On June 14, the Governor signed into law reforms passed by the State Legislature to the rent regulation system, which previously only covered New York City, as well as 34 municipalities in Nassau, Westchester and Rockland counties. Significant among these reforms is the option for any city town or village in the State to opt-in to the Emergency Tenant Protection Act of 1974 (ETPA), which established the system of rent stabilization.
The ETPA covers the regulation of residential rents, not commercial rents. Furthermore, the ETPA applies to rental units in the following non-public housing:
- Buildings with 6 units or more;
- Buildings completed or substantially rehabilitated prior to January 1, 1974;
Additionally, under a newly added provision, the ETPA does not apply to buildings outside of New York City that were vacant and unoccupied for at least one year, as of June 1, 2019.
Prior to June’s rent regulation reforms, a process known as “vacancy decontrol” allowed for units to be removed from rent regulation if the unit reached a certain rent threshold (approximately $2,700-$2,800) and the unit became vacant or the resident of the unit attained an income above $200,000. The new reforms eliminated vacancy decontrol. This means that units under rent stabilization cannot leave the rent stabilization system, so long as the ETPA is in effect for a locality.
Q & A: Rent Regulation Opt-In Process
What should local REALTOR® boards expect now that the ETPA is optional for localities outside of the NYC metro area?
Several localities have expressed interest in opting in to the ETPA. These include Albany, Ithaca, Syracuse, Kingston and Hudson. Others with vacancy rates at or near five percent may also consider this option. Local boards can expect those municipalities interested in the ETPA option to hold a public hearing prior to opting in and should be on the lookout for potential hearings. Additionally, some localities may look to contract with outside agencies to determine their vacancy rate prior to any such hearing (see #3 below). REALTOR® boards should be on the lookout for any activity from a city, town or village governing body that indicates that the locality may be interested in the ETPA.
How does a locality opt-in to rent stabilization? Can they opt out?
For a city, town or village to opt-in to rent regulation, its legislative body must hold a public hearing prior to adopting a resolution declaring a public emergency. The public hearing requires a 10-day notice. Furthermore, a public emergency may only be declared when the vacancy rate for any or all classes of housing accommodations are five percent or less. A locality may either opt out of the ETPA when the governing body of the city, town or village votes in favor of opting out, or the emergency ends when the vacancy rate exceeds five percent.
How are vacancy rates determined? Who makes the determination?
The ETPA does not establish a methodology for the determination of vacancy rates, however, the U.S. Census Bureau publishes estimated vacancy rate data for various municipalities. New York City partners with the Census Bureau to conduct a housing vacancy survey every three years. However, there is no requirement for municipalities to use Census Bureau data when determining vacancy rates. For example, the Village of Ossining in Westchester County, hired a consultant to determine its vacancy rate prior to opting in to the ETPA.
What happens after a resolution declaring a local emergency is passed?
If the locality is in a county without a Rent Guidelines Board (RGB), the county is required to establish a one. The Rent Guidelines Board, which must consist of nine members, is responsible for setting limits on annual rent increases. Five of its members must be public members, with at least 5 years of experience in finance, economics or housing. The length of a term ranges from 2-4 years. The ETPA excludes anyone who owns or manages rent-regulated housing from the RGB.
Can REALTOR® members serve on the Rent Guidelines Board? Who appoints RGB members?
Yes. REALTOR® members can and should seek to serve on these boards. RGB members are appointed by the State Commissioner of Housing and Community Renewal, upon the recommendation of the local legislative body.
Does NYSAR have a position on rent regulation?
NYSAR’s statement of policy advocates for the elimination of rent control laws. As localities will now be considering opting into the ETPA, this is a matter of local jurisdiction and NYSAR will support local REALTOR® boards as they oppose efforts by local governments to opt in to the ETPA.
What resources are available to REALTOR® boards looking to oppose efforts by localities to opt in to the ETPA?
NYSAR will primarily provide support in the form of Issues Mobilization Funds and Calls for Action. Issues Mobilization Funds are available, upon application, to develop campaigns to support or oppose specific issues, such as rent control. NYSAR will also support efforts by local boards to set up and execute Calls for Action targeting local lawmakers. Other resources include general talking points on rent regulation.