Oral argument was heard last week on the lawsuit filed by landlords of rent stabilized buildings seeking to overturn the rent freeze passed by the Rent Guidelines Board. The Rent Guidelines Board is supposed to operate independently from New York City and New York State but that independence is being questioned in this lawsuit. The rent freeze would go into effect October 1 on an estimated 1 million rent stabilized apartments in New York City. Judge Brendan Lantry did not immediately rule on the matter.
The landlords assert the Rent Guidelines Board manufactured data to support the rent freeze and that the Board was stacked with individuals determined to pass a freeze. The vote in favor of the rent freeze was 7-1. The landlords also claim the Rent Guidelines Board is ignoring increasing operating costs like real estate taxes, fuel and insurance. Operating costs have been increasing every year for New York rent stabilized landlords. The Rent Guidelines Board itself reported a 5.3% increase in expenses this year. The operating costs for New York City rent stabilized landlords rose approximately 31% over the past 5 years.
The City is defending the Rent Guidelines Board decision, maintaining that the rent freeze is justified and that the Rent Guidelines Board properly reached its decision after holding numerous hearings and reviewing supporting data. Should the judge rule to overturn the rent freeze, the City would most likely appeal. After all, numerous leases with no increase in rent have already been signed.
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