Bruno Unveils New Plan to Phase Out Rent Laws

New York Times, June 5, 1997

ALBANY, N.Y. -- In a show of Republican unity intended to pressure Democrats to compromise on a rent agreement, state Senate majority leader Joseph Bruno unveiled his plan Wednesday to end state rent regulations within two generations by eliminating protections for apartments that become vacant and for tenants who earn more than $125,000 a year.

Flanked by a dozen Republican state senators, including several who do not even support his plan, Bruno said his proposal marked a significant softening of his position since December, when he called for abolishing most rent protections within two years.

But he also reiterated his threat to allow the rent laws to expire June 16 if Assembly Speaker Sheldon Silver does not back away from his demand that the rules be left unchanged.

"If one person just keeps their arms folded and doesn't respond, then what you're headed for is a major crisis in the city," Bruno said, referring to Silver. "And at that time, we will have been trying to protect the tenants, and others will be held accountable."

But Silver, a Manhattan Democrat, said Wednesday he remained firmly opposed to Bruno's plan, charging that it would lead to the "slow death" of rent regulations and that it would drive the middle class out of New York City.

The speaker has been promoting his own proposal to construct enough new housing to bring the city's vacancy rate above 5 percent -- a level at which, under law, rent regulations automatically expire.

"We're still arguing about the issue of the survival of the middle class in the downstate region," Silver said Wednesday. "There's been no movement in anybody's position."

Both legislative leaders' actions Wednesday seemed intended to help them deflect blame if the laws expire June 16. By just advancing plans, even ones destined to die in the other man's house, both leaders are attempting to show voters that they are being reasonable. The laws restrict rent increases on 1.1 million units, almost all of them in New York City.

But the leaders and Gov. George Pataki also reported Wednesday that they had held relatively productive talks for the first time in months on the rent laws and other state matters, including the budget, which is now 65 days overdue. Though the leaders said they remained far apart on most issues, they argued that their ability to engage in an earnest discussion Wednesday was a form of progress.

"I think there is a genuinely a desire to carry forward this process and come to a resolution, not only on rent but on the budget as well," Silver said after an hour-long session with Bruno and Pataki.

Bruno's plan calls for allowing landlords to charge market rates on regulated apartments once the tenants die or move out, a policy known as vacancy decontrol. He would also immediately end rent protections for tenants, except the disabled and elderly, who earn more than $125,000 a year, a policy known as luxury decontrol. That now takes effect when tenants earn more than $250,000 and whose apartments rent for more than $2,000 a month.

He would also scale back laws governing what is known as succession, which allow tenants to pass regulated apartments on to relatives or domestic partners. Currently, a wide range of relatives, including grandparents, nieces and nephews, as well as unmarried partners, can continue living in a rent-regulated apartment after a tenant leaves or dies, provided they had been living there for two years.

Bruno would only allow spouses, children and parents to inherit regulated apartments, and only for one generation.

The majority leader said that his plan would end rent protections on 80 percent of regulated apartments within 14 years. He said his luxury decontrol plan would immediately affect 22,000 units. But Silver contended that vacancy decontrol would deregulate 50 percent of all rent-regulated apartments within five years.

Bruno would also stiffen penalties for landlords who harass tenants in an attempt to force them out. And he would require judges on most occasions to order tenants to pay rent into an escrow account during disputes with their landlords, a measure sought by landlord groups.

Landlord groups praised Bruno's plan, calling it evidence that he was attempting to be reasonable. But advocates for tenants said the plan, like one offered by Pataki, would encourage landlords to harass tenants and would drive up rents throughout the city.

"Bruno's bill puts in place the worst parts of the Pataki decontrol agenda," said Billy Easton, executive director of New York State Tenants and Neighbors Coalition.

Pataki and Bruno's plans overlap in several major ways. Both have called for vacancy decontrol, mandatory escrow payments during housing disputes and tougher penalties against landlords who harass tenants. Pataki would lower the threshold for luxury decontrol to $175,000. His major difference with Bruno is that he would leave the succession rules unchanged.

The major sticking point is over vacancy decontrol, which Silver has rejected out of hand. Silver has publicly refused to accept any changes, though privately, some Democrats say, he would be willing to expand luxury decontrol.

The one proposal Silver has publicly advanced would be to provide $650 million in tax abatements and direct subsidies to developers to construct 20,000 units of new housing in New York City. By doing that, he contends, the city's vacancy rate would rise enough to cause the rent regulations to expire.

But landlord groups derided that idea, saying that tenant groups, aided by Democrats, could always find a way to distort statistics to make it appear that the vacancy rate was below 5 percent. "You'll never get there," said Joseph Strasburg, president of the Rent Stabilization Association, a landlord group.