potential renters.

“It works with no detriment to us and it’s obviously better for the renter,” said Barry Sternlicht, the chief executive of Starwood Capital Group, one of the largest property owners in the country and an early investor in Rhino.

“I remember when I was in that situation, when I was 22 and having to come up with that security deposit. It’s a lot of money,” said Sternlicht, who is rolling out Rhino across his properties. “It’s just a bad thing because the money sits around doing nothing.”

This alternative model could help fix another problem: Tenant lawyers say landlords sometimes do not return security deposits or withhold arbitrarily large amounts of money for minor damages to an apartment, a power dynamic that is skewed against tenants.

To get that money back, tenants can either file a complaint with the New York State attorney general or take their landlord to court, an expensive and time-consuming deterrent.

“Anecdotally, we hear about it all the time,” said Judith Goldiner, head of the Legal Aid Society’s civil law reform unit. “Security deposits are also one of the reasons it’s so hard for low-income people to move.”

A 2018 report from the city comptroller found that the typical family of four would have to pay 6% of its annual income to cover the security deposit of a typical New York City apartment; that number can go up to 25% for residents of the city’s poorest neighborhoods.

Security deposits also disproportionally affect minorities and low-income families, who are less likely to have substantial savings, the report said.

“I’m not endorsing a particular model,” Scott M. Stringer, the comptroller, said. “What I’m saying is that private sector housing has to meet the needs of the middle class, and rent security deposits are another form of gouging working families and basically removing money from middle-class people.”

He added, “We should have this discussion in the private sector and the public sector, and maybe there is a way to meet in the middle.”

What if You Could Rent an Apartment Without a Security Deposit?

Nothing is certain in the grueling hunt for a New York City apartment, except perhaps the inevitability of shelling out thousands of dollars upfront in broker fees, one month’s rent and a security deposit.

But the roommates may get most of their money back, a rare happy outcome in today’s costly real estate market, after state regulators declared last week that real estate brokers must abide by a recently enacted $20-limit on application fees.

“We got $800 back, which is very awesome,” said Pellman, 23, an actor who moved to a two-bedroom apartment in the Williamsburg neighborhood of Brooklyn this month.

Months after New York passed sweeping tenant protections, including the $20 ceiling on application fees, many real estate brokers across New York City continued to charge renters like Pellman hundreds of dollars to apply for an apartment.

The new laws said landlords could not charge more than $20, but it made no mention of brokers, who are often the go-betweens to secure an apartment in the city. The ambiguity led to months of confusion as renters forked over large fees, and lawmakers and real estate professionals blamed each other for the fiasco.

But on Sept. 13, a state agency finally stepped in to provide some clarity: Brokers acting on behalf of landlords cannot charge tenants more than $20 in application fees, which can only be used to cover background or credit checks.

So said a two-page guidance memo from the New York Department of State. It was a source of good news for the countless renters who found an apartment after the new cap passed in mid-June and may have been overcharged.

The memo did not specify whether renters illegally charged were entitled to a refund, but Pellman recently contacted two brokerage firms, Corcoran and Nooklyn, informing them of the new laws — and got a rebate from each.

“I just think it’s ridiculous the way brokers and landlords profit on tenants not knowing their rights,” said Pellman, who shared on Instagram a template of the email she sent. “I don’t like getting scammed and I don’t want anyone else to get scammed.”

She said Rentopia, the firm through which they secured their apartment, had not answered her emails requesting a refund and she’s worried her landlord may penalize her for speaking up. Her broker at Rentopia did not respond to a request for comment.

But Ariel Dagan, a real estate broker for Compass, said that limiting application fees could be detrimental to agencies that relied heavily on them to make a profit.

“These fees are what keeps some brokerage firms in business,” said Dagan, who also runs PreApproved Renter, a software platform that helps landlords process rental applications.

Dagan said there were other unintended consequences that could place brokers in a bind.

Under the new laws, landlords and brokers are required to provide tenants with an invoice and copy of any background or credit checks they conducted. But Dagan said that provision may be at odds with credit-reporting agency rules, which typically bar clients who use their services from sharing credit reports with others.

Representatives for TransUnion and Experian, two of the largest credit-reporting agencies in the country, said their rules do not prohibit landlords from sharing reports with consumers.

A prospective tenant can also waive an application fee if they provide the broker or landlord with a copy of a background or credit check conducted within the last 30 days. That, Dagan said, could lead to the submission of phony documents.

Brokers are facing additional pressure this year from the City Council, which is considering a bill that would limit brokers’ fees to one month’s rent. That would lower housing costs for tenants, while curbing a broker’s earnings.

“I think it’s ridiculous,” Dagan said.

“It’s not a glamorous job. It’s a grind,” he added about real estate agents. “It would cap middle-class workers’ pay, and this is a progressive city.”

The cap on application fees applies statewide, and enforcement issues have reverberated far beyond the five boroughs.

Susan Segal recently helped her son, a student at Syracuse University, apply for an off-campus apartment, for which the management company charged $300 in application fees. She emailed the company to ask for a refund after she learned of the new laws, but has yet to hear back.

“I would be willing to bet that apartment owners in areas with high student populations might be particularly prone to ignoring the law, given that college students may not know or have the wherewithal to protest illegal practices,” Segal said.

The memo from the state included additional guidance: It specified that a real estate agent paid by a renter to find an apartment is allowed to charge more than $20 in application fees and that brokers who violate the law may be disciplined by the Department of State, which regulates and licenses real estate brokers and agents.

But the memo left unanswered many other questions about the impact of the new rent laws, which were propelled by recently elected Democrats in the state Legislature to address skyrocketing housing costs.

It was not clear, for example, whether $20 is the maximum fee per application or per person. In response to questions from The New York Times, Department of State officials clarified Wednesday that brokers were allowed to charge $20 per applicant, not application. For example, three roommates could each be charged $20, or a total of $60, to apply for an apartment.

Also in question is how the new limits on fees and security deposits (now capped at one month’s rent) might inadvertently apply to the rental and sale of co-ops and condominiums, which typically involve hundreds to thousands of dollars in application fees.

In a statement to The Times, the Department of State said it does not regulate or license co-op and condo boards, so it could only dictate rules for brokers and agents.

It said that a broker cannot charge more than $20 on behalf of a co-op or condo board “when the particular apartment is owned by, and being leased by, that particular board.” If the board is not the owner or shareholder of the apartment, then a broker is free to charge more than $20.

It is unclear whether property-management companies, which often handle leases and applications on behalf of condo and co-op boards, are free to charge more than $20 in fees. In interviews, real estate attorneys gave conflicting accounts on their reading of the law.

Carl Hum, the general counsel for the Real Estate Board of New York, an influential trade group, said property managers could continue to charge more than $20 in fees.

But some lawyers, like Jeffrey Schwartz, who advises co-op and condo boards, said he is recommending his clients err on the side of caution and abide by the $20 cap as a result of the ambiguity in the new laws.

“I think the issuance of the guidance is actually creating more confusion than clarifying,” said Schwartz, who hopes the state will pass new legislation to exclude co-ops and condos from many of the new rent laws.

The lack of clarity has left some co-op applicants in limbo.

One co-op board in Manhattan recently charged an applicant an assortment of nonrefundable fees totaling about $1,350. The renter, Jeff, who preferred to use only his first name because he is still going through the co-op’s interview process, said the large fees appeared to be against the law.

“But I don’t want to argue fees with the co-op board because it’s already so competitive to get here in the first place,” he said. “I don’t want to rock the boat.”

Does Your Real Estate Broker Owe You a Refund?

NEW YORK — When Jo Ellen Pellman and her roommate searched for an apartment in New York City this summer, the two women dug deep into their pockets: They paid brokers a total of $1,200 in nonrefundable application fees, or $400 for each apartment they applied for.

That, at least, is according to a 62-page audit released Friday by the city’s comptroller, Scott M. Stringer, whose office found the city has wasted millions on roof repairs that should have been free, and systematically failed to conduct maintenance to prevent leaks, mold and mildew.

“At a time when every penny counts, NYCHA is essentially lighting money on fire by investing millions in roof repairs when it doesn’t have to,” Stringer said during a news conference at the Ingersoll Houses in Brooklyn.

NYCHA, the largest public housing system in the country, is under strict oversight after a federal lawsuit accused the agency of cover-ups, chronic mismanagement and squalid living conditions, including pervasive mold and exposed lead paint.

Earlier this week, Bart M. Schwartz, the independent monitor who oversees the housing authority, also issued a damning report that shed light on the agency’s flawed inner-workings, culture of dysfunction and lack of accountability.

Schwartz, who was appointed in late February, found NYCHA fails to adequately clean up lead paint, uses imprecise internal data and is not adequately staffed to deal with a pest infestation so bad that rats are known to clamber up clogged garbage chutes to 14th-floor apartments.

Taken together, the reports offer a bleak picture of housing conditions for 400,000 low-income residents and the daunting road ahead for the agency’s new chairman, Gregory Russ, who will assume his role in August.

Lack of maintenance and millions wasted on roofs

Leaky roofs are a well-documented and seemingly intractable problem at the housing authority’s 325 developments. Because leaks can lead to mold, a severe health hazard, the city recently allocated more than $1 billion to replace hundreds of roofs.

The housing agency typically hires contractors to install roofs, which generally have a warranty of 20 years, during which time a private vendor can cover most repairs for free.

But the comptroller’s audit found the agency almost never uses its roof warranty coverage to make fixes, instead spending taxpayer money on repairs. The audit examined 700 roof-related work orders over a decade and found NYCHA used its warranty coverage only nine times.

A lack of maintenance can void warranties, burdening NYCHA with the cost of repairs, but the agency has failed to adequately perform such maintenance. The comptroller’s office inspected 35 roofs in 13 developments and found deficiencies — from cracks to pools of water — in 88% of them.

NYCHA has also failed to keep track of basic roof-related records — like copies of warranties and monthly inspection reports — and workers are rarely trained to ensure warranty standards are met.

As a result, the auditors found 19 damaged roofs that could cost $24.6 million in public funds to repair.

Chester Soria, a spokesman for the agency, said in a statement that the comptroller’s audit and recommendations were consistent with what NYCHA “has been aware of and addressing through new systems we are already implementing.”

“In our July 17 response, NYCHA agreed with many of his proposals, such as with our roof inspection and quality assurance process, and our record-keeping enhancements were underway before today’s report,” Soria said.

Rat infestations

In his first quarterly report released Monday, Schwartz, the monitor, found that NYCHA was unlikely to meet deadlines to reduce its rat population and backlog of pest complaints.

NYCHA employs only 108 pest exterminators, which means each exterminator is responsible for about 1,400 apartments.

Twelve more exterminators were expected to be hired, but the report said NYCHA needed almost 1,000 exterminators to meet the Aug. 1 deadline stipulated in the agreement struck by Mayor Bill de Blasio and the federal government to address pest complaints.

Schwartz was particularly struck by the rat epidemic at the Washington Houses in Harlem.

In a letter to NYCHA, the tenant association described residents feeling like “hostages in our own homes at night” because of rats spilling out of elevators and stairways, and workers refusing to enter compactor rooms “for fear of being attacked by rats.” Rats began to climb up the stuffed garbage chutes.

The letter went ignored by NYCHA, the 81-page report said, until the monitor’s team pressured the agency into addressing the problem.

Lead paint

For years, the housing authority lied about its failure to conduct lead paint inspections, which put thousands of young children at risk and led federal prosecutors to investigate the agency.

Those cover-ups forced the city to agree to the appointment of Schwartz to ensure the agency complied with lead regulations. But Schwartz said the city lacked a comprehensive strategy to address lead paint, and NYCHA has conceded it is not in compliance with lead paint rules.

For example, the agency does not have a count of how many children under age 6, the population most vulnerable to lead paint, live or frequently visit NYCHA apartments, the report found. Many lead paint cleanups are being conducted inadequately, the report said, and the agency is waiting on hundreds of laboratory results of lead paint tests.

“These first few months of our work have revealed NYCHA as an organization fraught with serious problems in structure, culture and direction and perhaps even worse,” Schwartz wrote. “No one needs a monitor to be appointed to figure that out.”

This year, 18 cases of young children with elevated levels of lead in their blood have been reported to the federal government by NYCHA.

‘Putrid liquid’ and lack of accountability

On an unannounced visit to the Polo Grounds Towers in Upper Manhattan, the monitor’s team discovered a large pipe “cascading putrid liquid” from the ceiling into a laundry room. A worker, who was trying to stem the flow with a mop, said the problem had persisted for two months.

That was because a superintendent had decided scaffolding was necessary to repair the pipe; workers were waiting for an order of wood, a carpenter and then a plumber to fix the issue. Then a secretary inexplicably closed out the work order for the leak.

After the monitor’s team told the agency about the leak, it was repaired in three hours with only a plumber and a ladder.

That example, Schwartz wrote, was emblematic of an inefficient bureaucracy with little accountability and oversight.

“The main problem here is NYCHA’s failure to take action to solve a problem that needed immediate attention,” he wrote. “NYCHA must learn how to identify and fix these problems expeditiously without getting bogged down in layers of bureaucracy or a ‘check the box’ mentality.”

This article originally appeared in <a href="https://www.nytimes.com/2019/07/26/nyregion/nycha-rats-roof-repairs.html" id="d692723a-93be-3266-aa30-e125516ed39f">The New York Times</a>.

'Lighting Money on Fire' as Mold and Rats Persist in New York Public Housing

NEW YORK — The New York City Housing Authority, known as NYCHA, spent almost $4 million to replace eight roofs at a Staten Island housing project — 10 years before the expiration of their warranty, which would have covered repairs for free.

For years, Republicans controlled the state Senate, and stymied Democratic efforts to strengthen laws affecting about 1 million rent-regulated apartments in the city.

But with a newfound monopoly over the state Legislature and governor’s mansion, Democrats have wasted little time introducing a cadre of bills aimed at protecting tenants.

Amid an affordable housing crunch and a spike in homelessness statewide, housing activists see the next few months as a crucial opportunity to pass previously unimaginable reforms now that elected officials have signed off on a state budget and the current rent laws are set to expire in mid-June.

But the real estate industry — which demonstrated recently that it still had sway in Albany — is also bracing for the upcoming clash, warning that the proposed changes could hurt landlords.

Small building owners in particular are fretting over changes to laws that allow them to raise rents when they make building repairs, cautioning they could worsen living conditions for tenants.

A push for ‘universal rent control’

You may have heard of “universal rent control” over the past few months from the new wave of progressive lawmakers in Albany or because Oregon recently passed legislation that would limit rent increases across the state.But what does it mean in New York?

It’s shorthand for a bevy of renter-friendly reforms that a large coalition of tenant groups is lobbying for.

Democrats in both chambers have introduced legislation aimed at curbing homelessness and tenant harassment, and closing loopholes landlords use to hike rents and lift affordable apartments out of rent regulation.

There are also ambitious proposals to shield tenants who are unprotected from eviction and to expand rent stabilization to other counties beyond New York City and its suburbs.

“There is a sense that this is a big moment of opportunity to change some stuff that should have changed a really long time ago if it wasn’t for the power of the real estate lobby,” said Benjamin Dulchin, the executive director of the Association for Neighborhood &amp; Housing Development.

Halting the loss of rent regulated apartments

A top priority of tenant groups is to abolishvacancy decontrol, a provision that allows landlords to deregulate apartments and convert them into units with market-rate rents when they become vacant and their rent surpasses a statutorily set threshold; currently it is $2,774.77.

For years, Democratic lawmakers unsuccessfully pushed to eliminate the provision — which has led to the deregulation of more than 155,000 units since 1994 — facing resistance from Senate Republicans.

But with the backing of an all-blue legislature, Gov. Andrew Cuomo vowed to end vacancy decontrol earlier this year.

A bill would also eliminate the so-called vacancy bonus for rent-stabilized apartments, which allows landlords to raise rents by up to 20 percent whenever a tenant moves out.

In 2017, there were more than 966,000 rent-stabilized apartments, typically located in buildings built before 1974, with six or more units, and also constructed or renovated since then with special tax benefits.

Every year, a city board decides the allowable rent increases for these apartments; increases have ranged from 0 to 2.5 percent in the past few years.

Solidifying preferential rents

For about one-third of all rent-stabilized tenants, landlords charge a preferential rent — a discounted rent lower than the legal regulated rent. Landlords might set a preferential rent if, for example, they’re having trouble filling an apartment.

But they can legally charge the higher regulated rent when a tenant renews their lease, sometimes resulting in steep rent increases, according to advocates.

Legislative proposals would make preferential rents permanent.

Take the case of Winsome Pendergrass, 60, who moved into a two-bedroom, rent-stabilized apartment in Flatbush, Brooklyn in 2010.

Pendergrass said she was attracted to the apartment because of its $1,200 monthly rent, but she didn’t know it was a preferential rent at the time. She was surprised when her landlord increased the rent to $1,400 when she renewed the lease two years later.

By 2018, her rent had shot up to $2,100, partly as a result of improvements made to the building’s roof and windows, she said.

“It was a big, whopping leap,” said Pendergrass, who juggles two jobs as a nursing assistant and a home-care aid for older adults.

She ended up moving farther east to Brownsville, also in Brooklyn.

“A lot of us, my color people, are being pushed back to God knows where and living somewhere I don’t want to live in,” said Pendergrass, who is black and a member of New York Communities for Change. “It’s displacement.”

Uncoupling rent and building repairs

Another bill would eliminate a provision known as major capital improvements, which allows building owners to pass on some costs of buildingwide improvements, like elevator or roof repairs, to tenants through permanent rent increases.

A similar policy allows rent increases when apartments are renovated, but tenant groups say a lack of state oversight leads landlords to inflate costs.

Advocates argue that unscrupulous landlords use the provision to push out tenants to raise rents beyond the limits established by the Rent Guidelines Board every year.

Much of the debate will likely focus on whether to keep, reform or entirely scrap these provisions.

And what do landlords say?

Real estate trade groups said the Rent Guidelines Board over the past few years has approved only modest rent increases that have not kept pace with the mounting costs — from higher property taxes to water and sewage charges — of maintaining residential buildings.

Without the slate of provisions that allow landlords to raise rents, they won’t have an incentive to make improvements to aging buildings, said Frank Ricci, the director of government affairs at the Rent Stabilization Association, which represents 25,000 building owners.

“It’s going to have a pretty dire impact on buildings,” Ricci said. “Not immediately, but over time it’ll take its toll on the conditions of buildings in New York City.”

He said it made no sense to repeal vacancy decontrol because it was unreasonable to protect a renter who can afford to pay more than $2,700 in monthly rent.

The repeal of the provisions in question could lead to lower property values and a loss of up to $2 billion in annual property tax revenues, according to a joint analysis by the Real Estate Board of New York, an industry group, and HR&amp;A; Advisors, a real estate consulting firm.

Christopher Athineos, 49, runs a family business that owns and manages nine buildings, most of them in Bay Ridge, Brooklyn. About half the 150 apartments are rent stabilized.

“We’re hands-on property owners,” he said. “We take pride in our buildings. But if they pass a lot of these proposals, I don’t think we’d be able to maintain my buildings in the manner my tenants are accustomed to having them maintained.”

Athineos said he routinely installed new kitchens and plumbing not necessarily to raise rents, but to prevent higher maintenance costs down the road in his buildings, which are more than 90 years old on average.

Without the incentives, he said, he would likely put off renovations.

“These politicians know nothing about running housing. These are the people running NYCHA,” he said referring to the dismal conditions of the New York City Housing Authority.

Are changes likely?

If real estate insiders and housing activists agree on one thing, it’s that Democratic-control of the legislature — for only the third time in more than half a century — all but ensures state rent laws will be revised this year.

But it’s too early to determine what the changes might look like.

Many activists and left-wing lawmakers have grown wary after the most recent budget cycle, which they said failed to deliver on key progressive policies. Others remain skeptical of Cuomo, who has raised millions of dollars from the real estate industry.

As Cea Weaver, the campaign coordinator of Housing Justice for All, a statewide coalition of tenant groups, put it: “I wouldn’t take anything for granted in Albany.”

This article originally appeared in <a href="https://www.nytimes.com/2019/04/17/nyregion/ny-rent-laws-regulation.html" id="fe77ba4f-1b05-3a6f-a7c6-399413aa3a1e">The New York Times</a>.

Has the moment finally arrived for housing activists seeking more robust rent laws in New York City?

Tenants May Get More Protections in New York City, After Decades of Battles. Here's Why

For years, the half-acre of green grass and leafy trees, tucked in between Spring and Prince streets in Manhattan, has been a lush backdrop for fashion shows, photo shoots, games of hopscotch and quiet afternoons.

But the city plans to sell the land soon to build a seven-story, 123-apartment elevator building for low-income seniors.

The plans have spurred a clash in the neighborhood, turning the garden in Little Italy into a quintessential New York City power struggle that pits two of the city’s scarcest resources — affordable housing and green spaces — against each other.

On Tuesday, a coalition of the garden’s supporters filed a lawsuit against the city in an attempt to halt the project.

“We need affordable housing in the community and all around the city, but it shouldn’t be coming at the expense of community green spaces, especially something unique and iconic as Elizabeth Street Garden,” said Joseph Reiver, executive director of a volunteer-based nonprofit that manages the upkeep of the land, which the city owns but has leased to his father for decades.

The fight is a familiar one in the city: As the amount of available land dwindles, the real estate market booms and the demand for housing increases, green spaces become easy targets for new construction.

In a city where an estimated 200,000 seniors are on the waiting list for an affordable apartment, supporters of the project see the garden as a palatable sacrifice in order to house older adults on fixed incomes who are burdened with high rents or isolated in walk-ups. Opponents say the garden is the last green space in Little Italy and SoHo, and that it’s an integral part of the neighborhood’s character, attracting more than 100,000 visitors each year.

The lawsuit is the latest salvo in a yearslong feud that has fueled petitions and raucous meetings held by Community Board 2, a group of residents who weigh in on land use issues in the neighborhood and which recently condemned the project. Councilwoman Margaret Chin, who represents the district where the garden is, supports the project, which is undergoing the city’s public review process.

It is expected to win the approval of the City Council — which gives great deference to the position of the local Council member — and be built by 2021, unless the lawsuit succeeds.

“I feel that people are upset and it pains me that I have to disagree with people that are so committed to their point of view,” Chin said. “But there are seniors that don’t have affordable housing and they helped build up our city. They helped build up our neighborhood.”

NEW YORK — The Elizabeth Street Garden’s paved paths meander around a granite balustrade from the early 20th century, limestone lion statues, benches and beds of roses and daffodils.

Luis Ferré-Sadurní

Articles written by the author

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