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A practice among rent-controlled buildings that leaves many tenants bewildered when their leases come up for renewal could become harder for landlords to pull off due to new legislation proposed by the D.C. Council today.
Ward 3 Councilmember Mary Cheh introduced a bill that would regulate so-called “rent concessions”: discounts on annual leases that owners offer to tenants before increasing prices by unexpected amounts at the end of the year. As City Paper recently investigated, the practice appears to be widespread across the District’s more than 80,000 rent-controlled units, putting residents in the difficult position of having to reconsider their living situations or pay more than they had predicted when moving into a rent-controlled building. Landlords that adjust monthly payments based on a purported “rent charged” figure that is higher than what a tenant actually pays amounts to false advertising or a bait-and-switch scheme, critics say. Experts say the issue arises from ambiguity in the law.
Under Cheh’s bill—which Councilmembers Anita Bonds and Elissa Silverman co-introduced and which was drafted in consultation with D.C.’s Office of the Tenant Advocate—landlords would be forbidden from stockpiling future rent increases to use as leverage against tenants. It would also narrow the circumstances under which a landlord could legally offer a tenant a discount on a rent-controlled unit, ensuring a lease is signed in good faith.
“Tenants expect, and we believe the law provides, that rent increases are increases on rent actually paid,” Cheh said in a statement to City Paper. “What some landlords have been doing is offering lower rents to lure tenants in, but later charging increases based upon what they say was ‘real rent.’ To me, this is a form of cheating and this bill addresses that.” She added that closing the rent-concession loophole would protect housing affordability.
The legislation also requires landlords to report information about concession agreements to the District’s Rent Administrator, including “the current rent charged for a unit, the temporarily reduced rent, the amount of the rent concession, the date upon which the rent concession expires… and that the rent concession is granted unconditionally.” As of today, some landlords only report higher “rent charged” figures to the city administration—not the real amount a tenant pays out of pocket each month. The bill would make it a “false statement” and “an unlawful demand for rent” under D.C. law if a landlord violates the reporting provisions.
D.C. Council Chairman Phil Mendelson, who co-sponsored the bill, referred it to the Committee on Housing and Community Development for mark-up. Bonds, an at-large member who oversees the committee, also proposed a bill related to rent control today.