Deal Reached On Montclair ‘Rent Control 2.0’: See The Details

MONTCLAIR, NJ — UPDATE: The petition for a referendum on Montclair's rent control law will be withdrawn, town officials said Thursday evening. Instead of an emergency meeting on March 25, the council will meet on March 28 for the limited purpose of "authorizing the settlement the parties agreed to, repealing the current rent control ordinance, and introducing the new compromise ordinance."

Montclair renters and landlords have reached an agreement on a new rent control law, a day ahead of an important deadline that would have forced a voter referendum.

On Thursday, Montclair Mayor Sean Spiller announced more details about a compromise between the Tenants Organization of Montclair (TOOM) and the Montclair Property Owners Association (MPOA). Watch the video below.

The deal lays the framework for a new rent control ordinance that would replace the current version, which the town council passed in April 2020. A two-year legal battle – spearheaded by the MPOA – has kept that ordinance from going into effect.

• Read More: Montclair Rent Control Law Likely Headed To Voters In 2022
• Read More: Landlord, Tenant Negotiations Break Down In Montclair

Some Montclair residents and advocates, including TOOM, have claimed the local rent control ordinance was a long overdue victory for people who are at the mercy of landlords seeking to raise their rents. But critics such as the MPOA have argued the law was pushed through during the coronavirus crisis and would have been a burden for landlords and single-family homeowners.

Both sides have been trying to come to an agreement on a new rent control law in an effort to avoid an election day showdown. If a deal isn’t reached – and the MPOA doesn’t withdraw its petition for a referendum by Friday – it will be up to Montclair voters to decide the fate of the current law via a special election.

The new ordinance will have to get a green light from the town council, which will be put to a vote during an upcoming meeting, Spiller said.

For much of this year, it seemed like a referendum was inevitable. But there may be a light at the end of the tunnel, the involved parties announced Wednesday.

According to a municipal notice, the Montclair Town Council will convene for a special meeting on Friday. The mission? To “discuss and vote on the repeal and replacement of Ordinance O-20-05.”

“This process has always been about fighting for Montclair ideals through protecting diversity in Montclair,” Spiller said. “Housing is one of the great challenges we face as a society. I am proud, after a number of past efforts, that we were able to come together and hammer out a deal on real tenant protections.”

According to Spiller, the new ordinance will include a rent control board and rent control officer. The board will be responsible for developing new regulations, monitoring implementation and managing the process for addressing tenant complaints.

Spiller said the agreement will save the town 60 percent on legal fees arising from litigation surrounding the rent control law. The MPOA has also agreed to give back half of the township’s remaining portion of legal fees to create a rental assistance fund, he said.

THE NEW LAW

The MPOA released a statement about the tentative deal on Wednesday, noting that the town’s mayor and council have said they would pass a new rent control law if the two sides found common ground.

According to the MPOA, the new rent control law would include:

• "Immediate 6% increase on adoption of ordinance, assuming that no increase was taken since May 2020"
• "Every 12 months thereafter, 4% allowable increase (2.5% for seniors)"
• "Vacancy decontrol once per five years"
• "Reasonable registration requirements without requirement to share personal tenant information"
• "Inclusion of two and three-family homes, unless they are occupied by owners"

“The MPOA has long held that it was willing to support rent control in Montclair that was focused on protecting existing residents who were otherwise vulnerable to displacement as a result of fast-rising market rates for rental housing,” the group said.

“While our economic interest would be to have a free market, as a group, we love this town and its residents, so we are proud to be part of a solution that equitably protects our property while it also stabilizes housing costs for our valued tenants,” the MPOA added.

“We also want to recognize Councilor Peter Yacobellis for inviting tenants and landlords to a mediation session with Deputy Mayor Bill Hurlock, without which several critical issues would not have been resolved,” the MPOA stated.

The MPOA also said it will simultaneously withdraw a separate lawsuit challenging Montclair’s “rent freeze” as part of the agreement. First passed in May 2020 as a reaction to the pandemic, that ordinance prevents any increase in the amount paid in rent – or any additional charges by residential tenants – in all rental units within Montclair's borders, with some exceptions. After several extensions, it is slated to expire on May 31. Read More: Montclair Landlords File Lawsuit Challenging Rent Freeze

Mitch Kahn, speaking on behalf of TOOM, also supported the new version of the law.

"We are grateful for all who maintained their commitment to rent control, tenant protections and economic diversity in Montclair throughout the process and thank Mayor Spiller for lending a big hand to the negotiations," Kahn said.

"The rent control measures we negotiated will protect families, seniors and others from the undue burden of unreasonable rent hikes and will allow many to stay in Montclair and continue to contribute to the richness of our community," Kahn said.

MONTCLAIR RENT CONTROL 2.0

Yacobellis released a statement about the compromise on Wednesday, dubbing it “Rent Control 2.0.”

The councilman wrote:

“After speaking with both parties, I'm excited to share that a compromise has been reached on the substance of a new rent control law and that our law department is preparing a copy of the compromise legislation to share with the Governing Body tomorrow. Further, we will likely pursue scheduling an emergency session of the Council to take action on this new law as soon as is feasible.

“My sincerest thank you to the Tenants Organization of Montclair, Montclair Property Owners Association, faith leaders, community organizations, various external experts and advocates, Township staff and my current colleagues as well as former Governing Body members. I especially want to thank Deputy Mayor Hurlock who joined me on Monday for a critical meeting with leaders of both sides where two of the last major outstanding issues were resolved between parties. I know that the Mayor and many of our other colleagues have spent countless hours on this too and due credit to all.

“Compromise is defined by the Oxford Dictionary as ‘an agreement or a settlement of a dispute that is reached by each side making concessions.’ Having been a participant in and witness to much of the concession making, I know that everyone is walking away from this a little unhappy -- which is my definition of compromise. Thank you to each and every person who has worked to get us something that I think works. Now, let's not ever do this again.

“It has been a two-year saga and I hope a lot of lessons have been learned. Never again should such a consequential law be rushed through in a pandemic and in the middle of a campaign when the issue is also a major campaign issue between the two mayoral candidates. The result of that was a poorly written law that left most renters unprotected and cost us a lot of money and an incalculable amount of time ever since it was enacted and immediately halted by the courts. The heat of politics and political ambition should never drive major policy decisions. Judgement is clouded and it becomes too much about how someone is going to look and who gets credit vs. what the actual substance of the policy is and what it would achieve.

“As a former rent control official for New York State, I know what good and bad rent control policy looks like. One of the most fundamental rules is that if you're going to have rent control, you better have it on as many units as possible or tenants in uncontrolled units will be hit with the associated costs that an owner isn't able to recoup on those few controlled units. That is why since before I was even elected, I was criticizing the previously passed law for leaving most renters out - and - why I've never stopped advocating for rentals in two and three family dwellings to be included. I'm really pleased to share that Montclair Rent Control 2.0 includes rental units in two and three family dwellings so long as the owner doesn't occupy one of the units in that structure. That's a big deal and nearly doubles the amount of renters who will now be covered. This affects thousands of people's ability to afford to stay in Montclair and I would have not accepted this deal without it.

“To be clear, I did not get close to everything I wanted in rent control 2.0. I always thought instead of a fixed annual increase, that instead it should be tied to the Consumer Price Index and set by a Board each year. Then you wouldn't need the Council doing rent freezes because the economic conditions would tell the Board that it had to do 0 or 1% in a tough year. And while I admire doing a special rate of 2.5% for seniors, I worry that without strong oversight or enforcement mechanisms, that it can invite discrimination against seniors. We'll have to watch for that. I also wanted tenants to be able to get a discount on multi-year leases and for families to have succession rights for a rental that may have been in their family for a long time. But again, this is about compromise and all of us being a little unhappy and at the same time, satisfied.

“Rent control is a statement of values for a community. If we are controlling how much rents can increase, regardless of market conditions, you are inevitably pushing the costs that might exceed that 4% into the rest of the marketplace to absorb. But I feel and I think a lot of other people in Montclair feel like we have to take serious action to try to blunt the upward cost trajectory that our rental stock is on, in order to preserve the socioeconomic diversity that made Montclair Montclair in the first place. And I hope we can collectively support this knowing that it will help a lot of people in our town. Like so many other issues, I get the good fortune of being able to help carry the baton across the finish line -- but I say that to remind everyone of the relay that this has been over many years and of all the people who have worked tirelessly to achieve smart rent control in Montclair. This major achievement is their achievement.”

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