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Quick overview of next steps, more at the bottom:
- Sign the petition: Save NYC’s Local Businesses
- Email/call your council member: Fair Rent NYC
- Post about small biz issues using #FairRentNYC #NoSmallBizNoNYC
- Tell your council member to support commercial rent stabilization. Go here for automated emails and scripts.
MEETING MINUTES:
Jenny Dubnau, Artist Studio Affordability Project (ASAP):
ASAP began organizing in Industry City years ago, when artists were being displaced. The group was involved in advocating for the Small Business Job Survival Act (SBJSA), legislation that was first introduced 30 years ago, but it has never passed. It allows tenants to go to mediation and binding arbitration with their landlords to settle disputes, but it costs money to hire lawyers. It can be an isolating experience, you and your landlord are alone trying to settle. It does mandate that if you request a 10 year lease, you get one. For context, NYC had commercial rent control under Mayor Fiorello LaGuardia, but the real estate lobby in the 60’s killed it.The goal of creating Commercial Rent Stabilization is to institute an across the board cap.
- Here is the text of the Small Business Jobs Survival Act.
- Here is the text of City Councilmember Levin’s Commercial Rent Regulation Bill.
Karen Narefsky, United for Small Business NYC (USBnyc), ANHD: Association for Neighborhood and Housing Development:
Right now, big corporate landlords are using this “opportunity” created by the pandemic to acquire real estate and drive out less profitable small businesses. This is an important moment for us to organize. Intro 1796 would create a Rent Guidelines Board similar to the residential one that already exists. There would be penalties for rent overcharges if the landlords do not follow the standards set by this board. Many commercial landlords are also residential landlords and already understand this system, so that is one benefit.
This system would apply to all tenants across the city and would allow for solidarity and public agitation, rather than one-by-one negotiation. There is a question of who is on the board. To improve the bill we could suggest stipulations about this. Right now the way it is drafted, the mayor appoints the board. We could have the city council give approval. We want to avoid having landlord interests on the board. There is also the question of how do we choose what rents to lock in. Right now in the draft bill, there is not a process to modify the initial rents from what they are now. There is also a problem with vacant spaces, right now the landlord gets to decide the rent amount. We would need an appeal process. This bill does not have a mechanism to roll back the rents from their current inflated amount. We also need to consider that enforcement mechanisms must be robust.
Jenny: a rent guidelines board could potentially roll back the rents, right?
Elizabeth: there could be a -% rent change (-1% or -2%) of an affected area if seen as inflated
Karen: USBnyc was successful in 2019 with legislation on protection against landlord harassment. There is also new Covid-related legislation. Unfortunately to benefit from this you must hire a lawyer. Still, legal protections are important.
Olympia Kazi, NYC Artist Coalition:There is also a Right to Counsel bill that has been introduced.
Sebastian: Hello everyone, my name is Sebastian and I am a New York resident, but also a commercial real estate professional. I’m curious what you guys think: what happens when property taxes increase for smaller landlords? How would they address the increase in taxes, if they can’t increase rent for residential or commercial tenants? I agree that corporate landlords need more oversight, but what about what about small time owners, with smaller buildings and lower cash statements?
Emma: Seconding Sebastian’s question.
Olympia: Under the guise of concern about small landlords, REBNY has stopped every piece of legislation. Unfortunately, there are very few small landlords left in NY and commercial tenants have little or no protections. After a business invests in a space, it can be kicked out or have a rent hike. This is why we need to have a hearing for the commercial rent stabilization bill, gather the data. Then we can see how many small landlords are there? I think we can deal with their needs with a rider subsidy or some sort of fund once we put in check the corporations who own 99% of the city.
William: Sebastian, a commercial rent guidelines board would set annual rent increases for landlords. Only a rent freeze would prevent some fairly determined rent increases.
Sebastian: My commercial counterparts aren’t willing to step out of their comfort zone and engage a different view. I think about who defines affordability and what does it mean.
Ryan: I’m here as a commercial tenant more concerned about our vulnerability.
Jenny: Sebastian, the USB petition calls for relief for small landlords as well. But the fact remains that the majority of NYC landlords are NOT small: most own multiple properties and are doing just fine. Interesting study on the “myth” of small landlords: https://medium.com/justfixnyc/examining-the-myth-of-the-mom-and-pop-landlord-6f9f252a09c
Jo: Sebastian we small time tents with no budget are forced into signing on for paying the landlord’s taxes.
Vivian: The SBJSA would eliminate the exploitative tax pass-along. We need both bills.
Heather: Merging the bills would be ideal.
Elizabeth Adams, Legislative Director of City Councilmember Stephen Levin: We worked closely with small businesses and commercial tenant attorneys to draft this bill. We are seeing landlords who are unwilling to negotiate and it is causing businesses to be forced to close. Evictions are still happening illegally despite the moratorium. Having a rent regulated system on the commercial and residential side is so needed. When a lease comes up we are still seeing 500% increases. The bill takes a universal approach, doesn’t target certain types of businesses. Everything below 10,000 square feet for retail, 25,000 for manufacturing space. This was thought to be the best way to cover small businesses. And so that there is not a negative incentive, that would cause landlords to want to rent to a bank branch for instance, this applies to everyone. The rent will be the same no matter the tenant. If we are carving out for different types of businesses, it could create loopholes. We could look at expanding the square footage, considering grocery stores for instance.
Jenny: In my opinion, there shouldn’t be square foot limitations—rent stabilization should apply to ALL commercial leases. To change the market, it needs to be a blanket thing. It is dangerous to exclude businesses based on square footage: large supermarkets? Beloved large music venues? Neighborhood bowling alleys? Any exclusions are an excuse for the landlord lobby to mount lawsuits excluding various sectors from rent protections.
Gabrielle: There was a question about the makeup of the board. How do we hold rent guidelines board accountable?
Elizabeth: It is currently modelled off the residential one. There would be community development members on the board, and small business representatives. We are still thinking about recommendations for how to make it even stronger, we want to have less control from the mayor.
Karen: More council oversight is valuable. The best way is through public engagement, testifying, protesting, collective action. That does not exist currently for small businesses. Having a universal system would cover even tenants who are successful and could pay a higher rent. But overall it keeps affordability. We don’t want to have rules about what types of business they like that could change over time and remove protections.
Sebastian: I think rent stabilization should not apply to something like Citibank
Elizabeth: If we say that we don’t want the benefits to apply to chains, it could have the effect of motivating landlords to rent to those businesses so they could charge higher rents.
Jenny: I think there could be a separate bill limiting chain stores and banks. Another crucial thing is long leases: that should be added.
Olympia: Instead of treating housing and commercial spaces as commodities and make them more expensive, we should directly tax higher income individuals more, redistribute the surplus in the ways our community prioritizes. It is the wild west for commercial tenants. Businesses build a community around them, but you can be thrown out in a minute. Other people can then take advantage of the equity that those people built. In other countries, this is not the case. What we are asking is common sense, we just live in an illogical urban environment. It didn’t work before the pandemic, and now we see it even more. This is a moment of crisis. The Mayor and the Governor have been cutting the budget for social services and things like public schools instead of investing in relief and creating much needed revenue streams. We need to push for a hearing to make these concerns heard. If we don’t organize, our leadership is not going to act in any way.
Briar: My question is about live/work spaces, we are considered a commercial space where it’s also legal to live, though we don’t live here, we use it as a workspace for my small business/art studios. Would we be covered by this bill? Seems like this could be a major gap in the bill, there are a lot of live/work loft spaces out there not covered by the Loft Law…
Liz: This bill applies to all commercial agreements regardless of whether there’s a lease. I can ask our attorneys.
Vivian: At present, it would depend on the wording of the lease, at least in part.
Olympia: Maybe live/work would need a separate bill, we can’t address everything in the same bill.
Elizabeth: There is a small business committee in the city council that has not yet had a hearing somehow. The chair of the committee Mark Gjonaj has failed to act so far, he is not a sponsor on the bill. I would encourage people to push Gjonaj and Speaker Johnson to act. We cannot wait, there won’t be small businesses left.
Jamie: Who do you think is most important to put pressure on right now? The speaker ?
William: It’s important to note the speaker is terming out and is no longer considering a run for mayor. He may not be the most important person to target now.
Olympia: We want to organize a big Town Hall with lots of press to give a space for small business owners to tell their stories and make their needs known. We want to shame politicians in the press and really get out the word about their lack of leadership. Likes and shares on social media can be really effective at getting the attention of elected officials. Once we get a hearing for the bill, we can work with the Council and other stakeholders on edits and get to a good draft and a vote.
Julia: Currently the bill has 10 sponsors, I think they are listed on the website. Call your Council Members for Commercial Rent Stabilization – Find your council person and what to say: http://fairrentnyc.com
Vanessa: How can amendments to the bill be made?
Olympia: We worked closely in drafting the bill and they were also hearing from other stakeholders. Once it is introduced, that is the first draft, then people respond to it in the public hearing. There will be a back and forth, it’s important for us to be a coalition and communicate with the Council. There could be second iterations and other hearings. There will be space for improvement, we need to be informed and present, otherwise the opposition will shape the bill much more than we will.
Elizabeth: We start with the simplest version of the bill and go from there, the second version of the bill will come out after the hearing. We can also push this forward using the 2021 election to push candidates to include this in their platform.
Olympia: We have a window of opportunity to get something in motion before this Council term ends next year. Both avenues can be pursued.
Vanessa: What can we do around canceling rent?
Olympia: The budgets are so problematic. We need to tax the billionaires, we can’t rely on the federal government now. There are several bills about rent relief that were introduced in Albany earlier on, from Gianaris and Niou, then there are other watered down versions from others. It’s all tied to the budget problems. We need Cuomo to create revenue by taxing the ultra-rich. Many things will become more clear once we know if there is any federal relief and how much is it.
Vanessa: Those are some of the demands that Housing Justice for All has been pushing for, so let’s support their demands. There is a big action on Thursday at 11 at Foley Square.
Olympia: It’s so important for our mental health to envision a better future.
NEXT STEPS
- Have more questions about the bill? Email the Artist Coalition.
- Sign the petition and forward to your network: Save NYC’s Local Businesses
- Post about small biz issues using #FairRentNYC #NoSmallBizNoNYC
- Write or record a video testifying with your story and why you need commercial rent protections. These can be anonymous or not. Email the Artist Coalition.
- Help us organize and promote a future town hall with testimonials and elected officials. Email us at aad.nyc@rise-up.net if you are interested in helping.
- Support efforts to help people who can’t pay rent now: tell your state representatives to #CancelRent. Go here for automated emails and scripts.