RGB Proposes Lease Renewal Adjustments

The Rent Guidelines Board (RGB), a nine-member panel that sets annual rent increases for rent-stabilized apartments, met on May 1 to vote on preliminary numbers for increasing rent-stabilized rents. The board voted for rent hikes of between 1.75 and 4 percent on new one-year leases and increases of between 3.5 percent and 6.75 percent for two-year renewal leases.

These increases are about 50 percent below last year's and signaled that tenants in more than a million rent-stabilized apartments could be on the verge of the lowest increases since 2002, when rents went up by 2 and 4 percent.

At the vote, tenant reps made a bid for a complete rent freeze, with the argument that tenants are paying the highest ever percentage of their incomes on rent. Meanwhile, owner representatives asked for 5 and 9 percent rent hikes, respectively. Once the final raises are decided in June, they will affect leases that expire between Oct. 1, 2012, and Sept. 30, 2013.

The influential factors in the range established by the board are recent trends and data in housing affordability, tenant income, and owners' costs. One of the three reports the RGB issued in April was the Price Index of Operating Costs for Rent Stabilized Apartment Buildings (PIOC). Here are some of the conclusions found in the report:

• The PIOC for rent-stabilized apartment buildings increased 2.8 percent this year.

• Costs in natural-gas-heated buildings increased 0.6 percent, and costs in fuel-oil-heated buildings rose 3.9 percent.

• The “core” PIOC, which excludes the erratic changes in fuel oil prices, natural gas, and electricity costs, is useful for analyzing inflationary trends. The core rose by 5.0 percent this year.

• Fuel oil costs rose 1.6 percent.

• Real estate taxes increased 7.5 percent due to a rise in assessments and tax rates for Class Two properties.

• Labor costs rose 2.5 percent.

• The Utilities component declined by 4.0 percent, primarily due to a decrease in natural gas costs.

• Insurance costs increased by 2.5 percent.

• The PIOC for rent-stabilized apartment buildings is projected to increase 7.0 percent next year.

A final vote setting the specific increase is scheduled for June 21. Before the final vote, the RGB will hold three meetings for public comment. Any person who wishes to testify has a legal right to do so, and the RGB has traditionally allowed three minutes for each speaker, alternating between owner and tenant representatives. In relation to the public hearings, registration of speakers is required. Pre-registration of speakers is now being accepted and is advised. Those who wish to pre-register for the June 13 hearing in the Bronx may call (212) 385-2934 until 1:00 p.m. on Tuesday, June 12, 2012. Those who wish to pre-register for the June 18 hearing in Manhattan may call (212) 385-2934 until 1:00 p.m. on Friday, June 15, 2012. An exact time for speaking cannot be provided, but those pre-registering will be informed of their number on the list of pre-registered speakers when they call the above listed phone number. Written requests for pre-registration must be received at the office of the Board at 51 Chambers St., Rm. 202, New York, NY, 10007, before 1:00 p.m. on Tuesday, June 12 for the June 13 hearing and before 1:00 p.m. on Friday, June 15 for the June 18 hearing.

If you wish to submit written testimony, you can submit your views in writing by Monday, June 18, 2012. Such materials must be submitted to the office of the RGB at 51 Chambers St., Ste. 202, New York, NY 10007, or in the alternative may be submitted directly to the RGB staff at the hearings on June 13 and June 18, 2012. Written submissions can also be sent via fax to (212) 385-2554, or by email to board@nycrgb.org.

RGB MEETING SCHEDULE
The schedule of the Rent Guidelines Board meetings to consider lease renewal adjustments is as follows: