Fifth defeat of a tenant initiative relating to rents.

Will they ever stop trying?

 

Click here to read revised “voluntary collective bargaining” proposal.

Click here to read original “compulsory collective bargaining” proposal.

Last updated October 31, 2007

In an 8-to5-vote on August 8, the Boston City Council defeated a landlord-tenant collective bargaining proposal that was drafted by a Harvard professor and tenant organizers at tax- and charity-funded City Life/Vida Urbana in Jamaica Plain, a radical tenant organizing group. Councilors Sam Yoon and Felix Arroyo sponsored the legislation.
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This was the fifth effort over the past six years to try to bring some form of rent control back to Boston, each one defeated by an 8-to-5 vote of the Council. One wonders if tenant advocates will try again. We suspect so.

During the debate leading up to the vote, SPOA emphasized that even the allegedly “modest” collective bargaining proposal that was produced in the end – requiring owners to meet with tenants twice a year for up to six hours each meeting, with no further requirements – was a major step towards full-blown compulsory collective bargaining, which would amount to rent control in the end.

This argument, which finally prevailed, was made to some 26,000 Boston property owners in mass mailings sent out by SPOA-ACT, the lobbying arm of SPOA. These owners flooded City Councilors’ offices with phone calls, email messages and letters. One councilor said the feedback from constituents was 90% against the collective bargaining proposal.

Here below is our statement of what’s wrong

with collective bargaining.

 

SUMMARY of IMPACTS on property owners

In general, the bottom line for all Boston property owners is either you will have less control of your property, especially in setting rents, OR you will have higher property taxes to offset the devaluation of rent-controlled properties.

SPECIFIC IMPACTS:

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Controlled owners: Below-market rents; no money for repairs; devalued properties; hard-to-evict tenants
Non-controlled owners: Higher property taxes to offset devaluation of controlled properties
The city’s tax base: Will steadily shrink as the number of controlled properties steadily expands.

ADDITIONAL IMPACTS in the special case of CONDO OWNERS:

The rent-controlled condos will affect owner-occupied condos as well as the condo association as a whole. Rent-controlled condos will be starved for cash. These units will deteriorate over time. Their owners will be forced to resist all special assessments for common-area improvements, leading to physical decline of the whole building. Troublesome rent-controlled tenants will be hard to evict, further eroding the quality of condo life. The problems for condo managers will escalate, pushing up their fees.

Advocates’ goal is rent control

The advocates proposing this almost-voluntary “collective bargaining” say it’s not rent control. But they are the same advocates who have tried and failed to bring rent control back to Boston over and over again in recent years. We know their goal is rent control.
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This proposal goes a long way toward their goal. It sets up a city bureaucracy. The city itself gets involved in organizing tenants and supervising meetings. These meetings, up to six hours long, are compulsory for landlords, backed by the denial of building permits and the threat of rent strikes as punishment. Just to avoid these meetings, landlords will think twice about raising rents.

As now drafted, this proposal puts intense psychological pressure on landlords to keep rents low. But let’s be very clear, this present proposal has the full bureaucratic and punishment structure of rent control and lacks only further landlord obligations. It can be easily turned into the complete compulsory “collective bargaining” system that these same advocates proposed just months ago. Moreover, the present proposal gives advocates critical help from the city in organizing tenants. Tenants are already free to organize spontaneously in response to a negligent landlord. This proposal injects new organizing power that will be used at the City Council to turn this proposal into the compulsory system that advocates want.

Compulsory “collective bargaining” IS rent control

Compulsory “collective bargaining” is tenants organized into groups assisted by the city to push their landlords into long-term contracts for below-market rents with the ultimate threat of rent strikes and severe penalties.
Affected landlords must meet with tenant groups and must bargain collectively “in good faith” about every rent increase. If they must bargain, that means they must be willing to lower their rents – the only question is by how much. That’s rent control.

If agreement can’t be reached, a third party finally decides the outcome of this time-consuming, compulsory collective bargaining. Who could that be? The city of Boston’s Rental Housing Resource Center, Boston’s former rent control board, now returning to its original function. There’s no way this will not be rent control!

Rent control will affect YOU – lower rents or higher taxes

If compulsory collective bargaining controls you directly, it will mean lower rents, no money for repairs or improvements, hard-to-evict tenants, and your property generally devalued. If it does not control you directly, then it will push DOWN the property values of those it does control and push UP your property taxes. If “collective bargaining” does not control you now, it may well control you in the future – because historically rent control always expands.

Lowering property values in Boston

The passage of “voluntary collective bargaining” alone will push for lower rents and start the process of devaluation. When voluntary collective bargaining becomes compulsory and tenants negotiate for still lower rents, property values will drop more and more. As the collective bargaining process spreads to more buildings and to smaller owners, ever larger segments of Boston’s rental housing market will be devalued. As buildings are deprived of money needed to fix them up, they will start falling apart and lose more value. Whole neighborhoods will be hurt by these deteriorating properties sitting in them.

Shifting the tax burden to non-controlled owners

When growing numbers of properties are devalued, the tax revenue they produce falls and Boston’s property tax base shrinks. Then the property tax burden will shift to owners of non-controlled properties. Their property taxes will rise to make up for the lost revenue!

There is no magical way to create lower rents without having an impact somewhere else. In the end, everyone pays for rent control.

Click here to read the revised “voluntary collective bargaining” proposal and the original compulsory “collective bargaining” proposal.