‘Reason for hope’ as landlords, Montclair negotiate to avoid rent control referendum
By LOUIS C. HOCHMAN and JAIMIE JULIA WINTERS
Montclair officials, housing advocates and landlords continue to negotiate, hoping to head off a referendum over the township's long-disputed rent control ordinance.
"From what I hear, things seem to be going OK and there is reason for hope," Ron Simoncini, executive director of the Montclair Property Owners Association, told Montclair Local by email this week.
In play are two related issues. One is the ordinance itself — which would limit annual rent increases at many properties to 4.25%, and to 2.5% for seniors. It was first passed in April of last year, but never put into effect because of an ongoing legal dispute.
A group of landlords conducted an electronic petition to force the matter to a referendum (allowed because the coronavirus pandemic interfered with door-to-door petitioning), and in late November an appellate court ruled Montclair’s clerk acted “arbitrarily and capriciously” when she rejected their petition over signatures she found didn't match handwritten ones in voter rolls. Without a compromise agreement, that decision would make a referendum likely, but first the matter has been sent back to Essex County Superior Court Judge Jeffrey Beacham’s courtroom for an evidentiary hearing. The landlords are also asking Beacham to award them legal fees.
No representative of the township called in for a Dec. 20 hearing, held over a conference call. An attorney for the landlords suggested to Beacham there may have been an oversight after the recent and sudden retirement of Township Attorney Ira Karasick (which occurred the same day he apologized for a racially insensitive comment to a housing official). They agreed to reschedule the matter after getting in touch with the township.
Also at issue is the property owners' association's threat to sue over Montclair's ongoing rent freeze. Unlike the ordinance, the freeze is meant as a temporary measure in the pandemic, and must be reauthorized every three months. The Township Council recently extended it for the seventh time, through March, though some members expressed reservations about doing so. One member, Peter Yacobellis, voted against it. So far, no suit over the freeze has been filed.
"My hope is that there is a comprehensive solution that will emerge from these discussions," Simoncini said. "But it is a binary thing. If we don’t settle the whole thing there will be a referendum and more litigation."
He said the new hearing hadn't yet been rescheduled. Both he and Mayor Sean Spiller said the parties were reaching out to each other on the matter.
Earlier this month, two landlords, Montclair Housing Commission co-chairs Deirdre Malloy and William Scott, tenant advocate Mitch Kahn and Spiller met on the issue. The mayor's most recent message to Montclair Local didn't specify the exact lineup of ongoing talks, but he said they included "those who represent the landlords that took legal action and advocates for rent control." Simoncini has said he wasn't directly involved in the talks, but landlords from the committee that petitioned for the referendum were.
"I think the conversations have been productive and I continue to participate with the continued goal of implementing measures that maintain the affordability, and thereby the socioeconomic diversity of our township," Spiller said.
Simoncini said he was aware of discussions involving "multiple parties."
"It seems nearly everyone in Montclair has their own version of what has happened, what is happening and what should happen, and they are all at variance," he wrote by email. "The mechanics of the petition’s evidentiary hearing, its likely certification, its subjectivity to council activity that could include withdrawing or amending the current ordinance, the lawsuit over repayment of our legal fees by Montclair as a result of civil rights violations, the political environment in Montclair surrounding referendum, and the complications that arise as a result of possible litigation around the rent freeze are just a few of the variables influencing discussions."
Spiller told Montclair Local if there were "any significant next steps, I will be sure to let you know." His message, like another sent to Montclair Local earlier this month, didn't say what was discussed at any meetings that have taken place so far.
While the possibility of a referendum looms, there are other potential paths ahead.
The township could repeal its ordinance, rendering the matter moot. Then, no referendum would take place, and no rent-control measure would go into effect.
The township could pass an amended ordinance, after coming to an agreement with landlords over its terms. The Montclair Property Owners Association has long contended it doesn't oppose rent control in principle, but objects to provisions such as a 10% limit on a rent increase after a tenant moves out.
The appellate court had said the township clerk was wrong to toss out electronic signatures without first contacting the people they represented, to check if the signatures were in fact theirs. It upheld an earlier ruling of Beacham's to the same effect, and instructed him to apply its findings. If the next hearing before Beacham results in the petition being certified, Montclair will have 40 to 70 days to hold a special election. Then, voters would decide if Montclair's rent control ordinance should become law.
Councilman Bob Russo wasn’t in on the talks earlier this month, but he said he’d urged all the parties to compromise “after talking to Steven Plofker [one member of the committee of petitioners] and small landlord Matt Horrigan, and three tenant leaders.” He said a compromise could help avoid “the cost and division of a referendum and give everyone a win/win.”
Russo voted for the rent freeze extension, but said Montclair needs to end it, and “implement fair and reasonable rent control and preserve Montclair's affordability and diversity.”
Yacobellis, a former New York City rent control/stabilization officer, sent constituents an email on Dec. 16 describing his own position on rent control — seeking several changes from the version of the ordinance that’s long been tied up in the court fight. He also hadn't been in on the talks earlier this month.
As written, the rent control ordinance only applies to properties with four or more units, and those constructed before 2008. Yacobellis said the “vast majority” of rental units in Montclair would not be covered under the current law — and that landlords who own some rent-controlled properties and some non-controlled properties would be under pressure to make their profits on the latter.
"If you're going to have rent control with the intention of preventing egregious rent increases, then have it on all units that we're able to apply it to (state law exempts new construction)," he wrote.
Yacobellis would like caps on rent increases to be variable and set by a rent leveling board, instead of fixed. And he said the 10% limit on rent increases after vacancies “can and must be fixed to be more realistic.” He also suggests discounts for renters who sign multi-year leases, and succession rights for children.
In a brief to Beacham before the Dec. 20 hearing, Charles Gormally, who both represents the Montclair Property Owners Association and the specific committee of petitioners, wrote that if the township continues to argue signatures should be rejected, he'll get direct certifications or testimony from signers that the signatures are indeed theirs.
“Given the preference to avoid disenfranchisement of the signers in exercising this constitutional right, we believe that the outcome of this evidentiary hearing will not change the result already found by this court — to wit, that the petition should be deemed certified and then directed to the governing body for their consideration,” Gormally wrote.
He also told the court that after the appellate decision was handed down, he requested that the township consider abandoning its position that the clerk acted properly in rejecting signatures.
“We hope that the township seriously considers this request to conserve both judicial resources and the attorney fees that will form the basis of our fee application to the court at the matter’s conclusion,” Gormally wrote.