Advocates: Some Montclair tenants see higher rent hikes than allowed by new law

Rent control in Montclair went into effect on May 9 — but not all landlords are following the new regulations, and some are notifying tenants of increases larger than those allowed by law, housing advocates say.

The regulations allow a landlord to increase a tenant’s rent one time up to 6%, if the rent hasn’t gone up since May 2020, while a separate, temporary rent freeze remained in effect, and if the tenant is under the age of 65. After that, annual rent increases are limited to 4%, and 2.5 for seniors. 

Pam Holland is just one of many who are seeking help with new leases that are reflecting higher increases than the new law allows, according to Housing Committee Chair William Scott.

Holland told the Montclair Township Council on May 17 that she was handed a new lease that raises her rent from $1,400 to $1,550 — almost 11% — and is due June 1. Her landlord is also requiring another $500 as a security deposit, she said. A year and a half ago, during the rent freeze — which the council reauthorized every three months during the pandemic, citing powers under New Jersey’s state of emergency declaration — her landlord raised her rent as well, she said. She paid it, not aware of the freeze, she said.

“My landlord suggested I come to the town to help me find a place to live. Rent control has to be in place for hardworking people who are being thrown out on the street,” Holland said.

Some units are exempt from the law. New Jersey since 2008 has prohibited rent control on large new buildings for 30 years after the date construction is completed or until after an initial mortgage is amortized, whichever comes first. Montclair’s rent control law also exempts two- and three-family owner-occupied properties.

The law also allows landlords exceptions for certain hardships — for instance, when their expenses for a building exceed 65% of the gross income, when they conduct major capital improvements or when they add major additional services.

Holland has lived in a three-family home on Sylvan Place for 19 years, in a property that wouldn’t be exempt under the rule for newer construction. Her building is not owner-occupied, which would let her landlord to raise rents above the limits.  

But a letter from her landlord, she told the council, states he can raise the rent due to “hardship.”

“That’s not the way it works. He can’t determine this on his own,” Councilman Bob Russo told her. 

A rent control board, which has yet to be set up, would hear and decide any hardship cases, under Montclair’s rent control ordinance.

Members of the council and officials then referred her to the Tenants Organization of Montclair advocacy group, legal aid services, the Montclair Neighborhood Corporation and the Department of Community Affairs. Township Manager Tim Stafford suggested she file a complaint with the county in Essex County civil court, which hears landlord-tenant complaints.
The court would also be the next authority for any appeal of the rent control boards’ decisions. 

Councilwoman Lori Price Abrams suggested the Landlord/Tenant Housing Committee, which for years helped parties negotiate rental complaints, but which became basically defunct after members were told by then-township attorney Ira Karasick to stop holding hearings and to only advise tenants of their rights.

Although the law went into effect May 9, its rollout has been slower than some tenants and housing advocates had hoped. Information that the ordinance was in effect is posted on the township website, but misinformation originally there led to confusion. It originally didn’t include the 6% one-time increase, and originally incorrectly stated rents could be raised 10% after a vacancy; the law sets no limits on increases after vacancy, but only allows such increases once every five years. That information was removed on May 18 and replaced with a link to the ordinance and a list of frequently asked questions on the law, with the correct information.  

Assistant manager Brian Scantlebury has been named as interim rent control officer to ensure the law is being followed and that landlords register their units with the township. On May 19, a landlord registration form went up on the township website. 

Mayor Sean Spiller hasn’t returned a May 12 email asking when appointments to the yet-to-be-formed rent control board would be made. The township sent out an email blast on May 18 seeking applications from residents wanting to serve. A tenant complaint form has not yet been uploaded to the township website, but tenants can email the rent control office at RentControl@montclalirnjusa.org or call 973-509-4956.

Scantlebury hasn’t yet returned an email sent May 18 asking why Holland was referred outside the township.

Toni Martin, first vice chair of the Tenants Organization of Montclair, opined that township officials referred Holland to outside sources because the rent control rollout is taking some time. “The officials were relying on what they already know is available,” she said.

“It's a complex ordinance, and the market forces continue to roar. But it was not precisely confidence-boosting to hear them point elsewhere, instead of immediately looking to use the ordinance, when presented with a pretty desperate situation, and clear violation of the freeze,” Martin said.

Scott said that now that the rent increase freeze has been lifted and permanent rent stabilization is in effect, the process must be “very clear and transparent so that landlords know we are going to implement this ordinance.” 

“Tenants are receiving rent increases on misinformation. Tenants are receiving unconscionable rent increases. I believe an implementation process has to begin immediately. First, it’s the registration process that brings this ordinance into implementation,” Scott said. 

Deirdre Malloy, who for years chaired the Landlord/Tenant Housing Committee, said since May 9 she has received more than 20 calls and nearly as many emails from tenants with complaints of rising rents. She said that while some landlords may understand the new increase limits, they don’t understand that increases can only occur when leases are up. Some don’t understand that the increases allowed now are relative to the base rent that was being collected as of May 2020. That base rent is put on file through the registration process.

“Several property managers are poised to raise rents June 1. One landlord was set to raise rents across all of their tenants by 6% for people under 65 and by 2.5% for seniors. However they were informed that they should not raise rents on tenants until their lease is expired and set to renew,” Malloy said.

Educating landlords about the new law and the registration process is crucial to alleviating any confusion, Malloy said. 

She said that the township “is diligently working to get things in order.”  

Township Communications Director Katya Wowk said she did not yet know how the township would notify landlords that they are required to register and of the new limits on rent increases.