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Renters and tenant advocates got a big, sloppy French kiss this month when the D.C. Council voted unanimously to enact sweeping rent-control reform. But for some, the smooch has been followed by a bite from area landlords who may be seeking inordinate rent increases before the reforms become law.
The York Apartments, a 120-unit building in Foggy Bottom, has long been subject to yearly rent increases, according to tenants. But last month, Bernstein Management, which manages York, upped rents on a number of rent-controlled units only six months after the last hike. “This is an effort to make hay while the sun is shining,” says Laetitia Combrinck, president of the York tenants’ association.
How is this possible?
Under the city’s longstanding rent-control policy, landlords could save allotted increases for a later date, sometimes resulting in disproportionate rent hikes. To ensure more stable rents, the reforms have substituted a use-it-or-lose-it policy for increases, and those can be instituted only annually. Good news for tenants—except the reform legislation won’t go into effect until it’s approved by Congress after its recess, likely sometime in the fall.
In the meantime, Combrinck says, her landlord’s getting while the getting’s good. “[The increases] are obviously in response to the reform legislation,” Combrinck says.
“I’ve lived in this building for 26 years, and this is the first six-month increase I’ve gotten,” says Elizabeth Elliot, a York resident. After receiving a rent increase in November, Elliot received another hike of more than $100 that will become effective in July. Rent on her 600-square-foot, one-bedroom apartment will be almost $1,400. “I think it’s a little much considering that the building is not the easiest place to live,” Elliot says, referring to York’s status as a “de facto [George Washington University] dorm.”
Bernstein Management did not return calls for this article. The Apartment and Office Building Association, a real-estate-management trade group involved in drafting the reform legislation, also declined to comment.
Problems extend beyond tonier units in Northwest. Anecdotal evidence about possible rent-gouging has been trickling into tenant associations and nonprofit legal-service providers from all corners of the city.
“We’ve received an increase in calls from tenants with notices of rent increases they don’t understand,” says Marian Siegel, head of Housing Counseling Services, a District nonprofit that provides tenant advocacy and seeks to prevent homelessness. “[T]herefore we can only assume that the number of notices has increased.”
Jim McGrath, chairman of TENAC, a tenants’ advocacy coalition, sees not only a larger volume of reports but also potentially illegal activity. “We take the position that it is de facto rent gouging,” McGrath says. “On its face, rent gouging is illegal.”
While rent-control reform struggles to escape the District’s bureaucratic maze, residents of Pleasant Park are reaching deeper into their wallets. Tenants in rent-controlled units of this sprawling collection of 60 two-bedroom apartments huddled around the District line near the intersection of East Capitol Street and Southern Avenue NE share some of York renters’ woes.
“My previous increases were not as monumental in jump of price,” says Cheketha Lynch, member of Pleasant Park’s tenant association. Having faced rent increases “between $15 and $25” since 1998, Lynch was hit with a $99 increase this year.
Kevin O’Malley, president of CIH Properties Inc., which manages Pleasant Park, says the rent hikes have less to do with the approaching reforms than with passing on the higher costs of running the property—rising energy costs and property taxes, for example. “It is not prudent to make business decisions on legislation that has not yet passed,” O’Malley says.
“The purpose of rent control is to control rent,” says Eldred Blue, laughing. When he moved into Pleasant Park in 2005, his rent was $718 per month, but in May it was bumped up by 15 percent, to $829. Blue recognizes this is still a good price in a tight rental market, but he’s worried about another $100-plus increase next year. “Whatever procedure they do, I just want to make sure it is legal,” he says.
Ward 1 Councilmember Jim Graham, who sponsored the reform legislation, is considering an emergency bill to prevent rent-gouging but has not decided to take action yet. Graham says he is “looking very seriously” at introducing such a measure at the July 11 council meeting.
Hard data to support additional legislation, though, is scarce. Department of Consumer and Regulatory Affairs (DCRA) spokesperson Karyn-Siobhan Robinson says that her agency’s Office of the Tenant Advocate has experienced “a spike in calls about rent increases,” and confirmed one case where a landlord sought a $1,400 rent increase from a tenant. Still, the state of the DCRA’s records makes determining whether rent-gouging is widespread an almost impossible task.
“The question you are asking could be answered by a formal statistical study that can’t be done,” says Kevin Fitzgerald, a World Bank economist who has tracked the District’s rent trends for Graham’s DCRA committee on behalf of tenant advocates. Fitzgerald’s efforts have been stymied by the lack of a comprehensive list of rent-controlled units in the city. Still, he says, whispers about rent-gouging are likely well-founded. “It is pretty clear from the anecdotal evidence,” he says. “Landlords have had wind that something was changing.” CP
Additional reporting by Ryan Grim