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Re: NYC TENANTS: the RGB votes TODAY: defeat the poor-tax !

Posted by Public Notice on June 22, 2000 at 07:18:37:

In Reply to: NYC TENANTS: the RGB votes TODAY: come to the meeting! posted by Public Notice on June 22, 2000 at 07:16:08:

from today's New York Times Online:


Rent Board to Vote on Extending Much-Debated Surcharge
By BRUCE LAMBERT

T he official term is
"supplemental adjustment,"
but opponents call it "the poor
tax."

Whatever name is used, it is the
surcharge that rent regulators
have imposed on low-cost
apartments in New York City in 14 of the last 17 years.
The cumulative effect has been to sharply raise prices
at the low end of the rental market, a study shows.

The surcharges have been much debated and are
likely to be debated again tonight when the Rent
Guidelines Board votes on annual increases for the
city's 1 million rent-stabilized apartments.

Since the surcharges began in 1983, rents have risen
158 percent, which means a rent of $490 for a tenant
who was paying $190 a month and took one-year lease
renewals, according to calculations by the Metropolitan
Council on Housing, a tenant advocacy group. For
apartments not subjected to surcharges, rents rose by
only 87 percent, the group said.

Making the same comparison for tenants taking
two-year lease renewals, the council said rent on a
$190 apartment rose to $412, or 117 percent,
compared with 71 percent for apartments not subjected
to surcharges.

Low-cost rentals are rapidly dwindling. The United
States Census Bureau says that the number of
apartments renting for less than $500 was cut to
209,725 last year from 417,438 in 1996. The 1998
median annual income of tenants in such apartments
was $15,000, compared to $30,000 in those renting for
$500 and above.

The surcharge, a perennial thorny issue for the rent
board, comes up for renewal tonight. The board has
proposed a $15 monthly surcharge on apartments
renting for less than $500, in addition to a general 4
percent increase for one-year leases and 6 percent
increase for two-year leases. For an apartment renting
for $450 a month, the surcharge would make the total
increases 7 percent for one year and 9 percent for a
two-year lease.

Four of the nine board members are against the
surcharge, according to advocates for tenants, who
say they hope to win one more vote.

The surcharges began during the Koch administration,
were suspended during the Dinkins administration and
resumed under Mayor Rudolph W. Giuliani.

Supporters of the surcharge say the annual general
rent increase, when applied to low-priced apartments,
does not yield enough income for landlords to meet
their costs.

"I really hope they keep it; it really helped to make a
difference," Denis Gittens, a landlord in Crown Heights,
Brooklyn, whose 14 two- and three-bedroom
apartments rent from $420 to $745, said in a telephone
interview. The surcharges enable him to break even
sometimes, he said, although now he is behind on his
tax, water and fuel oil bills.

Another owner, Myrtle A. Hamilton, said the surcharges
helped the finances for her eight-apartment building in
Prospect Heights shift from a deficit to breaking even.

But critics contend that the surcharges impose the
heaviest percentage increases on those least able to
afford them. "The poor tax has done more damage than
anything else to the supply of affordable housing," the
housing council's director, Jenny Laurie, testified at a
board hearing last week.

But landlord representatives have not budged. "I've
never heard anybody say a tenant left because of the
low-rent supplement," said Dan Margulies, director of
the Community Home Improvement Program, a landlord
group.

Jack Freund, executive vice president of the Rent
Stabilization Association, which represents landlords,
said that "the low-rent adjustment affects poor owners"
because the apartments they apply to are clustered in
buildings where owners need the income.

He also disputed the claim that the poor are being
singled out. "Just because you live in a low-rent
apartment does not mean you are low income," he
said.

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