BY JAIMIE JULIA WINTERS
Negotiations between a group of tenant advocates and landlords seeking to avert a referendum on a Montclair rent control ordinance have reached an impasse.
The breakdown in negotiations between the Montclair Committee of Petitioners on Rent Control and the Tenants Organization of Montclair also comes just a month and half before Montclair’s rent increase moratorium is set to expire on March 31. That moratorium is a separate measure from the disputed rent control ordinance — authorized under the ongoing pandemic state of emergency, but dependent on renewal by the Township Council every three months.
On Thursday, Feb. 10, the petitioners were advised by the tenant committee that it would withdraw from efforts to reach a compromise, according to a statement sent to Montclair Local by the Montclair Property Owners Association, a landlords group that has been at the center of the legal battle over rent control in the township.
Members of the Montclair Property Owners Association (landlords Steven Plofker and David Genova) have been meeting with tenant advocates Mitch Kahn and Joan Pransky on behalf of Tenants Organization of Montclair to attempt to amend a rent control ordinance that the Township Council passed in April 2020, but that has never gone into effect.
Kahn, who has negotiated hundreds of local rent control ordinances, contends that the negotiations so far had led to terms that offered Montclair landlords the “most generous rent stabilization in any town in New Jersey.”
“We were willing to make considerable concessions, but what they wanted would create an unenforceable rent control. … If they walk away from this, they have to be misguided,” Kahn said.
The ordinance passed by the council in 2020 — and still potentially headed to a referendum — would limit annual rent increases to 4.25%, and to 2.5% for seniors, on multifamily properties with four or more units, except in cases where rent control is prohibited by federal or state law. It would also limit rent increases after vacancies to 10%, which has been a sticking point for some landlords.
The law was originally expected to take effect 20 days after the council approved it, but was paused when a group of landlords conducted an electronic petition to force the matter to a referendum. After the township clerk rejected their petition over signatures she found didn’t match handwritten ones in voter rolls, the petitioners sued the township. Essex County Superior Court Judge Jefferey Beacham eventually ruled that the clerk had acted “arbitrarily and capriciously” and ordered the clerk to certify the petition. The township appealed Beacham’s decision and lost.
The case was sent back to Beacham’s courtroom for an evidentiary hearing on Dec. 20, but the township failed to appear.
Another hearing was postponed while the tenants and the landlords attempted to reach an agreement on an amended ordinance. Without a compromise agreement, that decision would make a referendum likely.
“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,” Ron Simoncini, executive director of the Montclair Property Owners Association, said.
According to both Simoncini and Kahn, the parties had made some headway. Kahn did not want to elaborate, saying that it was inappropriate to discuss the specifics of the negotiations, and didn’t want to further negotiate through the press.
But Simoncini said the parties had agreed upon a lower maximum increase of 4%. Instead of rent control applying only to apartments with four or more units, two and three family units would be included. They also agreed to nixing the overall 10% rent increase limit on apartments vacated by tenants — and to instead would allow increases after vacancies with no limits, but no more often than once every five years.
The sticking points were over three other items the tenants advocates wanted, Simoncini said. The tenants group attempted to set a 2.5% rent increase limit for seniors, make the ordinance retroactive to April 2020, and require landlords to release private information on tenants as part of the landlords’ registration process with the town. he said.
“All of these are unconstitutional,” Simoncini said.”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.”
He said that a discount for any group is price discrimination and illegal. The landlords also argued strongly against releasing any personal information about their tenants and questioned the legality of such a requirement.
On its landlord registration form, East Orange, asks for each tenant’s name and whether they are disabled or seniors. Annual rent increases are also limited to 2% for seniors.
Simoncini said that making the rent control retroactive could also lead to legal problems.
Although Montclair’s separate rent increase moratorium — in effect since May of 2020 and set to expire March 31 unless the council renews it once again (and several members have expressed strong reluctance to do so) — some landlords did send out rent increase notifications as leases expired during the pandemic.
“Landlords couldn’t collect the increase in rent, but could notice the tenant of a rent increase and by how much increase once the rent freeze is over,” Simoncini said.
Tenants who received notices would see their rents increased once the moratorium expires, but those increases wouldn’t be retroactive.
Mayor Sean Spiller has not yet returned an email sent on Thursday, Feb. 10 from Montclair Local, asking about the status of the negotiations and what moves, if any, the council will make.
But Simoncini said the committee of petitioners remains hopeful that the council will evaluate the proposed compromise from the committee, despite the withdrawal of tenants from the bargaining table.
“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,” Simoncini said.
Councilman Peter Yacabellis, before leaving for a vacation out of the country last week, sent Montclair Local a message saying that an impasse should occur, it would make sense “for the council to now take this across the finish line.”
“So at this point I would like to see the council take this back over and resolve some of these outstanding issues, redevelop the ordinance to incorporate compromise solutions, finalize some of these remaining outstanding pieces and avoid any further costly and divisive battles on this,” Yacobellis said.
In December, after the Township Council authorized the moratorium for a seventh time, the Montclair Property Owners Association’s attorney notified the township of the group’s intention to sue.
Kahn said come April, when the rent freeze increase expires, and without rent control in place, many tenants will be facing “unconscionable” rent increases.
Past rent stabilization referendums in 1979 and 1986 both failed in Montclair.
“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,” Simoncini said. “We are trying to do the right thing here.”
When the township and the landlords head back to court, the landlords will also ask Beacham to award them legal fees. The group of petitioners’ attorney, Charles Gormally, has said he believes they’ll win that request, alleging the township committed a violation of the New Jersey Civil Rights Act in refusing to certify the petition.