By JOSEPH DE LA CRUZ
What prevents a landlord from cheating to charge higher rent on what are otherwise supposed to be price stabilized apartments?
The answer? Housing advocacy groups and class actions.
At least that’s how some have dealt with homeowners who have illegally used what is known as the J-51 tax breaks in the Bronx over the past few years.
J-51 was designed to incent homeowners to make repairs or conversions of their individual units to multi-family apartments in return for city tax savings each year – reductions that can last for up to two decades. The program dates back to 1955 and has been widely cited as the driving force behind the decline in single bedroom occupancy units.
In addition to the reduction benefits, landlords can also increase the rent, as long as the increase is proportional to the physical improvements made to the apartment. However, tenants often find themselves paying rent well in excess of what the law allows.
It’s a rebate that landlords take all too often, according to some housing advocates, but even bringing one super culprit to justice might not be enough to solve the problem for the rest of an apartment building raising rent in the city. part of the J-51 program.
In fact, housing experts like Aaron Carr believe more can be done.
“At the end of the day, there is not much we can do to combat this problem. Said Carr, executive director of Housing Rights Initiative. “We need government intervention.
Carr’s group has succeeded in attacking landlords who use the abatement as a way to cheat tenants – by raising rents much higher than what they are legally allowed to do. Still, Carr believes her group’s lawsuits have become nothing more than a cost of doing business for these owners.
“We have found that a large percentage of owners who own J-51 buildings have re-stabilized their previously deregulated units in response to the dozens of J-51 class actions our organization has generated,” he said. “This is a great achievement as our # 1 priority, above all else, is to put illegally deregulated apartments back into rent stabilization roles. However, despite these gains, the majority of landlords have not returned the money they illegally stole from their tenants.
Still, the bigger the offense, Carr said, the better the results. Still, while the number is powerful, he stressed that this shouldn’t be the answer to dealing with homeowners who abuse the program.
“This is why we are leading these collective actions in large numbers,” Carr said. “But at the end of the day, what we really need is proactive government enforcement.”
Four years ago, Christopher Ford and dozens of his neighbors sued their owner, Parkoff Operating Corp., in court. They claimed that Parkoff forced them all to overpay rent at 500 W. 235th St. – which many of them didn’t even realize until years later.
Ford continued to pay that higher rent for almost, only starting to question it when he found out how much the tenant who lived in his apartment before was paying him.
Ford said The Riverdale press in 2017, its starting rent was $ 1,490, more than double what its predecessor was paying in the weeks before Ford moved in. The owner allegedly justified the increase with the J-51 tax abatement, citing $ 26,000 in repairs to the apartment.
The problem? Ford claims it has never seen any major repairs. Especially one that costs thousands of dollars. And it came from a building which, just weeks before the trial, suffered months without gas.
Parkoff was also targeted by the Housing Rights Initiative – a Manhattan-based advocacy group – for failing to meet the thresholds for the tax break he enjoyed financially with several of his other buildings.
According to its lawsuit, Housing Rights claimed that Parkoff is still increasing renters’ rent without properly demonstrating that he has completed the renovations he claims to have done in each unit.
Yet Parkoff is not the only owner to be sued for alleged abuse of the J-51 program. In August, tenants in six buildings in Highbridge called on their landlord, Emerald Equity Group, to stop trying to deregulate more than 200 existing rent-stabilized apartments, according to reports.
More so, many of those same tenants turned to landlord Isaac Kassirer – owner of Emerald Equities – to fix some of the terrible conditions many apartments were experiencing.
As in the Parkoff case, Emerald’s tenants were organized by an advocacy group known as Community Action for Safe Apartments, but represented by Bronx Legal Services.
It’s a practice that Carr says will do justice to every tenant, even those who are afraid to report their landlords for fear of reprisal.
“Our nonprofit is treating these cases as class actions to create the greatest deterrent effect,” Carr said. “The advantage of a class action lawsuit is that it not only benefits the group representatives who lead the lawsuits, it benefits every current tenant and former tenant who has been overbilled in a given building – as long as their claims are in. the limitation period. “
Government agencies are guilty of these practices because of their inability to perform due diligence, Carr said.
“By law, landlords are required to register their rents with the housing law enforcement agency,” he said.
“One of the biggest problems with our system is that the law enforcement agency doesn’t actually review the data owners record with them. So the vast majority of tenants don’t even know they are victims of fraud, and our system places the onus on them to find out for themselves.
If things are really going to change, Carr stressed that the government will need to get involved and follow up with landlords rather than leaving it at the feet of tenants.
“In reality, most renters don’t have the time to do this because they’re busy trying to do things like put food on the table,” Car said. “That’s why we need to overhaul our enforcement system and put the enforcement burden where it belongs: on government. “