Preserving vacancy decontrol.

The Rent Stabilization Association, representing owners and managing agents of over one million apartments in New York City, continues to play a vital leadership role on key issues affecting rental housing providers including this year's battle over renewal of the rent laws.

The New York State Legislature recently extended the laws governing the rent stabilization system, but the results have been widely viewed as a victory for the real estate industry because it preserves limited vacancy decontrol. RSA led the fight to preserve this critical right that allows owners to deregulate high-rent units upon vacancy.

One of the most important reforms achieved by the industry and RSA during legislative battles over the rent laws in 1993 and 1997, limited vacancy decontrol allows deregulation of apartments that reach a legal rent of $2,000 or more per month upon vacancy. Claiming that vacancy decontrol will destroy the rent control system, tenant advocates waged a long, bitter fight to either eliminate it or raise the threshold to $2,500 per month.

The new legislation also preserves high-rent, high-income luxury decontrol for existing tenants with an Income of $175,000 for two consecutive years whose apartments rent for $2,000 or more per month.

These decontrol provisions should help to erode the constituency favoring rent control, primarily affluent residents of Manhattan who are its chief beneficiaries, by the time the rent laws come up for renewal in eight years. In fact, tenant advocates charge that between 300,000 and 400,000 apartments will be deregulated over that line period.

Additional important provisions of the legislation strengthen State control over rent regulation, maintain deregulated status for apartments that subsequently rent for less than $2,000 and ensure that a preferential rent may return to the legal regulated tent upon vacancy.

The Urstadt Law, which prohibits municipalities from enacting legislation that is more restrictive than existing State law, was strengthened to give the State jurisdiction over any changes in the rent regulation system. This precludes new legislation by the New York City Council that would affect the rent laws except for legislation pertaining either to rent law renewal or the removal of housing accommodations from regulation.

For instance, legislation proposed earlier this year would have allowed the City Council to approve Rent Guidelines Board members, to establish guidelines based on changes in net income and other measures of profitability, and to bar owners from collecting rent increases unless they submit income and expense statements to the RGB. This new provision prevents this legislation with its potentially disastrous consequences for owners of rent stabilized apartments.

The current Rent Stabilization Code provision providing that a deregulated unit remains deregulated regardless of whether a future rent for that unit is less than $2,000 per month is now codified into law. Property owners who reach the legal limit of $2,000 per month can deregulate the apartment and rent it for a lesser amount.

The new legislation also provides that a preferential rent may return to the legal regulated rent upon vacancy or upon lease renewal. Owners who offer tenants rents at rates lower than the legal rents during a slow economic period will be able to return rents to legal levels as the economy improves.

This provision provides further incentive for owners to register legal rents timely with the New York State Division of Housing and Community Renewal. RSA's extremely successful Rent Registration Service currently registers rents for hundreds of thousands of tent stabilized apartments. The Rent Registration Service files apartment information directly into the DHCR database, and also produces and mails annual rent registration notices to tenants.

RSA offers numerous other services to help owners remain competitive in a tough market including Lead Paint/ Window Guard Notification, Fire Safety Service, Court & Credit/NTN tenant screening, Legal Services Plan and Fuel Purchasing Program.

Recently, RSA introduced a new member service, a Rent Recovery/Collections Program designed to recover unpaid rent from tenets who move prior to the expiration of their lease or from tenants who are evicted for non-payment or other reasons.

RSA's Rent Recovery/Collections Program will seek to collect unpaid rent owed to members--without any risk or up-front costs. The program will collect unpaid rent dating as far back as six years. In addition to the unpaid rent, the program will recover expenses as well as interest accrued at the rate of 9% per year.

The Rent Recovery/Collections Program should be a real benefit to members, especially in a sluggish economy. It is a powerful tool owners can use to pursue revenue that would otherwise be lost.

BY JOSEPH STRASBURG

PRESIDENT, RENT STABILIZATION ASSOCIATION