Like housing costs, interest in rent control running high

By Chris Lisinski

JAN. 11, 2022…..If the city of Chelsea had been allowed to implement a cap on how much property owners could increase rent, La Colaborativa Executive Director Gladys Vega contended Tuesday, COVID-19 might not have exacted such a dire toll on the community.

As supporters of reversing the statewide ban on rent control policies made their latest push after years of unsuccessful efforts, Vega drew a link between the controversial proposal and the frequency in Chelsea of crowded living conditions that contribute to spread of the virus.

The city has been one of the hardest-hit cities and towns in the state over the course of the pandemic, with its population of nearly 40,000 cumulatively accounting for more than 12,000 confirmed cases and 237 deaths.

“Chelsea was drastically impacted by the pandemic, and I tell you, if our residents and families would have had apartments that they could afford and they could be living individually in their own apartments and not subleasing, we wouldn’t have lost so many lives and we would have been better off,” Vega told the Housing Committee.

Legislative leaders over the years have shown little appetite for reconsidering the law that prohibits cities and towns from limiting rent increases, implemented after voters narrowly approved a landlord-backed ballot question in 1994.

The latest push, though, has generated intense debate: with several bills seeking to allow local rent control options on the agenda, Housing Committee Co-chair Sen. John Keenan estimated at the start of Tuesday’s hearing that roughly 160 people had signed up to testify, projecting “nearly eight hours of testimony.”

Landlord and real estate industry groups continue to push to keep the ban in place, arguing that clearing the way for cities and towns to pursue rent control would curtail the available supply of housing and cut into local property tax revenues.

The National Apartment Association on Monday published an analysis cautioning that imposing a 3 percent annual cap on increasing apartment rents could prevent Massachusetts developers from building 16,629 units of new housing over the next decade and imperil another 1,995 units through decreased spending on maintenance and repairs.

Together, those figures would represent more than a third of the more than 48,000 units the state needs to meet demand through 2030, NAA and the Greater Boston Real Estate Board, which represents thousands of property owners in the area, said.

In Boston, the industry-backed groups said a 3 percent rent cap would prevent construction of 739 new units each year and forego $2.3 million in property tax revenue to the city.

“Imposing artificial and arbitrary limitations on rents interferes with the market’s ability to naturally respond to changing economic forces. Rent control destabilizes the rental market and decreases affordability,” NAA President and CEO Bob Pinnegar wrote in testimony to the committee. “Policies that increase the spread of rent control are not the right policy solution. Instead, we encourage the Joint Committee on Housing to consider housing policies that have been proven to successfully increase access to quality, affordable housing and properly target assistance to low and moderate-income renters that need a help up.”

Legislation before the panel would not guarantee the return of rent control. Instead, several proposals aim to empower cities and towns to implement the policy if their leaders and voters support it.

One bill (H 1378 / S 886) would include rent control among a range of several tenant protection policies municipalities could deploy. The bill would give participating cities and towns the option to attach income-based eligibility requirements to rent-controlled units.

Another proposal (H 1440 / S 889) focuses only on restricting rents and evictions, capping an annual rent hike for covered dwellings at either the one-year increase in the Consumer Price Index or 5 percent, whichever is lower.

Both sets of bills would exempt owner-occupied buildings with three or fewer units and newly constructed homes from the limit on rent hikes.

“That responds to one of the arguments against (rent control) and in fact would drive investment toward construction of new units,” said Sen. Patricia Jehlen, a Somerville Democrat and one of the lead sponsors of the narrower-scope bills.

With their public push focusing on both the harms wrought during the COVID-19 crisis as well as the lack of available and affordable housing across the state, rent control proponents are likely to run into continued opposition from Republican Gov. Charlie Baker and a muted response from top Democrats in the Legislature.

Baker in October said he would “probably not” sign a law reviving rent control options if one landed on his desk, though he said he would “leave the door open a little bit.”

“I lived for a bunch of years in Boston paying market rent when I was a young person next to two apartments that had older folks in them that made more than me who paid about half what I paid in rent because their apartments were rent-controlled and mine wasn’t,” Baker said in a GBH News interview. “As we all know, that was in many ways one of the biggest issues people have with rent control generally, which is basically it did not treat everybody the same and your income had nothing to do with whether or not you had a rent-controlled apartment.”

The arrival of new political figures, and a chance to propose new guardrails for rent control, could change the outlook. Boston Mayor Michelle Wu campaigned on bringing back some form of rent control to help address housing instability and skyrocketing prices. In December, one month after she started in the city’s top office, Wu announced she would convene a Rent Stabilization Advisory Group and seek to draft statewide legislation for the 2023-2024 legislative session.

At a virtual rally ahead of the Housing Committee hearing, Wu said opponents often portray rent control as a “scary” proposal that will wreak economic harm on a region.

“We know that other cities across the country who have implemented rent stabilization and rent control are seeing it working, are seeing that it doesn’t come with the sky falling and some of the consequences that opponents would have you believe,” Wu said. “It does mean that people are put first instead of profits. It does mean that we are working toward a vision of cities where everyone is welcome and everyone has a home.”

Baker’s decision not to seek reelection also leaves the gubernatorial field wide open. If the ultimate winner of that race comes to embrace local rent control options, combined pressure from the governor and the mayor of the state’s largest city could shift the calculus for legislative leaders.

Market trends factored heavily into the argument Rep. Nika Elugardo, who co-filed the multi-pronged tenant protection bill alongside Rep. Mike Connolly of Cambridge and Sen. Adam Gomez of Springfield, made to her colleagues.

She cited statistics from the National Low Income Housing Coalition finding that more than three-quarters of extremely low income households in Massachusetts, defined as a household income of $32,430 or less for a family of four, pay at least 30 percent of their monthly income solely on housing costs and utilities.

“If you Google Chapter 40P of Massachusetts General Law, you will see the purpose. You click on the purpose and it says, ‘This policy is based on the belief that the public is best served by free-market rental rates,'” Elugardo, a Boston Democrat, said, referencing language enacted via the 1994 ballot question. “Does anybody believe that any more? Completely uncontrolled free-market rental rates? If we ever believed that, if that was a statement we were debating back then, we’re not even debating that any more.”

Last session, the Housing Committee favorably endorsed two bills that would allow cities and towns to place a limit on how much landlords could increase rent with three-quarters of its members in support, but both proposals died without a vote in the House Steering, Policy and Scheduling Committee.

The rent regulations proposals were aired Tuesday amid a steady escalation in home and condo prices, and state government’s ongoing efforts, through a variety of programs, to preserve and build more affordable housing and to help ensure that low-income residents can cover their housing costs.

Rent control supporters say the measure could mitigate hikes that exceed the statewide trend and place undue pressure on tenants. Isaac Simon Hodes, director of Lynn United for Change, said he got a call last week from a renter who must leave in 30 days if she cannot afford a spike in her rent from $1,300 to $3,000 per month.

In Somerville, Jehlen said, “we often see extraordinary rent increases of $500 to $900 per month.”