Special Virtual Hoboken Council Meeting Set Wednesday For Possible Rent Control Compromise

HOBOKEN, NJ — The Hoboken City Council will hold a special meeting this week to decide if they should make a compromise to the city's existing rent control ordinance in order to avoid a landlord-backed decontrol measure from heading to the ballot in November, the day of the presidential election.

Rent control keeps older (and some newer) buildings in the city to rent increases that rise with the cost of living increase, while giving landlords some allowances such as the ability to tack on a water or tax surcharge.

A landlord-backed decontrol proposal would allow landlords to pay $2,500 into an affordable housing fund in order to raise the rent whatever they want when a tenant leaves, one time. Their group raised enough signatures this spring for a referendum this coming November. If the matter goes to the ballot, the future of thousands of rental units could depend on which side of the issue gets out the most voters. While Hoboken has many renters, some are still registered in their former hometowns.

Councilwoman Emily Jabbour wrote in her newsletter on Monday:

Special City Council Meeting

"There will be a special City Council Meeting this Wednesday, July 24 at 7 p.m. via Zoom to address a time sensitive proposal regarding Rent Control (for a full copy of the agenda, click here.

"A lobbying organization called Mile Square Taxpayers Association (MSTA) that represents landlords in Hoboken has put forward a sufficient number of petitions to force a referendum regarding Rent Control on the November 2024 ballot. The proposed referendum would allow Rent Controlled units to be decontrolled upon vacancy in exchange for a one-time payment of $2500 to the Affordable Housing Trust Fund. I am not supportive of this proposal, as it will effectively eliminate the stock of Rent Controlled units in the City in exchange for less than one month's rent.

"In order to have MSTA withdraw the referendum, Councilmembers have been actively negotiating a more robust set of amendments that would benefit landlords and tenants. Given the tight deadlines we are under to respond to the referendum filing, these negotiations are ongoing and we understand that it is short notice."

What's It All About?

Since 1973, Hoboken has had a Rent Control Ordinance meant to keep rent control from suddenly spiking, and it's been altered and revised over the years.

Currently, it limits annual increases to the Cost of Living Adjustment — usually 5 percent or less. The law prevents landlords from, for example, raising the rent each month to push a tenant out, or raising the rent by amounts such as 30 percent in one year.

There are provisions to help landlords get a return on their investment. They can divide increases in water bills and property taxes among their tenants. They also can get a 25 percent vacancy decontrol every three years or more if a tenant leaves voluntarily, and they can apply to raise the rent for upgrades and hardships.

Over the years, various groups have tussled over how to make the law more effective and how to revise it for changing times.

A group of property owners led by public relations executive Ron Simoncini, who has opposed rent control ordinances in other towns, has fought for changes in Hoboken's law for decades. Simoncini's group, the Mile Square Taxpayers' Association, has been involved in public elections in Hoboken as well. The last attempt at a decontrol measure failed in a very close public vote. MSTA, which had been hoping to institute a vacancy decontrol, challenged the election results in court, then dropped their claim in 2014.

Tenant advocates fear that the makeup of town has changed enough that not enough renters will vote to keep rent control as is, or even understand the issue.

The City Council can avoid the public vote if it achieves a compromise by July 30 with the landlord group pushing for the vote.

You can read the MSTA's proposed amendment and referendum question here.

Which Buildings Would Be Affected?

Most buildings in Hoboken that are more than 30 years old fall under rent control — but there are exceptions, and some new buildings are governed by local rent control as well.

The state of New Jersey passed a law in 1987 allowing builders to apply for a 30-year exemption from local controls, but they had to follow certain rules about timing, and have to let tenants know the building is exempt when they move in. Some newer luxury buildings in Hoboken have been determined to be under rent control because they couldn't prove they were exempt.

It should be noted that all rented units, rent controlled or not, fall under the state of New Jersey's anti-eviction laws. Among them, the state says rent increases can't be "unreasonable or unconscionable." A tenant who believes their increase is too high can, by law, withhold the amount of the increase and, if taken to court, plead their case to a judge. But if they lose, they must pay.

What's Happening Now?

Recently, MSTA got enough signatures in a petition drive to force an election on their proposed decontrol measure during the November presidential election.

The proposal would allow landlords to pay $2,500 per unit toward future affordable housing, in order to have an unlimited, one-time increase when a tenant leaves voluntarily. (It's unclear how a landlord would prove a tenant left voluntarily, under the current proposal.)

The MSTA says the ordinance is fair, because it could provide for future affordable housing. However, others say that the city's already existing housing stock that's still accessible to the middle class will disappear, unit by unit. A landlord who can raise the rent $500 to $1,000 per month could earn back an extra $2,500 in five months.

Tenant advocates also worry that pressure on tenants to leave will increase — in fact, renters have told Patch recently about landlords trying to push them out, even in violation of the state's eviction laws.

In Hoboken, the median rent has risen to above $4,000. Recently, the Zoning Board approved the demolition of three rent controlled apartment buildings where tenants currently live, meaning, they'll need to find another rent controlled or affordable building or leave town.

(Want to know if your lease or increase is legal? The city has a tenant advocate on retainer to help for free.)

Last year, Simoncini and a vocal tenant advocate in town, Cheryl Fallick, met to try to compromise and avoid a referendum. They came up with a plan that the City Council approved it, but Mayor Ravi Bhalla vetoed it. Bhalla has also come out against the referendum and in favor of strong rent control protections.

Some feel that compromising would be better than leaving the matter up to a public vote, which could largely depend on which constituency draws the most voters to the ballot box or mailbox.

How Does Your Councilperson Feel?

Mayor Ravi Bhalla has called the prospect of a referendum "offensive and unacceptable."

With the petitions handed in, a city spokesperson said, "Mayor Bhalla will be doing anything and everything necessary to ensure residents are fully informed about the harmful impacts of the referendum, and will forcefully advocate to protect rent control protections should it come to a vote."

Hoboken Councilman Phil Cohen, who represents the northwest part of town, wrote in his newsletter last week, "I introduced an emergency resolution at this week’s Council meeting, opposing the proposed referendum, and urging residents who support rent control protections to vote No if the Petitioners choose to place the question on the November ballot. Thanks to all my Council colleagues for speaking in a unified, clear voice — unanimously opposing the Petitioners’ proposed question, and urging residents to vote no, if the question appears on the November ballot.

"The resolution also commits to work with Petitioners on a compromise to address flaws in our City’s Rent Control Ordinance that would remove the threatened question from appearing on the ballot. I am committed to seeing if a reasonable compromise can be found to make our Rent Control Ordinance more fair, without gutting Hoboken’s rent control protections."

What Else?

Some say a compromise could still weaken rent control too much. Others say a public vote is too risky.

Tenant advocate Fallick said last month, "My feeling on it is that MSTA probably doesn't want to go to the ballot and would much prefer a compromise. The question is what an acceptable compromise is. Truth is, despite all of the spin, there has never been a change to the rent control ordinance that favored tenants."

Read last week's story on the matter here.

You can read the MSTA's proposed amendment and referendum question here.

• RELATED: Hoboken Had Highest Rent Increases Of All Cities In NY And NJ: Study
• DID YOU KNOW? New Jersey Has Laws About "Unconscionable" Rent Increases. Click Here.
  
• Three Corporate Landlords Suing Hoboken And Jersey City
  
• Landlord To Hoboken Council: Don't Play 'Roulette' With Tenants
• Are 25 Percent Rent Increases Legal? Hoboken Files 'Test Case'