Senate, Assembly approve rent bill

by MARC HUMBERT, Associated Press
Albany Times Union, June 20, 1997
ALBANY -- After months of squabbling that had New Yorkers on edge, the state Legislature voted Thursday to extend a program that has protected millions of tenants from sharp rent increases since World War II.

The Democrat-controlled Assembly approved the legislation, 93-53, after an almost one-hour debate. The Republican-led Senate follow suit, approving the measure on a 59-1 vote, after a half-hour debate.

Gov. George Pataki has said he will sign the bill into law, possibly as early as today.

The rent system, which expired at midnight Sunday, covers more than 1 million apartments, most of them in the New York City area. The six-year extension approved Thursday is retroactive to Sunday.

The battle over the state's rent regulation system had pitted tenants, ranging from welfare families in the Bronx to millionaires from Manhattan's Silk Stocking district, against landlords who had contributed more than $1 million to New York Republicans in hopes of ending the rent system.

To the end, Republicans argued that rent limits have exacerbated a housing shortage that continues to plague New York City and which originally led to the rent laws.

"If you cap food prices, you have a food shortage. If you cap umbrella prices, you have an umbrella shortage,'' John Faso of rural Columbia County told his state Assembly colleagues.

In the end, the tenants won the battle to keep the rent regulation system alive, although landlords will receive more money as apartments are vacated and new tenants move in.

"I believe this is going to lead to more open competition, to more housing choices and more affordable housing choices for all ew Yorkers, while protecting more than 1 million tenants who have relied with justification on a system that has been in place for more than 50 years,'' Pataki told a state Capitol news conference late Thursday afternoon.

Pataki had unsuccessfully pressed for a gradual phasing out of the rent system. He gave up on that as independent polls showed his approval rating skidding in New York City. He is up for re-election next year.

The governor and legislative leaders had announced a "conceptual agreement'' to extend the laws just after midnight Sunday, but since then their lawyers have been haggling over how to translate that into legalese.

The battle over the rent laws had held up action by the state Legislature on a host of other issues, including a new state budget. As of Thursday, the budget was 80 days late. Of course, New York's state budget, due by April 1, is late for the 13th straight year. Last year, it wasn't adopted until July 13, a record for tardiness.

State Senate Majority Leader Joseph Bruno, an upstate Republican and the leading opponent of the rent regulation system, had launched the war in December by declaring that the rent laws would be scrapped.

On Thursday, Bruno sought to put the best face on his loss.

"I think we have landed in a place that, bottom line, will benefit everyone in the city and the state,'' the Senate leader said.

The rent law extension will give landlords minimum rent increases of 20 percent when rent-regulated apartments are vacated. The increase is even greater if the old tenant has been in the apartment for eight years or more. The apartment would remain rent-regulated for new tenants.

The legislation, with its continued regulation, left landlords grumbling.

Joseph Strasburg, president of the largest landlords' lobbying group, the Rent Stabilization Association, said the agreement was "far from what is needed for the health of the city's rental housing market.''

Between Sunday and Thursday, negotiators had argued over a host of issues including language requiring renters to deposit at least a portion of their rent into special escrow accounts when there was a dispute with a landlord.

Landlords had pressed for that, and it remained in the final bill. Tenant groups have threatened to challenge that provision in court.

The new legislation would expand the state's luxury decontrol program under which apartments held by wealthy tenants are deregulated. Under the old law, apartments were decontrolled when a tenant's household income exceeded $250,000 for two consecutive years.

That threshold falls to $175,000 under the new bill. Apartments renting for more than $2,000 a month are deregulated as they become vacant.