Montclair Rent Control: Talks Between Landlords, Tenants Break Down

MONTCLAIR, NJ — Both sides agree on one thing: they tried to reach a compromise on rent control in Montclair … and failed.

Negotiations between groups of landlords and tenants over Montclair’s controversial rent control law recently came to a standstill, with both claiming the other is the source of the problem. The continued deadlock makes it much more likely that the law will be put to the test in a local referendum this year.

The Montclair Township Council passed its rent control law in April 2020. It limits annual rent increases in the township to 2.5 percent for seniors and 4.25 percent for other tenants, with some exceptions. A court battle has kept the ordinance from going into effect, however. Read the ordinance here.

Meanwhile, a separate “rent freeze” in Montclair will last until at least March 31. Read More: Montclair Council Extends COVID Rent Freeze, But Concerns Linger

Some Montclair residents – including the Tenants Organization of Montclair (TOOM) – have claimed the rent control ordinance is a long overdue victory for people who are at the mercy of landlords seeking to raise their rents.

But critics such as the Montclair Property Owners Association (MPOA), have argued the law was pushed through during the coronavirus crisis and will impact property taxes paid by single-family homeowners.

Both sides have been trying to come to an agreement in an effort to avoid an election day showdown. However, those talks apparently went off the rails last week. And if a compromise isn’t reached, it will likely be up to voters to decide on the future of rent control in Montclair.

Mayor Sean Spiller addressed the ongoing legal battle at the town council meeting on Feb. 15, noting that the rent control law will likely be decided by voters (watch the video below).

Here’s the latest from the MPOA and TOOM.

• Read More: Montclair Rent Control Law Likely Headed To Voters In 2022

LANDLORDS: ‘WE’RE TRYING TO DO THE RIGHT THING’

The MPOA, a group of landlords opposed to the rent control law, released a statement about negotiations on Feb. 10, with spokespeople claiming that they are “trying to do the right thing.”

Read more about the group’s position on the law here.

Their statement reads:

“The Montclair Committee of Petitioners on Rent Control was advised by the Tenant Organization of Montclair that it would withdraw from efforts to reach a compromise to avert a referendum vote on a rent control ordinance that has never taken effect in Montclair. The Committee and the Tenants had previously been working on a compromise that would also enable the Township to end litigation over the matter and save the Township from its potential liability for hundreds of thousands of dollars in attorney fees due to the Township’s refusal to certify the Committee’s petition. Recently the appellate court ruled that the Township was arbitrary and capricious in not certifying the Committee’s ballot question which seeks to repeal the entirety of the ordinance.

“The formation and actions of the Committee of Petitions is protected by state law that ensures that citizens can seek the repeal of government action that the majority of the residents oppose. When the Township adopted a rent control scheme literally on the eve of the declaration of a state of emergency due to COVID-19, the Committee, comprised of large and small landlords, tenants and homeowners, formed and secured thousands of signatures to its repeal petition as required by law. The Township Clerk repeatedly refused to acknowledge the validity of the Committee’s efforts and rejected the petition causing the matter to be the subject of costly and time-consuming litigation.

“Nevertheless, the Committee always insisted that simple amendments to the rent control ordinance would be considered by them as a compromise which would allow the Committee to withdraw the Referendum and accept an Ordinance that protects tenants while being fair to landlords and property owners. We remain hopeful that the Township Council will evaluate the proposed compromise from the Committee despite the withdrawal of tenants from the bargaining table since it is in the best interest of the Township. Doing so will not only result in reasonable rent control in Montclair, and in the withdrawal of the Referendum, but settlement of legal issues associated with the Rent Freeze, which was acknowledged by Councilors to be retribution for property owners expressing opposition. The tenants’ insistence on including unconstitutional provisions in the ordinance is flawed both legally and practically and would create disharmony between landlords who provide safe and affordable housing, and the tenants who reside in the Township. In addition, the tenants’ insistence to force the issue to the ballot will likely result in the resounding elimination of all rent control in the same way two previous Township votes rejected rent control and likely result in the Township being exposed to a claim that it owes the Committee reimbursement of its attorney fees.

“We are trying to do the right thing here.”

TENANTS: ‘THE CLOCK MUST START’

Housing advocates in Montclair, including TOOM, sent a memo to the mayor and town council on Feb. 12, explaining their decision to withdraw from the negotiations.

It reads:

“For the past two months the Montclair NAACP, the Montclair Housing Commission, the Landlord-Tenant Advisory Committee, and the Tenants Organization of Montclair (TOOM) have been negotiating with the Montclair Property Owners Association (MPOA) in an effort to craft mutually acceptable changes to Montclair’s Rent Control Ordinance, passed by the Council in April 2020. Our shared, stated objective was to come up with a compromise that would avoid a costly and divisive referendum battle, predicated on MPOA not pursuing legal fees or filing additional litigation, such as their threat to challenge the rent freeze.

“It was and continues to be our view that the Township Council is best served either by introducing a new Rent Control Ordinance, negotiated and agreed to by the above stakeholders, or by submitting the Township’s already enacted reasonable Rent Control Ordinance to the voters of Montclair. Anything else would simply return the Township to another contentious community battle.

“To that end, the tenant/housing advocates have negotiated in good faith. Over the course of the negotiations, we made major concessions to the MPOA. In fact, MPOA’s publicly stated key opposition to the Township’s Rent Control Ordinance was the inclusion of a 10% limit on vacancy decontrol. Reluctantly, but in an effort to meet its objection and move forward, we accepted unlimited vacancy decontrol every five years. As soon as we agreed, MPOA demanded more. We continued to give more, including acceptance of a change to the definition of substantial compliance, the elimination of tax appeal refunds, the adjustment of the hardship formula, and more.

“We made these concessions in exchange for an expansion of the number of units covered, to which they agreed, and for meaningful enforcement mechanisms, to which they would not agree. Still, we continued, accepting MPOA’s demands for provisions that permitted them to provide their own certifications that tenants voluntarily vacated units without any tenant confirmation as well as their own certifications of substantial compliance, allowed them to cure their violations of the vacancy decontrol and registration requirements without consequence, and more.

“We have again reviewed the Rent Control Ordinance passed by the Council. It is far more restrictive than the one we substantially negotiated with MPOA. The benefits MPOA would gain under the proposed Ordinance make it one of the most liberal for landlords that exists in New Jersey.

“Still, MPOA continues to make demands, with veiled threats of legal challenges if they don’t get what they want, all in the name of ‘negotiating.’ It has done everything to prevent a Rent Control Ordinance in Montclair and has succeeded for almost two years. It is time for the Council to act.

“We urge the Council to move the referendum process now. To do so, the Municipal Attorney should direct the Township Clerk to certify MPOA's Petition in time for the Feb.15 Mayor and Council meeting. Upon receipt, the Council should immediately pass a resolution accepting the petition, voting not to repeal the existing Township Ordinance, and directing the Clerk to submit the referendum petition to the voters in accord with law.

“In accord with the referendum statute, upon certification of the petition and action by the Council, the MPOA will have 10 days to withdraw their petition and come to an agreement or the Township Ordinance will go to the voters. The clock must start.

“In addition, the Township Council must make clear that unless the stakeholders can reach agreement on a mutually acceptable Rent Control Ordinance, the Township’s enacted Ordinance will go to the voters of Montclair.

“Finally, the rent freeze is due to expire on March 31. Tenants are already facing unconscionable rent increases and this will likely intensify in the coming weeks. The Township must introduce a new Rent Freeze Ordinance to ensure that its tenants are not confronted with an onslaught of unreasonable rent increases before a Rent Control Ordinance is finally put in place.”

Spokespeople with TOOM said they “stand staunchly” behind Mitch Kahn, their lead negotiator in the recent talks.

TOOM advocate Toni Martin said a provision in the ordinance that the MPOA is now claiming is “unconstitutional” provides a 2.5 percent cap on annual rental increases for seniors 65 and older, with a 4 percent cap for others.

“Tere are at least half dozen towns in New Jersey operating with special rates for seniors, and other states where that is being done,” Martin said. “I suppose the landlords could use their continuing legal muscle to fight this all the way to some high court in an attempt to deprive seniors of a little extra protection. Is that really what they want to be doing with their money?”

Seniors aren’t the only ones struggling to pay their rent, according to TOOM president and founder, AhavaFelicidad.

AhavaFelicidad cited the case of a woman residing on Francis Place in a three-bedroom apartment, who had been paying monthly rent of $2,550. When the building changed hands last summer, the new owner claimed her apartment actually had four bedrooms (counting a closet as one of them), and raised the rent to $3,900 – a 56 percent increase.

The tenant contacted TOOM, was advised of her rights and the terms of the freeze, and the matter was resolved, AhavaFelicidad said.

Councilman Robert Russo, a former state Consumer Affairs Department official, said he knows about other such cases occurring in Montclair.

“People come into town, buy a piece of property, try to jack up the rent by $1,000 [to] $1,500 dollars,” Russo said. “It’s fraud, misrepresentation, lack of consumer disclosure. This is what’s happening to a lot of tenants.”

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