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HomeMy WebLinkAboutMN-RHAC-1989-03-13 6;11e4ierift • ECEIVED MAY 19 i g9 March 13, 19R9 DRAFT MINUTES (by SJ) Present: Jackson (Chair) , Killeen (Vice-Chair) , Howard, Lewis, Lytel, MacDougall, McLaughlin, Rector, Weiss; Invited guests (tenants) Jay Janowski and Butch Howard; members of the public and press. Meeting called to order at 7:10 pm. Jackson opened the meeting by reminding Task Force members that the business of the following meeting, on the 27th, would be the introduction of specific proposals or ideas or recommendations and a decision as to which ought to be pursued by the task force through working groups. He invited all members to submit written ideas to him prior to that meeting if possible. Jackson then introduced the topic of the meeting as hearing the tenants' points of view on the rental housing situation, with comments from both invited guests and members of the Task Force. Before that begins, invited Valerie MacDougall to present information on rents in the City. MacDougall then presented information contained in a handout (a copy of which is included with the official record of the meeting) . The information shows the patterns in rents both in downtown and outside the City over the past year, concluding that, for example, downtown, for apartments including utilities, an average studio rent was $306, an average one bedroom rent was $414, an average two bedroom rent was $518, and an average three bedroom rent was $678. Comparing rents in March of 1988 to that of 1989, one bedroom apartments had increased by about 5%, while those for two bedrooms had increased almost 20%. Finally, she showed that a single person earning $6 per hour could not rent an 'average' priced one bedroom apartment in the City without spending 43% of their gross income, or 58% of their take home pay. This is much higher than the Federal guidelines which recommend that people spend no more than 30% of their gross income on housing. MacDougall then switched to discuss the rental housing situation from her personal perspective as a single working person trying to make ends meet in the City. She is fortunate enough to earn $7.50 per hour, working a 40 hour week; she grosses $300 per week, netting $223.47 in take home pay. She pays $430 per month for a one bedroom apartment including utitilities [NOTE from SJ: that is about 33% of her gross income, approximately equal to the Federal guidelines. This is also equal to approximately 44% of her net income. ] After making payments for the loan which she obtained to pay for the security deposit for her apartment, for her telephone hook-up, for a medically required presecription, for her laundry, and including approximately $25 per week for food, she has about $45 per month left over. However, she owes her dentist $480 for work already done (with another $1000 worth of work needed but on hold until it's somehow affordable) , she owes her mother $300 for a personal loan, and she owes another $60 for medical expenses. This leaves her $840 in debts with only $45 per month in 'excess' income, and with no allowance for clothing, shoes, entertainment, gifts, savings, or transportation. Jackson then distributed a sheet containing the results of his own research, similar to bu completely independent of that of MacDougall concerning rents in downtown Ithaca. His results (attached to the official record) are very similar. He shows average rents during the fall of 1988 as being $404 for a one bedroom, $520 for a two bedroom, and $638 for a three bedroom apartment including utilities. In response to a query about the possible biases in the estimates of both Jackson and MacDougall because of their method which relies on those advertisements in the Ithaca Journal which list sufficient information including rents, Jackson responded that the averages are likely to be about right because those apartments with the lowest rents are never advertised; they are rented through word of mouth. On the other hand, the most expensive apartments tend not to list their rents in the ads, hence they too are excluded. Nonetheless, he conceded that these numbers do not constitute a scientific study or random sampling. Jay Janowski says he has been renting all his life in Ithaca. With his wife, he is now buying a house but only under the most stressful circumstances. After five years renting their home at the same location, the landlady came to them last fall and said it would be to their advantage if they no longer were tied to a lease. In December, she came to them again and told them that they would have to be out of their apartment by February 1st. They had two months to find another place to live for themselves and their two children, one of whom was in school. They managed to squeeze an extra couple of months from her, and by saving, borrowing, begging, and stealing, they have managed to put together enough money to buy a house. But, it could have been a disaster: two bedroom apartments downtown (like theirs) run right at the average indicated by MacDougall, and are not easy to find. He concluded that the rental situation for families downtown is becoming desperate. Paula Weiss spoke about the leases to which tenants are subjected. She indicated that at the Univ. of Pennsylvania they had a model lease which had been developed to protect the interests of both landlords and tenants. The lease she signed here seemed to protect only the landlord. For example, it the landlord sues the tenant, the tenant is responsible for legal fees (but not the other way around) . Or, if sewer lines get plugged, it may be the tenants' responsibility. She indicated the importance of some neutral body developing a lease that was mutually protective. MacDougall suggested that while leases are contracts, they don't seem to have any benefits for tenants, only burdens. Larry Beck said that Cooperative Extension's publication, "Rent Smart, " had a lot of useful information, but that it was important to remember that landlords put all of those provisions in the leases for a reason. Butch Howard indicated that lots of tenants may not understand all the provisions of their leases, while some tenants do take advantage. Chris Anagnost asked angrily why the Task Force was wasting its time discussing leases when the issue before the Task Force was affordability. Besides, he added, 90% of the time, leases don't matter. Ben Nichols responded that Common Council gave a broad mandate to the Task Force, not restricted to affordability, and that the issue being discussed was that of providing a level playing field, for tenants and landlords alike. Weiss indictaed that the issue is made worse because of the emerging monopolies in the control of large numbers of units. Lewis indicated that the story of Janowski shows the connection between leases and affordability. Anagnost said that it is the tenants job to be aware of the real hidden costs in a lease, and to know that they are not bound by illegal clauses. Many of the clauses are now in leases because of the student housing market. Lytel asks which provisions in standard leases are due to student experience of landlords. Howard answers that in more than 600 units, rented to students and non-students alike, they use the same lease. Lytel indicates that the landlord tenant relationship is a power relationship which is unequal . Even with good faith, there is still unequal power. Read it and sign the lease is the standard choice given to a potential tenant. Power is at work in addition to the market pressures of a tight supply. Anagnost retorted that the response is to increase the vacancy rate. John Efroymson asked the landlords how many times a tenant had come in with a lease, and had the landlords sign it. Mark Finkelstein said that it is a power relationship. Given the market today, it is a sellers market. Lease provisions have market value. Changing market conditions will lead to changes in leases. To profoundly change the situation, you have to make more housing available. Butch Howard, coordinator of the homeless shelter at Southside Community Center, seconded Valerie MacDougall's comments about how high rents are compared to the low incomes paid to many working people in Ithaca. What is available in the way of assistance for low income people is too little: in addition to Ithaca Housing Authority units, there are 220 section 8 vouchers for households and 30 apartments restricted to section 8 participants. Section 8 requires people to pay 30% of their gross income for rent and utilities. However, 30% of $3.35 per hour does not pay rent in Ithaca. Many people are taking Section 8 vouchers out to trailer parks outside the City; the problem is that then they have to have cars which also add to their expenses. Many landlords now require 3 months' rent up front; at $4 per hour it is hard to come up with $1500 needed to get into an apartment. In recent months, Howard reminded the Task Force, 80-125 single room occupancies had been lost. This means that at least 80-125 people are out of apartments; in fact, the number is probably much higher, since many people double or triple up in the SROs. Howard noted that a lot of people on the street cannot afford housing, even though they work. People working with Section 8 do not see more housing becoming available through that program. We need in Ithaca a local agency able to provide housing and subsidies for low income people, providing housing which is restricted to low income people, rather than forcing them to compete against higher income tenants. Anagnost noted that on the CBS News the previous evening there had been stories about Catholic Charities in NYC rehabilitating housing and making it available at $30,000 per unit rather than the $90,000 per unit which it would normally cost, and about the Boston Bricklayers Pension Fund creating brick rowhouses at one half the normal price. He also noted that when security deposits are a problem for Department of Social Services clients many landlords accept a letter of security from DSS. Butch Howard noted that many landlords do not accept these letters. Killeen noted that a tenant/landlord relationship is an economic relationship, and that in Ithaca this has been shaped in a paternalistic way. Section 8 is a paternalistic program; student housing is paternalistic; and these tend to influence the general attitude towards housing. Most people signing leases never have before. Perhaps the role of government is to inform and protect people in their role as tenants. Howard asked how there was any relation between security deposits and affordability. Killeen argued that landlords use deposits to make additional profit. McLaughlin argued that the question was not whether there should be security deposits; rather the question was how to make it so more people could afford the deposits and get in to apartments. Killeen noted that Cornell's recently announced increase of 7.2% in rents in university housing for the coming year was likely to serve as a price leader for the private sector. MacDougall noted that between January 1988 and January 1989 rental housing costs went up 13%. Larry Beck suggested that increasing rents are not just the result of speculation increasing land values. Much of the increase is the result of legislation imposing costs: smoke detectors, deadbolt locks, zoning and code compliance, recycling costs (where fines are assessed to landlords) , tax increases, special assessments for College Ave. improvements, utility cost increases all increase the costs of business for landlords. Several people on the Task Force challenged the assumption that these costs accounted for a substantial portion of the costs driving higher rents. MacDougall argued that the issue for tenants is, in part, the quality of the housing they get for their rent. Many tenants feel like they are not getting their money's worth. Many apartments do not have working smoke detectors. Many do not have locks on windows. Many are not in compliance with the Building Code. Many landlords have added provisions to leases passing recycling fines on to tenants. Many apartments suffer from poor insulation, leaky roofs, mildew, missing windows and screens, insufficient heat, old appliances, and insect infestation. Many suffer from lack of maintenance of common areas. The tenant has to comply with the lease regardless of landlord compliance. Tenant has an obligation to pay rent whether all the things which should be received for rent have been done. Butch Howard seconded MacDougall , and asked whether it was because landlords don't care, or because property managers can't keep up with all the demands. Lytel challenges argument of Beck that the way to make housing more affordable is to reduce demands for cleanliness, and safety, and compliance with codes. Beck responds that increased quality produces increased costs. He suggests an analogy to the difference in cost between a Porsche and a Geo. Lytel responds that cars and housing are not the same. Housing is not a case of consumer sovereignty, where lots of people have lots of choices about what kind of car to buy. Rather, it is a situation where all of us have to buy and there is a very limited supply. In the housing market, if you even ask to kick the tires, you'll be told to go elsewhere. McLaughlin protests the atmosphere of confrontation in which tenants' views are not being taken seriously enough and being challenged at every step by the landlords present. She suggests that for the discussion to be productive, it is important to avoid making judgments about whether the complaints of tenants are right or wrong; rather it is important to accept those complaints as true from their perspective. Tenants have had good experiences; but also have had bad ones. It is important that we listen to all of them. Efroymson suggests that the Task Force may wish to pause before suggesting new laws or ordinances and figure out first how to enforce the provisions which already exist. Bill Lower notes that he has owned at one time 50-75 rental units downtown and 100 units on East Hill. Every building on East Hill has been inspected; no house downtown has ever been inspected. Killeen asks if it wouldn't be reasonable to post a certificate of occupancy in the lobby of buildings. Lower and Anagnost indicate it as a good idea. Paula Weiss seeks to summarize the issues raised during the course of the meeting: high rents; lack of model leases; security deposits; shortage of SROs; monopoly of units by property managers; quality of housing; enforcement of housing codes; Cornell influence driving up rents; tenants rights' ; and handicapped accessibility to apartments. MacDougall asks how one is supposed to meet the gap between low incomes and high housing costs. The only options are: work 2 or 3 jobs; work off the books; accept a lower standard of living; live with family or friends; become homeless. Housing problems, she noted, compound other problems that low income people are often dealing with. Meeting adjourned at 9:05pm.