Testimony Of Lucy Block Before New York State Homes and Community Renewal Regarding Housing Stability and Tenant Protection Act Regulations

November 15, 2022

Good morning, and thank you for the opportunity to testify today. My name is Lucy Block and I’m the Senior Research and Data Associate at the Association for Neighborhood and Housing Development (ANHD).

ANHD’s mission is to advance equitable, flourishing neighborhoods for all New Yorkers. Founded in 1974, today, ANHD represents 80+ neighborhood-based and city-wide nonprofit organizations with affordable housing and/or equitable economic development as a central component of their mission. We work in coalition with our member groups and partner organizations to support policies and programs that center justice, equity and opportunity for NYC’s marginalized communities and neighborhoods. We believe housing justice equals economic justice equals racial justice.

As we know, a primary goal of the Housing Stability and Tenant Protection Act (HSTPA) was to close the many loopholes in our rent stabilization laws which incentivized landlords to systematically deregulate stabilized housing. ANHD believes it is of utmost importance to maintain focus on the purpose of the laws and ensure that implementation does not undermine the strong protections they established.

There are many consequential regulations that are being discussed today, and we want to emphasize our support for the policy platform created by the Homes and Community Renewal (HCR) working group of the Housing Justice for All Coalition. ANHD was involved in efforts to examine how HCR can best execute HSTPA as it was intended, “to prevent the exaction of unjust, unreasonable and oppressive rents and rental agreements, and to forestall profiteering, speculation and other disruptive practices” (9 N.Y.C.R.R. § 2520.3). The working group has put forth detailed recommendations and responses to HCR’s implementation of HSTPA so far, and we urge HCR to take that platform and those recommendations seriously and into account as you finalize these rules.

HCR’s Responsibility to Enforce Accurate Registration of Rent Stabilized Apartments

Among the many important regulations under consideration, we are concerned about the role and ability of HCR to ensure that landlords do not evade HSTPA by failing to report accurate–or any–information to the agency. Currently, if a landlord reports incorrect information about the legal rent or regulatory status of an apartment, the burden falls on tenants and their advocates or attorneys to prove the landlord is falsifying information. This is an extremely onerous administrative and/or legal process for a tenant to carry, yet the many organizers and advocates who work with New York City rent stabilized tenants, many of whom are testifying today, know that landlords’ falsification of information is widespread and commonplace. Failure to register stabilized units is even more common. Landlords should not profit from misreporting or failing to report the correct regulatory status of stabilized apartments. As the administrative agency overseeing rent regulation, it is the responsibility of HCR to proactively audit landlords who make false statements on any filings with the agency, including the failure to register stabilized apartments.

The public needs to be able to trust that HCR is fulfilling its role as the regulatory agency responsible for administering rent registration. We need to be able to trust that landlords cannot simply neglect to register their units or report illegal decreases in stabilized units without consequences. However, ANHD’s members’ experiences have been that landlords can systematically flout rent regulation laws without any direct repercussions from HCR. It is simple to imagine a flagging system in which HCR is notified when a landlord reports fewer registered units since HSTPA was enacted. However, based on our knowledge, no such system is in place. We urge HCR to implement the relatively simple technological solutions that would allow the agency to monitor flagrant lack of compliance with registration requirements.

Current HCR Reports Show Indications of Illegal Deregulation and/or Widespread Lack of Reporting

Based on the aggregate data that HCR publishes as per HSTPA Part L, there have been major decreases in registered stabilized units from 2019 to 2020, indicating that landlords’ failure to register or correctly report their stabilized units could be happening on a large scale. The number of stabilized units decreased in every county. In New York City, the percent decrease from 2019 to 2020 was as high as 9.3% in Brooklyn, or 23,698 units. HCR reported decreases in Queens and the Bronx of 14,177 and 13,794 units respectively and a decrease of 62,886 units (a 6.6% decrease) across all counties. In comparison, there was a decrease of only 2.8%, or 27,314 units, from 2018-2019.

Why have there been such large decreases in stabilized units across the State since HSTPA was enacted, when HSTPA ended almost all forms of deregulation? It is hard to imagine legitimate reasons that more than twice as many units would have exited stabilization from 2019 to 2020 than 2018 to 2019. These numbers raise major flags. Either landlords aren’t registering their units or they’re reporting potentially illegal decreases. Either way, this is a problem that HCR needs to address.

HCR is Not Practicing Data Transparency

Additionally, HCR has not practiced the level of data transparency that we believe was written into the law and which would allow the public and organizations such as ANHD to further examine the widespread reporting issues indicated in HCR’s annual reports, such as missing registrations and suspicious decreases in stabilized units. HCR does not publish data on the number of rent stabilized units in each building, which would allow for an analysis of which buildings and which landlords appear to be systematically flouting regulations.

Part L of HSTPA requires HCR to report annually on a series of metrics regarding rent regulation and the underlying data used to produce those metrics on its website in machine-readable format. (HSTPA Part L §20.2). In 2019 and 2020, HCR only included the underlying data for some of the figures required to be included in the annual report. In 2021, the links to underlying data were broken. HSTPA requires that HCR take “any steps necessary to protect confidential information regarding individual buildings, housing accommodations, property owners, and tenants,” but the agency has interpreted that to mean they do not need to provide the number of registered stabilized units at each address containing them. We believe firmly that doing so would not infringe on individual privacy. It would not give information about rents or preferential rent status for individual apartments, just the total number that are regulated each year.

ANHD urges HCR to take its role in enforcing consistent and accurate reporting seriously, and to be transparent with the public. The agency needs to proactively track and investigate missing or suspicious rent registrations and to make data on numbers of stabilized units per building available to the public. So far, we have not seen a commitment from HCR to holding landlords accountable through these simple mechanisms, and a failure to do so undermines the intent and laws enacted by HSTPA.

Thank you for the opportunity to testify today. If you have any additional questions, you can reach me at lucy.b@anhd.org.