[NYtenants-online] You Can Now Dig Deeper for Rent

[Tenant]

NYtenants Online/TenantNet                                 5/5/03
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IN THIS ISSUE ...

1. Why More Rent?
2. OT: Save the Fare Rally this Friday!
3. RGB Board Authorizes Jumps in Rent Up to 8.5 Percent (NY Times)

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Why More Rent?

Did anyone notice that the same day the Rent Guidelines Board announced
it's preliminary vote for 5.5% and 8.5% rent increases for next year,
that the NYC Economic Development Corporation (NYC-EDC) announced a $46
million corporate welfare giveaway to Pfizer Inc.

And did anyone notice that when Mayor Bloomberg announced his Doomsday
Budget last month, with massive layoffs and now with higher taxes, that
the City announced on the same day it would use the corporate pork
barrel to the tune of $100 million for office development in Brooklyn?

Even the nation's largest hypocrite, the New York Times, is getting
around $26 to $29 million in incentives for its new office tower in
Manhattan ... with the help of Eminent Domain that's forcing many small
businesses to close. How did they earn that? They endorsed Pataki last
November.

Between the City and State, there are hundreds of millions of dollars of
corporate giveaways every year. On top of that, huge amounts of tax
dollars are used for high-rise luxury apartments in the form of HFA
bonds and 421-a tax abatements. Some estimate that a full 60% of the
cost of these towers is paid for with tax dollars.

While the City and State claim the corporate pork is necessary for job
retention and growth, many observers question if companies really need
these incentives and if their predictable threats to leave are just
that: threats. After all, would the New York Times move to San Antonio?

Last fall the city raised property taxes 18.5%. Building owners are
passing on these costs to tenants whether or not you're in a regulated
apartment. The pressure for the large RGB increase is directly related
to the increase in property taxes and the city budget crisis.

We can't tell you an exact dollar figure of all this corporate welfare,
but a good place to start is at Good Jobs New York at
http://www.ctj.org/itep/gjny/ You can see who is getting the corporate
subsidies and how the money is spent.

It's this simple: if the corporate welfare didn't exist, a large part of
the city's budget crisis wouldn't exist, any property tax increase would
have been lower and so would your rent increase.

So the next time you see your City Councilmember or State Legislator
rubber-stamp these corporate incentives, realize they are just doing
their bit to raise your rent.

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BRIEF OFF-TOPIC NOTICE
Save the Fare Rally this Friday!

Well, it's not completely off-topic as the $2 fare means less money for
rent.

Status:

The battle to Save the Fare is far from over. Last Friday, Manhattan
Supreme Court Justice Louis York scheduled a hearing on a preliminary
injunction on the fare hike and token booth closings, although he
declined to issue a temporary restraining order to block the fare hike
before it started.

The hearing on the injunction is set for this Friday, May 9, 2003, at
2:30 pm. at 60 Centre Street.

Save the Fare Coalition will have a pre-hearing "Roll Back the Fare"
rally at 1:30 pm this Friday at 60 Centre Street, across the street from
the courthourse near the fountain.  To sign up and for more information,
go to http://www.straphangers.org/farehikesham/index.htm.

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Board Authorizes Jumps in Rent Up to 8.5 Percent
By DAVID W. CHEN
New York Times
May 6, 2003

Setting the stage for what would be the largest rent increases since
1989, the New York City Rent Guidelines Board gave landlords preliminary
approval last night to raise rents up to 8.5 percent for the one million
apartments affected by rent stabilization.

The board's approval of 5.5 percent increases for one-year leases and
8.5 percent for two-year leases reflected a surge in landlord expenses
for property taxes, fuel and insurance. The board's decision not to
approve the double-digit increases urged by landlord groups reflected
how much tenants, too, have been reeling because of record unemployment
and a weak economy.

Still, the approval prompted peals of anger from the crowd of onlookers,
most of them tenants, who gathered last night in the United States
Custom House downtown for the meeting. At one point, the yelling was so
heated that the police removed at least one tenant organizer.

Every spring, the board wrestles with how much to change rents for the
one million apartments that are subject to rent regulations. Year after
year during the series of public hearings before the final vote in June,
landlords say they are not making enough money and tenants say they are
paying too much.

This year, though, has been unusual, both sides agree. The vote, the
first by a rent board made up mainly of appointees of Mayor Michael R.
Bloomberg, came against a bleak backdrop of budget cuts, pending tax
increases, a subway fare increase, the city's struggling economy and the
lingering effects of the 9/11 terrorist attack. As a result, the
discussion leading to the vote this year was seasoned with an extra
degree of urgency.

The board discussed the proposals but heard no testimony last night,
though there will be a chance at a later hearing for the public to be
heard. Tenants still managed a running and often blistering commentary
during and after the meeting, in tones ranging from heckling to
whispers.

After the vote, some tenants in the audience started chanting: "What do
we need? A rent freeze! When do we need it? Now!"

Others yelled: "Shame, shame, shame!"

One tenant said, "These people are like Saddam Hussein."

One of the handful of landlord allies who attended stood up and yelled
back, "The chairman has spoken, you freeloaders."

For the record, the board voted 6 to 3, after a 90-minute hearing. For
lofts, the board proposed increases of 4 percent for one-year leases and
7 percent for two-year renewals. For residential hotels, the board
proposed an annual increase of 4 percent.

There will be one more public hearing, on June 17. Then comes the final
vote on June 19, and the resulting increases would apply to leases that
are renewed between Oct. 1, 2003, and Sept. 30, 2004. The final vote
rarely differs from the preliminary one.

Of the city's three million dwelling units, about two million are
occupied by renters, though the national ratio is one-third renters. Of
the two million rental units, about one million are stabilized units and
therefore subject to the rates set by the board. About 350,000 more are
rent-controlled apartments, public housing and other kinds of
government-related residences, while only 650,000 units are not
regulated, said Anita Visser, executive director of the Rent Guidelines
Board.

Since the board was established in 1968 to review rent rates, there has
never been a rent decrease or even rent freeze. During the high-
inflation years of the late 1970's and early 1980's, the board sometimes
approved rent increases of up to 14 percent for two-year leases. In the
late 1980's and early 1990's, rising fuel costs were largely responsible
for rent increases of up to 9 percent for two-year leases.

For the better part of the last decade, rents have gone up by a few
percentage points, in keeping with low inflation. Last year, for
instance, the board approved increases of 2 percent for one-year leases,
and 4 percent for two-year leases, even though the price index of
operating costs, a study that summarizes landlords' expenses, showed a
decrease for the first time in history.

This year, by contrast, that price index rose 16.9 percent, the highest
since 1980, when it jumped by 17 percent and the resulting rent rates
went up by as much as 14 percent for two-year leases. Tenants' groups
said the 16.9 percent increase was offset by a 19 percent gain in
landlords' net operating income over the last decade.

Before the vote last night, the board came under extra scrutiny because
five of its nine members were newcomers. They replaced members with
decades of collective experience who had either resigned, indicated a
reluctance to serve again or were not reappointed by Mr. Bloomberg.

In years past, membership on the board did not exactly have its
privileges. Its per diem allotment of $100 is among the lowest of the
city boards, the board's decisions often leave tenants and landlords
seething with anger, and board members have sometimes been subject to an
intense political vise.

For instance, in 2001, Mayor Rudolph W. Giuliani, who was never shy
about voicing his opinions on rent increases, replaced the board's
chairman and appointed two other new members just in time for them to
take their seats and vote. That was also the rare year in which the
final vote differed from the preliminary one, and changed rent increases
of 3 and 5 percent to 4 and 6 percent.

By all accounts, Mr. Bloomberg has granted his appointees far more
independence than Mr. Giuliani did. Board members said they struggled
with the immense volume of data and arcane information all weekend
before arriving at the final figures last night, in full public view.