Red Bank landlords are pressing the borough government to make changes to its rent leveling ordinance. (Photo by Dustin Racioppi; click to enlarge)
By DUSTIN RACIOPPI
Red Bank has one of the oldest and most successful rent control measures in the state, Mayor Pasquale Menna says.
But landlords went before Menna and his council counterparts last week to complain that they’re getting squeezed by the stringent standards in the borough’s rent leveling ordinance.
Two prominent Red Bank landlords, John Bowers and Marc Gelber, made an appeal to the council to review the rent leveling ordinance, which they say has contributed to deteriorating properties, drops in housing values and late or unpaid taxes.
Under the ordinance, landlords are allowed to raise rents by 80 percent of the Consumer Price Index — the system that measures changes in the price of consumer goods. For example, if the CPI goes up two percent, landlords can raise rents 1.6 percent, leaving the balance of higher costs for expenses like heating oil, landscaping and trash removal to the property owners, Bowers said. The ordinance applies to property owners with more than three units on one property, Menna said.
“In effect, the tenant basically gets a reduction every year because they pay less than consumer price index,” he said.
“The expenses are so out of line with 80 percent consumer price index that it just boggles my mind,” Gelber said.
Bowers gave the example of two residents of his property, Shrewsbury Manor, who have lived in the apartments for nearly three decades and have seen marginal increases in that time and now pay between $500 and $600 a month for their units.
“For someone to pay $600 a month for an apartment in Red Bank, that’s a steal,” Council President Art Murphy said.
The ordinance, in effect since the 1960s, is designed to protect renters who aren’t exactly breaking the bank and to maintain a stable housing market, Menna said.
But if it’s pinching landlords, then it needs to be reviewed, he said.
Gelber, who owns Les Gertrude Apartments at Broad Street and Pinckney Road, said the rising costs landlords are experiencing has led to delays or non-payments of property taxes, shoddy repairs and a decrease in values.
He posed the question to the council: Who actually benefits from rent control? He and Bowers would like to see the ordinance repealed, but knowing that the borough is committed to it, will settle for some sort of change to help landlords share the cost to maintain the properties.
“The system is such that the landlord’s not collecting money, the borough’s not collecting money, so where does the money go?” Bowers said. “At least let us charge people what you’re paying for your sustenance.”
Menna said the council will task the rent leveling board to take another look at the ordinance, with the aim that a more equitable approach can be put in place.
“It’s not unusual for the council to undertake a periodic review of the way the rent leveling ordinance functions,” he said. “I would not expect a revolutionary change by the council.”
