Public Hearing - May 16, 2019

    


       1      BEFORE THE NEW YORK STATE SENATE
              STANDING COMMITTEE ON HOUSING, CONSTRUCTION, AND
       2      COMMUNITY DEVELOPMENT
              ------------------------------------------------------
       3
                                PUBLIC HEARING:
       4
               RENT REGULATION AND TENANT PROTECTION LEGISLATION
       5
              ------------------------------------------------------
       6
                                         Medgar Evers College
       7                                 1650 Bedford Ave
                                         Brooklyn, New York
       8
                                         Date:  May 16, 2019
       9                                 Time:  1:00 p.m.

      10
              PRESIDING:
      11
                 Senator Brian Kavanagh
      12         Chair

      13      PRESENT:

      14         Senator Michael Gianaris

      15         Senator Brad Hoylman

      16         Senator Robert Jackson

      17         Senator Liz Krueger

      18         Senator John C. Liu

      19         Senator Zellnor Myrie

      20         Senator Gustavo Rivera

      21         Senator Julia Salazar

      22

      23

      24

      25







                                                                   2
       1
              SPEAKERS:                               PAGE  QUESTIONS
       2
              Beverly Newsome                           23
       3      President
              Ebbets Field Tenants Organization
       4
              Darryl Randall                            23
       5      Member

       6      Sara Lazur                                23
              Member
       7      Crown Heights Tenant Union

       8      Michael Barbosa                           35       42
              Assistant Attorney General in Charge
       9      Brooklyn Regional Office

      10      Benjamin Dulchin                          45       57
              Executive Director
      11      The Association for Neighborhood &
                Housing Development
      12
              J.T. Falcone                              45       57
      13      Policy Analyst
              United Neighborhood Houses
      14
              Carmen Vega-Rivera                        74       85
      15      CASA Leader
              Anita Long
      16      CASA Leader
              CASA
      17
              Nilda Rivera                              95      105
      18      Tenant Leader
              Woodside on the Move
      19
              Ivan Contreras                            95      105
      20      Lead Organizer, Woodside on the Move
              Also, Campaign Coordinator,
      21        No More MCI Coalition

      22      Sandra Dominguez                          95      105
              Member
      23      Woodside on the Move

      24

      25







                                                                   3
       1
              SPEAKERS (Continued):                   PAGE  QUESTIONS
       2
              Kathleen Wacom                           109      125
       3      Member
              Julia Easterlin
       4      Member
              Andrea Shapiro
       5      Program Manager
              Metropolitan Council on Housing
       6
              Adam Meyers                              134
       7      Deputy Director, Preserving Affordable
                Housing Program -
       8        Group Representation Unit
              Brooklyn Legal Services Corporation A
       9
              Chavette Jackson                         134
      10      Senior Staff Attorney
              Brooklyn Legal Services NYC,
      11        Brooklyn Branch

      12      Xiao Ling Chen                           162      172
              Member of Chinatown Tenants Union
      13      Coalition Against Anti-Asian Violence

      14      Melanie Wang
              Translating for Xiao Ling Chen
      15
              Clara Perez Joseph                       177      190
      16      Member
              Marcela Mitaynes
      17      Tenant advocate and organizer
              Neighbors Helping Neighbors
      18
              Delsenia Glover                          194
      19      Executive Director, New York State
                Tenants and Neighbors
      20        Information Service,
              Also, Executive Director, New York State
      21        Tenants and Neighbors Coalition

      22

      23

      24

      25







                                                                   4
       1
              SPEAKERS (Continued):                   PAGE  QUESTIONS
       2
              Ona Burns                                200      215
       3      A Tenant

       4      Martin Kofman                            200      215
              President, American Package Company
       5      Also, Owner of an IMD Building in
                Green Point
       6
              Diamond Harding                          200      215
       7      Member, Fifth Avenue Committee
              Member, Stabilizing NYC Citywide
       8        Tenant Union

       9      Paimaan Lodhi                            218      226
              Senior Vice President
      10      Real Estate Board of New York

      11
              Amshula Jayaram                          282      295
      12      Senior Campaign Strategist
              Demos
      13
              Nakeeb Siddique                          282      295
      14      Director of Housing for the
                Brooklyn Neighborhood Office
      15      Legal Aid Society

      16      Esther Diaz                              302
              Member
      17      Make the Road New York

      18      Julian Gomez                             302
              Translating for Esther Diaz
      19      Tenant Organizer, Make the Road

      20      Giselda Matza (not present)              302
              Member, Make the Road
      21      Written Statement read by
                Julian Gomez
      22
              Christine Malden (ph.)                   309
      23      A tenant

      24

      25







                                                                   5
       1
              SPEAKERS (Continued):                   PAGE  QUESTIONS
       2
              Ximena Garnica                           309
       3      A Tenant
              Allison Dell
       4      A Tenant
              New York City Lost Tenants
       5
              Eric Adams (not present)                 332
       6      Brooklyn Borough President
              Written Statement Read by
       7        Anthony Drummond, Housing Policy
                Analyst to Eric Adams
       8
              Laura Mascuch                            340
       9      Executive Director
              Supportive Housing Network of New York
      10
              Emily Mock                               340
      11      Tenant Organizer, CAAAV
              Representing Chinatown Tenants Union
      12
              Jackie Del Valle                         340
      13      Stabilizing NYC Coordinator
              Urban Justice Center
      14
              Nancy Sher                               357
      15      A Tenant
              Brooklyn
      16
              Matthew Berman                           357
      17      Partner
              Valli Kane & Vagnini, LLP
      18
              Alicia Boyd                              357
      19      Member
              Movement to Protect the People
      20
              Frederick Johnson                        357
      21      A Tenant

      22      Esteban Giron                            385
              Member, Organizing Committee of
      23        Crown Heights Tenant Union
              Also, Member, Tenants PAC Board
      24

      25







                                                                   6
       1
              SPEAKERS (Continued):                   PAGE  QUESTIONS
       2
              Lisa Mathis                              385
       3      Member
              Crown Heights Tenant Union
       4
              Lynne Timko                              400
       5      Member
              GOLES
       6
              Tyrone McDonald                          400
       7      Government and Community Relations
              Neighborhood Housing Services
       8        of Brooklyn

       9      Jennifer Weber                           400
              Member
      10      CIRCL

      11      Mark Gering                              409
              Founding Member
      12      New York City Loft Tenants

      13      Mateo Cartegena                          409
              A Tenant
      14
              Victoria Hillstrom                       409
      15      A Tenant

      16

      17                           ---oOo---

      18

      19

      20

      21

      22

      23

      24

      25







                                                                   7
       1             So I'm Senator Brian Kavanagh, Chair of the

       2      Housing Committee.

       3             And, first of all, let me begin by welcoming

       4      everybody here.

       5             This is our second hearing of the Senate

       6      Housing Committee on tenant protection and the rent

       7      laws.

       8             And we are very happy and proud to be right

       9      here in Brooklyn, where we know much of the concern

      10      and much of the effect of what we're trying to do

      11      here will be felt directly in our communities.

      12             We do, as anyone who came through the front

      13      door of this building know, have a great deal in

      14      testifying.

      15             We have about 140 seats in this room, and we

      16      have a very long list of people who are interested

      17      in testifying, and we're going to try do our best to

      18      get everybody, particularly those who signed up in

      19      advance, up here.

      20             I'm going to keep my remarks very brief, but

      21      I have a wide range -- a whole bunch of senators

      22      here, most of whom are members of the Housing

      23      Committee, and others of whom are joining us today.

      24      And I'm going to give each of them an opportunity

      25      now to say something briefly, if they choose to.







                                                                   8
       1             But, we have Senators Myrie, Salazar,

       2      Krueger, Gianaris, Liu, Rivera, and Jackson with us

       3      today.

       4             So I'm going to actually turn over the floor

       5      to any of them who wants to say something to begin.

       6             SENATOR RIVERA:  Should we start with Robert?

       7             SENATOR KAVANAGH:  So we'll start -- why

       8      don't we start on my left with Senator Jackson.

       9             SENATOR JACKSON:  Hi, everyone.

      10             I'm Robert Jackson.  I represent Marble Hill,

      11      Inward, Washington Heights, part of West Harlem,

      12      going down to Upper West Side, down to midtown, to

      13      Chelsea area, 13 miles long, a very gerrymandered

      14      district in Manhattan.

      15             And I looked at the list of rent-stabilized

      16      units.  Gustavo Rivera and myself, we have the

      17      highest number of rent-stabilized units out of all

      18      of 39, all of the New York State senators, out of

      19      63.

      20             We have 68,000 units in our senatorial

      21      districts that are rent-stabilized.

      22             So with that, I look forward to listening to

      23      the testimony.

      24             I'm signed on to all nine bills.

      25             I am a rent-stabilized tenant myself --







                                                                   9
       1                [Applause.]

       2             SENATOR JACKSON:  -- so what I do affects

       3      you, and it affects me and my family.

       4             Thank you very much.

       5             Thank you, Mr. Chair.

       6             SENATOR KAVANAGH:  Thank you.

       7             Next up, Senator Rivera.

       8             SENATOR RIVERA:  Good afternoon to everybody.

       9             Gustavo Rivera, State Senator for the

      10      33rd District in the bogey-down Bronx

      11      (hand-gesturing).  I got to throw up my Xs, got to

      12      do it, particularly --

      13                [Applause.]

      14             SENATOR RIVERA:  -- particularly when I'm all

      15      the way down in Brooklyn.  I don't necessarily come

      16      down to Brooklyn unless it's very important, like

      17      what we're doing today.

      18             Now, as Robert said, it is -- it's actually

      19      fitting that he spoke first and I spoke second

      20      because, in the number of rent-stabilized units in

      21      the entire state, the number-one Senate District is

      22      Robert's, the number-two district is mine.

      23             Now, when -- a couple years ago I would have

      24      told you about 70,000 units.

      25             The reality is, that we are below 67,000 now







                                                                   10
       1      in my district.

       2             And that is precisely what we're talking

       3      about in these hearings, and why we are doing the

       4      work that we're doing to strengthen the rent laws.

       5             Now, I should tell you that, I've been in

       6      New York since 1998, and I've been living in a

       7      rent-stabilized unit since 2000.  I've been living

       8      in my same building in a rent-stabilized unit.

       9             I moved in 2010 from a studio to a

      10      one-bedroom, but the fact is, that I would not be

      11      able to live in the city or thrive in the city were

      12      it not for rent regulation, rent stabilization.

      13             And, I'm one of the lucky ones.

      14             There are families that come to my district

      15      office every day, talking about the issues that they

      16      have to deal with.

      17             So I'm looking forward to hearing from all of

      18      you.

      19             One last thing that I will say before I pass

      20      it on to my colleagues, I know that we're going to

      21      be talking about a lot of things.

      22             One of the things that I'm going to be very

      23      much paying a lot of attention to is major capital

      24      improvements (MCIs).

      25             The reality is --







                                                                   11
       1                [Applause.]

       2             SENATOR RIVERA:  The reality is, that MCIs

       3      are not equal to maintenance.

       4             "Maintenance" is what you do to keep your

       5      apartments livable.  You don't wait until they're

       6      all messed up, to then be able to get some extra

       7      money out of your tenants just because you haven't

       8      fixed it to make it livable.

       9             So we -- so that's just one of the many

      10      things that we're going to be talking about today.

      11             But, whether it's independent apartment

      12      improvements or MCIs, I'm going to be paying a lot

      13      of attention to that.

      14             Thank you for being part of this process.

      15             And, I'm also a co-sponsor on all of the nine

      16      bills.

      17             Thank you so much.

      18                [Applause.]

      19             SENATOR KAVANAGH:  Thank you -- thank you,

      20      Senator Rivera.

      21             Next up, Senator Liz Krueger.

      22             SENATOR KRUEGER:  Hi, I'm Liz Krueger from

      23      Manhattan --

      24                [Applause.]

      25             SENATOR KRUEGER:  -- and I've been in the







                                                                   12
       1      Senate for 17 years.

       2             And one of my reasons for allowing myself to

       3      be drafted to run for the Senate 17 years ago was to

       4      finally fix our rent laws.

       5             So it's taken a hell of a lot longer than

       6      I imagined it would ever take --

       7                [Laughter.]

       8             SENATOR KRUEGER:  -- but I am confident that,

       9      before we leave session at the end of June, we

      10      have -- we'll have done an amazing job at addressing

      11      some of the fundamental problems facing the future

      12      of New York, making sure we have affordable, stable

      13      housing for people to live in and for their families

      14      to stay in.

      15             And people think, Manhattan, what kind of

      16      problems do you have?

      17             Well, I'll tell you, we've been ground zero

      18      of everything that you're seeing in the rest of the

      19      boroughs now.

      20             And when a reporter says to me, "Well, isn't

      21      rent regulation just a problem in Manhattan?" I say,

      22      Where you been living for the last 25 years?

      23                [Laughter.]

      24             SENATOR JACKSON:  Everything wrong that

      25      happened in Manhattan has spread throughout the







                                                                   13
       1      entire city of New York.

       2             So, things that you think are new in your

       3      communities and your buildings, check with us from

       4      Manhattan, we'll tell you our stories from 20 years

       5      ago.

       6             So I am proud to be here with this great

       7      panel.

       8             And I know, I can tell you, that

       9      Brian Kavanagh and Zellnor Myrie have been leading

      10      us in our housing working-group efforts.

      11             And those of you who don't know them, should

      12      know, you couldn't be prouder of these two

      13      legislators for doing the work that we need to do --

      14                [Applause.]

      15             SENATOR KRUEGER:  -- to bring us over the

      16      finish line in coordination with the Assembly.

      17             Thank you all for being here.

      18             SENATOR KAVANAGH:  Thank you.

      19                [Applause.]

      20             SENATOR KAVANAGH:  Thank you,

      21      Senator Krueger, for your kind remarks.

      22             Next up, our hometown senator, who I think

      23      needs very little introduction in this room,

      24      Zellnor Myrie.

      25                [Applause.]







                                                                   14
       1             SENATOR MYRIE:  Thank you.

       2             I really want to thank the Chair,

       3      Brian Kavanagh, Senator Kavanagh, for bringing this

       4      hearing to Central Brooklyn.

       5             I think it means a lot to the tenants of my

       6      district, but really tenants all over the city, for

       7      you to bring the New York State Senate into a place

       8      where affordability is at a crisis level.

       9             So, I really want to publicly thank you for

      10      that because it means a lot to us.

      11             I want to thank Medgar Evers College for

      12      being an excellent host and accommodating us.

      13             I'd like to thank my colleagues.

      14             We're also joined by Assembly

      15      Member Walter Mosley whose district we are in.

      16                [Applause.]

      17             SENATOR MYRIE:  And it would not be a public

      18      hearing on housing in Brooklyn if the unofficial

      19      hearing didn't start outside on the corner --

      20                [Laughter.]

      21             SENATOR MYRIE:  -- for those of you who were

      22      here earlier.

      23             I too am a rent-stabilized tenant.  I am --

      24      grew up in a rent-stabilized apartment four blocks

      25      from where we are right now.







                                                                   15
       1             I went to elementary and middle school three

       2      blocks away from where we are right now.

       3             I would not be who I am today if it were not

       4      for the protections of rent regulation.

       5             So this is an issue that is very, very

       6      personal to me.  It is the number-one reason why

       7      I ran for office.

       8             And I am honored to be sitting and amongst

       9      colleagues who care just as deeply for protecting

      10      our communities throughout the state.

      11             So I look forward to hearing the testimony

      12      today.

      13             Please, we have accommodated you in order to

      14      give us everything that you think we should be

      15      paying attention to as it pertains to rent

      16      regulation.

      17             So, thank you again to all of the tenants

      18      that have made their way out from all over the

      19      state, and I look forward to hearing your testimony.

      20                [Applause.]

      21             SENATOR KAVANAGH:  Thank you, Senator Myrie.

      22             Next up we have Senator Salazar.

      23             SENATOR SALAZAR:  Thank you.

      24                [Applause.]

      25             SENATOR SALAZAR:  Thank you, everyone.







                                                                   16
       1             Thank you for coming here today for the

       2      second in a series of hearings that the Senate is

       3      hosting on rent regulation.

       4             I want to thank both Assemblyman Mosley and

       5      Senator Myrie for hosting us in their district, for

       6      Senator Kavanagh as the Chair of the Housing

       7      Committee.

       8             This issue is personal to me.

       9             Years ago I was a tenant in a building that

      10      was not protected by rent stabilization, and

      11      organized a small rent strike, to try to get our

      12      neglectful, abusive management company and landlord

      13      to make urgent repairs in the building.

      14             Ever since then, have been deeply invested in

      15      the fight for housing justice in New York State.

      16             I'm the senator for the 18th, or as I call

      17      it, the "great-teenth," District, in North

      18      Brooklyn, where we have seen a lot of tenants

      19      suffering from the rapid loss of rent-stabilized

      20      housing in the district, particularly due to

      21      deregulatory policies that I believe we need to

      22      repeal ahead of the rent laws expiring in just

      23      30 days from now.

      24             I'm really excited to hear from tenants and

      25      stakeholders today so that you-all can inform what







                                                                   17
       1      we do next in the next few weeks to really

       2      strengthen our rent laws.

       3             Thanks.

       4                [Applause.]

       5             SENATOR KAVANAGH:  Thank you,

       6      Senator Salazar.

       7             Next up we're gonna -- we have -- I think a

       8      lot of people in the house from Queens, and we'll

       9      hear from -- first, from Senator John Liu.

      10                [Applause.]

      11             SENATOR LIU:  Thank you.

      12             This is -- I guess I'm the beginning of the

      13      Queens section on the dais.

      14             Let me start by saying that I am not, and

      15      I have never, been a rent-stabilized tenant, but

      16      this is an issue that is core to New York City.

      17             Unlike most cities in this country where,

      18      typically, you have one-third of the residents

      19      living in -- as tenants, in New York City we have

      20      the vast majority of people living as tenants; more

      21      than two-thirds.

      22             And so we have a system where the rents have

      23      been, or at least been kept, somewhat reasonable

      24      because of a housing shortage and housing emergency.

      25             That's how it's been defined under the law.







                                                                   18
       1             But the problem is, over the last couple of

       2      decades, the laws in New York have continued to

       3      eliminate unit after unit, hundreds of hundreds,

       4      thousands of thousands, of rental units from the

       5      rent laws, from their stabilized-rent laws, and that

       6      is making our city unlivable for too many people.

       7             As our population continues to grow, the

       8      number of affordable housing units continue to

       9      decline.

      10             This is a trend that must be stopped and must

      11      be reversed.

      12             And that is why we are deliberating and

      13      discussing and, hopefully, passing, in short order,

      14      the entire package of rent-reform laws.

      15             So, I'm here to hear all of you.

      16             I am also with my colleagues on these bills,

      17      and, the bottom line is, we need to do this.

      18             We need this reform because the rent is

      19      (motioning)...

      20             THE AUDIENCE:  ... too high!

      21             SENATOR LIU:  I think everybody is on board.

      22                [Applause.]

      23             SENATOR KAVANAGH:  Thank you, Senator Liu.

      24             Next up, Senator Gianaris.

      25             SENATOR GIANARIS:  Thank you.







                                                                   19
       1                [Applause.]

       2             SENATOR GIANARIS:  Thank you.

       3             Thank you, thank you.

       4             I also am part of the Queens contingent,

       5      proudly, and I happen to represent the district that

       6      has the most rent-stabilized units in Queens,

       7      although, as Senator Rivera pointed out, that number

       8      is decreasing too quickly.

       9             It's some of the fastest gentrifying

      10      neighborhoods in New York: Astoria, Long Island

      11      City, Sunnyside, Ridgewood, and, of course,

      12      Woodside.

      13             My friends in Woodside are here.

      14             I too sponsor all nine bills in the platform

      15      and proud of it.

      16                [Applause.]

      17             SENATOR GIANARIS:  But, you're probably only

      18      going to hear me talking today about the bill that

      19      I authored and sponsored, which is the elimination

      20      of MCIs.

      21                [Applause.]

      22             SENATOR GIANARIS:  I think you saw some of my

      23      friends outside that came to talk to me about the

      24      MCIs.

      25                [Laughter.]







                                                                   20
       1             SENATOR GIANARIS:  And the only other thing

       2      I would mention is, that I want to commend so many

       3      of my colleagues up here, who, like me, have refused

       4      to take contributions from landlords and the real

       5      estate industry any longer.

       6             So as --

       7                [Applause.]

       8             SENATOR GIANARIS:  -- as we do this important

       9      work, it's important for us to make clear that we

      10      stand with our tenants, and we will not be

      11      influenced by any political support from anybody

      12      else.

      13             So, I want to hear from the folks, I'll cut

      14      it off there.

      15             But, thank you all for being here.

      16             And, in a couple of weeks, hopefully, we'll

      17      get this done the right way.

      18                [Applause.]

      19             SENATOR KAVANAGH:  Thank you, all.

      20             So now we come to the purpose for which we're

      21      here, which is to hear from the many witnesses that

      22      have signed up.

      23             We also have a few additional people who are

      24      requesting to testify, and we are going to try to

      25      accommodate everybody.







                                                                   21
       1             We are scheduled to be here until 8:00, and

       2      not much later than that, given our understanding

       3      with Medgar Evers College.

       4             But, again, so just a few ground rules that

       5      we would appreciate people respecting during this

       6      hearing.

       7             There is a 6-minute timer.  It is -- it

       8      should be down there (indicating).

       9             You all probably can see it, I can't see it.

      10             There's another version of it there on this

      11      very official cardboard box (indicating), which

      12      means we can see it.

      13             We would ask that, if you are testifying,

      14      that you -- your testimony, meaning your initial

      15      remarks, be contained within that 6 minutes.

      16             In addition to that, if members of the panel

      17      up here, members of the Senate, have questions for

      18      you, they will ask.

      19             That does not count as your 6 minutes.  That

      20      is the time of the senators.

      21             Some of you will get questions, and some of

      22      you may not, because, again, although we want to

      23      hear from you, and may have, you know, thoughts and

      24      questions about your testimony, we are also gonna --

      25      I'm going to ask all of my Senate colleagues to try







                                                                   22
       1      to move through this so -- because, again, we have

       2      50-some-odd people that would like to talk today.

       3             In the same spirit, two things:

       4             Although we all -- we all enjoyed the rousing

       5      rounds of applause for some of our colleagues, we

       6      are going to ask people to keep audience reaction to

       7      a minimum.

       8             You're going to hear a lot of things that

       9      your fellow testifiers, that you like.  You're gonna

      10      hear some other things maybe that you don't like so

      11      much.

      12             But if we kind of applaud each time we hear

      13      something we like, and, you know, do that, and

      14      something else each time we hear something we don't

      15      like, that will just diminish the number of people

      16      get to speak today.

      17             So we are trying -- again, our goal is to

      18      come to Brooklyn to hear from everybody.

      19             And, we are going bring people up in groups,

      20      just because it's easier, you get three people

      21      seated.

      22             We're going to try to keep you in sort of

      23      groups that are of similar perspective, but,

      24      obviously, you're all welcome to testify as you see

      25      fit.







                                                                   23
       1             So -- and we're -- you know, we know that

       2      some people are outside and still trying to get in

       3      because there's a limited capacity in here.

       4             So, I'm going to call names.

       5             If you are not -- if the person's not here,

       6      we will -- you know, we'll call the name again a

       7      little later.

       8             If you hear somebody's name, and you know

       9      them and they're not here, please, you know, text

      10      them or let them know that they've been called, and

      11      they should let us know when they come back into the

      12      room.

      13             Okay, so without further ado, I think we're

      14      going to begin with some of our -- given that we're

      15      here in Brooklyn, I think we will start with

      16      Beverly Newsome and -- of Ebbets Field Tenants

      17      Association (sic), and, Sarah Lazur and

      18      Darryl Randall of the Crown Heights.

      19                [Applause.]

      20             SENATOR KAVANAGH:  So just -- the way this

      21      works, these folks are handling the A/V.  This whole

      22      thing is recorded.

      23             So please begin by stating your name, and any

      24      organization you're representing, and then proceed

      25      with your testimony.







                                                                   24
       1             So, thank you.

       2             BEVERLY NEWSOME:  Can you hear me?

       3             SENATOR LIU:  Just a little closer

       4      (inaudible).

       5             BEVERLY NEWSOME:  A little closer?

       6                (Indiscernible cross-talking.)

       7             BEVERLY NEWSOME:  Oh, okay.

       8             Oh.

       9             Okay, thank you.

      10             Good afternoon.

      11             My name is Beverly Newsome.

      12             I'm president of Ebbets Field Tenants

      13      Organization, so I represent the tenants of Ebbets

      14      Field.

      15             Today I would like to draw attention to the

      16      application of MCIs in Ebbets Field.

      17             We've received elevator MCIs for at least

      18      two buildings on the property.

      19             The cost was broken down into cost per room,

      20      which increased the cost per apartment by

      21      approximately $16, which, after three months, this

      22      cost was added to the total amount of the rent.

      23             After the MCI, the elevators continued to

      24      breakdown with the same level of frequency as they

      25      did prior to the MCI work being done.







                                                                   25
       1             According to "The New York Post," for

       2      January 1, 2019, FDNY visited the property

       3      159 times, rescuing individuals from the elevator.

       4             We are now in housing court because elevators

       5      were either not working or poorly working.

       6             Tenants didn't know when they got home if the

       7      elevators will be working at all, but we continue to

       8      pay the MCI increase; that hasn't changed.

       9             In addition to our management exploiting us

      10      with MCIs, we have preferential leases which are

      11      being used to manipulate tenants out of their

      12      rights.

      13             Preferential leases not only prevent tenant

      14      engagement, it is used with bias.

      15             I have seen tenants be denied a rent increase

      16      because they engaged in a building-wide decrease in

      17      services, and we won.

      18             I've seen a tenant's rent go up to $1,000

      19      because she began an HP action for having fallen

      20      down a broken handicap ramp.

      21             I've seen a single mom's rent be increased by

      22      $700 because she reported to the press her inability

      23      to get needed repairs addressed.

      24             Preferential leases create transient

      25      communities, allowing landlords to evict tenants by







                                                                   26
       1      just increasing the rent out of their reach.

       2             Preferential leases must be stopped.

       3             Many landlords use tenants' homes as if they

       4      are banks, using them as leverage to purchase other

       5      properties without maintaining the properties they

       6      currently have.

       7             Tenants regularly paying rent, but finding it

       8      necessary to do an action in order to get repairs

       9      done.

      10             We are counting on our electeds to balance

      11      the scales.

      12             Thank you.

      13             SENATOR KAVANAGH:  Thank you.

      14                [Applause.]

      15             SENATOR KAVANAGH:  So we have a question.

      16             BEVERLY NEWSOME:  Sure.

      17             SENATOR RIVERA:  Really quickly, 159 times?

      18             BEVERLY NEWSOME:  Ah, yes.

      19             SENATOR RIVERA:  And how long, in a year?

      20             BEVERLY NEWSOME:  A year.

      21             SENATOR RIVERA:  159 times in one year?

      22             BEVERLY NEWSOME:  159 times in one year.

      23             SENATOR RIVERA:  Thank you.

      24             BEVERLY NEWSOME:  You're welcome.

      25             SENATOR RIVERA:  That's (inaudible).







                                                                   27
       1             DARRYL RANDALL:  Hello.

       2             My name is Darryl Randall, and I'm a member

       3      of the Crown Heights Tenant Union, and I organize

       4      with UHAB.

       5             I lived at 944 Marcy Avenue for 22 years.

       6             My landlord is Jeff Groner (ph.).  He owns

       7      16 buildings throughout Central Brooklyn.

       8             My building is facing multiple MCIs, rent

       9      increases, and people are going to have to move out.

      10             I am currently unemployed and I'm living off

      11      a very tight budget, and our newest pending MCI rent

      12      increase will make it harder for me to pay for food,

      13      utilities, and transportation.

      14             It might eventually mean that have I to move

      15      out of the neighborhood I have called "home" for

      16      22 years.

      17             This is my issue with MCIs:

      18             Landlords are using them as a tactic to kick

      19      out long-term residents.

      20             MCIs undermine rent stabilization by allowing

      21      landlords to increase rents very quickly.

      22             According to RGB data, the owner of an

      23      average rent-stabilized building made a total of

      24      $1.87 million in net operating income from that

      25      building between 2011 and 2017.







                                                                   28
       1             I know that, from public record, that my own

       2      landlord reported over $230,000 of net operating

       3      income from my building last year, yet he tells us

       4      in meetings that he cannot possibly afford to make

       5      upgrades to the building without passing the cost

       6      off to tenants.

       7             My building is also getting deregulated

       8      apartment by apartment.

       9             I'm sure you are familiar with this pattern

      10      of using the vacancy bonus, IAIs, MCIs, et cetera,

      11      to deregulate apartments and convert them to market

      12      rate.

      13             Tenants in my building who are not

      14      rent-stabilized are afraid to organize because they

      15      are not guaranteed a lease renewal.

      16             Even though they face the same issues as us,

      17      including a broken elevator, they do not feel like

      18      they can fight for their rights because they know

      19      the landlord can just not renew their lease.

      20             There are a lot of smaller buildings in this

      21      district that are not even subject to rent

      22      stabilization.

      23             Passing good-cause eviction, that would

      24      provide basic protection to 27,000 people in my

      25      Senate District.







                                                                   29
       1             This is our chance -- this is our chance to

       2      act and to preserve the New York that we all love.

       3             I strongly believe that every bill in this

       4      package needs to be passed together in order to

       5      create the change we need to see.

       6             From my experience, having a landlord that

       7      exploits every loophole available to him, I know

       8      that getting rid of the vacancy bonus without

       9      getting rid of MCIs, for example, would just mean

      10      that tenants will see more MCIs in our near future.

      11             I believe in universal rent control as a path

      12      towards addressing the grave injustices that have

      13      been committed towards people of color across the

      14      entire history of housing policy.

      15             We need you to pass all nine bills so that we

      16      can feel secure in our homes and strengthen our

      17      communities.

      18             Thank you.

      19                [Applause.]

      20             SENATOR KAVANAGH:  Thank you.

      21             We're going to begin the clock again.

      22             And just to be clear, we're gonna do 6 --

      23      we're going to offer people 6 minutes per person

      24      testifying, but you're welcome not to use all

      25      6 minutes, as two people have done so far, which is







                                                                   30
       1      very welcomed, so other people get to speak.

       2             Also, I just want to note, if you do have

       3      written testimony and it is, you know, maybe longer

       4      than you want to read, if you submit a written

       5      document, it will be considered part of the record

       6      of this hearing.

       7             So feel free to submit your written testimony

       8      as well.

       9             And proceed, thank you.

      10             SARA LAZUR:  Good afternoon.

      11             My name is Sarah Lazur.

      12             I'm a lecturer at Barnard College, and a

      13      member of the Crown Heights Tenant Union as well.

      14             When I moved to Brooklyn, I had no idea what

      15      rent stabilization was.

      16             When I found out about it, I got my rent

      17      history, I decoded it on my own, and I found out

      18      that my apartment used to be stabilized, but had

      19      been destabilized five years before I moved in.

      20             I was disappointed, but this became anger

      21      when I saw that the pathway to that destabilization

      22      included illegal increase percentages at multiple

      23      times, no accounting for increases, and even a

      24      failure to register one year, followed by more

      25      illegal increases, preferential rents, and







                                                                   31
       1      destabilization.

       2             The rent history also told another story, one

       3      in which long-term tenants move out and are followed

       4      by a turning mill of short-term tenants, people who

       5      stay for one year and then evaporate, signing leases

       6      whose numbers make no sense, but who clearly were

       7      not around long enough to discover the problem or

       8      try to rectify it.

       9             When I researched further, I found that the

      10      number of destabilized units in my building

      11      diminished regularly with every passing year, and

      12      the same was taking place in every building owned by

      13      the same landlord.

      14             This couldn't be a coincidence, could it?

      15             Since joining the Crown Heights Tenant Union

      16      and learning more and more about the laws, I've

      17      helped friends and neighbors to decode their rent

      18      histories, and similar same patterns immerged:

      19             Illegal increase percentages;

      20             Vacancy turnover, accelerating in the 1990s

      21      after vacancy decontrol was enacted;

      22             And loss of stabilized units across their

      23      landlord's portfolio since 2007.

      24             This can't be a coincidence, can it?

      25             In my working with the CHTU, I have met







                                                                   32
       1      hundreds of my neighbors who have been dealing with

       2      lack of heat and hot water in the winter, lack of

       3      repairs, refusals to give leases, and overcharge,

       4      and this is even with the protections promised by

       5      current laws and with landlords having MCI and

       6      IAI allowances at their disposal.

       7             Now, if they can push the cost of a new

       8      boiler on to the tenants indefinitely through MCIs,

       9      how is it that my neighbors are still without heat?

      10             It's because MCIs are not being used for

      11      their stated purpose.

      12             The entire purpose of letting someone go

      13      without heat is to make their living condition so

      14      bad they choose to leave.

      15             And if you churn through enough stabilized

      16      tenants, you can get through enough vacancy bonuses

      17      to get to the brass ring, decontrol.

      18             Crown Heights North ranks fourth in the

      19      entire city in how quickly the price per square foot

      20      is increasing, and, at the same time, Crown Heights

      21      North ranks fourth in the entire city in terms of

      22      serious housing-code violations per unit.

      23             This can't be a coincidence, can it?

      24             I can admit, I'm scared to be putting my

      25      decontrol story out there.







                                                                   33
       1             So far I've been lucky.

       2             I have a good relationship with my landlord,

       3      and my rent increases have been at levels I have

       4      been able to manage, although, 4 to 5 percent every

       5      year will eventually be too much when my income

       6      increases only 2 percent every year.

       7             But because my landlord -- because my

       8      apartment isn't currently stabilized, if my landlord

       9      changes his mind about liking me having -- having me

      10      in the building, if I try to start a tenant

      11      association, or if he finds out that I'm talking

      12      about the rent laws in public, or if I make too many

      13      requests for repairs, there is nothing to prevent

      14      him from choosing to not renew my lease in the

      15      future, nor to prevent him from raising my rent by

      16      50 percent or 100 percent.

      17             I'm a good tenant.

      18             I pay my rent on time, I take good care of

      19      the place, and that still might be enough -- not be

      20      enough to stay in my home and in my community.

      21             And there are more of us among the

      22      unregulated tenants that you might -- than you might

      23      think.

      24             Repealing the vacancy decontrol would be a

      25      godsend.







                                                                   34
       1             My stabilized neighbors dealing with

       2      harassment could get peace of mind that their rights

       3      will remain, and my destabilized neighbors and

       4      I would get the security of a lease renewal back.

       5             Passing good-cause eviction would ease the

       6      existential dread felt by my neighbors in

       7      unregulated apartments, and would bring

       8      New York State into line with commonsense policies

       9      in places like Germany.

      10             For all the reasons I've stated, I'm nervous

      11      to speak today, but I chose to speak because these

      12      laws are too important to remain silent.

      13             This housing crisis is not the result of

      14      coincidences.

      15             It has been engineered through bad policy,

      16      and my neighbors and I are asking you to do the

      17      right thing and enact these good policies.

      18             Thank you.

      19                [Applause.]

      20             SENATOR KAVANAGH:  Thank you, all.

      21             And I am going to add, we would all like to

      22      applaud, but I'm going to ask everybody to hold

      23      their applause till -- you know, as we move forward.

      24             Any questions for anyone on this panel?

      25             Okay.







                                                                   35
       1             Thank you so much for your testimony.

       2             Next up we are going to have Michael Barbosa,

       3      representing our Attorney General Letitia James, who

       4      I think has some familiarity with Brooklyn.

       5             ASST AG MICHAEL BARBOSA:  Good afternoon,

       6      Chair Kavanagh and distinguished members of the

       7      Committee.

       8             My name is Mike Barbosa.

       9             I'm an assistant attorney general in charge

      10      of the Brooklyn Regional Office.

      11             I thank you for allowing me to share

      12      testimony on behalf of our Attorney General James.

      13             There is perhaps no more important issue

      14      facing this chamber than the one we're discussing

      15      today.

      16             Just under 2 1/2 million New Yorkers live in

      17      rent-regulated apartments, mostly in New York City,

      18      but also in parts of Long Island, Westchester, and

      19      Rockland County.

      20             Statewide, 46 percent of all households are

      21      renters, the highest percentage of any state in the

      22      nation.

      23             8.3 million New Yorkers live in rental

      24      housing statewide.

      25             As we are all aware, that people in New York







                                                                   36
       1      face significant challenges with finding safe

       2      affordable housing.

       3             In New York City, 30 percent of renters pay

       4      half or more of their income toward rent.

       5             In Brooklyn it's slightly higher, at

       6      31 percent.

       7             Rent regulation is meant to alleviate the

       8      pressure by not only providing for housing that is

       9      affordable, but also assuring the long-term

      10      stability of families and neighborhoods.

      11             But weaknesses in the law have let this

      12      valuable source of affordable housing slip away, and

      13      has eroded the protections that families rely for

      14      housing stability, such as the right to renew their

      15      leases, as discussed, protections against reductions

      16      in services, and reasonable rent increases.

      17             The laws governing how and when landlords can

      18      increase rent, pass along fees, or deregulate units

      19      altogether have proven to be inadequate.

      20             Because of these weaknesses in the law, we're

      21      losing rent-regulated housing at an alarming rate.

      22             Since 1994, when vacancy decontrol was

      23      reintroduced in New York City, 291,000 apartments

      24      were lost to deregulation.  Of these, 155,000 units

      25      were lost to vacancy decontrol.







                                                                   37
       1             Rent-regulated housing makes the bulk of

       2      apartments that are affordable to families in

       3      New York City.

       4             Those with fewer resources may become

       5      homeless, and others may choose to leave New York

       6      for good.

       7             It's no coincidence that, as more apartments

       8      become deregulated, homelessness has increased.

       9             Since January of 2017, there's been at least

      10      48,000 evictions citywide, with 13,500 evictions in

      11      Brooklyn alone.

      12             That is, on average, each month, 482 families

      13      were thrown out of their apartments in Brooklyn

      14      since 2017.

      15             The waves of displacement we've seen in

      16      neighborhoods throughout Brooklyn and across the

      17      state have been fueled by speculation harassment,

      18      speculative capital, and weakened (sic) in the law

      19      have resulted in an eviction machine.

      20             But let me just talk about our office,

      21      because I'm really speaking to the crowd.

      22             As the Attorney General, we take an active

      23      role in protecting the rights of tenants against

      24      landlords that engage in harassment, intimidation,

      25      and fraud.







                                                                   38
       1             And I thank the Committee and the

       2      Senate for your assistance in passing

       3      Senator Krueger's-sponsored bill, the Tenants

       4      Protection Act of 2019, which will give our office

       5      more tools in holding landlords accountable for

       6      harassment.

       7             But while the act gave us more tools to fight

       8      harassment after it occurs, it would be even better

       9      to prevent tenants from being harassed in the first

      10      place.

      11             This moment is ripe with opportunity to

      12      reform a rent-regulation system that, at this time,

      13      is not serving its intended purpose.

      14             This chamber is debating a number of bills

      15      that would greatly affect the lives of tenants in

      16      New York State.

      17             While I cannot comment on the specifics of

      18      these bills in this venue and at this time, I do

      19      want to state, unequivocally, that our

      20      Attorney General and the Office of the Attorney

      21      General supports the aims of these bills, to protect

      22      the rights of tenants, and to reform a system that

      23      landlords have too easily been able to manipulate at

      24      the expense of working families and seniors.

      25             The current system leaves tenants vulnerable







                                                                   39
       1      to harassment and fraud, displacement, and despair.

       2             The system needs to change.

       3             Through the course of our several

       4      investigations, our office has gained firsthand

       5      knowledge of the ways in which landlords abuse the

       6      laws governing rent regulation.

       7             We put some landlords in jail, others has

       8      paid fines and direct restitution to tenants they

       9      have harmed.

      10             But for every bad actor they bring -- we

      11      bring to justice, there are countless other families

      12      who feel powerless to stop the harassment or abuse

      13      of the law used to force them out of their homes.

      14             We cannot address tenant harassment and

      15      displacement if we do not address the underlying

      16      cause, which is greed, enabled by a rent-regulation

      17      system that rewards landlords for punishing (sic)

      18      tenants out of their apartments.

      19             So the enactment of vacancy decontrol led to

      20      the loss of 155,000 rent-regulated units, many were

      21      once affordable.

      22             As we lose more units to decontrol, we have

      23      fewer and fewer apartments that are affordable to

      24      low-income New Yorkers.

      25             Because the vacancy decontrol exists, so does







                                                                   40
       1      the temptation of landlords to raise rents by

       2      abusing the law.

       3             Similarly, the vacancy bonus incentivizes

       4      landlords to turn over apartments as quickly as

       5      possible by pushing out tenants.

       6             These bonuses can quickly add up.

       7             We also talked about -- it's also been

       8      discussed about the MCIs and the IAAs (sic).

       9             This system allows landlords to claim rent

      10      increases when they make building improvements.

      11             It's broken.

      12             There's far too little oversight, and we

      13      know, because of our investigations, that landlords

      14      fraudulently abuse the system.

      15             Currently, DHCR relies on landlords to

      16      faithfully represent the amount of work done when

      17      claiming these increases, which can lead to abuses.

      18             But our office has received complaints from

      19      tenants about landlords' abuses by inflating the

      20      cost of the renovations and not doing the work.

      21             Preferential rents.

      22             Landlords claim to charge regulated tenants a

      23      lower preferential rate when local -- are lower than

      24      the legal rent allows for rent regulation.

      25             The number of households with preferential







                                                                   41
       1      rent is increasing as landlords scoop up allowed

       2      rent increases even as they charge in reality.

       3             And then there is the Emergency Tenant

       4      Protection Act (ETPA) and the good-cause eviction.

       5             Both these measures would expand the

       6      protections afforded to tenants across the state.

       7             More than 2 million tenants statewide are not

       8      protected.

       9             The good-cause bill, giving tenants the right

      10      to renew, could allow tenants to request repairs

      11      without fear of reprisal, as previously discussed.

      12             But I also need to talk about manufactured

      13      homes.

      14             There are 85,000 New York households living

      15      in manufactured homes.

      16             As a result, park owners have little power

      17      over as residents because they have to pay for the

      18      land.

      19             And they need protections as well.

      20             The Attorney General is committed to

      21      protecting individual and family tenants from

      22      unscrupulous landlords, but we need your help as

      23      well.

      24             SENATOR KAVANAGH:  I'm going to ask to you

      25      wrap up, even though the clock just said you had







                                                                   42
       1      99 more minutes.  And --

       2                [Laughter.]

       3             ASST AG MICHAEL BARBOSA:  Thank you.

       4             Too many tenants have already had their lives

       5      disrupted because of unscrupulous landlords'

       6      behavior.

       7             We have a moral imperative to act.

       8             Thank you for allowing me the opportunity to

       9      testify.

      10                [Applause.]

      11             SENATOR KAVANAGH:  Thank you.

      12             Again, we'd appreciate, hold the applause,

      13      just to get more people to speak.

      14             Any questions?

      15             SENATOR KRUEGER:  Just urge the Governor to

      16      sign the bill we passed.

      17             ASST AG MICHAEL BARBOSA:  Thank you.

      18             SENATOR KAVANAGH:  Okay, some -- I think you

      19      do have questions, though.

      20             So, first up we have Senator Gianaris.

      21             SENATOR GIANARIS:  Thank you.

      22             I appreciate your testimony.

      23             And, as someone from the office that deals

      24      with enforcement in a lot of these things,

      25      I appreciate you identifying the problem properly.







                                                                   43
       1             I wanted to ask about MCIs specifically.

       2             Many of us are concerned that, if we do a lot

       3      of reform on the other issues, but leave MCIs as

       4      something landlords can exploit, they're going to

       5      end up exploiting it even more than they are now.

       6             In other words, if that's the remaining

       7      loophole, they're going to drive a truck through it.

       8             Is it your opinion that the MCI program is

       9      salvageable at all, or, like some of us would like,

      10      just to get rid of it entirely?

      11             ASST AG MICHAEL BARBOSA:  Well, the

      12      Attorney General has not made a public opinion on

      13      the specifics of MCI.

      14             Our investigations show that there is fraud

      15      in MCIs and IAIs in some instances, and not in

      16      others.

      17             SENATOR KAVANAGH:  Further questions?

      18             SENATOR SALAZAR:  Yes.

      19             SENATOR KAVANAGH:  Senator Salazar.

      20             SENATOR SALAZAR:  Thank you.

      21             And thank you for your testimony.

      22             I also want to thank the Attorney General for

      23      supporting the good-cause eviction bill that I'm the

      24      lead sponsor of in the Senate.

      25             I wanted to ask, because you mentioned the







                                                                   44
       1      need to enhance enforcement as well, if you and the

       2      Attorney General have specific steps that you think

       3      we can take to improve enforcement by HCR?

       4             ASST AG MICHAEL BARBOSA:  Well, with our

       5      office, we just need more and more written

       6      complaints.

       7             Many times, with increases, there's a certain

       8      time limit, and it's too late for us to enforce due

       9      to statute-of-limitation issues.

      10             So we would encourage all tenants to continue

      11      to complain, and continue to write complaints, to

      12      our office.

      13             SENATOR SALAZAR:  Thank you.

      14             SENATOR KAVANAGH:  Any other questions?

      15             Thank you again.

      16             And please send our regards to the

      17      Attorney General.

      18             ASST AG MICHAEL BARBOSA:  Thank you.

      19             SENATOR KAVANAGH:  Next up we're going to

      20      have Ben Dulchin, of The Association for

      21      Neighborhood and Housing Development.

      22             Is Ben in the room?

      23             Okay, Ben may have stepped out for a minute.

      24             OFF-CAMERA SPEAKER:  No, he's here.

      25             SENATOR KAVANAGH:  Oh, there's Ben.  Good.







                                                                   45
       1             Come on down, Ben.

       2             And on deck, actually, if J.T. Falcone of the

       3      United Neighborhood Houses is here.

       4             Whenever you're ready.

       5             BENJAMIN DULCHIN:  Thanks very much.

       6             So, thank you, Chairperson Kavanagh; thank

       7      you Committee members.

       8             I'm very pleased to be here this morning

       9      testifying.

      10             My name is Benjamin Dulchin.

      11             I'm the executive director of the Association

      12      for Neighborhood and Housing Development.

      13             We're an umbrella organization of

      14      103 neighborhood-based not-for-profit organizations

      15      that work on affordable-housing issues and

      16      economic-development policy across the city.

      17             But half our members are mission-driven

      18      affordable-housing developers, and are currently

      19      managing about 30,000 units of affordable housing,

      20      and have built or preserved about 139,000 units of

      21      affordable housing over the last three decades.

      22             I mention this to say that we really do

      23      understand the issue from both sides.

      24             We both are deeply involved in research and

      25      analysis and support around tenants-rights issues,







                                                                   46
       1      affordable-housing preservation issues.

       2             But, as managers, we also understand that

       3      income needs to meet expenses, and that, you know,

       4      without that, that a building can physically suffer,

       5      and that a building has to be managed appropriately,

       6      and that all sides need to -- need to fulfill their

       7      obligations.

       8             So I want to talk primarily -- so, just to

       9      start off, ANHD supports all the major legislation

      10      in the Housing Justice For All platform.

      11             But I want to focus my testimony this morning

      12      particularly on the rent-increase loopholes, and how

      13      we think that, since 1994, they have fundamentally

      14      undermined the mechanism that really allows rent

      15      regulation to work, what's really been the core of

      16      it.

      17             I've attached to my testimony a white paper

      18      that ANHD recently released on the actual use of the

      19      individual apartment improvement increase, which we

      20      think really is the keystone of the loss of

      21      affordable housing in the city.

      22             So -- I mean, I think, you know, sort of,

      23      everybody here knows the major changes that happened

      24      in 1994 when the Republican-controlled Senate pushed

      25      for some significant changes in rent regulation.







                                                                   47
       1             That was really marked the moment, where,

       2      what was effective about rent regulation, the core

       3      mechanism, was really fundamentally undermined.

       4             So, again, like, you know, it's not about

       5      good landlords, bad landlords; good landlords, bad

       6      people.

       7             It's about speculation; it's about the way in

       8      which rent regulation had been an effective

       9      preventative against speculation.

      10             So, you know, what rent regulation

      11      fundamentally does is it controls the expectations

      12      of the market.

      13             So when you buy a building, you buy a

      14      building understanding that you're going to need to,

      15      you know, sort of pay a price, that it can be

      16      supported with the tenants in place, expecting only

      17      modest Rent Guidelines Board increases.

      18             If you have these rent-increase loopholes,

      19      such as individual apartment improvement increases,

      20      you suddenly open up the market to imagine that they

      21      can pay significantly more for a building because

      22      they can expect unlimited upside for the building.

      23             And that's speculation, and that's really

      24      what's -- that's what's broken; that's what, sort

      25      of, fundamentally changed.







                                                                   48
       1             So let me give an example, actually, of the

       2      building around the corner from here, probably in

       3      Senator Myrie's district.

       4             In sort of looking at -- doing research

       5      around this, I looked at the building my mother grew

       6      up in, right around the corner.

       7             When she grew up in that building, it was a

       8      working-class, immigrant-dense building, very

       9      affordable, and it still is today, you know, which,

      10      given the changes that the neighborhood has gone

      11      through, is rather remarkable.

      12             But it's really not remarkable, because

      13      looking at every sale that building has -- every

      14      sale on that building over the last 40 years that we

      15      can track the sales, that building has been bought

      16      and sold for around 10 times the rent roll, which is

      17      an appropriate price.  Right?

      18             If you buy a building for 10 times rent roll,

      19      you can make a decent profit as a landlord, and

      20      landlords have the right to make a decent profit,

      21      still maintain the building, right, without having

      22      that pressure, having an expectation, of pushing out

      23      the low-rent-paying tenants.

      24             Unfortunately, my mother's building is an

      25      anomaly.  Right?







                                                                   49
       1             The majority of buildings that we're seeing

       2      now marketed today aren't being marketed for

       3      10 times rent roll, aren't being marketed at

       4      reasonable prices, assuming that they're not

       5      speculative.

       6             They're being marketed at 16, 17, 20 times

       7      rent roll, which is a clear recipe for displacement.

       8      Right?

       9             So that speculation is the keystone of

      10      displacement.  Right?

      11             Why do you displace somebody?

      12             You displace them so that you can

      13      dramatically increase the rent.

      14             How do you dramatically increase the rent?

      15             Through those -- through major loopholes in

      16      the law, like the individual apartment improvement

      17      rent increase.

      18             So what the white paper points out is that,

      19      you know, in looking at data that we collected, that

      20      the Housing Rights Initiative collected, on the

      21      individual apartment improvement increase, is that

      22      it is not fundamentally used, as we have heard the

      23      landlord lobby claim, to make modest improvements

      24      where it's needed, to bring up the quality of the

      25      apartment in a reasonable way.







                                                                   50
       1             It is really being fundamentally used to

       2      dramatically drive up rents in a portfolio of

       3      buildings that -- that they had data for, that we

       4      analyzed with them.

       5             Looking at well over 100 apartment rent

       6      histories, we found that the average IAI-derived

       7      rent increase was 107 percent increase over the

       8      previous rent.  Right?

       9             The average rent was about 1500, and it was

      10      raised by -- well, you know, to almost twice that

      11      with an IAI increase.

      12             So, IAIs are not functioning to incentivize

      13      modest improvements.

      14             They are fundamentally functioning.  They

      15      were designed to be, the formula is designed to be,

      16      a fundamental mechanism that leads to displacement.

      17             And I'll just sort of say, you know, one more

      18      thing before I close, one thing we've heard a lot

      19      about is that, you know, if you close these

      20      rent-increase loopholes it's going to damage

      21      mom-and-pop landlords.

      22             You know, looking at the data for the market,

      23      we think that there is a real overstatement of the

      24      centrality of mom-and-pop landlords in the market

      25      and their vulnerability.







                                                                   51
       1             The nature of the rent-stabilized real estate

       2      market has really changed in the last couple of

       3      decades.

       4             You know, earlier, sort of in the -- you

       5      know, before the aughts, you know, there really --

       6      there was a prevalence of some mom-and-pop

       7      landlords.

       8             That really started to change in the early --

       9      you know, in the 2000s, where you began to see

      10      large, sort of, institutional-money-backed investors

      11      coming in and buying up large portfolios of

      12      buildings.

      13             That is -- both, that is driving out

      14      mom-and-pop landlords because it's driving up

      15      prices, and that has really been, sort of, one of

      16      the driving factors behind speculation in the

      17      market.

      18             You know, generally, you know, we've seen

      19      this, and we've sort of seen this with the buildings

      20      that our members manage, Rent Guidelines Board

      21      increases have -- over the years, have more than

      22      accounted for basic increases, and the

      23      (indiscernible) basic increases in operating costs.

      24             Responsible landlords generally don't need to

      25      take these -- these -- these -- you know, major







                                                                   52
       1      rent-increase loopholes.

       2             You drive major increases through

       3      rent-increase loopholes when you've speculated on

       4      the building, when you're accounting on being able

       5      to pay that high price, by pushing out

       6      low-rent-paying tenants.

       7             Those need to be closed.

       8             SENATOR KAVANAGH:  So I'm going to -- we do

       9      have copies of your testimony.  I think you also

      10      will have a few questions, but I'm going to cut you

      11      off, and thank you for your testimony.

      12             But I'm going to ask J.T. Falcone to testify

      13      first.

      14             J.T. FALCONE:  So, thank you Chair Kavanagh

      15      and members of the Committee for the opportunity to

      16      testify today.

      17             My name is J.T. Falcone.

      18             I'm a policy analyst at United Neighborhood

      19      Houses (UNH).

      20             UNH is a policy and social-change

      21      organization representing 42 neighborhood settlement

      22      houses across the state.

      23             Over the past century, UNH's member

      24      settlement houses have shepherded communities across

      25      New York State, offering a wide variety of







                                                                   53
       1      programming and leading social-reform movements.

       2             Settlement houseworkers have fought to ensure

       3      that all community members have access to

       4      opportunity by promoting fair laws and regulations,

       5      and holding up those in power to keep them

       6      accountable.

       7             In this way, settlement houses have been

       8      particularly influential in fighting for housing and

       9      quality-of-life reforms, establishing the

      10      first-in-the-nation tenement laws regarding

      11      low-income housing and ensuring the safety of all

      12      residents.

      13             Today we're here to continue that legacy of

      14      promoting fair laws by urging the Committee to enact

      15      real rent reform and right the wrongs done in the

      16      1990s when New York City's rent laws tipped in favor

      17      of the landlord.

      18             New York settlement houses see this movement

      19      as a tipping point for our communities.

      20             In order to preserve the city we love and

      21      ensure there remains a diverse place where residents

      22      of all income brackets can make a living and afford

      23      a decent home, we must return to a strong system of

      24      rent regulations with commonsense reform and real

      25      accountability for those who choose to cheat.







                                                                   54
       1             UNH joins our partners and fellow advocates

       2      in calling on the New York State Senate to pass

       3      commonsense rent reforms that corrects for the

       4      disastrous changes made in the 1990s, and that have

       5      led to the loss of hundreds of thousands of

       6      protected units at a time when income inequality and

       7      rising rents threaten the future of low- and

       8      middle-income communities.

       9             Specifically today I want to focus on some of

      10      the big top issues that we see, especially around

      11      preserving systems and communities.

      12             So that includes ending vacancy decontrol.

      13             I think that's something that I can kind of

      14      skip over because it seems like everybody is, more

      15      or less, on the same page there, but, so are we.

      16             Same with the eliminating the vacancy bonus.

      17             Combined with vacancy deregulation, the

      18      vacancy bonus has proven disastrous for our

      19      communities.

      20             I can't tell you the number of settlement

      21      houses that look around and see completely different

      22      neighborhoods from where they were founded, and a

      23      lot of that has to do with the fact that their

      24      neighborhoods are changing at a pace that's too

      25      rapid for communities to keep up.







                                                                   55
       1             And, because of the rising income inequality,

       2      because of the rising rents, their constituents are

       3      unable to hold on, and they're losing the heart of

       4      their neighborhood in that way.

       5             We also are very concerned with MCIs and

       6      IAIs.

       7             Specifically, we want to lift up the fact, as

       8      has been noted already, that the system is ripe for

       9      abuse and fraud because it falls on tenants to track

      10      and report suspicious activity.

      11             We were definitely excited by the inclusion

      12      of funding for the office of rent administration and

      13      tenant-protection unit at HCR, but we don't even

      14      know how that's going to shake out yet, we haven't

      15      seen results.

      16             So, we want to make sure that MCIs and IAIs

      17      are not something that falls on tenants to address

      18      if they continue to exist at all.

      19             Obviously, the current allowable increase for

      20      MCIs and IAIs is much too high.

      21             6 percent is an amount that allows landlords

      22      to skirt the careful deliberations of the RGB.

      23             They spend a lot time weighing testimony and

      24      thinking through what's a reasonable increase for

      25      that year.







                                                                   56
       1             And with a loophole open like this one, that

       2      you could drive a truck through, as has been noted,

       3      it leaves -- it leaves too much potential for abuse.

       4             And, finally, the fact that MCIs and IAIs,

       5      I don't have to tell any of you, the fact that

       6      they're added on to legal rent causes cascading

       7      issues, given that all rent increases are weighed by

       8      percentages.

       9             And so, for years and years and years to

      10      come, that sits on the tenants and it sits on the

      11      communities.

      12             So I just -- I wanted to come here from the

      13      settlement-house perspective and say,

      14      New York City's institutions, settlement houses, are

      15      fully behind the protections that this committee

      16      wants to see, to support and safe in our community.

      17             As Benjamin noted, this is about speculation.

      18             This isn't about good or bad landlords,

      19      although, I think we all have heard enough stories

      20      to know that there are bad landlords out there.

      21             This is about communities, and for us, this

      22      is about seeing a New York City for the next

      23      100 years that we've seen for the last 100 years,

      24      and preserving that diversity and that shine.

      25







                                                                   57
       1             SENATOR KAVANAGH:  Thank you for your

       2      testimony.

       3             So we're gonna -- we're gonna go from left to

       4      right on the panel, and then -- and that's strictly

       5      spacial and not ideological.

       6             But, anybody on -- to my left have a

       7      question?

       8             Okay.

       9             SENATOR RIVERA:  So I want to actually -- to

      10      Mr.Dulchin.

      11             And also, Mr. Falcone, "J.T. Falcone," I just

      12      want to say on the record, coolest freaking name,

      13      ever, J.T. Falcone, it's a great one.

      14                [Laughter.]

      15             SENATOR RIVERA:  But, actually -- but,

      16      actually, I want to delve a little bit deeper into

      17      the whole idea, the whole notion, of mom-and-pops,

      18      right, mom-and-pop landlords.

      19             So your -- I've -- I've -- my staff, by the

      20      way, Rachel Ferrari, who is my brain when it comes

      21      to housing issues, loves you folks because of all

      22      your data.

      23             So you've gone through all the data, and you

      24      probably have some of it in your head.

      25             If not, I'd really appreciate it if you could







                                                                   58
       1      get me this.

       2             There are, obviously, thousands and thousands

       3      of landlords in the city of New York.

       4             There's -- you know, I don't know how many

       5      buildings the city of New York, that are -- you

       6      know, millions of buildings, probably.

       7             So, what would you -- what would be your

       8      definition, roughly speaking, of a mop and --

       9      mom-and-pop landlord?

      10             BENJAMIN DULCHIN:  Well, I mean, I think --

      11      we use the term very informally as it is used.

      12      Right?

      13             It's often used as sort of an ideological

      14      shield, like, oh, it -- nothing bad can happen

      15      because it's mom-and-pop landlords.

      16             SENATOR RIVERA:  So since you folks are data

      17      people, tell me, data-wise, if you have to make --

      18      if you have to define such a thing, how would you do

      19      so?

      20             BENJAMIN DULCHIN:  You know, I think, you

      21      know, we would define it as, you know, a landlord

      22      who owns no more than, you know, three or

      23      four buildings.  Right?

      24             Use, four.

      25             SENATOR RIVERA:  So, four.







                                                                   59
       1             So if you consider the data that you've seen,

       2      as far as ownership, what do -- would you even have

       3      a guess as to what percentage of the total number of

       4      landlords that there are in New York amount to

       5      mom-and-pop landlords?

       6             BENJAMIN DULCHIN:  You know, it is tricky to

       7      know because every individual building is

       8      generally -- is -- is filed under its own individual

       9      LLC.

      10             SENATOR RIVERA:  Yes.

      11             BENJAMIN DULCHIN:  We are -- we are currently

      12      working with some colleagues on this data project,

      13      and might have some interesting data to report to

      14      you.

      15             SENATOR RIVERA:  It would be -- I would be --

      16      as you scour the data, it would be really, really --

      17      we would be really interested, I certainly would be

      18      really interested, in kind of finding this out,

      19      because, as you mention, it is used as an

      20      ideological shield.

      21             But if you have the -- I'm going to guess --

      22      obviously, the data will speak for itself when you

      23      crunch it.

      24             But I'm going to guess, that if you have

      25      people that own 5, 10, 15, 20, 50 buildings, that --







                                                                   60
       1      obviously, that's not considered a mom-and-pop.  And

       2      then the impact that their decisions have on entire

       3      portfolios, and, therefore, on entire neighborhoods,

       4      you know, can certainly be measured.

       5             BENJAMIN DULCHIN:  Look, the housing market

       6      has fundamentally changed in the last 20 years.

       7      Right?

       8             There was a long time when rent-stabilized

       9      real estate was a backwater.  Right?

      10             People invest in it, they owned a few

      11      buildings, you really could say the typical owner

      12      was a mom-and-pop landlord.

      13             Rate of return was 5, 6 percent a year, it

      14      was a boring but very steady, very reliable, you

      15      know, investment that you could maintain while

      16      respecting the integrity of rent regulation and only

      17      following Rent Guidelines Board increases.

      18             That was fundamentally broken initially in

      19      1994 with the changes in the rent laws.

      20             And then with, in the early aughts, this

      21      tsunami influx of private-equity-backed money into

      22      the real estate market, recognizing that these, you

      23      know, buildings, like my mother's, like these sort

      24      of rent-stabilized buildings in the outer boroughs,

      25      were not, you know, sort of islands of affordability







                                                                   61
       1      that should be respected; but, rather, were untapped

       2      assets that you could invest a lot of money in with

       3      an aggressive speculative strategy of pushing out

       4      low-rent-paying tenants.  Then using the

       5      rent-increase loopholes as the mechanism for that.

       6             So those two things really go together.

       7             That's not the mom-and-pop landlord who is

       8      increasingly a smaller and smaller portion of the

       9      market.

      10             That's -- that's -- that's

      11      institutional-backed money.  That is --

      12      increasingly, that is what we see as the driver of

      13      the loss of affordability.

      14             I'll just sort of point out two numbers.

      15             We're losing about seven and a half thousand

      16      units a year through (indiscernible) control.

      17             But that isn't even really the key number.

      18             The key number, because a lot -- you can lose

      19      affordability, but not reach that decontrol

      20      threshold.

      21             We've actually -- the rent guidelines, with

      22      the -- Rent Guidelines Board recently, the housing

      23      vacancy survey reported, that, since 2014, there

      24      were 166,000 units renting below $1500, were lost

      25      just between now and 2014.







                                                                   62
       1             That's a 12.5 percent loss in the percentage

       2      of those relatively affordable units.

       3             Those are probably -- many of those are still

       4      counted as rent-stabilized, but they are no longer

       5      affordable in the neighborhoods in which they -- you

       6      know, in -- in -- in -- in which they are.

       7             And, unquestionably, like, we know this from

       8      deep, deep experience, the mechanism for the loss of

       9      every single one of those units was IAIs.  That is

      10      the keystone of the speculative --

      11             SENATOR RIVERA:  As you crunch those numbers,

      12      I would really, really appreciate it, because I want

      13      to dig deeper into that.

      14             Thank you, Mr. Chairman.

      15             SENATOR KAVANAGH:  Thank you.

      16             I think Senator Krueger has a question.

      17             SENATOR KRUEGER:  Thank you.

      18             I like your name also, Ben Dulchin.

      19             BENJAMIN DULCHIN:  No, you don't.  No one

      20      does.

      21             SENATOR KRUEGER:  It might not be as cool,

      22      I don't know, but I like your name.

      23             BENJAMIN DULCHIN:  I don't want to testify

      24      with J.T. again.

      25                [Laughter.]







                                                                   63
       1             SENATOR KRUEGER:  And I also appreciate so

       2      much your being here, and we've known each other

       3      for, I don't know, 30, 25 years.

       4             And I so appreciate the work of ANHD.

       5             So in your testimony, as you've highlighted

       6      it, the IAI issue is huge for us to address.

       7             But you were really targeting the speculation

       8      that has gone on by people buying up these buildings

       9      and imagining they can turn around and get 15,

      10      20 percent profit rapidly.

      11             Besides all the bills we all know very well

      12      and are discussing, is there something else we can

      13      or should do in the next few weeks, as part of the

      14      package we are fighting for, to address limiting the

      15      ability to speculate, by limiting how banks loan

      16      money, and what you have -- what standards would

      17      have to be met before the banks could loan the

      18      money, to slow down the speculations?

      19             I don't know if I'm saying it right --

      20             BENJAMIN DULCHIN:  Yeah, no --

      21             SENATOR KRUEGER:  -- but what do we do to

      22      further protect this happening in the first place?

      23             BENJAMIN DULCHIN:  -- yeah, so, I mean, one

      24      factor in the (indiscernible) speculation that we've

      25      seen has been overly aggressive, sort of, investment







                                                                   64
       1      money, often backed by mortgages, with -- you know,

       2      sort of based on unsound underwriting.  Right?

       3             So, sort of, in the early aughts we saw a lot

       4      of underwriting that wasn't fundamental -- loan

       5      underwriting, right, sort of first-mortgage

       6      underwriting, that wasn't based on the existing

       7      tenants.  Right?

       8             So the thing we look at is the debt-service

       9      coverage, right, and the debt service coverage has

      10      to easily be met by the rent roll that's in place.

      11             If it doesn't, then you know that that loan

      12      was made with the expectation of tenants being

      13      pushed out.

      14             You know, under -- you know, with the advice

      15      and pressure from a lot of community groups, a lot

      16      folks who are in this room, actually, the

      17      New York State Department of Financial Services

      18      (DFS) recently released a set of guidelines for how

      19      banks should lend on buildings with rent-stabilized

      20      properties, that we think are very strong guidelines

      21      that talk about:

      22             Not lending based on preferential rents;

      23             Lending, you know, at least a

      24      1.2 debt-service coverage, you know, based

      25      on the in-place on the rent roll;







                                                                   65
       1             And, not lending to proven harassers.  Right?

       2      Not lending to people who have a proven history

       3      of -- you know, of harassing people out.

       4             We think those are all excellent guidelines

       5      that would be, you know, well-followed by anybody.

       6             But I would say that, you know, while we've

       7      been very focused, you know, on -- sort of on bad

       8      lending, whether or not you have bad -- and,

       9      certainly, bad lending exacerbates bad behavior, you

      10      know, sort of, by -- by -- you know, by speculative

      11      landlords.

      12             It is those rent-increase loopholes, that is

      13      preferential rents, that is IAIs, that is

      14      (indiscernible) things that you control, that -- you

      15      know, and -- and, to a certain extent, MCIs, that

      16      are the foundation of that strategy for any landlord

      17      and the banks that love them.

      18             SENATOR KRUEGER:  You had a follow-up answer?

      19             J.T. FALCONE:  I don't want to take us too

      20      far off-track, but you mentioned speculation.

      21             And I just wanted to say, Senator Salazar's

      22      introduced the small-home anti-speculation tax.

      23             And that's something that would also be very,

      24      very helpful, in terms of, not as much on this

      25      issue, but in terms of protecting communities across







                                                                   66
       1      the city.

       2             SENATOR KRUEGER:  Thank you.

       3             Thank you, both.

       4             SENATOR KAVANAGH:  Thank you.

       5             Okay, I think we had, Senator Myrie has a

       6      question.

       7             SENATOR MYRIE:  Thank you, both, for your

       8      testimony.

       9             Can you speak to the notion that eliminating

      10      a lot of these loopholes will completely

      11      disincentivize investment in the housing stock?

      12             I know that -- and can you speak to that,

      13      specifically as it regards to MCIs and IAIs?

      14             BENJAMIN DULCHIN:  Sure.

      15             It's a ridiculous notion.

      16                [Laughter.]

      17             SENATOR MYRIE:  Is that the legal term?

      18             BENJAMIN DULCHIN:  It is -- it is -- it is

      19      absurd on its face.

      20                [Applause.]

      21             BENJAMIN DULCHIN:  And, again, I would sort

      22      of -- I don't mean to be glib.  Right?

      23             I mean, there was a fundamental shift in the

      24      way the housing market functioned after 1994, but --

      25      you know, in the change of the rent laws.







                                                                   67
       1             But, really, you know, with the sudden, you

       2      know, sort of influx of all of this

       3      private-equity-backed money in the early aughts, you

       4      can buy and sell real estate.  You know, it is a

       5      commodity that can happily be bought and sold, as

       6      long as the profit expectations are reasonably

       7      contained by the rent-stabilization laws and by Rent

       8      Guidelines Board increases.

       9             That system functioned reasonably well prior,

      10      you know, in earlier decades.

      11             That was -- you know, at that time, when you

      12      didn't have those rent-increase loopholes, and rent

      13      regulation succeeded, was successful in maintaining

      14      sort of pushing down speculation.

      15             Again, I would sort of give the example of my

      16      mother's building around the corner.  Right?  That

      17      building was bought and sold five times in the last

      18      number of decades.

      19             Every time it was bought and sold, somebody

      20      made a nice profit, I assume.  Right?  You know,

      21      otherwise, why would they have bought and sold it?

      22             The average rent, though, is still a little

      23      over $1,000 in that building, to this day, because

      24      the price of that building was kept in proper

      25      proportion to the rent roll from the building.







                                                                   68
       1      Right?

       2             If you buy and sell a building for 10 times

       3      rent roll, the way rent stabilization imagines

       4      you'll -- you know, fundamentally imagines you

       5      should, you can have healthy buying and selling of

       6      buildings, you can have healthy profits, you can

       7      make, you know, 5 or 6 percent, but, you're not

       8      going to have that expectation of pushing out the

       9      tenants, you're not going to have that expectation

      10      of displacement and harassment.

      11             So what we will see, if these rent rolls are

      12      closed, is not that the housing market's going to

      13      suddenly collapse around our feet; but, rather, it

      14      will return to sanity the way it was a few decades

      15      ago.

      16             SENATOR KAVANAGH:  I think Senator Liu had a

      17      question.

      18             SENATOR LIU:  Yeah, I think, actually,

      19      Senator Rivera addressed the -- this concept.

      20             We've been -- you know, we hear from a lot of

      21      people, like, Oh, if you take away the MCIs, we're

      22      not going to be able to maintain our property,

      23      especially since we're mom-and-pops.

      24             First of all, I'm not sure that somebody who

      25      owns three or four buildings is really a







                                                                   69
       1      mom-and-pop.

       2                [Applause.]

       3             SENATOR LIU:  Okay?

       4             I mean, I don't think my mom and my pop could

       5      own three or four buildings.

       6             So if we -- if we, you know, more precisely

       7      define what "mom-and-pop" is, I suspect that they

       8      would have an even smaller proportion of the market.

       9             But I second Senator Rivera's request, that

      10      if you could provide us with, you know, roughly, how

      11      much of the market are we talking about?

      12             Are we -- you know, we -- sometimes we're led

      13      to believe that 20 to 30 percent of the rental

      14      market -- rent-stabilized market is owned by "moms"

      15      and "pops."

      16             I suspect it's much smaller.  I suspect it's

      17      probably in the single digits, and perhaps even in

      18      the low single digits.

      19             But it would help us if you -- it will help

      20      me, and probably Gustavo, and perhaps others, if you

      21      could give us some sense as to what portion of the

      22      market really is owned by small-owners.

      23             I don't even want to say mom-and-pops

      24      anymore.

      25             Just small-owners.







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       1             And by "small-owners," I would -- I would --

       2      you know, I think the reasonable person on the

       3      street would be, a "small-owner" is somebody who may

       4      have, like, you know, a couple of units here or

       5      there, but not more than -- you know, say, not more

       6      than a dozen.  And I'm just even throwing "12" out

       7      there as a random number.  But it's certainly not

       8      in, like, three or four buildings.

       9             BENJAMIN DULCHIN:  Yeah, so, I mean, we'll do

      10      our best to put together some data with our

      11      colleagues.

      12             It's difficult data to get, just 'cause

      13      (indiscernible).

      14             SENATOR LIU:  I understand.

      15             BENJAMIN DULCHIN:  But I guess, in some ways,

      16      it's a red herring, because, you know, I guess --

      17      you know, taking -- you know, aside from -- you

      18      know, sort of putting aside the -- sort of, the

      19      ideological use of this concept of mom-and-pop that

      20      it's used for, it probably is the case that there is

      21      a less efficient economy of scale if you have fewer

      22      units, so it's little bit less efficient to manage

      23      the building.

      24             But the truth is, and I say this, right, you

      25      know, with our member organizations that currently,







                                                                   71
       1      you know, sort of own -- you know, manage about

       2      30,000 units of affordable housing, you can properly

       3      manage affordable -- you know -- and, you know,

       4      maintain stable, decent housing, based on Rent

       5      Guidelines Board increases, which, over the years,

       6      have more than accounted, right, historically, more

       7      than accounted for increases in operating costs.

       8             You can properly manage and maintain those

       9      buildings without resorting to Draconian rent

      10      increases, as long as you haven't paid too much for

      11      that building, right, as long as you have not paid a

      12      speculative price for the building.

      13             SENATOR LIU:  Right.

      14             BENJAMIN DULCHIN:  And that's where the

      15      market needs to return to.

      16             SENATOR LIU:  And that was actually my second

      17      question, that if you could give us some kind of

      18      demonstration as to how the Rent Guidelines Board

      19      increases, especially after -- especially under the

      20      previous, you know, administration, that how those

      21      increases would have been enough for the reasonable

      22      landlord, or the conscientious landlord, to keep up

      23      her or his property.

      24             BENJAMIN DULCHIN:  Yeah, I can pull those

      25      numbers for you.







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       1             They -- they -- those increases have far

       2      outstripped increases in operating costs.

       3             SENATOR LIU:  Okay.  Thank you.

       4             SENATOR KAVANAGH:  Senator Gianaris.

       5             SENATOR GIANARIS:  Yeah, just more a -- more

       6      of a comment than a question, because Senator Myrie

       7      kind of touched on what I wanted to ask you.

       8             But, I appreciate your answer on the MCIs,

       9      because there are advocates of reform, rather than

      10      elimination, that keep citing this point of, we need

      11      the MCIs to incentivize any repair work at all.

      12             And so to hear an expert like yourself say

      13      that's completely unnecessary is actually very

      14      important for us to gather.

      15             And to hear landlords crying poverty over the

      16      ability to maintain these buildings, when they're

      17      actually making money off of people who are

      18      genuinely in poverty in their buildings, is

      19      infuriating.

      20                [Applause.]

      21             SENATOR KAVANAGH:  I am going to ask people

      22      to please, you know, refrain from responding.

      23             Thank you.

      24             SENATOR GIANARIS:  And the other thing is not

      25      so much for you.







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       1             I just wanted to clarify for the record, that

       2      the Attorney General, I think her rep is still here,

       3      in "The Queens Chronicle" did actually come out for

       4      the elimination of MCIs back in October.

       5             So she is on the record on that as well.

       6             SENATOR KAVANAGH:  Thank you,

       7      Senator Gianaris, representing our Attorney General.

       8                [Laughter.]

       9             SENATOR KAVANAGH:  Okay, any other questions

      10      for this panel?

      11             Okay, hearing none, thank you, both, so much

      12      for your testimony, and all the work you do, and all

      13      the analysis that you've already provided for our

      14      work.

      15             Next up we are going to have

      16      Carmen Vega-Rivera of CASA, and Anita Long, also of

      17      CASA.

      18                [Applause.]

      19             SENATOR KAVANAGH:  And while they're getting

      20      set up, just so that we have -- the next folks can

      21      be ready to come up, the next panel will be

      22      Nilda Rivera of Woodside on the Move, and

      23      Ivan Contreras, also of Woodside on the Move.

      24                [Applause.]

      25             SENATOR KAVANAGH:  Can we at least let these







                                                                   74
       1      people testify before you applaud the next panel.

       2             And then -- and, in addition, I think we're

       3      also going to hear from Sandra Dominguez.

       4             So if those three folks could be ready to go,

       5      we'd appreciate it.

       6             Whenever you're ready.

       7             CARMEN VEGA-RIVERA:  Good afternoon.

       8             My name is Carmen Vega-Rivera.

       9             I'm a CASA leader with Community Actions for

      10      Safe Apartments in The Bronx.

      11             I'm also a proud member of the Upstate

      12      Alliance fighting for universal rent control so that

      13      all tenants, both regulated and unregulated in the

      14      state, have basic and expanded rights.

      15             I'm here today to demand that the entire

      16      New York State Senate support universal rent control

      17      and pass the full platform.

      18             Every single bill on our platform needs to be

      19      passed, including good-cause, and elimination of

      20      major capital improvements and individual apartment

      21      improvements.

      22             Over half the families that live in The Bronx

      23      are rent-burdened.

      24             And I want to highlight that our senator,

      25      Gustavo Rivera, has been instrumental in helping us







                                                                   75
       1      to address these issues.

       2             Rent stabilization barely keeps us in our

       3      homes.

       4             It does not mean our rents are affordable or

       5      that we live in good conditions.

       6             What about the millions of tenants without

       7      basic rights in New York State that would benefit

       8      from good-cause and expanding the emergency tenant

       9      protection?

      10             I'm here today to share a picture of what

      11      I've been going through, and how the impact of weak

      12      rent-stabilization laws, and how our neighbors have

      13      also lost their homes, because of the loopholes in

      14      rent stabilization.

      15             You can't make piecemeal reforms to a system

      16      designed to benefit landlords and exploit tenants

      17      and displace us.

      18             I live in a very well-known building created

      19      by Emery Roth, an architect.

      20             It is 888 Grand Concourse, right on a pivotal

      21      corner of East 161st Street in the Grand Concourse.

      22             I moved from the Lower East Side in the late

      23      '70s to The Bronx right before I would have been

      24      displaced.

      25             My previous landlord, Louis and







                                                                   76
       1      Jonathan Bombart, owned the building since 1987,

       2      four buildings in The Bronx, and a few in Brooklyn,

       3      and it was a family business.

       4             No, they sound small, but they were wealthy.

       5             They made millions off the misery that they

       6      put us through.  Left their family $50 million of my

       7      rent money.

       8             After organizing and fighting for decades, we

       9      finally got rid of our landlord.

      10             Our building entered into foreclosure, and we

      11      almost auctioned off -- were auctioned off to one of

      12      the worst and biggest corporate landlords in

      13      The Bronx, Finkelstein.

      14             During this time, a receiver was appointed

      15      after we requested it, that one will be so, in

      16      Supreme Court.

      17             A new boiler was installed by the receiver

      18      with our rent-roll money as tenants, that we paid

      19      into.

      20             Now we have a new landlord, and not much

      21      better than the old one.

      22             They are doing all kinds of building work

      23      that will eventually all lead to major capital

      24      improvement, anywhere from 10 to 13.

      25             After No More MCI Coalition met with the







                                                                   77
       1      Commissioner, Ruth Anne Visnasukas, and her team,

       2      last year, we were told that my new landlord would

       3      be eligible to apply for an MCI for the same boiler

       4      that we as tenants pay for it.

       5             How does this make any sense?

       6             Reforming the MCI system would leave

       7      loopholes open for landlords to exploit.

       8             No, it's no secret, DHCR and the

       9      New York State Division of Homes and Community

      10      Renewal doesn't enforce the current rent laws,

      11      doesn't have the staff or the resources to

      12      legitimately process MCIs and scrutinize the

      13      application.

      14             They're actually there to help also support

      15      tenants, yet I feel that they're part of the problem

      16      because they're helping to displace us.

      17             Even when we organize, we have an attorney

      18      challenge the MCI, the outcome is the same.

      19             Over 90 percent of the time, the agency

      20      rubber-stamps MCIs, has one inspector per borough to

      21      eliminate MCIs, and doesn't investigate or research

      22      how much a bathroom should really cost.

      23             Landlords don't need incentives like MCIs or

      24      IAIs.  That's a myth.

      25             Landlords of rent-stabilized buildings







                                                                   78
       1      already enjoy the highest rent of profit of almost

       2      any property owner in the nation.

       3             That is a fact.

       4             It is validated by the Rent Guideline (sic)

       5      Board yearly report.

       6             This year's report from the RGB confirmed the

       7      following:

       8             Rent-stabilized landlords keep making money.

       9             Again, they keep making money.

      10             In fact, they're operating net income has

      11      steadily grown for 13 years.

      12             In 2017, 95 percent of rent-stabilized

      13      landlords made a profit.

      14             As our elects, and as our Senate representing

      15      all New Yorkers, my question is simple:  Do you care

      16      about the 400,000 low-income New Yorkers living in

      17      rent-stabilized housing, or do you care about the

      18      5 percent of the landlords who can use the hardship

      19      exemption?

      20             You have to pick, and I'm hoping you're gonna

      21      to choose and move to the tenants' side.

      22             So let's change the narrative.

      23             Landlords don't need incentives, like MCIs or

      24      IAIs.

      25             What gets lost in that conversation is that







                                                                   79
       1      tenants are the ones paying for the capital

       2      improvements.

       3             Landlords didn't pay for the boiler.

       4             Tenants will end up paying for the boiler

       5      forever, and our rents will go up permanently.

       6             So it's not an incentive.

       7             It's just another tool to drive up legal

       8      rents, push rents past the deregulation threshold,

       9      and displace us.

      10             If landlords are truly struggling, they can

      11      apply for a hardship exemption.

      12             Landlords are currently spending millions of

      13      dollars to influence and lobby our elected

      14      officials.

      15             They know their time is up, and universal

      16      rent control is long overdue.

      17             Why doesn't the landlord lobby spend these

      18      millions educating their members on how to actually

      19      register apartments with DHCR, or -- well -- as to

      20      how to apply for existing government subsidies, like

      21      J-51 and weatherization programs?

      22             Our landlord, I believe, is exploiting and

      23      flaunting the entire rent-stabilization system.

      24             The studio apartment next to me in my

      25      building was $800, until recently, when my neighbor







                                                                   80
       1      moved.

       2             After an IAI, it is now $2000.

       3             The two-bedroom right next to me, that was no

       4      more than 1800, is at the threshold of 2700.

       5             Someone explain to me all the fuzzy math,

       6      because I just don't get it.

       7             This is why we are demanding to end major

       8      capital improvement and to end IAIs (individual

       9      apartment improvement).

      10             The system cannot reform it.

      11             It must be eliminated.

      12             Thank you.

      13                [Applause.]

      14             SENATOR KAVANAGH:  Thank you.

      15             ANITA LONG:  Good afternoon.

      16             My name is Anita long, and I am a CASA leader

      17      with Community Action For a Safe Apartment in

      18      The Bronx.

      19             I'm also a proud member of the

      20      Upstate/Downstate Alliance fighting for universal

      21      rent control so that all tenants, both regulated and

      22      unregulated, in this state have basic expanded

      23      rights.

      24             I am here today, specifically, to share how

      25      I have been impacted by major capital improvements,







                                                                   81
       1      and how thousands of my neighbors in my communities

       2      have been fighting MCIs on their own, and organizing

       3      with their neighbors, and have still lost their

       4      homes, because of MCIs and other loopholes in rent

       5      stabilization.

       6             Since June of 2018, I have received two MCI

       7      permanent rent increase from my landlord, who's a

       8      corporate landlord.

       9             On top of that, a rent increase under the

      10      Rent Guideline (sic) Board.

      11             Now, back in the fall of 2016, CASA and

      12      Northwest Bronx Community and Clergy Coalition

      13      formed the No More MCI Coalition in The Bronx.

      14             Together, we are actively organizing over

      15      18 buildings, representing 1500 families, fighting

      16      almost $18 million in permanent monthly rent hikes.

      17             We organize together with one same vision:

      18      Eliminate MCIs forever.

      19             We targeted "DHCR," that's the department of

      20      homes and community renewal, because we knew they

      21      had the power to make policy and administrative

      22      changes.

      23             Thank you, Senator Rivera.

      24             The MCI process is unfair, and landlords are

      25      always given every benefit of the doubt, while the







                                                                   82
       1      burden is on the tenants to provide the oversight as

       2      if they themselves are the enforcement agencies.

       3             According to the DHCR data submitted to the

       4      Rent Guideline (sic) Board in 2017, over 90 percent

       5      of MCI applications were granted in 2017.

       6             That's unfair.

       7             We met with the commissioner,

       8      Ruth Anne Visnauskas, and her team, several times

       9      with the same message:  We are being displaced by

      10      MCIs.

      11             DHCR is not doing a thorough job of examining

      12      these MCI applications from the landlords.

      13             They are not allocating enough resources and

      14      inspectors to actually inspect every building, and

      15      they are denying tenants their basic rights, such as

      16      language access.

      17             A deep systemic overhaul is needed and long

      18      overdue.

      19             After meeting and hearing directly from the

      20      commissioner and the executive team, one thing

      21      became clear:  The system cannot be reformed.

      22             Reforming the common MCI system will only

      23      contribute to the problem.

      24             MCIs are designed to only benefit landlords,

      25      and not just any landlords, but, particularly, large







                                                                   83
       1      landlords that own many buildings and have large

       2      portfolios.

       3             When the landlord lobby began their campaign

       4      a few months ago, they posted a simple fact on

       5      social media.

       6             The landlord lobby said:  According to DHCR

       7      in 2017, barely 1 percent of the landlords of

       8      rent-stabilized buildings applied for an MCI that

       9      year.  That MCIs are used sparingly.

      10             And we agree with that, that's a fact.

      11             We -- we keep -- why keep the MCI program

      12      when 99 percent of the landlords don't actually need

      13      it or use it?

      14             Why keep MCIs for the bad landlords, like my

      15      landlord, who owns over 75 buildings in The Bronx

      16      and who imposes multiple MCIs on their tenants?

      17             The reality is, landlords do not need

      18      incentives.

      19             Landlords already have capital, and they use

      20      MCIs to displace long-term tenants of color citywide

      21      in the most vulnerable and poor communities in

      22      New York City because they are betting we will be

      23      gentrified and leave.

      24             From The Bronx, to Chinatown, to Brooklyn, to

      25      Queens, to Manhattan, we are being evicted and







                                                                   84
       1      displaced because of MCIs and other loopholes, and

       2      we are saying, no more MCIs.

       3                [Applause.]

       4             SENATOR KAVANAGH:  Thank you.

       5             Okay, again, I'm going to, please -- as we

       6      have about 40 more people who want to testify, to

       7      please, you know, we have just -- if we could please

       8      restrict responses.

       9             Proceed.

      10             ANITA LONG:  I'm here today to demand that

      11      the entire New York State support universal rent

      12      control -- New York Senate support universal rent

      13      control, and pass the full platform.

      14             Every bill on our platform needs to be

      15      passed, including major capital improvement,

      16      individual apartment improvement, and also that

      17      good-cause.

      18             I am being affected personally by the

      19      good-cause.

      20             I have a son who is a renter in the

      21      South Bronx, who lives in the three-family home.

      22             His landlord came to him on March 31st of

      23      2019 and told him, "Your lease expires March 31,

      24      2019, and I'm not granting, renewing, a lease.  You

      25      have to move out by May 31, 2019."







                                                                   85
       1             My son came to me because he knows I'm an

       2      advocate, I'm an activist, out here fighting.

       3             He said, "Can you help me?"

       4             It was heartbreaking to tell him, "I cannot

       5      help you because you're not regulated."

       6             This is why we need good-cause.

       7             If good-cause was in place, he would at

       8      least, like other tenants, have the opportunity to

       9      appear in court before a judge to plead his case, as

      10      well as the landlord, and let the judge make that

      11      final decision.

      12             But he's standing there, like, I've never

      13      been to housing court in my life.  I've lived here

      14      for nine years.  And my landlord is not even giving

      15      me a reason why they're not renewing my lease.

      16             This is why we need good-cause to be on the

      17      bill and to be passed.

      18             Thank you.

      19             SENATOR KAVANAGH:  Thank you.

      20             And thank you, you know, for just pointing

      21      one thing.

      22             Good-cause is often talked about as something

      23      we're going to do for the rest of the state.

      24             But just point -- it's very important to

      25      point out that it would affect a very large number







                                                                   86
       1      of people who live within New York City as well.

       2             So, thank you.

       3             And I think Senator Rivera has a question.

       4             SENATOR RIVERA:  So, obviously -- well, first

       5      of all, thank you for coming all the way down to

       6      Brooklyn.

       7             If I would have known, I would have given you

       8      a ride.

       9                [Laughter.]

      10             SENATOR RIVERA:  Come on.

      11             SENATOR KAVANAGH:  (Inaudible) he's available

      12      to give you a ride.

      13             SENATOR RIVERA:  Exactly.

      14             So I'm -- but I'm actually -- I'm actually

      15      going to play the devil's advocate.

      16             Let's assume that I've never met you fine

      17      people before.

      18             And then let's say, you know -- but, you

      19      know, this whole MCI thing, let's talk about it for

      20      a second.

      21             Have you ever seen anything like this?

      22             This is only 200-plus pages.

      23             This is one MCI, you know, application.

      24             You can go -- how much time do you have to go

      25      through this?







                                                                   87
       1             CARMEN VEGA-RIVERA:  None.

       2             SENATOR RIVERA:  No, no, but, just, if you

       3      get one for your building, as a tenant, how much

       4      would you have?

       5             CARMEN VEGA-RIVERA:  We don't have time --

       6             SENATOR RIVERA:  Oh, you don't?

       7             CARMEN VEGA-RIVERA:  -- nor do we have the

       8      support.  Right?

       9             SENATOR RIVERA:  But why not?  It's just

      10      200 pages.

      11             CARMEN VEGA-RIVERA:  We don't have the legal

      12      support, the wherewithal, to put this together.

      13             We didn't put the application.  That

      14      shouldn't be passed on to us.

      15             Landlords are using MCIs, three times --

      16             SENATOR RIVERA:  But this is --

      17             CARMEN VEGA-RIVERA:  -- charging it to us --

      18             SENATOR RIVERA:  But this is --

      19             CARMEN VEGA-RIVERA:  -- taking it off on

      20      their taxes.

      21             SENATOR RIVERA:  But this is -- but this

      22      is -- is it -- I'm just -- okay, okay, okay.

      23             So, you have 200-plus pages.

      24             I mean, there's only -- you know, I only see

      25      architectural drawings and checks and invoices and







                                                                   88
       1      descriptions.

       2             I mean, you could -- you -- you don't -- you

       3      wouldn't be able to do this in 45 days?

       4             CARMEN VEGA-RIVERA:  That shouldn't be --

       5             ANITA LONG:  No.

       6             CARMEN VEGA-RIVERA:  -- the responsibility of

       7      tenants.

       8             And, no, we're not able to do it.

       9             It shouldn't be our -- our --

      10             SENATOR RIVERA:  Okay.

      11             CARMEN VEGA-RIVERA:  -- it shouldn't be us

      12      answering that.

      13             Landlords have no right adding MCIs when it's

      14      their capital asset, it is their property, it is

      15      their responsibility to maintain the building.

      16             SENATOR RIVERA:  But would it --

      17             CARMEN VEGA-RIVERA:  We pay rent, there's a

      18      rent rule.

      19             What that should say is --

      20             SENATOR RIVERA:  But what --

      21             CARMEN VEGA-RIVERA:  -- this MCI will not be

      22      approved, being that you've already double-dipped.

      23             SENATOR RIVERA:  This is perfect, this is

      24      perfect.

      25             SENATOR KAVANAGH:  I would ask the landlord







                                                                   89
       1      advocate not to -- to stop interrupting the witness.

       2             SENATOR RIVERA:  Okay.

       3             Would it --

       4                [Laughter.]

       5             CARMEN VEGA-RIVERA:  And please note, that

       6      just because his last name is Rivera, we are not

       7      related.

       8             SENATOR RIVERA:  No, but -- no, she's my

       9      cousin, actually.

      10             But, actually, in all seriousness, in all

      11      seriousness, we've worked on this a lot together,

      12      and it is -- it is -- it is one of things that, just

      13      for the record, I'm looking forward to hearing from

      14      other folks in other parts of the city because --

      15      I know, because of the work that we've done

      16      together, and the work that you've done in our

      17      backyard, that this is normal for this -- what is

      18      normal for a process that is, you know, millions of

      19      dollars for, you know, I don't know, terracotta

      20      pointing, that has no actual -- you know, that --

      21      that -- the reality is, that landlords then put this

      22      in front of you and say -- and DHCR says, You only

      23      have, like, a month and a half.

      24             It's not like you -- you know, you're --

      25      some -- some of the folks in those tenants might be







                                                                   90
       1      lawyers, but most of them are not.

       2             Some of them might be experienced in

       3      construction.  Most of them are not.

       4             And so you are asked, as a tenant, to

       5      actually look at this --

       6             CARMEN VEGA-RIVERA:  Right.

       7             SENATOR RIVERA:  -- and say, I have to

       8      give -- and actually what you said, Ms. Long,

       9      I really take to heart, the idea that, currently,

      10      sadly, the current system makes it so that tenants

      11      have to kind of be the authority, kind of have to be

      12      the --

      13             ANITA LONG:  Right.

      14             SENATOR RIVERA:  So one thing I was going to

      15      ask you, because you mentioned weatherization --

      16             And I'm wrapping up.

      17             -- but it was, like, you mentioned

      18      weatherization.

      19             Could you tell us a little bit more about

      20      that?

      21             Since it seemed there's also a criticism,

      22      that this is the only program that's available, IAIs

      23      and MCIs are the only things that are available, to

      24      landlords to be able to -- you know, get some money

      25      for their buildings.







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       1             Is that accurate?

       2             CARMEN VEGA-RIVERA:  Yeah, I -- no.

       3             SENATOR RIVERA:  Oh, it isn't?

       4             CARMEN VEGA-RIVERA:  I have weatherization --

       5             SENATOR RIVERA:  Oh, why not?

       6             CARMEN VEGA-RIVERA:  -- going on in my

       7      building right now, with asbestos and the parapet,

       8      and the bricks and mortars have to be replaced.

       9             There are weatherization programs.

      10             There are lots of programs that they can

      11      apply to.

      12             What landlords don't want to do is, that same

      13      application that the tenants are getting, they don't

      14      want to sit there and do the work, and open up their

      15      books to show what their profits are, and where the

      16      money's coming.

      17             So there are programs in place, as I speak,

      18      that will allow landlords to get the benefits that

      19      they need if it's so deemed so, in terms of, that

      20      they don't have the financial capital to do so.

      21             So, in my case, and the weatherization is

      22      happening right now, we are netted from roof to the

      23      bottom of the building, is I'm very concerned,

      24      because I said that I'm facing 10 to 13 MCIs.

      25             That application you show me will be 13 size







                                                                   92
       1      that amount that you just showed us.  That is huge.

       2             And in there is the weatherization of, not

       3      only the parapet with the asbestos were we exposed

       4      to, but it's the weatherization of the bricks and

       5      mortars.

       6             ANITA LONG:  It's, also, landlords can apply

       7      for the J-51 tax abatement.

       8             My landlord has applied for it before he had

       9      did the MCI.

      10             When we got the notice regarding the MCI, we

      11      notified DHCR regarding that J-51.

      12             So, what DHCR did, told me:  Here's the MCI.

      13      This is what you're going to pay.  Yeah, we know

      14      that he did get the J-51, but you're going to

      15      continue to pay this amount until we muddle through

      16      the paperwork.  And then we'll come back and let you

      17      know what your real bill should be.

      18             That's unfair to the tenant.

      19             CARMEN VEGA-RIVERA:  And in addition to the

      20      J-51, which our building had with the previous

      21      landlord, that it took us 2 1/2 -- 25 years to get

      22      rid of, is that they did have a J-51 in the early

      23      '90s.

      24             25 years have passed.

      25             Weatherization issues in that building are







                                                                   93
       1      paramount because of the movement of the trucks and

       2      the buses that pass by 161 of the Grand Concourse,

       3      and you see all the cracks in our building.

       4             So there has to be another way that they

       5      could apply for another J-51, an Article 11, and all

       6      the other hardship loans that are out there.

       7             One of the issues, in speaking with our new

       8      landlord, they said, they don't want to open up the

       9      books to show that they are making a profit, and

      10      they do have the capital do it.

      11             So they're gonna pass it on to us.

      12             But they could go back, and they should be

      13      able to go back, for another J-51, without passing

      14      it back on to the tenants.

      15             SENATOR RIVERA:  The bottom -- the bottom

      16      line is, I thank you for all the advocacy that

      17      you've done over this -- over the years on this.

      18             There's a lot that I've learned by seeing the

      19      situations that happened in our neighborhoods.

      20             And you have been an important part of that.

      21             And -- and I -- and as -- and as we discussed

      22      at the beginning, I was not on the nine bills.

      23             And it was part of the work that -- the work

      24      that you folks did and the Northwest Bronx Community

      25      and Clergy Coalition did that kind of convinced me







                                                                   94
       1      that all of them I needed to be on.

       2             So thank you so much for that.

       3             CARMEN VEGA-RIVERA:  Well, we thank you.

       4             ANITA LONG:  Thank you.

       5                [Applause.]

       6             SENATOR KAVANAGH:  Thank you.

       7             Any further questions?

       8             Okay.

       9             Thank you, both.

      10             CARMEN VEGA-RIVERA:  Thank you.

      11             ANITA LONG:  Thank you.

      12             SENATOR KAVANAGH:  So next up I mentioned

      13      already, the Woods --

      14             OFF-CAMERA SPEAKER:  Give her a ride back

      15      home.

      16             SENATOR KAVANAGH:  -- and, hopefully,

      17      Senator Rivera has a large vehicle.

      18             Next up, we have -- we'll take copies of the

      19      testimony.

      20             We have the Woodside on the Move folks

      21      I mentioned before.

      22             And following up, again, just -- following

      23      up we have, Kathleen Wacom of Met Council on

      24      Housing, and, also, if I'm -- Andrea Shapiro, also

      25      of Met Council on Housing.







                                                                   95
       1             NILDA RIVERA:  Good evening, everyone.

       2             My name is Nilda Rivera.

       3             I'm a tenant leader from Cosmopolitan in

       4      Woodside, Queens.

       5             We started to get MCIs 2017 and 2018, which

       6      our rents got too high for tenants to pay.

       7             When landlords can buy building after

       8      building, definitely, they can maintain and improve

       9      their own property and not to fall back on the MCIs.

      10             Tenants are not property owners and should

      11      not be subjected in buying equipments for landlords.

      12             The so-called law says, the improvements

      13      benefits tenants, but, the law is incorrect.

      14             Who benefits 100 percent are the landlords.

      15             They own the property, our money for the MCI,

      16      and the equipments we buy for the landlord's

      17      property.

      18             We all know, when you buy, you own, and

      19      tenants don't own nothing.

      20             Some millionaires/landlords are using MCI to

      21      increase the property-value enhancements, and even

      22      the improvements of those for free, but tenants get

      23      stuck with the bills.

      24             In real estate side is a monopoly, but in the

      25      tenants' side it's a (indiscernible).







                                                                   96
       1             We tenants call for the elimination of the

       2      MCI to stop the abuse and misuse of the MCI that are

       3      causing the displacement of tenants.

       4             Last year we will meet with senators on the

       5      MCI.

       6             They were saying, We need the majority of the

       7      Democrats in the House for those nine bills.

       8             Well, we voted more Democrats in the House,

       9      and still MCI is stuck in the House.

      10             So what's the problem now?

      11             Still, Democrats in the house are considering

      12      reforming MCI.

      13             MCI shouldn't be reformed, only elimination.

      14             All landlords should be responsible for their

      15      own property and not on the backs of the poor.

      16             We all know actions speaks louder than words.

      17             Since you now know half the majority of the

      18      Democrats in the House, show us your actions, that

      19      you are for tenants instead of for the rich

      20      landlords that are looking to increase their bank

      21      accounts.

      22             Show us that you are for the struggling

      23      tenant side, and not all for-profit landlord side.

      24             Senator Kavanagh and Senator Krueger, please

      25      sign the elimination of no more MCI.







                                                                   97
       1             Thank you.

       2                [Applause.]

       3             SENATOR KAVANAGH:  Thank you.

       4             And just -- Mr. Contreras, just before you

       5      start, is Sandra Dominguez here and planning on

       6      testifying as well?

       7             OFF-CAMERA SPEAKER:  Yes, she is.

       8             SENATOR KAVANAGH:  Okay.  Do you want -- why

       9      don't you come on up as well.

      10             IVAN CONTRERAS:  Thank you.

      11             And thank you, everyone, thank you, everyone,

      12      from the Committee.

      13             My name is Ivan Contreras.

      14             I'm the No More MCI campaign coordinator, and

      15      also the lead organizer of Woodside on the Move.

      16             You have to pardon my voice, since I was

      17      screaming the hell out of today at the press

      18      conference, and, also, it was weird to me to see a

      19      bunch of employees outside screaming, and to see

      20      working-class people fighting against working-class

      21      people.

      22             I was debating with them, and I called one of

      23      them, and I asked him, "What are you fighting for?"

      24             They have no idea what they were fighting for

      25      and what they were screaming for outside.







                                                                   98
       1             And that just made me feel how the real

       2      estate is using its money again to put people on the

       3      street, to work and to fight against another

       4      working-class people.

       5             And I think that's outrageous.

       6             I was trying to prepare, so, coordinate,

       7      structure, a speech today for all of you, but

       8      I think I'm tired of being tired, and you guys have

       9      been hearing all.

      10             I have been having meetings with all of you,

      11      if not me personally, the number of MCI Coalition

      12      have been having meetings of all of you.

      13             And we have been telling you, and dismantle

      14      by -- by -- one by one, why you should eliminate the

      15      MCI, which is, with good-cause, the bill that the

      16      real estate is fighting against the mass.

      17             And you know why.

      18             And you know why.

      19             You already know why.

      20             We told you this many times:  It's the

      21      quickest way to get rich through the expense of the

      22      tenants.

      23             Period.

      24             The tenants are paying for something that

      25      doesn't belong to them, and that's not fair.







                                                                   99
       1             We have been telling you this many times.

       2             And I'm so glad that the expert today from

       3      ANHD told you exactly what we've been telling you

       4      for many years, but you guys still keep thinking

       5      about reforming.

       6             I just have a beautiful example with what

       7      happened with one of my buildings.

       8             I've been working in around 16 buildings, all

       9      of them with several MCIs.

      10             Just to give you an example -- just to give

      11      you an example:

      12             Cosmopolitan buildings, they have been

      13      massively and systemically attacking with MCIs.

      14             That's why we're entering in this fight.

      15             So right here, I have a meeting, regular

      16      meeting, with my tenants, because one of my tenants

      17      came to my office and said, Ivan, what is this?

      18             And I told you, This is an MCI application.

      19      We're going to have to fight against this.

      20             She said, I'm for it.

      21             We're going to do a meeting at the building

      22      and all the process that organizers do.

      23             I went to the building.  I'm looking for

      24      where the landlord was in the meeting.

      25             I asked the tenants if they wanted the







                                                                   100
       1      landlord to be in the meeting, and they said, yes,

       2      that's fine.

       3             I did the meeting, and explained to the

       4      landlord that I was going to revise, point by point,

       5      if what they were claiming in the MCI, which was

       6      around $255,000, was, in fact, what he spent on

       7      invest on the building.  And I told him that we're

       8      going to go with a couple of lawyers, that we're

       9      going to hire different experts, that we're going to

      10      do this, that.

      11             To my surprise, next meeting, the landlord

      12      decided to drop the MCI.

      13             He sent me a letter, and he said, you know

      14      what, Ivan?  I'm not going to apply for the MCI

      15      anymore.  I don't think that I have my tenants to

      16      pay for the MCI.

      17             And then he said, But the only thing that

      18      I want from you, and he's telling me, a proposal

      19      that he want me -- he want the tenants to pay

      20      $18,000.

      21             So he lowered himself from two fifty-five --

      22      $255,000, to $18,000.

      23             And he say like that, he say, Everything that

      24      I want you guys to pay, and it's just one payment.

      25      You not gonna continue paying.







                                                                   101
       1             And then I said, like, No.  I actually want

       2      to see if what you spend on everything that you

       3      saying is at $18,000.

       4             And you know what happened the next meeting?

       5             He said, I'm not going to charge you a penny.

       6             So this is just an example of, like, how the

       7      DHCR, in conjunction with the landlord, are using

       8      this to displace the tenants without any kind of

       9      enforcement.

      10             If you try to reform this program, this

      11      problem is going to continue.

      12             The only solution that we have to the MCI is,

      13      what?

      14             (All audience members say:  Elimination!)

      15             IVAN CONTRERAS:  That be the only thing that

      16      we can, and this is just an example of many, many

      17      buildings that are happening.

      18             Okay?

      19             So, please, eliminate the MCI, and pass the

      20      all nine bills.

      21             SENATOR KAVANAGH:  Thank you.

      22                [Applause.]

      23             SANDRA DOMINGUEZ:  Good afternoon, everyone.

      24             Thank you for your time to coming here to

      25      this meeting with us and listen to any testimony







                                                                   102
       1      here.

       2             And, I'm coming to the -- from my country

       3      20 years ago, and I living in the same apartment.

       4             SENATOR KAVANAGH:  (Inaudible) could you

       5      state your name for the record so that they have it

       6      on the -- just your name for the record, and then

       7      proceed.

       8             SANDRA DOMINGUEZ:  Okay.

       9             Sandra Dominguez.

      10             SENATOR KAVANAGH:  Thank you.

      11             SANDRA DOMINGUEZ:  And I'm coming from

      12      Cosmopolitan Associates.  I'm a tenant from the

      13      Cosmopolitan for 28 years.

      14             It's only apartment I'm having when I coming

      15      to the city.  I never moved to another apartment.

      16      That's the only I have it.

      17             I have it two childs.  My two childs born in

      18      that apartment too.

      19             My husband working two jobs to care and

      20      afford it, to pay everything.

      21             Sorry.

      22             Sometimes I need to choose, pay half rent so

      23      I can afford some money to buy food for my childs.

      24             And I'm coming to get -- no, personal, I'm

      25      personal.  It's -- that's why I'm here.







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       1             And I have to say public here, thank you so

       2      much to Ivan, because when I had the first MCI, I

       3      don't know -- I don't know anything.

       4             But I want to say, the second one, $240.

       5             This is something like almost I have to be

       6      homeless with my two childs, and my husband too.

       7             And I have to say thank you so much.

       8             Thank you, thank you, thank you, thank you,

       9      Lord, to have Woodside on the Move to help for me,

      10      to help my -- to help me every day.

      11             Anything can I say, I have to say, thank you,

      12      Ivan.

      13             Thank you.

      14             God bless you, always.

      15             And the thing is, please, please, please help

      16      the people.

      17             Help for the people, because my landlord

      18      looking only for the good-looking outside to the

      19      buildings.

      20             I'm invited to you guys, come into my

      21      apartment.  You're very welcome.  Check everything.

      22             My ceiling is broke for 1 1/2 year, and

      23      nobody fix it yet.

      24             My walls is almost fell down.

      25             So explain to me why I have to pay the MCI,







                                                                   104
       1      because, just in case I have the money, I have no

       2      problem to pay it.  But the thing is, I don't have

       3      it.

       4             And, anyway, he only looking, like the

       5      womans, look from outside, beautiful, paint, but

       6      what about inside?

       7             So come into my apartment and look

       8      everything, and nobody help me until this point.

       9             It raining one day, twice, is coming to my

      10      bedroom, to the fifth floor to the one floor.

      11             Everybody coming to my apartment, 3:00 in

      12      morning, and asking me, What happened?  What

      13      happened to your apartment?  Why you throw away the

      14      water everywhere?

      15             And I said, No, it's the raining.  It's the

      16      ceiling.

      17             And I have it, I have a video.  And I show

      18      everybody, and everybody is scared, even me.

      19             So, please, help me to don't lose my

      20      apartment.

      21             I need a place for live with my two childs

      22      after coming to a school and asking me, I have a

      23      home.

      24             Thank you so much for your time, and God

      25      bless you guys.







                                                                   105
       1                [Applause.]

       2             SENATOR KAVANAGH:  And I think we have

       3      questions here.

       4             Thank you so much for being here and sharing

       5      your time with us.

       6             I think we'll start from the right and work

       7      our way over.

       8             So Senator -- oh, before I do that, I just

       9      want to acknowledge that we've been joined by

      10      Senator Brad Hoylman of Manhattan.

      11                [Applause.]

      12             SENATOR KAVANAGH:  And next up,

      13      Senator Gianaris.

      14             SENATOR GIANARIS:  Thank you.

      15             Let me thank Sandra for sharing your story

      16      with us.

      17             I know it's hard to get in front of so many

      18      people and be so personal, but, this is what the

      19      senators need to hear.

      20             So thank you for doing that.

      21             Nilda, can I ask you to come back up?

      22             I have a question for you be also.

      23             Nilda, by the way, is also not related to

      24      Gustavo Rivera, just in case...

      25                [Laughter.]







                                                                   106
       1             SENATOR GIANARIS:  But -- but -- and, Ivan,

       2      thank you for the example you used, because I feel

       3      constantly, like, the people that advocate for

       4      reform, even if they're coming from a good place,

       5      are assuming, at the end of the day, that there's

       6      good faith on the part of the landlords.

       7             So they assume, if we write the law in a good

       8      way, they will adhere to the law and good things

       9      will happen.

      10             But the problem that you pointed out, and

      11      that we're hearing over and over again, is MCIs for

      12      landlords are not a way to upkeep their buildings.

      13             It's a business strategy to make money and to

      14      displace their tenants.

      15             NILDA RIVERA:  Exactly.  (Indiscernible.)

      16             SENATOR GIANARIS:  Well, the reason I asked

      17      you to come back, Nilda, is we -- I did visit your

      18      building, and Sandra's building, and I saw Sandra's

      19      video.

      20             But I want you to talk about the MCIs.

      21             Some of the MCIs you all were charged for,

      22      that don't actually benefit anybody living there or

      23      the building, because the things you were pointing

      24      out to me were ridiculous, and they were charging

      25      the entire building for these minuscule things that







                                                                   107
       1      were clearly just an excuse to jack up the rents

       2      and, eventually, get people out of those homes.

       3             So can you tell us some of the things that we

       4      saw in the common areas and the outside, just so

       5      everyone else can hear what the MCIs were being

       6      charged for?

       7             NILDA RIVERA:  Well, in my part, it started

       8      with the gas pipes.  And they put the gas pipes

       9      outside of the wall.  Even some of the gas pipes are

      10      inside, it goes through the bedrooms.

      11             Okay?

      12             So this is dangerous, and they still did it.

      13             Okay?

      14             I don't know if stopped because somebody

      15      complained to Ivan.  I don't know if it was stopped.

      16             That's one of them we got an MCI for that.

      17             Also, cameras, that some of them do not work.

      18      Some of them do and some of them don't.

      19             And when you need someone to access, you

      20      know, something happens, access, they don't have

      21      information on the camera because it's not working,

      22      but we're still paying the MCI for it.

      23             SENATOR GIANARIS:  The place where we met,

      24      too, had that garden that they -- I don't even want

      25      to call it a garden.  It was like the size of this







                                                                   108
       1      chair.

       2             SANDRA DOMINGUEZ:  Exactly.

       3             SENATOR GIANARIS:  But we were standing

       4      around this plant, basically, that was also charged

       5      as a common-area improvement, right, for you folks.

       6             SANDRA DOMINGUEZ:  Exactly.

       7             But, see, it shouldn't be charged because you

       8      it's not something that you really need.

       9             It's just something that -- it's like to

      10      beautify and enhance the building.

      11             That's it.

      12             SENATOR GIANARIS:  Well, it's an excuse.

      13      That's what it is, it's an excuse.

      14             SANDRA DOMINGUEZ:  It's an excuse for an MCI,

      15      that's all.

      16             SENATOR GIANARIS:  Thank you.

      17             SANDRA DOMINGUEZ:  Yes, you're welcome.

      18             SENATOR KAVANAGH:  Any further questions,

      19      comments?

      20             Okay.

      21             Thank you all very much for your testimony.

      22                [Applause.]

      23             So, again, if we can get Kathleen and Julia

      24      up here from Met Council on Housing.

      25             And then we are going to follow up with a







                                                                   109
       1      panel of folks from Brooklyn Legal Services.

       2             I think we have Adam Meyers and -- sorry --

       3      and -- sorry, there are a couple of people from

       4      Brooklyn Legal Services.  You probably know who you

       5      are.

       6             So, we'll have that panel next.

       7             Thank you.

       8             Anyone from Met Council wants to join the

       9      panel and give testimony, this would be a great

      10      time.

      11             Thank you.

      12             So, again, we'll begin the clock, and please

      13      begin by identifying yourself by name, and then

      14      proceed with your testimony.

      15             KATHLEEN WACOM:  Okay.

      16             Good afternoon.

      17             SENATOR KAVANAGH:  And if folks exiting

      18      could, you know, let us proceed, we'd appreciate it.

      19             KATHLEEN WACOM:  Good afternoon.

      20             My name is Kathleen Wacom, and I'm a member

      21      of Metropolitan Council on Housing.

      22             For over 40 years I have lived in my

      23      rent-stabilized apartment in the East Village,

      24      Lower East Side.

      25             My landlord is Madison Realty Capital, a







                                                                   110
       1      private-equity firm.

       2             I am here to talk about the need for the

       3      Senate to pass good-cause eviction.

       4             My building is one of 15 that

       5      Raphael Toledano purchased in September 2015 for

       6      $97 million.

       7             In March of 2017, Toledano files bankruptcy.

       8             The New York State Attorney General's Office

       9      cited that this bankruptcy proceeding is part of an

      10      ongoing property-flipping scheme which started in

      11      September 2015 when Toledano purchased

      12      15 rent-stabilized apartment buildings using

      13      financing provided by Madison.

      14             According to "The Real Deal" in 2017, a

      15      federal bankruptcy judge granted Madison the right

      16      to replace Toledano as the property manager of these

      17      buildings.

      18             Madison would pay less than $10 million so

      19      that Toledano would be able to pay off creditors.

      20             Presently, Madison is warehousing apartments

      21      in my building which is on East 12th Street.

      22             Of the 37 apartments, 18 have been vacant

      23      since 2016.

      24             Market-rate tenants have not had their leases

      25      renewed.  No reason was given for renewal denial.







                                                                   111
       1      Their apartments remain vacant.

       2             One couple, who is expecting a baby, moved to

       3      a smaller apartment uptown.

       4             Others are doubling up with tenants

       5      elsewhere.

       6             Good-cause eviction must be passed to protect

       7      market-rate tenants from lease-renewal denial and

       8      self-eviction due to inability to pay astronomical

       9      rent increases.

      10             Throughout the state, market-rate tenants are

      11      fearful to report no heat or hot water, to ask for

      12      termination of bedbug and rodent infestation, to

      13      request necessary repairs.

      14             They are fearful because their leases may not

      15      be renewed.

      16             Good-cause eviction will stop this fear

      17      because tenants will know that their leases will be

      18      renewed at reasonable rates.

      19             Also, good-cause eviction will provide

      20      stability to buildings and communities.

      21             According to the Right Council Coalition,

      22      over 250,000 evictions in the city are due to

      23      inability to pay rent.  Many are among the more than

      24      62,000 homeless people living in shelters.

      25             Rent regulation expires on June 15th of







                                                                   112
       1      this year.

       2             You have the power to stop the housing crisis

       3      across New York State.

       4             You need to pass all nine of our bills that

       5      make up our universal rent control platform so that

       6      we can feel secure in our homes and strengthen our

       7      communities.

       8             Our homes are not commodities for

       9      private-equity firms to flip and make further

      10      profits while tenant leases are not renewed or their

      11      rents increased at unconscionable rates.

      12             I thank the Senate for these hearings.

      13             SENATOR KAVANAGH:  Thank you.

      14                [Applause.]

      15             SENATOR KAVANAGH:  Next.

      16             JULIA EASTERLIN (ph.):  Good evening,

      17      everybody.

      18             Congratulations.

      19             I'm just (indiscernible) -- and

      20      congratulations.

      21             I was there to see -- oh, this is off the

      22      books.

      23             I was up there Tuesday to give you a package

      24      from statewide -- State Citywide Council.

      25             I left it up there with your secretary,







                                                                   113
       1      through that package, and to send it to you.

       2             SENATOR MYRIE:  Thank you.

       3             JULIA EASTERLIN (ph.):  You're welcome.

       4             My name is Ms. Julia Easterlin (ph.), and I'm

       5      a member of the Met Council for, like -- the old

       6      Met Council of 12 years, and the new one, one year.

       7             One year?

       8             Yeah, one year.

       9             What -- you have to wake -- you have to wake

      10      up the Democrats, 'cause they're sleeping, because,

      11      before we had this vacancy, we didn't have no

      12      vacancy, we didn't have no MIC (sic), and everything

      13      did good.

      14             Now the tenants are poor, they can't pay the

      15      rent, and it's really bad for them -- for the --

      16      ya'll say one thing.

      17             I'm not saying you, because you knew.

      18             (Indiscernible) you've got to talk them up

      19      there up there when you negotiate.

      20             So this is the thing what we're having, they

      21      say one thing, and do another.

      22             So the thing is, they know the landlords are

      23      crooked.  Someone is not regulating the buildings.

      24             Come to find out, when I went to the

      25      testimony in Broadway, 250 Broadway, and the thing







                                                                   114
       1      is, we have to get rid of the management, because

       2      they're harassing.  And I'm in court now.

       3             (Indiscernible) said they're going to get

       4      assets.

       5             And then we told them that we wanted wait to

       6      hear from the commissioner and the mayor.

       7             We haven't heard from the mayor.  He was off

       8      at something else.

       9             The commissioner, Vickie Been, she was at

      10      something else.

      11             And we had a serious emergency, problem with

      12      heat, heat, from December 2014 up until now.

      13             Then he take us to court, we had this

      14      problem.

      15             And nobody (indiscernible) when you call,

      16      I went to Brad Lassen (ph.) office, they didn't do

      17      nothing.

      18             I went to Robert Cordidi (ph.), he didn't do

      19      nothing.

      20             I stepped over boundaries at 250 Broadway.

      21             They said they were going to help me and my

      22      brother for the building.

      23             We are senior citizens.  We have children in

      24      the building.

      25             And that's emergency, the heat shut off.







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       1             We called 311.

       2             They told us, Don't say "heat."  Say "the

       3      boiler."

       4             And we went to -- he told us to go to the

       5      building department, 280 Broadway.

       6             We went to the building department and we

       7      talked to them.  I said, the heat's shut off and

       8      all.

       9             So he said he was there, he got a fine for

      10      something, I don't know.

      11             But, anyway, he went back out there and saw,

      12      it was a clogged-up pipe, heat -- from the heat

      13      coming up on the first and all.

      14             Nobody hasn't done a darn thing, and that's

      15      wrong for us to suffer for five months --

      16      five years.

      17             Okay?

      18             Then the building department came back out to

      19      check it again.  They went down there before.

      20             Everything is a violation.  The whole

      21      building is a violation.

      22             So when they came out, they said it's a

      23      clogged-up pipe.

      24             I gave it to -- I sent it to the mayor, the

      25      commissioner.







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       1             I wrote -- we wrote three times.

       2             Vickie Been -- Commissioner Vickie Been, she

       3      never answer, three times.

       4             Brad Lassen office, I went to him.

       5             Then his -- what you call them, the one that

       6      you do the appointments?

       7             No, no, no.

       8             Schedule.

       9             Thank you.

      10             The schedule, so, you know, that we can meet

      11      with Brad Lassen.

      12             So the schedule fellow was going to give me

      13      the date, but the one, Susan, (indiscernible) told

      14      her, don't do it.

      15             So I then went to the supervisor, APD, on the

      16      eighth floor.

      17             We did everything.

      18             And nobody didn't do anything, and I don't

      19      think that's fair.

      20             When you say "emergency," you have no heat

      21      and hot water.

      22             Somebody, and I called emergency, they say

      23      was coming.

      24             All of a sudden nobody come.

      25             You see?







                                                                   117
       1             That's wrong right there.

       2             Then I went to MIC (sic) and the -- what's

       3      the other one?

       4             KATHLEEN WACOM:  IAI.

       5             JULIA EASTERLIN (ph.):  -- IAI.

       6             I don't know too much because this is my

       7      first time in the apartment where I'm at now.

       8             So I always lived in a private house.

       9             So these are the things that you have to be

      10      aware of what's going on.

      11             And get rid of the management.

      12             The landlord had, for 100 buildings, they

      13      should know how to handle them, like they did

      14      before.

      15             The manager harassed tenants, and charge a

      16      lot of money.

      17             They can't pay it, they move.  They're, like,

      18      in and out, in and out.

      19             And you have all different nationality, from

      20      White on down.

      21             So it's not fair.

      22             And I'm in court now because, if I made a

      23      mistake, the lawyer is supposed to help us, and she

      24      didn't do nothing that the landlord -- the lawyer do

      25      everything.







                                                                   118
       1             So now we have to wait.

       2             We getting word, the tables are turned, said,

       3      God don't love ugly.

       4             So now we in the front of the row, so he has

       5      to do everything in our apartment before September

       6      of 2019.

       7             But this -- and the other thing, the vacancy,

       8      you know, we didn't have -- Senator, they had

       9      stopped that, and they brought it back.

      10             People was living good.

      11             And they went and they came in a vote, you

      12      know, up to legislators.  And then they vote this

      13      bill back again, with that MCI and the vacancy, and

      14      that's wrong.

      15             People can't -- that's why you got a lot of

      16      homeless because they can't live like this.

      17             Okay?

      18             And another thing, and the harassment.

      19             These management need to go.

      20             Let the landlord be accountable for what they

      21      do, because they get away with a lot of stuff, a lot

      22      of things.

      23             I was a landlord once, and I know how -- I'm

      24      not nasty like some landlords.

      25             Some is good and some is bad.







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       1             So I've been a landlord, and now I'm a

       2      tenant.  But they shouldn't do the people like that.

       3             Fortunately, thank God, that, you know, I'm

       4      not struggling.

       5             But, you know, for other people, they're

       6      struggling.  It's bad no matter what shade or color.

       7             They should do the right thing towards

       8      people.

       9             That's what I feel.

      10             Let me see.

      11             Okay, yeah.

      12             Okay, thank you so much.

      13             SENATOR KAVANAGH:  Thank you.

      14                [Laughter.]

      15             SENATOR KAVANAGH:  That was actually a

      16      perfect use of 6 minutes, so very impressive.

      17             And, Ms. Shapiro, would you like to go?

      18             ANDREA SHAPIRO:  Hello.

      19             My name is Andrea Shapiro, and I'm the

      20      program manager at the Metropolitan Council On

      21      Housing.

      22             The Met Council has been fighting for tenants

      23      for 60 years, and it's hard to tell the difference

      24      between our signs for today and our signs 10 years

      25      ago, 20 years ago, 30 years ago, 40 years ago, they







                                                                   120
       1      almost say the same exact thing.  We even have the

       2      same Governor's name on some of them.

       3             We've been fighting this cause because, since

       4      1959, when we were founded, we have seen tenants

       5      being harassed and scared to speak up.

       6             We simply can't answer the phones fast enough

       7      on our hotline to answer all of the questions that

       8      are coming in.

       9             And, more than likely, we actually don't have

      10      a good answer for the tenant.

      11             What their landlord is doing is,

      12      unfortunately, legal, but we know legal doesn't mean

      13      it's right.

      14             That landlords are able to raise the rent on

      15      the market-rate tenants with as little as 30 days'

      16      notice, ask them to leave.

      17             It's a very common question.

      18             We sit there calculating, "when does that

      19      30-day window start?" not being able to tell them,

      20      No, you have a right, you have ability, to really

      21      fight back.

      22             The answer is, Have you thought about moving?

      23      which is not the answer you want give tenants.

      24             It's not why we're here.

      25             We believe that tenants have -- should have







                                                                   121
       1      the right to choose when they're moving, and where

       2      they're moving to, not being forced from one

       3      neighborhood to another, hoping that they'll get a

       4      new lease in the new place, and that they'll find

       5      that rent-stabilized apartment that still has a low

       6      rent.

       7             At our clinic, which we have one downtown,

       8      and one uptown in Inwood, we are constantly seeing

       9      preferential rents.

      10             Most people don't know that they have them.

      11             It's not as the simple as saying, you signed

      12      a lease and you know what you got.

      13             When you're signing a lease, you see two

      14      numbers on it.

      15             You're told you're paying one number.

      16             It doesn't explain how preferential rent

      17      works.

      18             They think they're paying a lower amount,

      19      that's the amount they have.

      20             Then three, four years, usually, later, the

      21      rent goes up and they have no recourse.

      22             That's just how it works.

      23             And we know that it's four years or

      24      five years later because there's an overcharge being

      25      hid in the past.







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       1             About a year ago, while Zellnor was

       2      campaigning to be state senator, he took a morning

       3      off to help me at Ebbets Field, as we were getting

       4      ready to start the HP court case, helping tenants

       5      file rent reductions.

       6             Tenants were coming to us with their rent

       7      histories and their leases, to find out, sort of, if

       8      they were rent-stabilized, and if they had a

       9      preferential rent.

      10             For a long time we thought all Ebbets Field

      11      is rent-stabilized.  It's a huge complex, it's built

      12      before 1974.  The rents are relatively low.  It

      13      should be.

      14             And one tenant after another, we realized

      15      they actually weren't only rent-stabilized.

      16             That landlords had used vacancy bonuses,

      17      MCIs, and deregulation to get tenants out.

      18             The building used to be filled with families,

      19      multi-generations.

      20             That's my favorite thing about going to

      21      tenants' meetings, is I hear about everyone's kids,

      22      everyone's grandparents.  Everyone is connected to

      23      each other in these buildings.

      24             Now there's, more and more, the landlord's

      25      turning the apartments over, getting transient







                                                                   123
       1      tenants who aren't paying attention, don't have

       2      family in the building, aren't from the area, and

       3      harassing the long-term tenants out, bringing them

       4      to court case after court case, of non-payments, of

       5      refusing to cash checks, lying about when checks

       6      come in, in order to get them out, to put -- to

       7      deregulate these apartments to get more and more

       8      money.

       9             The fact that the elevators took two years to

      10      get any repairs even started, when a building is

      11      filled with seniors, is a clear sign the landlord's

      12      trying to get tenants out.

      13             They are not doing this by accident.

      14             These are how the laws were designed by the

      15      New York City Council, the New York State Senate,

      16      the New York State Assembly, and former governors.

      17             You all have the chance to finally correct

      18      these mistakes, and then help more tenants.

      19             Granted, tenant emergency, it only makes

      20      sense that we provide more protections, and that

      21      would include market-rate tenants.

      22             The unregulated tenants of New York City and

      23      New York State can't live 30-days notice.

      24             You can't find a new apartment in that.

      25             You can't plan your life.







                                                                   124
       1             You can't plan your children's schooling.

       2             It's a matter of, not just housing justice,

       3      but racial justice, women's rights, health care,

       4      educational justice, all of the things I know you

       5      all care about beyond housing.

       6             And so we need you to pass these nine bills,

       7      and we need you to do it before June 15th.

       8             We can't let landlords give out notices to

       9      the landlords -- to their tenants to scare them

      10      about June 15th, that they won't have regulations

      11      after that date.

      12             We need it done early for once.

      13             Thank you all.

      14                [Applause.]

      15             SENATOR KAVANAGH:  Thank you.

      16             Can I --

      17             JULIA EASTERLIN (ph.):  One more -- just one

      18      more.

      19             Another thing, my Senator --

      20             SENATOR KAVANAGH:  We're going to give

      21      hometown -- a brief hometown exemption from the

      22      6 minutes, just for you, but please keep it brief.

      23             JULIA EASTERLIN (ph.):  Get rid of --

      24      30 years ago -- 30 years ago I was in front, with

      25      me, Met Council, when I realized nobody never asked







                                                                   125
       1      on the platform.

       2             It was 10 landlords and 2 tenants.

       3             30 years later, the Met Council gave, at

       4      St. Francis College last June.

       5             Now we got one tenant, he was so scared.  And

       6      it's not fair.  It's should be five tenants and five

       7      landlords.

       8             Do you agree with that?

       9             SENATOR KAVANAGH:  Okay, well, I'm just going

      10      to say --

      11             JULIA EASTERLIN (ph.):  No, I'm talking to my

      12      senator.

      13             SENATOR KAVANAGH:  -- the questions go this

      14      way.  Okay?

      15             JULIA EASTERLIN (ph.):  Oh, oh.  (Inaudible.)

      16             SENATOR KAVANAGH:  But we appreciate it.

      17             Perhaps the Senator wants to address your

      18      point.

      19             Any questions from Senators?

      20             Senator Hoylman first.

      21             SENATOR HOYLMAN:  Yes.

      22             Hi, nice to see you, Kathleen.

      23             KATHLEEN WACOM:  Oh, hi.  It's nice to see

      24      you, Senator.

      25             SENATOR HOYLMAN:  It's good to see a







                                                                   126
       1      constituent.

       2             I had a question about, if you could just

       3      describe for my colleagues what it's like not to

       4      have a traditional landlord anymore.

       5             Since you, thankfully, lost Toledano, but now

       6      you have this nameless, kind of faceless, financial

       7      institution.

       8             How has -- has the situation improved with --

       9      with you and your fellow tenants?

      10             Who do you go to when you don't have hot

      11      water or -- or -- or -- or heat?

      12             KATHLEEN WACOM:  Oh, HPD, because not only do

      13      we not have a regular landlord, because we sent our

      14      checks to, you know, 325 East 12th Street, LLC, we

      15      have not had a legal super since March of 2013, and

      16      the building is horrendous.

      17             And according to the AG, the manager of the

      18      building is Madison Realty Capital, under -- and,

      19      also, they use their subsidiary Silverstone to

      20      manage it.

      21             However, I went on HPD, and the real owner is

      22      David Goldwasser who lives in Florida.

      23             So there's a lot of hanky-panky, and the

      24      lawyers don't even know what's going on.

      25             I've talked to them, and, you know, well, I'm







                                                                   127
       1      too busy, whatever.

       2             And the real owner is David Goldwasser who

       3      lives in Florida, and, meanwhile, Madison Realty

       4      Capital is continuing funding the whole

       5      East Village.

       6             Now they're trying to take over Campos Plaza,

       7      which is a NYCHA development in the East Village.

       8      And that was the last residence of our co-founder,

       9      (indiscernible), by the way.

      10             But, really, Madison and the other private

      11      equities, they're running rampant.

      12             And there are no more mom-and-pops, because

      13      when you talk about number of buildings, you should

      14      talk about number of units, because two buildings

      15      can encompass 200 units.

      16             Okay, thank you, Senator Hoylman.

      17             SENATOR HOYLMAN:  Thank you.

      18             Thank you.

      19             SENATOR KAVANAGH:  Next up, I think

      20      Senator Krueger has a question.

      21             SENATOR KRUEGER:  Yes.

      22             Hi.

      23             Thank you.

      24             When you talked about Madison Capital, I just

      25      wanted to just read into the record, that when they







                                                                   128
       1      attempted to buy a building in my district, they

       2      were explaining in their written materials that they

       3      estimated they could get rid of 75 percent of the

       4      regulated tenants within two to three years.

       5             And that was actually sort of their --

       6             KATHLEEN WACOM:  Business model.

       7             SENATOR KRUEGER:  -- business model, thank

       8      you.  So they're a, potentially, disturbing group.

       9             But, Andrea, I wanted to ask you, are you

      10      seeing an increase in landlords trying to break

      11      preferential-rent deals this year?

      12             ANDREA SHAPIRO:  Yes.

      13             I mean, we have -- according to DHCR,

      14      30 percent of tenants have preferential rents.

      15             And I feel like we've been seeing much higher

      16      numbers, and that would make sense, of people who

      17      first have preferential rents, and then preferential

      18      rents going up.

      19             And we have several tenants in The Bronx who

      20      are, I guess, on a partial rent strike, which

      21      were -- they were hoping that you guys would pass

      22      these laws back in March, because they don't know

      23      what else to do.

      24             And, also, their entire building lost their

      25      preferential rents, starting in about February of







                                                                   129
       1      this year.

       2             We have seen that in a number of other

       3      buildings.

       4             SENATOR KRUEGER:  And one of the reasons

       5      I ask is because we hear, anecdotally, that as the

       6      real estate industry sees what we're very likely to

       7      pass in the Legislature this year, they want to jump

       8      ahead of us.

       9             So if they can get rid of preferential rents

      10      for individual tenants now, even when we change the

      11      law, saying they can't do that, it's too late.

      12             ANDREA SHAPIRO:  Yes.

      13             SENATOR KRUEGER:  We're also very concerned

      14      that, as we move forward with major reforms of rent

      15      regulation, that, at least in some parts of the

      16      city, real estate will quickly reevaluate whether

      17      they want to do a condominium conversion and get

      18      themselves out of this completely.

      19             So we're trying to do what we believe are the

      20      right things, and also try to predict how to protect

      21      against what I call "unintended consequences" of

      22      everybody knowing what we're trying to do.

      23             ANDREA SHAPIRO:  Yes, we definitely see

      24      preferential rents going away.

      25             All of a sudden, MCIs that had been sort of







                                                                   130
       1      pending for years, are being put forward.

       2             And I know Mike (indiscernible), he has a lot

       3      of thoughts on dealing with the concern that club

       4      conversions could become a thing again, that we lose

       5      a lot of rent stabilization too, that he's happy to

       6      share thoughts on, and you can ask him.

       7             SENATOR KRUEGER:  Thank you.

       8             SENATOR KAVANAGH:  Senator Myrie.

       9             SENATOR MYRIE:  Thank you.

      10             Thank you, Andrea, for the work that you are

      11      doing, and that you continue to do.

      12             Ms. Easterlin, I want to thank you for your

      13      testimony.

      14             And, also, just for the record, state that

      15      I think you were bringing up the composition of the

      16      Rent Guidelines Board.

      17             And, you know, I think it's important, that

      18      as we are considering these reforms, that we

      19      consider the Rent Guidelines Board as well, because

      20      we do not operate in a vacuum.

      21             I know that there are some of us who have

      22      expressed that, in the interim, while we are

      23      considering and deliberating, that there is a rent

      24      freeze, and that there are a number of things that

      25      are under the RGB's jurisdiction that we should be







                                                                   131
       1      looking at to protect tenants.

       2             So I just want to say thank you for bringing

       3      that up, and we will be taking that into

       4      consideration.

       5             JULIA EASTERLIN (ph.):  Good.  I appreciate

       6      that.

       7             SENATOR KAVANAGH:  Thank you.

       8             And, Senator Jackson, I think you had a

       9      question.

      10             SENATOR JACKSON:  First, let me thank you all

      11      for coming in, and the rally that was up in Albany,

      12      and lobbying.

      13             We have to keep the pressure on, let me just

      14      say that.

      15             Just one rally and we think that, okay, the

      16      Assembly and the Senate are going to unify and come

      17      with a united bill.  And then we have to face the

      18      800-pound gorilla in the room, the Governor and the

      19      Real Estate Board of New York.

      20             And I heard people come up and give testimony

      21      earlier, that, you know:  We put you all in office.

      22      Now there's, you know, Democrats in the Senate and

      23      Democrats in the House, meaning, the Assembly, now

      24      get it done!

      25             I wish it was so easy.







                                                                   132
       1             And I think that what we need to do, is to

       2      make sure that everyone knows that it's not over

       3      until it's over, and it's not over until it's done.

       4             And so the pressure must be continuous, so we

       5      feel the heat, and so that the Governor feels the

       6      heat, and so that all of the other Assembly Members

       7      and the Speaker and the Majority Leader feel the

       8      heat.

       9             Now, some people say, well, you know, don't

      10      say that.

      11             They are the leaders, the three leaders of

      12      our state, and we are the foot soldiers, and we have

      13      to communicate loud and clear to them our

      14      priorities.

      15             And that's why -- that's what we're doing.

      16             And I say to you that, both Brian Kavanagh

      17      and Zellnor Myrie, in leading the work group, are

      18      doing an excellent job.

      19             I have the ended all of them, and I plan on

      20      continuing to go to all that they have, in order to

      21      speak out on behalf of all of the people that

      22      I represent, and all of the people that I don't

      23      represent that are in the same boat as the people

      24      that I represent.

      25             So, please, it's not as easy as you think







                                                                   133
       1      you -- it is, but keep the pressure on all of us.

       2             Thank you.

       3             And thank you for your advocacy, all of you.

       4             SENATOR KAVANAGH:  Thank you.

       5             Any --

       6                [Applause.]

       7             SENATOR KAVANAGH:  Any further questions or

       8      comments?

       9             Okay.

      10             Thank you all again for your testimony.

      11             Next up we have Adam Meyers of Brooklyn Legal

      12      Services, and Chavette Jackson, also of Brooklyn

      13      Legal Services.

      14             And there was someone else who was expected

      15      from Brooklyn Legal Services, who I think hasn't

      16      checked in.

      17             But, anyone else from Brooklyn Legal Services

      18      planning on testifying, this is your moment.

      19             Then next up after that, we are going to

      20      have -- I apologize if I'm not pronouncing this

      21      properly -- but, Xiao Ling Chen, and I think

      22      Melanie Wang is going to translate, and they're both

      23      from CAAAV.

      24             ADAM MEYERS:  Okay.

      25             SENATOR KAVANAGH:  Welcome.







                                                                   134
       1             ADAM MEYERS:  Thank you, and good afternoon,

       2      Senators.

       3             My name is Adam Meyers, and I'm an attorney

       4      with Brooklyn Legal Services Corporation A.

       5             It assures the first three words of the other

       6      Brooklyn Legal Services.  We're actually different

       7      organizations.

       8             And my office has been representing tenants

       9      and tenant associations in north and east Brooklyn

      10      for 50 years now.

      11             Thank you for the opportunity to speak at

      12      this hearing.

      13             You've heard a lot today about the package of

      14      nine bills, about what we need to do to get MCIs

      15      ands IAIs and preferential rents under control,

      16      and extend good-cause protections to other tenants

      17      who are not yet protected.

      18             And these are all crucial measures, and we

      19      fully support each and every one of them; they

      20      should all be passed.

      21             But I'm here to talk to you about something

      22      additional.

      23             What I keep pushing is my "tenth bill," which

      24      is -- it's about owner's-use evictions.

      25             It's a modest reform, it's pragmatic, it's







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       1      achievable, and it is something that would tie up

       2      what is currently a massive, massive loophole in the

       3      rent-stabilization system, even if it doesn't get so

       4      much attention as MCIs are right now.

       5             So what is "owner's-use eviction"?

       6             "Owner's-use eviction" -- uh, as you guys all

       7      know, as a general rule, rent-regulated tenants,

       8      rent-stabilized and rent-controlled tenants, have

       9      the right to renewal leases at regulated rents.

      10             They can, basically, stay in their apartments

      11      as long as they don't break the lease or cause a

      12      nuisance, or something like that.

      13             "Owner's-use eviction" is an exception to

      14      this rule which says that, if an owner declares that

      15      he or his family wants to move into a

      16      rent-stabilized or rent-controlled unit and occupy

      17      it, he's allowed to do so, and he's allowed to tell

      18      the tenant, no matter how long they've lived there,

      19      that you're not entitled to a renewal lease and

      20      you've got hit the road.

      21             One can think back and understand why this

      22      was probably passed.

      23             It's not a crazy idea, if you imagine small

      24      landlords with maybe only one building.  They want

      25      to retain some flexibility with respect to renting a







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       1      unit now, but then, maybe, when the kid comes back

       2      from college they need a place to stay, or something

       3      like that.

       4             But over the last 20 years we have seen a

       5      rampant, sort of, escalation and abuse of the way

       6      owner's-use eviction is being used.

       7             The biggest problem with the law is that it

       8      imposes no limitation upon the number of units that

       9      can be recovered by a landlord for their own use.

      10             There are big landlords who own dozens of

      11      buildings that are using the law to clear out entire

      12      multi-family properties and convert them to these

      13      extravagant single-family mansions.

      14             There was a big high-profile case back in the

      15      mid-2000s, where, eventually, the court of appeals

      16      declared that a couple landlords on the Lower East

      17      Side were able to clear out all the tenants in this

      18      six-story, 11,000-square-foot building, and turn it

      19      into just a giant mansion for themselves and their

      20      baby.

      21             I'm currently -- my office is currently

      22      working with a great number of tenants facing these

      23      cases, just in one neighborhood of

      24      South Williamsburg.

      25             At 374 Wallabout, this a 6-unit building,







                                                                   137
       1      where the landlord is trying to evict two long-term

       2      tenants; one's been there 40 years, one's been there

       3      20 years.  He's trying to evict them so that he can

       4      convert the entire building into a single-family

       5      home.

       6             At 157 Lorimer, just a few blocks away, it's

       7      the same story.

       8             The landlord is trying take this 6-unit

       9      building and turn it into, basically, a duplex, so

      10      that his two kids can live on either half of the

      11      building.

      12             And then, at 273 Lee, another building,

      13      again, just a couple blocks away, landlord is trying

      14      to take a large portion of the 8-unit building and

      15      is evicting three long-term Latino tenants, so as to

      16      put his kids in there.

      17             These are just a tiny sample of the problem.

      18      This is going on across the city.

      19             And the thing that I want to emphasize, and

      20      this touches on what -- something Senator Krueger

      21      said a moment ago, we expect this problem to get

      22      bigger; we are talking about unintended

      23      consequences.

      24             And if we are going to pass these other

      25      critical reforms, reforms of MCIs and IAIs, that







                                                                   138
       1      while they extend huge new protections to tenants,

       2      they're going to make landlording of a

       3      rent-stabilized building a bit less profitable, we

       4      can expect more and more landlords to decide, you

       5      know what?  Rather than make less money, I would

       6      rather live in a fancy house.

       7             And so we need to tie up this loophole now

       8      while we still can.

       9             Luckily, Senator Kavanagh has introduced a

      10      bill that would do just this.  This is S4130, and

      11      this would make a number of changes to the law that

      12      would, basically, tie up the loophole.

      13             First, it would strictly limit the number of

      14      units that a landlord could get through this kind of

      15      eviction.  He's limited to one, and that's all you

      16      need for, you know, if your elderly parent is

      17      downsizing from their home, or if the kid comes back

      18      from college.  It's not enough to take massive

      19      numbers of units out of circulation.

      20             Second, this bill would provide additional

      21      protections to rent-stabilized units, and would

      22      provide that a rent-stabilized unit could only be

      23      recovered by the landlord in the case of urgent or

      24      compelling necessity, rather than simply on a

      25      landlord's whim.







                                                                   139
       1             And then, finally, it would create additional

       2      protections for tenants who have lived in their

       3      apartments for 15 years or longer.

       4             These changes are modest and they're

       5      targeted, and they're going to be effective, and

       6      they're just -- just imminently reasonable.

       7             It's critical that these changes be made now

       8      before this problem gets bigger.

       9             And, thank you all for your time, and for

      10      everything that you're doing on these issues.

      11             SENATOR KAVANAGH:  Thank you.

      12             And I'll hold my comments, other than to say,

      13      if I had known what you were going to testify about,

      14      you know, we would have brought you up sooner.

      15             ADAM MEYERS:  Yeah, perfect.

      16             SENATOR KAVANAGH:  But thank you for your

      17      (indiscernible).

      18             Thank you, for the other Brooklyn Legal

      19      Services now.

      20             CHAVETTE JACKSON:  Hi.

      21             My name is Chavette Jackson.

      22             I'm a staff attorney at Legal Services NYC,

      23      in our Brooklyn branch.

      24             I'd like to thank Senator Kavanagh and the

      25      Committee for this opportunity to offer testimony.







                                                                   140
       1             We applaud the Committee's efforts to provide

       2      desperately-needed protections for vulnerable

       3      tenants struggling to pay unaffordable rents and

       4      avoid displacement of homelessness due to a myriad

       5      of loopholes in the existing system of rent

       6      regulation.

       7             Legal Services NYC is one of the largest law

       8      firms for low-income people in New York City, with

       9      18 community-based offices and numerous outreach

      10      sites located throughout each of the city's five

      11      boroughs.

      12             Legal Services NYC's mission is to provide

      13      expert legal assistance that improves the lives and

      14      communities of low-income New Yorkers.

      15             New York City and New York State are facing

      16      an ever-deepening affordable-housing crisis.

      17             45 percent of New York City tenants are

      18      rent-burdened.  Hundreds of thousands of

      19      New York City tenants must defend themselves in

      20      eviction proceedings each year.

      21             The vast majority struggling to pay rents

      22      that have risen above their means.

      23             60,000 families currently reside in the

      24      city's homeless shelters.

      25             At the root of this crisis are insidious







                                                                   141
       1      loopholes punched in the rent laws by past

       2      legislatures oblivious to the social cost of

       3      weakening controls on cut-throat -- on the

       4      cut-throat real estate market.

       5             Meanwhile, literally, millions of tenants in

       6      unregulated smaller properties live with constant

       7      fear of displacement because they have no protection

       8      against arbitrary eviction by their landlords.

       9             I'm one of them.

      10             The newly-introduced rent-regulation reform

      11      bills would provide desperately needed protections

      12      to millions of vulnerable working-class and

      13      middle-class families throughout the city and state,

      14      closing scandalous loopholes that provide -- that

      15      allow predatory landlords to enrich themselves at

      16      the expense of our families and our communities.

      17             Legal Services NYC believes that all the

      18      bills included in the Housing for All campaign will

      19      immeasurably benefit our clients, and help curtail

      20      the epidemic of homelessness and rent hardship that

      21      afflicts working families throughout the state.

      22             Senate Bill 3482 will repeal the current law

      23      that allows landlords to permanently deregulate

      24      apartments upon vacancy when the maximum

      25      legally-collectable rent exceeds 2773, even if the







                                                                   142
       1      landlord actually charges less than that amount.

       2             Vacancy deregulation provides a powerful

       3      incentive for landlords to charge less -- or, to

       4      displace tenants through harassment, as well as

       5      through the aggressive use of housing-court eviction

       6      proceedings.

       7             Even where the market will not support rents

       8      above that threshold, landlords still seek

       9      deregulation to deprive their tenants of rights and

      10      protections available under rent stabilization.

      11             Deregulation, therefore, affects thousands of

      12      tenants in low-income neighborhoods where market

      13      rents are below the threshold.

      14             Deregulation operates as one of the principle

      15      drivers of displacement and neighborhood instability

      16      in New York City.

      17             S1593 will repeal the current law that

      18      permits landlords to increase rent-stabilized rent

      19      by 20 percent upon vacancy.

      20             This increase is not tied to any increase in

      21      the landlord's costs, which are already compensated

      22      through the annual rent increases approved by the

      23      Rent Guidelines Board.

      24             The 20 percent vacancy bonus does not require

      25      any improvement to the apartment either.







                                                                   143
       1             It is a pure windfall to landlords and a

       2      major cause of inflated rents, and must be

       3      abolished.

       4             Due to existing loopholes in the

       5      rent-stabilization law, the maximum stabilized rents

       6      actually exceed market rents in many neighborhoods.

       7             Current law allows landlords to charge market

       8      rent under the name "preferential rent," while

       9      registering often much higher -- a much higher legal

      10      rent.

      11             When market conditions change, landlords are

      12      free to revoke the preference upon expiration of the

      13      tenant's lease, subjecting tenants to increases of

      14      50 to even 100 percent.

      15             In some low-income neighborhoods, one-third

      16      to one-half of rent-stabilized tenants are currently

      17      being charged revocable preferential rents.

      18             S6527 will require landlords to base renewal

      19      leases on the original preferential rent for the

      20      life of the tenant's occupancy so that tenants will

      21      not be displaced by drastic rent hikes.

      22             In 1997 the Legislature enacted a law,

      23      requiring judges to order tenants to deposit

      24      outstanding rent during the course of an eviction

      25      case, and mandating the dismissal of the tenant's







                                                                   144
       1      defenses if they could not afford the deposit.

       2             The law unconstitutionally prevented tenants

       3      from challenging illegal overcharges if they could

       4      not afford to deposit the illegally high rent, and

       5      allowed landlords to evict tenants from freezing

       6      substandard apartments without giving them a chance

       7      to defend -- to demand a rent abatement.

       8             S4526 will bar judges from striking the

       9      defenses of indigent tenants, and give tenant

      10      advocates appearing, under the Universal Access to

      11      Counsel Project, the time they need to properly

      12      prepare their cases and assert essential defenses

      13      for their clients.

      14             Current law protects dishonest landlords who

      15      charge rent in excess of the legal limits by barring

      16      tenant overcharge claims after four years elapse.

      17             The law penalizes tenants, particularly

      18      low-income tenants, who are unaware of their legal

      19      rights and fail to act within the four-year period.

      20             Indeed, landlords often lull tenants into

      21      inaction by charging them lower preferential

      22      rents -- excuse me -- only to revoke the preference

      23      after four years.

      24             Senate Bill 280 will protect landlords who

      25      provide -- who file truthful, lawful registration







                                                                   145
       1      statements, while allowing tenants to challenge

       2      registrations rendered unreliable due to fraud or

       3      dishonest practices.

       4             Thousands of tenants in New York City and

       5      throughout the state who are not covered by rent

       6      regulation may be evicted by their landlords for any

       7      reason or no reason, even when they're willing and

       8      able to pay market rents.

       9             Such tenants live perpetually in fear that

      10      their landlords -- of their landlords, afraid to

      11      request repairs and are vulnerable to harassment.

      12             S2992 restores simple justice to the

      13      unregulated rental market.

      14             Landlords will be able to recover apartments

      15      for bona fide reasons, but will no longer be able to

      16      arbitrarily evict law-abiding tenants.

      17             Under our current system, landlords that

      18      upgrade systems and individual apartment finishes

      19      are able to pass costs of those repairs on to

      20      tenants forever.

      21             However, many of these building systems --

      22      system repairs are necessary after years of neglect,

      23      and landlords often overstate the cost and extent of

      24      renovations.

      25             Individual apartment improvements are even







                                                                   146
       1      more susceptible to abuse because they are not

       2      monitored by HCR, and can lead to doubling of rents

       3      and the immediate decontrol of apartments.

       4             The proposed bills will protect tenants from

       5      these predatory practices which eviscerate the

       6      State's efforts to keep rents affordable for working

       7      families.

       8             Thank you.

       9             SENATOR KAVANAGH:  Thank you.

      10             Questions for this panel?

      11             SENATOR KRUEGER:  Gustavo first.

      12             SENATOR KAVANAGH:  Seems like we have

      13      several.

      14             First, Senator Rivera.

      15             SENATOR RIVERA:  Okay.

      16             I'll point out, we've been joined by

      17      Assembly Member Richardson.

      18             I'd like to hear later about that video that

      19      you posted about, someone who's paying people

      20      outside?

      21             OFF-CAMERA SPEAKER:  Yes.

      22             SENATOR RIVERA:  That would be -- that would

      23      be really -- I'd love to hear that.

      24             But, for you two folks, thank you for being

      25      here.







                                                                   147
       1             You both are both -- both are attorneys, and

       2      have represented many tenants, and you represented

       3      tenants in MCI cases, to try to get them to fight

       4      MCIs?

       5             You have, ma'am?

       6             CHAVETTE JACKSON:  I have not particularly.

       7             SENATOR RIVERA:  Okay.

       8             You have, sir?

       9             ADAM MEYERS:  I've represented a few, yes.

      10             SENATOR RIVERA:  Okay.

      11             So if -- if you could tell me, just briefly,

      12      kind of give us the worst-case scenario.

      13             I'm just -- the one that you remember,

      14      particularly, because, as you might have been here

      15      earlier, this is just one, right, application.

      16             This is for a $2.2 million renovation on

      17      restore -- on facade restoration, a lobby

      18      renovation, et cetera.

      19             But if you could tell us a little bit, just

      20      from a point of view of a professional, because this

      21      is what you do for a living, you represent tenants,

      22      could you tell us a little bit about the worst

      23      experience that you can remember of trying to defend

      24      tenants that were going through an MCI process, and

      25      then still seeing it go through at the end?







                                                                   148
       1             Or maybe tell us a good story as well.

       2             ADAM MEYERS:  No, I have no good stories

       3      about MCIs.

       4             The case that I've dealt most directly with

       5      MCIs is a building that I represented -- a tenant

       6      association I represented in a building up in

       7      Greenpoint on Manhattan Avenue.

       8             It's only a 6-unit building, and so it didn't

       9      get up into the 2 1/2-million-dollar range, but it

      10      was several hundred thousand dollars.  And it -- the

      11      landlord was seeking rent increases for the tenants

      12      that translated into, I believe, between one and

      13      two hundred dollar rent increases per apartment,

      14      which for low-income folks is extremely difficult.

      15             And so we -- you know, we did spend months

      16      working with the tenants, collecting what evidence

      17      we could, about what work was done at the property,

      18      whether or not it was done in a workman-like

      19      fashion, whether or not it was effective or

      20      necessary, or whether it actually benefited the

      21      tenants.

      22             In this case, a lot of the benefits actually

      23      went to a commercial tenant that was occupying the

      24      first floor, that DHCR, frankly, did not really

      25      recognize the true extent of their presence there,







                                                                   149
       1      and so didn't attribute enough of the expense to

       2      them.

       3             But, long story short, we weren't able to do

       4      a lot with it.

       5             The decision came down.

       6             It's currently under what's called

       7      "a petition for administrative review," so, it's,

       8      theoretically, on appeal.  But that's a long

       9      process, and it's going to be a while before the

      10      tenants see any relief from that.

      11             SENATOR RIVERA:  To follow up a second, so

      12      the -- you said that DHCR did not, in this

      13      particular case, recognize the extent of the

      14      presence, I think is what you said, the extent of

      15      the presence of that particular commercial tenant?

      16             ADAM MEYERS:  Yeah, and it gets a bit

      17      complicated, and I don't want to drag us into the

      18      weeds --

      19             SENATOR RIVERA:  Okay.

      20             ADAM MEYERS:  -- but, basically, commercial

      21      tenants who occupy buildings, and where some of the

      22      benefit of renovation work goes to those commercial

      23      tenants, the costs are suppose to be transferred to

      24      the commercial tenants sort of in relation to the

      25      amount of space that they occupy of the property.







                                                                   150
       1             And our big argument was that, DHCR

       2      undercounted the space that was occupied by the

       3      commercial tenant, and gave too little expense to

       4      the commercial tenant and too much to the

       5      residential residents.

       6             SENATOR RIVERA:  I guess the question I'm

       7      really asking is related to the role of DHCR.

       8             Since you made the -- your statement was,

       9      they didn't take (indiscernible) into account.

      10             Obviously, that's a situation, as far as the

      11      commercial tenant.

      12             There might be many situations that are

      13      similar.

      14             Would it -- do you have a sense, in your

      15      experience, based on your experience, do you think

      16      it's because of an inability of DHCR to do that type

      17      of work?  Maybe too much on their plate?  Or maybe

      18      the law doesn't allow them to take into

      19      consideration that commercial tenant's --

      20             ADAM MEYERS:  Yeah, I think it's a resource

      21      issue.

      22             I don't think that they lack the ability to

      23      do it.

      24             I've met inspectors that work -- worked for

      25      DHCR that are very sharp.







                                                                   151
       1             But, I think that they have a lot of these

       2      cases to deal with, and their practice is at a place

       3      where they tend to give a lot of deference to

       4      landlords when they are handed those 250-page stacks

       5      of paper.

       6             SENATOR RIVERA:  Got it.

       7             And, ma'am, you said you have not represented

       8      tenants yourself.

       9             Maybe you're -- maybe -- do you know of any

      10      cases like that in your -- that maybe --

      11             CHAVETTE JACKSON:  I think the biggest issue

      12      we encounter with -- I've encountered with MCIs are

      13      in these DHCR rent-registration histories, where

      14      we're trying to go back four years, and we're trying

      15      look for overcharges, and the landlords are either

      16      claiming owner's use or MCIs for past tenants.

      17             And that's the way they're using the MCIs to

      18      jack up the rents for current tenant.

      19             And so it's very hard -- it's very difficult

      20      to go back and to trace these apartment improvements

      21      on these dilapidated buildings to see what the

      22      landlords have done, either individually in

      23      apartments or, overall, to the structure, the

      24      overall building structures.

      25             So sometimes we can't see what work has been







                                                                   152
       1      done at all, either in the past or for our current

       2      client, to justify these increases that the

       3      landlords are trying to charge.

       4             SENATOR RIVERA:  Thank you both.

       5             Thank you, Mr. Chairman.

       6             SENATOR KAVANAGH:  We have several questions

       7      on this one.

       8             I think we're just going to keep going

       9      across, if that's okay.

      10             So, Senator Krueger.

      11             SENATOR KRUEGER:  It's actually not a

      12      question I -- to Adam Meyers.

      13             I want to thank you for highlighting

      14      Senator Kavanagh's other bill on single-use

      15      eviction, and I just want to high -- owner's-use

      16      eviction.

      17             So in the beginning I made a statement that

      18      Manhattan has seen everything go on forever, and now

      19      the rest of the city is seeing the same thing.

      20             So when I was first elected, I think almost

      21      17 years ago, one landlord named Steve Croman, he

      22      went on to much great fame.

      23             He evicted 20 tenants in my district in one

      24      building to build himself a mansion.

      25             Just saying.







                                                                   153
       1             So this has been a growing crisis.

       2             So as -- you're absolutely right, as

       3      neighborhoods gentrify more and more, there is more

       4      and more motivation for us to see things people used

       5      to imagine nobody would ever do that anyway.

       6             So, it's very important.

       7             SENATOR RIVERA:  Can I ask just one last

       8      quick question, because I just realized something?

       9             To the gentleman that's represented, very

      10      quickly, so in your experience, based on the

      11      cases --

      12             How many have you done, as far representing

      13      tenants in MCI cases?

      14             ADAM MEYERS:  I don't know.

      15             SENATOR RIVERA:  5?  10?  15?

      16             ADAM MEYERS:  Yeah, around five, probably.

      17             SENATOR RIVERA:  Around five, but, obviously,

      18      you're not like things that you can get done in a

      19      couple of days.  They're complicated.

      20             ADAM MEYERS:  No, they're complicated.

      21             SENATOR RIVERA:  -- so in your experience, do

      22      you think that tenants that do not have the luxury,

      23      in your case, the luck, of having someone who can

      24      work for them pro bono, that just a run-of-the-mill

      25      tenant with a run-of-the-mill life in a







                                                                   154
       1      rent-stabilized apartment, whether that person

       2      could, on their own, go through this process and be

       3      able to advocate effectively on their own?

       4             Do you think that's possible?

       5             ADAM MEYERS:  Do I think it's possible?

       6             Do I think there are extraordinary

       7      individuals who sort of rise to the occasion?

       8             Yeah, probably, but, it's extremely

       9      burdensome.

      10             But it's long odds against them if only due

      11      to the fact that, when a landlord's filing an MCI

      12      application, he's doing it with well-paid counsel.

      13             And so if the lawyer's going to add any value

      14      to the situation, and, professionally, I have to say

      15      that it does, the tenant's at a disadvantage just by

      16      virtue of being unrepresented.

      17             SENATOR RIVERA:  Thank you.

      18             SENATOR KAVANAGH:  And you've added value to

      19      our hearing as well.

      20             Next up, Senator Myrie.

      21             SENATOR MYRIE:  Thank you for your testimony.

      22             Mr. Meyers, on the issue of owner-use

      23      eviction, it happens to be something that I support.

      24             I'm not just saying that because I'm sitting

      25      next to the sponsor of the bill.







                                                                   155
       1             Can you speak to, without getting, you know,

       2      like Comm Law 101, the constitutional argument

       3      against it, that people will say, or landlords will

       4      say, You're telling me that I can't live in the

       5      property that I own and that I've bought?

       6             ADAM MEYERS:  So, it's a good question, and

       7      I'll confess that I haven't done a deep-dive

       8      research into the constitutional issues.

       9             But I don't think they're going to be a big

      10      problem here, and the reason I think that is

      11      because, there is a substantial body of law

      12      affirming New York State and New York City's ability

      13      to sort of put restrictions on the way that property

      14      owners, and especially landlords, are allowed to use

      15      their property.

      16             This bill would not prohibit landlords from

      17      using their own properties for their own occupancy.

      18             It would simply require that they do it

      19      either with one unit, or they wait until units

      20      become vacant, or, negotiate buyout agreements with

      21      tenants.

      22             That's actually one of the really interesting

      23      issues with the current state of the law, the fact

      24      that, if you purchase a rent-stabilized building

      25      full of below-market tenants, and you want to turn







                                                                   156
       1      that into a higher-rent building, sort of a luxury

       2      rental, the way you do that is you offer people

       3      buyouts, and the market sort of interacts with you

       4      and the tenant and you arrive at prices, you know,

       5      maybe this tenant will take 100 grand.  That tenant

       6      will take a hundred fifty, whatever it is.

       7             You can get them out if you offer them enough

       8      money.

       9             But what New York State does, under the

      10      current law, is it subsidizes landlords who,

      11      instead, want to take these units completely off of

      12      the market and turn these, you know, 10-unit

      13      buildings into mansions.

      14             New York State subsidizes them to the tune of

      15      the buyouts they would otherwise have had to pay to

      16      the tenants, and that's a big problem.

      17             SENATOR KAVANAGH:  Senator Salazar.

      18             SENATOR SALAZAR:  Thank you.

      19             Thank you both for your testimony.

      20             My question is for Ms. Jackson.

      21             In your testimony, when you spoke about the

      22      need to reform preferential rents, or close the

      23      preferential rent loophole, certainly, the --

      24      there's, currently, the proposal that you spoke to

      25      of making those preferential rents the legal rent







                                                                   157
       1      for the remaining period of the tenancy.

       2             But, there is an alternative proposal to

       3      actually make the preferential rent the legal rent

       4      beyond the current tenancy.

       5             I assume -- I know the answer to this --

       6      well, I don't want to assume that I know the answer

       7      to my question, but, do you -- is it -- in your

       8      opinion, the second option, is it viable, and is it

       9      preferrable?

      10             CHAVETTE JACKSON:  It's certainly

      11      preferrable.

      12             I think, in a lot of cases, in my experience,

      13      where I'm representing large clusters of buildings,

      14      and tenants either facing eviction, or, especially

      15      when coming from under regulatory agreements, where

      16      the landlords are lawfully allowed to restructure

      17      rents and double and triple tenants' rents,

      18      preferential rents become very important to tenants.

      19             And so what we often negotiate in settling

      20      those cases are preferential rents for the tenants,

      21      and the fight we get from the landlords is

      22      succession rates, and the rights for these

      23      preferential rates to enure, not just for the life

      24      of the tenancy, but for any successors.

      25             It is our position that it's important that







                                                                   158
       1      successor tenants have the right to enjoy these

       2      preferential rents as well.

       3             We don't know what's going to happen during

       4      the life of the tenancy.

       5             We don't know what the landlords are going to

       6      do in the interim to these tenants.

       7             And so it's important that any successor

       8      tenant will have the opportunity to have the

       9      affordable rent that their family member had, any

      10      children or anybody remaining in the apartment.

      11             So we definitely support it enuring for even

      12      longer than just the life of the tenancy.

      13             SENATOR SALAZAR:  Thank you.

      14             SENATOR KAVANAGH:  Senator.

      15             Senator Hoylman.

      16             SENATOR HOYLMAN:  Thank you,

      17      Senator Kavanagh, and thank you for your bill on the

      18      issue of owner-occupied units.

      19             Question for you:  How prevalent is it?

      20             Is it increasing in number?

      21             Do you have any sense of borough?

      22             I know there's a lot that has occurred in the

      23      East Village, and even the -- in the wider Greenwich

      24      Village in my district.

      25             But I was wondering if you see the trend line







                                                                   159
       1      continuing?

       2             ADAM MEYERS:  And so my answer here is going

       3      to be entirely anecdotal, based on the fact that, to

       4      the best of my knowledge, there is no governmental

       5      body that tracks this stuff at all.  It's completely

       6      unmonitored.

       7             But, to the best of my knowledge, it is

       8      increasing.

       9             We are seeing an increasing number of these

      10      cases in Greenpoint, we're seeing an increasing

      11      number of these cases, and this is where I'm really

      12      seeing most of them, in South Williamsburg, where

      13      the Hasidic community is using these cases as their

      14      population expands, and they are displacing,

      15      largely, Latino long-term tenants via owner's-use

      16      eviction.

      17             SENATOR HOYLMAN:  Well, it is the ultimate,

      18      like, fat-cat landlord move, to say that, my family

      19      is better than yours and you have to move out of

      20      your apartment to accommodate, you know, my kids and

      21      parents.

      22             ADAM MEYERS:  It's a really bad look.

      23             SENATOR HOYLMAN:  It's a real -- it is so

      24      outrageous.

      25             So thank you, Senator Kavanagh, for your







                                                                   160
       1      bill.

       2             And thank you for advocating for it.

       3             SENATOR KAVANAGH:  And I'm just going to

       4      follow up with one -- one or two quick questions.

       5             So you've talked about a common phenomenon,

       6      where the goal is to clear out lots of people to

       7      make few dwelling units.

       8             Like, and we had, I think, 20 -- I think it

       9      was 28 units on East 3rd Street, I think you may

      10      have ref -- that made me think of the same case that

      11      was from a number of years ago.

      12             But there's also -- this is also useable by

      13      multiple family members for multiple units as well;

      14      right?

      15             ADAM MEYERS:  That's correct.

      16             SENATOR KAVANAGH:  So if I am a landlord and

      17      I have lots of relatives, and I want to take an

      18      occupied rent-regulated building, and I want to

      19      designate each apartment as the new home of each of

      20      many of my relatives, I can use that as the basis

      21      for taking all of those units out of deregulation --

      22      out of regulation?

      23             ADAM MEYERS:  That's correct, yeah.

      24             If -- they would have to be immediate family

      25      members, but, assuming they're immediate family







                                                                   161
       1      members, you don't need to prove that you need these

       2      units for any reason or that you don't have other

       3      places to put them.

       4             You only need to prove that this is what you

       5      want.

       6             SENATOR KAVANAGH:  And to your knowledge, is

       7      there any ability on the part of HCR, or any other

       8      agency, to follow up subsequent to the deregulation,

       9      to ensure that your relatives are still living

      10      happily in these units?

      11             ADAM MEYERS:  It -- I have no knowledge of

      12      any program by DHCR to follow up on this.

      13             DHCR does have a rule, I believe, that, if

      14      you evict someone for owner's use, you must, as the

      15      owner or as the owner's family, occupy that unit for

      16      three years after that eviction.

      17             But I think, if you violate that rule, all

      18      that happens is that there is a sort of

      19      rent-increase penalty imposed on the building.

      20             And, two, you're exactly right, that I don't

      21      think DHCR looks for that independently.

      22             It would only be brought to their attention

      23      by super-observant tenants, you know.

      24             SENATOR KAVANAGH:  Okay.

      25             Again, thank you, and we have your testimony,







                                                                   162
       1      and we would like to follow up with you on this.

       2             ADAM MEYERS:  Thank you.

       3             SENATOR KAVANAGH:  Thank you.

       4             Okay, great.  Thank you very much.

       5             Next up, as I -- as previously mentioned, we

       6      have Xiao Ling Chen, and, Melanie Wang, who I think

       7      is going to translate, with CAAAV (the Coalition

       8      Against Anti-Asian Violence).

       9             And then next up after that we have Neighbors

      10      Helping Neighbors, and that is going to be

      11      Abigail Martinez and Clara Perez Joseph, and

      12      I believe Marcela Mitaynes is also here.

      13             XIAO LING CHEN:  (Speaking Chinese.)

      14                (Translated to English by a translator.)

      15             So, hello to the State Senators, and all of

      16      our allies, and ladies and gentlemen here today.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             So my name is Chen Xiao Ling, or Xiao Ling

      20      Chen.

      21                (Speaking Chinese.)

      22                (Translated to English by a translator.)

      23             I'm a member of the Chinatown Tenants Union

      24      at CAAAV.

      25                (Speaking Chinese.)







                                                                   163
       1                (Translated to English by a translator.)

       2             So I live in Chinatown on Eldridge Street,

       3      135 Eldridge Street, Apartment 1-C.

       4                (Speaking Chinese.)

       5                (Translated to English by a translator.)

       6             I came to Chinatown in 1981, New York City's

       7      Chinatown, and I moved into this apartment in August

       8      of 1982.

       9                (Speaking Chinese.)

      10                (Translated to English by a translator.)

      11             My daughter was born in this apartment on

      12      November 3rd of 1982.

      13                (Speaking Chinese.)

      14                (Translated to English by a translator.)

      15             So I've come here today to support

      16      Housing Justice For All's nine bill proposals, and

      17      also, particularly, to ask you for your support in

      18      ending the MCI program.

      19                (Speaking Chinese.)

      20                (Translated to English by a translator.)

      21             So I didn't come here today to make a speech

      22      or to tell stories.

      23             I came here just to share with you the true

      24      experience that I've had and the impact I've

      25      suffered from MCIs.







                                                                   164
       1                (Speaking Chinese.)

       2                (Translated to English by a translator.)

       3             So, from 1982 to 2014, we lived very happily

       4      in our building.

       5             Our building was owned by a small Chinese

       6      landlord who, for 30 years, followed the letter of

       7      the law and followed the annual RGB rent increases

       8      when increasing the rent.

       9                (Speaking Chinese.)

      10                (Translated to English by a translator.)

      11             Then in 2014, our current landlord, a large

      12      corporate company, bought our tenement building.

      13                (Speaking Chinese.)

      14                (Translated to English by a translator.)

      15             So from that point on our lives changed

      16      greatly.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             So in the beginning, our landlord told a lot

      20      of the tenants who were living in the building, who

      21      had previously shared their apartment with others or

      22      lived with relatives, that their situations were

      23      illegal and, thus, forced those tenants out.

      24                (Speaking Chinese.)

      25                (Translated to English by a translator.)







                                                                   165
       1             For example, when I moved into my apartment,

       2      I was still pregnant with my daughter, so,

       3      naturally, my lease just has my name on it.

       4             And then this new landlord, when they came in

       5      in 2014, tried to tell us that my daughter couldn't

       6      live with me because her name wasn't on the lease.

       7                (Speaking Chinese.)

       8                (Translated to English by a translator.)

       9             And I would try to pay them rent by check,

      10      and they would refuse to take the checks and send

      11      them back.

      12                (Speaking Chinese.)

      13                (Translated to English by a translator.)

      14             And I even ended up having to go to court

      15      with them.  But, eventually, their own lawyers said

      16      that they would have to take the checks that I sent

      17      in.

      18                (Speaking Chinese.)

      19                (Translated to English by a translator.)

      20             And then, in 2015, I received a letter from

      21      the housing department, saying that they had

      22      inspected my apartment and that my apartment had

      23      lead in the apartment.

      24                (Speaking Chinese.)

      25                (Translated to English by a translator.)







                                                                   166
       1             And at that time, my daughter had three

       2      children already.

       3                (Speaking Chinese.)

       4                (Translated to English by a translator.)

       5             And the oldest was 9.

       6                (Speaking Chinese.)

       7                (Translated to English by a translator.)

       8             The second was 7.

       9                (Speaking Chinese.)

      10                (Translated to English by a translator.)

      11             The third was 4 years old.

      12                (Speaking Chinese.)

      13                (Translated to English by a translator.)

      14             So when the government said that there was

      15      lead in the apartment, they had to do repairs and

      16      clear up the lead violations.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             And I remember very clearly --

      20             SENATOR KAVANAGH:  And just forgive me for

      21      interrupting, but, in fairness, since this has to be

      22      translated, we're going to -- I think we're just

      23      going run the clock again.

      24             XIAO LING CHEN:  (Speaking Chinese.)

      25                (Translated to English by a translator.)







                                                                   167
       1             So then they notified me that they would have

       2      to do repairs to fix the lead issues, and my

       3      daughter at that time was working.

       4                (Speaking Chinese.)

       5                (Translated to English by a translator.)

       6             So I had a relative in China who was sick and

       7      was about to pass away, so I asked my landlord, give

       8      me four weeks' time, I'm going to China, and can you

       9      wait until I come back to do these repairs?

      10                (Speaking Chinese.)

      11                (Translated to English by a translator.)

      12             And they agreed.

      13                (Speaking Chinese.)

      14                (Translated to English by a translator.)

      15             And when I came back in May, I found that

      16      they had completely destroyed my apartment.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             And my daughter told me that the landlord had

      20      come in to do the repairs because that they said

      21      they couldn't wait to do the repairs, and my

      22      daughter was at work.

      23                (Speaking Chinese.)

      24                (Translated to English by a translator.)

      25             So a long time ago we had fixed up our







                                                                   168
       1      kitchen and our kitchen cabinets.  And the landlord,

       2      in order to fix the lead violations, had placed

       3      additional siding on the walls all around the

       4      kitchen, and completely re-adjusted our cabinets so

       5      that everything in the kitchen was crooked and

       6      working improperly.

       7                (Speaking Chinese.)

       8                (Translated to English by a translator.)

       9             So they had found their own people, own

      10      contractors, to come and do this work.

      11             But when the State came back to inspect, they

      12      found that there was still evidence of lead in the

      13      apartment.

      14             So it took them two or three times of repairs

      15      before they finally got a licensed contractor to

      16      come and do the repairs.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             So then, in order to increase the rent, the

      20      landlord did a lot of construction on the building,

      21      including construction to fix the facade, and then

      22      the commercial spaces on the ground floor.

      23             And because I'm on the ground floor, and

      24      there's only a wall between my bedroom and these

      25      spaces, there was a lot of impact to me, including a







                                                                   169
       1      giant hole that was knocked into my wall and damage

       2      to my bed.

       3                (Speaking Chinese.)

       4                (Translated to English by a translator.)

       5             So the hole was so big that I could see --

       6      from my side of the wall, I could see into their

       7      space, and I could see them.

       8                (Speaking Chinese.)

       9                (Translated to English by a translator.)

      10             And I couldn't sleep there anymore.

      11                (Speaking Chinese.)

      12                (Translated to English by a translator.)

      13             Then they said that there was a small hole in

      14      the wall next to my bed, and they said it was my bed

      15      that created the hole.  So they got a lawyer to

      16      write a letter to me, and requesting monetary

      17      damages.

      18                (Speaking Chinese.)

      19                (Translated to English by a translator.)

      20             So they also did facade repair work, and last

      21      year we received two MCI applications from the

      22      landlord to increase the rent.

      23                (Speaking Chinese.)

      24                (Translated to English by a translator.)

      25             The first one was for every room, increasing







                                                                   170
       1      the rent around $50.

       2                (Speaking Chinese.)

       3                (Translated to English by a translator.)

       4             The second one was for every room, increasing

       5      the rent about $20.

       6                (Speaking Chinese.)

       7                (Translated to English by a translator.)

       8             So, luckily, the second MCI application DHCR

       9      has already rejected.

      10                (Speaking Chinese.)

      11                (Translated to English by a translator.)

      12             But their reasoning is that, they've repaired

      13      the facade --

      14                (Speaking Chinese.)

      15                (Translated to English by a translator.)

      16             -- and done water re-piping.

      17                (Speaking Chinese.)

      18                (Translated to English by a translator.)

      19             But since 2015, after they did the water

      20      re-piping, the water situation in my home is

      21      actually a lot worse, and there's very little water

      22      coming out of the faucet.

      23             And my grandchildren that live in the

      24      apartment are often sick and have runny noses

      25      because they're not able to wash properly.







                                                                   171
       1                (Speaking Chinese.)

       2             SENATOR KAVANAGH:  Yeah, I'm going to ask you

       3      to wrap up this testimony.  I think you -- we'll

       4      have some questions as well, so...

       5             XIAO LING CHEN:  (Speaking Chinese.)

       6                (Translated to English by a translator.)

       7             So, I have many things to say and I can't

       8      possibly finish them all.

       9                (Speaking Chinese.)

      10                (Translated to English by a translator.)

      11             So I just want to say that the construction

      12      the landlords are doing is not improving our lives

      13      at all.

      14             It doesn't have nothing to do with us, and,

      15      in fact, has made my life worse; has made it so that

      16      I don't have proper water in my apartment, that

      17      there are actually water leakages from the

      18      re-piping, that created mold damage that ruined a

      19      lot of things in our apartment.

      20                (Speaking Chinese.)

      21                (Translated to English by a translator.)

      22             After they did the exterior renovation and

      23      rented the space out to a bar, the mice in the

      24      building have increased substantially, and so that

      25      there are mice in my apartment all the time.







                                                                   172
       1             SENATOR KAVANAGH:  I'm going to ask you, if

       2      you -- if we could conclude.

       3             Maybe we have a couple of comments from the

       4      senators, anyway.

       5             XIAO LING CHEN:  (Speaking Chinese.)

       6                (Translated to English by a translator.)

       7             SENATOR KAVANAGH:  No, if you could stay for

       8      just a moment.

       9             XIAO LING CHEN:  Thank you very much.

      10             SENATOR KAVANAGH:  And thank you.

      11             I also want to begin by acknowledging that,

      12      you know, CAAAV -- you know, my staff has been

      13      working with CAAAV, and with, I think, the Urban

      14      Justice Center is also represented in the room.

      15             And, just, those organizations have done

      16      tremendous work in, I think, what is just one of the

      17      worst cases of a landlord abusing every aspect of

      18      the law that -- that is available to them.

      19             So I just -- I -- first of all, I appreciate

      20      your work here.

      21             And I would also just note that this is a

      22      rare case where, HCR, the state agency, has actually

      23      imposed -- they've refused to move forward with the

      24      applications; they've imposed rent freezes; they

      25      have, in some cases, rescinded -- you know, ordered







                                                                   173
       1      some money to be returned to tenants.

       2             But it just continues to be a horrific

       3      situation.

       4             My question for you is:

       5             As you -- as the folks in your building have

       6      been dealing with this terrible situation, have

       7      you -- have you managed to, you know, organize, you

       8      know, all of the tenants in your building?

       9             Are you -- are you working, you know,

      10      together and -- to address this with CAAAV and with

      11      the other organizations that have been working with

      12      you?

      13             XIAO LING CHEN:  (Speaking Chinese.)

      14                (Translated to English by a translator.)

      15             So all of us old tenants who have been in the

      16      building for a long time are working together.

      17             But the newer tenants moving into the

      18      building are paying much more in rent than us.

      19             And a friend of mine looked into their rent

      20      situation.

      21             And, you know, for us, the older tenants, we

      22      pay, more or less, around $1,000.  But the new

      23      tenants pay upwards of $3,600 for the same size

      24      apartment.

      25             SENATOR KAVANAGH:  And you perceive that --







                                                                   174
       1      this -- that to be the purpose of a lot of this

       2      activity, is to harass the old tenants out to get

       3      new tenants in who will pay much more?

       4                (Speaking Chinese.)

       5                (Translated to English by a translator.)

       6             Of course.

       7                (Speaking Chinese.)

       8                (Translated to English by a translator.)

       9             My grandchild, who last year turned 7, told

      10      me:  Grandma, the landlord isn't for us.  He doesn't

      11      want to rent this apartment to us.

      12             You know, the young children understand.

      13      Even they understand.

      14             SENATOR KAVANAGH:  I'm going to -- and by --

      15      you know, thank you for bringing your, you know,

      16      story to us today.

      17             And thank you for, you know, in spite of

      18      enduring all these terrible things, you know,

      19      working to try to change them, and -- and bringing

      20      your testimony to us, to help us figure out how to

      21      change the laws.

      22             Thank you.

      23                [Applause.]

      24             SENATOR KAVANAGH:  We have one -- we have

      25      additional questions for you.







                                                                   175
       1             Senator Myrie.

       2             SENATOR MYRIE:  Again, thank you for your

       3      testimony.

       4             On a good note, I wanted to let you know that

       5      you -- your daughter shares my birthday as well,

       6      November 3rd.

       7             But I also just wanted to ask if you could --

       8             SENATOR SALAZAR:  Every day is your birthday.

       9             SENATOR MYRIE:  Wait, right, yeah, inside

      10      Senate joke.

      11             Get it together, please.

      12             I wanted to ask if you could talk about --

      13      this is a difficult situation to begin with for any

      14      tenant.

      15             But if you could speak specifically to

      16      whether or not it is more difficult when English is

      17      not your first language?

      18             XIAO LING CHEN:  (Speaking Chinese.)

      19                (Translated to English by a translator.)

      20             So the landlord, you know, is not someone who

      21      speaks Chinese, and this presents a lot of

      22      communication difficulties for us.

      23             And within their company they only have one

      24      staff person who is Chinese and able to communicate

      25      with us in our language.







                                                                   176
       1                (Speaking Chinese.)

       2                (Translated to English by a translator.)

       3             So, often, when we make phone calls, we can't

       4      reach anybody.  When we leave messages, no one

       5      responds.

       6             SENATOR MYRIE:  Thank you.

       7             SENATOR KAVANAGH:  Thank you.

       8             Further questions?

       9             Okay.

      10             Thank you again very much for your testimony.

      11             MELANIE WANG (translator):  I just want to

      12      speak to, Ms. Chen's building has -- DHCR did reject

      13      one of the MCI applications, and they've also gotten

      14      a rent reduction.

      15             But we believe strongly that this is through

      16      the strong advocacy work Ms. Chen and her neighbors

      17      have done in participating in the No More MCI

      18      Administrative Reform Campaign, meeting with DHCR

      19      administrators more than once, right, and with other

      20      elected officials, and strong work with our

      21      legal-services partners.  Right?

      22             So it's only through strong tenant advocacy

      23      that we believe special attention has been paid to

      24      this building.

      25             SENATOR KAVANAGH:  Yeah, and as I mentioned,







                                                                   177
       1      extraordinarily strong advocacy on behalf of these

       2      tenants by these organizations.

       3             But there are many, many, many tenants that

       4      are not so lucky.

       5             And thank you again for your work.

       6                [Applause.]

       7             SENATOR KAVANAGH:  Next up we'll have the

       8      Neighbors Helping Neighbors panel.

       9             And then we're going to be followed by

      10      Delsenia Glover of Tenants and Neighbors.

      11             CLARA PEREZ JOSEPH:  Good afternoon, members

      12      of the dais, Senators.

      13             I especially want to thank you for coming

      14      down here because we've been pushing up to Albany

      15      all the time, and it's a grueling trip, but we have

      16      to do it and it gets done.

      17             But it's nice and refreshing that it's here.

      18             With my COPD, I appreciate it because I'm

      19      only three blocks away.

      20             SENATOR KAVANAGH:  Thank you.

      21             CLARA PEREZ JOSEPH:  I also want to thank the

      22      newly-elected -- congratulate the newly-elected

      23      political officials.

      24             SENATOR KAVANAGH:  Thank you.

      25             And can I ask you to identify yourself.







                                                                   178
       1             CLARA PEREZ JOSEPH:  Yes.

       2             My name is Clara Perez Joseph.

       3             I've been living in Crown Heights for

       4      52 years; about 13 years rent control, and then,

       5      after 39 years, rent-stabilized, and rent

       6      stabilization was very important to me.

       7             I was a very young divorced mother with three

       8      children, and I was able to raise them and give them

       9      stability, protection, a sense of community, not to

      10      be, you know, sending them from school to school.

      11             And I also put all of them through college

      12      because, you know, at the time, the rent was

      13      affordable.

      14             I'd like to talk about -- first of all,

      15      I want to start, instead of closing, I want to start

      16      by urging you to please support us with the nine

      17      bills, and not just eight, or seven, because if one

      18      doesn't get passed, that leaves a loophole.

      19             And the system is broken, it's cracked, and

      20      we know that we can't put Humpty-Dumpty back

      21      together again.

      22             So we just need these bills, this platform,

      23      to pass.

      24             I would like to talk about preferential rent.

      25             My first experience with that was when







                                                                   179
       1      I accompanied my daughter to get her first apartment

       2      after she graduated college.  And she was very

       3      excited that now she was going to be independent.

       4             We went to the real estate office.  I had no

       5      idea what that kind of lease was, and there were two

       6      amounts, and I thought it was strange.

       7             And I asked the young real estate agent, you

       8      know, Why two amounts?

       9             He said, Well, we have an $800 and $1200.

      10      Don't worry about the $1200.  We're going to give

      11      her the apartment for $800, we're giving her a

      12      break, and we're giving her preference.

      13             Well, she got the apartment.  She didn't want

      14      me to make any waves.  And invested in some

      15      furniture.  She's paying student loans, after two

      16      master (sic) degrees, trying to do the right thing;

      17      young adult up and coming, the -- our future.

      18             And then a couple years later, two years

      19      later, I think she gets hit with the $1200.

      20             So now, sadly, she goes from independent

      21      status, to roommate status and furniture in storage.

      22             That is horrendous.

      23             But that is the "monster" bill, the "monster"

      24      law, because it's the quickest way to raise the rent

      25      and get the tenants out.







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       1             Now, the other bill that I really am

       2      concerned about is the vacancy bonus, because that

       3      just gives the landlord the incentive to keep

       4      harassing the tenant.

       5             I'd like to thank Senator Krueger for the

       6      work that she did for protect -- tenant protection,

       7      but, we need to do more.

       8             And between the vacancy bonus, the

       9      preferential rent, and the MCIs, and the IAIs,

      10      those are ways to displace us quickly for

      11      gentrification.

      12             Now, I say that MCI is the biggest robbery

      13      I've ever seen, legally, because, you know, robbery

      14      is robbery.  And, whether you get mugged and your --

      15      you know, your purse gets taken, or someone goes

      16      into your account, this is robbery as well, because,

      17      if you pay for a service, you pay for a service and

      18      this is the amount, and you paid for it, okay, you

      19      shouldn't get paid peren -- he shouldn't make a

      20      perennial profit.

      21             So that has to go.

      22             I was looking at, the other day, the movie

      23      "The Pursuit of Happiness," with Will Smith.  A lot

      24      of you have seen it.

      25             The Declaration of Independence tells us we







                                                                   181
       1      have the right to life, liberty, and the pursuit of

       2      happiness.

       3             How the heck can you pursue happiness when

       4      you don't even have a place to live?

       5             Okay?

       6             It's very, very difficult to see your

       7      neighbors moving.

       8             The stores, it's a -- the storefront is a

       9      blight, because they push out the mom-and-pop

      10      stores, and no one else wants to pay those rents

      11      either.

      12             So you have -- you walk down and there's no

      13      shopping strip whatsoever.

      14             Also, I would like to speak on behalf of

      15      rent-control tenants and also non-regulated tenants.

      16             Housing is a human right.

      17             So we need to pass that good-cause bill for

      18      unregulated tenants because they have a right also.

      19             And the rent-controlled tenants should not

      20      have to pay that NBR, 7.5, or whatever it is, every

      21      year.

      22             They should have the right that

      23      rent-stabilization tenants.

      24             Okay, if I'm -- I'm proud to be a tenant

      25      leader, it's a privilege.







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       1             If I were a public official, I would feel it

       2      was priv -- it would be a privilege tenfold.

       3             And you have the power, and I urge you to use

       4      that power.

       5             And in the words of Emma Lazarus:  Give us

       6      your tired, your poor, your huddled masses yearning

       7      to breathe free, the wretched refuse of your teeming

       8      shore.  Send those, the tempest-tossed to me, I lift

       9      my lamp beside the golden door!

      10             There's no golden door for us.

      11             There's no door for us.

      12             The doors are closed.

      13             Use your vote and open those doors for us and

      14      save our homes.

      15             Thank you.

      16                [Applause.]

      17             SENATOR KAVANAGH:  Thank you.

      18             MARCELA MITAYNES:  Hello.

      19             Ms. Avigail Martinez is unable to meet with

      20      us because of work commitments, and I'd like to read

      21      her testimony for the record, please.

      22             SENATOR KAVANAGH:  Okay.  So, just identify

      23      yourself for the record, and then --

      24             MARCELA MITAYNES:  Sure.

      25             Marcela Mitaynes from Neighbors Helping







                                                                   183
       1      Neighbors, Avigail Martinez representing Neighbors

       2      Helping Neighbors.

       3             Avigail Martinez moved into her apartment at

       4      680 53rd Street in Sunset Park in 2014, with her

       5      husband and 4 children, ages 4 and 13 years old --

       6      4 through 13 years old.

       7             She began paying $2,200 a month in rent.

       8             She had help paying her rent because she had

       9      roommates; however, when her roommates moved out,

      10      she lost the rental income and she seeked help.

      11             She came to Neighbors Helping Neighbors,

      12      where she learned about her apartment being

      13      rent-stabilized and that she had rights.

      14             When she reviewed her rent history, she

      15      discovered the landlord had reported to the state

      16      agency DHCR that she was paying $643.50, and noticed

      17      that the prior tenant was paying $588.89.

      18             She learned that she can request an

      19      investigation with the State to determine the legal

      20      rent amount.

      21             The owner claimed the $1500-a-month rent

      22      increase was due to an individual apartment

      23      improvement.

      24             Compared to the other apartments,

      25      Ms. Martinez's apartment had been renovated,







                                                                   184
       1      created an additional bedroom, got rid of the living

       2      room, and moved the location of the kitchen from the

       3      middle of the apartment to the entrance of the

       4      apartment, all of this construction without any DOB

       5      permits.

       6             The State ruled in her favor, lowered her

       7      legal rent amount, from $2,200, to $750, a month,

       8      and ordered the landlord to refund her an overcharge

       9      of $56,000.

      10             The landlord challenged the State's ruling

      11      with the fancy expensive lawyer, claimed there was

      12      no requirements for permits when applying for an

      13      IAI, and the decision was overturned, and the legal

      14      rent was adjusted back to $2,200 a month.

      15             She is now appealing the decision in

      16      Supreme Court, and has to pay for a private attorney

      17      for assistance with the appeal, as none of the

      18      legal-service providers would take a case like this.

      19             While she is waiting for the decision, she

      20      continues to have to pay $2,200 a month for rent.

      21             The landlord refuses to make repairs or

      22      maintenance to the apartment or the building.

      23             And as this testimony is being provided, he

      24      continues to renovate the vacant apartments, and

      25      continues ignoring the long-term tenants' requests







                                                                   185
       1      for repairs and basic needs.

       2             I'd like to provide my testimony now if

       3      that's possible?

       4             SENATOR KAVANAGH:  Sure.

       5             Again, just for the people keeping track, if

       6      you can identify yourself and then go ahead.

       7             Can we reset the clock?

       8             OFF-CAMERA SPEAKER:  Reset it?

       9             SENATOR KAVANAGH:  Yes.

      10             MARCELA MITAYNES:  Thank you.

      11             So, good afternoon, Senators, and welcome to

      12      Brooklyn.

      13             I am Marcela Mitaynes.  I'm a tenant advocate

      14      and organizer for Neighbors Helping Neighbors

      15      located in Sunset Park on the other side of

      16      Senator Myrie's district.

      17             I used to live in Hell's Kitchen when I was a

      18      little girl.  And then, at the age of 5, my dad

      19      moved us to Sunset Park --

      20             Thank you.

      21             -- to a rent-stabilized apartment.

      22             We were living there for about 30 years.

      23             And then we got a new landlord that purchased

      24      the building, and within six months was able to

      25      empty out half of the apartments.







                                                                   186
       1             A lot of us just didn't understand what was

       2      happening, and a lot of what was happening was also

       3      happening because tenants tend to not be informed of

       4      their rights.

       5             There was a lot of rampant harassment, and

       6      I ended up losing my rent-stabilized apartment in

       7      2008.

       8             I then moved two blocks down.

       9             So, I was displaced from my rent-stabilized

      10      apartment that I've known for my whole life, where

      11      we were paying $625, to move two blocks away to a

      12      two-bedroom apartment, paying $1400 a month.

      13             And I share this because this is a common

      14      thing that we see with tenants.  Once they lose

      15      their rent-stabilized affordable apartment and are

      16      put back out into the market rate, they're only

      17      market-rate tenants for so long.

      18             I was only able to be in that apartment for

      19      the first two years.  And when it was time to renew

      20      it, we're talking about, going from $1400, to almost

      21      $1700 a month.

      22             That is not affordable to someone who's been

      23      in the community for a really long time.

      24             And so now I'm living in an unregulated unit,

      25      with no lease, no right to a lease, and can easily







                                                                   187
       1      be evicted within 30 days.

       2             I share this because this is the type of

       3      issues and problems that we're seeing in the

       4      community.

       5             As an advocate, I've been working in my

       6      community for 10 years, advocating and fighting for

       7      tenants to stay in their homes.

       8             We've seen all kind of abuses with the bills

       9      and the legislation that we're trying to pass, which

      10      is why we're here trying to support it.

      11             And there's three buildings that were in the

      12      news a lot in Sunset Park: 545, 553, and

      13      557 46th Street.

      14             Each are 17-unit, rent-stabilized buildings.

      15      They've been hit with five MCIs, totaling $400 a

      16      month additional rent for the MCIs.

      17             Now, the tenants are fighting it, but this,

      18      again, would require a private attorney.

      19             If they're not able to fight it, this will

      20      cause displacement.

      21             When we're talking about eviction and the

      22      eviction numbers, they do not reflect all the

      23      evictions.  They do not reflect the evictions that

      24      happen as a result of tenants being priced out.

      25             Avigail Martinez is an example of the abuse







                                                                   188
       1      of the individual apartment increases.

       2             The vacancy decontrol acts as an incentive

       3      for landlords.

       4             If they can raise the rents high enough to

       5      get the tenants out, then they are no longer dealing

       6      with legislation or rules.

       7             The four-year rollback, again, like you've

       8      heard, in the past, unless a tenant is aware or

       9      knows that there's a way of trying to find out if

      10      their legal rent is correct, they only have a short

      11      four windows -- a four-year window to do it.  And if

      12      they can't, then they're stuck with the higher rent.

      13             Again, the rapid harassment that's happening

      14      in these communities, particularly to the

      15      working-class immigrant population that is located

      16      in Sunset Park, is very detrimental.

      17             We're going through gentrification.

      18             Most of the work, most of the counseling,

      19      most of the advocacy, most of the tenant workshops,

      20      tenant meetings, that we have are done predominantly

      21      in Spanish because that is the main language that

      22      they speak, that is what they understand.

      23             For a working-class immigrant community like

      24      Sunset Park, the fact that they are undocumented

      25      brings additional harassment pressures.







                                                                   189
       1             They are being told to their face that

       2      they're going to call immigration.

       3             They're being told that they're gonna --

       4      their children are going to come home and not

       5      find -- and not find their parents.

       6             This is an easy way for these landlords to

       7      vacate these apartments, renovate them, and then

       8      convert them into market rate.

       9             What is happening has been happening over

      10      years.  This is not something that's sudden.

      11             These laws that have been passed, with the

      12      help of the real estate industry, is really to make

      13      the real estate industry richer.

      14             They are not complicit in making money.

      15             They want to be millionaires at the expense

      16      of the working-class.

      17             We are at a unique opportunity to make

      18      history, and I hope that history will show that you

      19      guys all are on the right side of history by passing

      20      these laws.

      21             We cannot accept just one or two bills being

      22      passed.

      23             It's really the package of bills that's going

      24      to make a difference in the homelessness that's

      25      being experienced in the whole state of New York.







                                                                   190
       1             And one last thing, I implore to you make

       2      sure that you're able to pass these bills in the

       3      Senate; work with the Assembly, make sure that they

       4      pass it.

       5             Do not give the Governor an opportunity to

       6      water down these bills.

       7             SENATOR RIVERA:  I didn't hear you.

       8      (Inaudible.)

       9             MARCELA MITAYNES:  Do not give the Governor

      10      the opportunity to water down these bills.

      11             SENATOR RIVERA:  Oh, got you.

      12             MARCELA MITAYNES:  Pass these bills, put them

      13      on his desk, and let's see what he does.

      14                [Applause.]

      15             SENATOR KAVANAGH:  Again, I appreciate the

      16      enthusiasm, but let's try to keep the reactions.

      17             Any questions from senators?

      18             SENATOR RIVERA:  One thing I wanted to -- if

      19      I may?

      20             SENATOR KAVANAGH:  Senator Rivera.

      21             SENATOR RIVERA:  Thank you.

      22             That last part, I'm sorry, maybe my hearing's

      23      a little (indiscernible), could that last part --

      24      what did you -- what did you mean exactly about

      25      this -- what is that last thing you said?







                                                                   191
       1             I kind of missed it, I'm sorry.

       2             MARCELA MITAYNES:  I mean, the last time we

       3      had an opportunity to pass and renew these laws --

       4             SENATOR RIVERA:  Yes.

       5             MARCELA MITAYNES:  -- there were three men in

       6      a room doing the negotiations.

       7             SENATOR RIVERA:  Got you.

       8             MARCELA MITAYNES:  And there were two

       9      Republicans and only one Democrat there.

      10             SENATOR RIVERA:  Got you.

      11             Who was that again?

      12             MARCELA MITAYNES:  The Governor cannot be

      13      allowed to water down these bills.

      14             SENATOR RIVERA:  Oh, okay, got you.

      15             The hearing was terrible.

      16             Thank you for that, ma'am.

      17             I did -- I did -- one thing that I wanted

      18      to -- one thing that I actually -- as you were -- as

      19      you were telling the stories that you were telling,

      20      my -- one of my staffers, who's actually somewhere

      21      in the room, she might be charging her phone right

      22      now, remembered a situation in our -- in -- in our

      23      district that -- that had similarities.

      24             And I just wanted to, really quickly, for the

      25      record:







                                                                   192
       1             There's a -- there's a tenant in my district

       2      that was overcharged by just under $800.

       3             They were owed close to $40,000 over the

       4      whole time that the -- that the overcharge happened.

       5             The landlord challenged, sued for eviction

       6      for non-payment, because they were deducting their

       7      rent for the amount they owed, about three to

       8      four times a year.  Filed three rent overcharges.

       9             The landlord has refused to:

      10             Number one, pay them;

      11             Number two, correct the bills, and continued

      12      to overcharge them;

      13             Three, give them the correct leases.

      14             And it's been going on since 2012, so much

      15      so, that they recently moved to Florida because they

      16      could no longer afford the private attorney and they

      17      just gave up.

      18             So the -- it's a -- and one thing that

      19      I wanted to just -- if you could underline for us --

      20             Because it has been a repeating pattern a

      21      couple of times we're talking, not only about some

      22      of the weaknesses in the law, but, sadly, some of

      23      the weaknesses, some of the agencies, and the

      24      actions or inactions of those agencies.

      25             So it seems to me, just in this case alone,







                                                                   193
       1      and we've seen many of them, sadly, in my district,

       2      where they're just incredibly passive.

       3             -- so if you had -- in your experience, being

       4      an organizer, and talking to many tenants that are

       5      having situations and are interacting with some

       6      state agencies, mainly, DHCR, if you had, it is your

       7      sense, what would you think, what would you like to

       8      tell them on the record, about some of the actions

       9      that they need to take, particularly if we

      10      strengthen the laws the way that we want to

      11      strengthen them?

      12             Obviously, they're still going to have to

      13      implement them.

      14             So, if you want to just tell as a little bit

      15      about what you think their role should be in this,

      16      and whether it should be more active, that -- this

      17      is the opportunity.

      18             MARCELA MITAYNES:  Their role should be to

      19      look at all the facts, and act accordingly.

      20             And if they can't, they should be replaced

      21      with people that can.

      22                [Applause.]

      23             SENATOR RIVERA:  All right.

      24             Thank you, Miss.

      25             Mr. Chairman, I'm good.







                                                                   194
       1             SENATOR KAVANAGH:  Thank you, Senator Rivera.

       2             Thank you for breaking it down.

       3             Sometimes, Senator Rivera, it takes it a

       4      little longer for him.

       5             SENATOR RIVERA:  Because I'm slower, I'm

       6      slow.

       7             SENATOR KAVANAGH:  Thank you.

       8             Next up, we have Delsenia Glover of Tenants

       9      and Neighbors, if you're ready.

      10             And then we are going to have a couple of

      11      tenant -- we're going to have a panel of tenants,

      12      various folks.

      13             We're going to have Diamond Harding.  We're

      14      going to have -- forgive me -- Ona Burns, and

      15      Martin Kofman, will be the next panel.

      16             DELSENIA GLOVER:  Oh, good afternoon.

      17             SENATOR KAVANAGH:  Good afternoon.

      18             DELSENIA GLOVER:  Thank you, Chair Kavanagh,

      19      for this opportunity.

      20             My name is Delsenia Glover, and I'm the

      21      executive director of New York State Tenants and

      22      Neighbors Information Service, and New York State

      23      Tenants and Neighbors Coalition, which are two

      24      affiliate organizations whose mission is to build a

      25      powerful and unified statewide organization that







                                                                   195
       1      empowers and strengthens tenant protections.

       2             We organize in rent-regulated Mitchell-Lama

       3      and project-based Section 8 buildings, and the story

       4      is all the same.

       5                (Unidentified person approaches witness

       6        table and takes a seat next to the witness.)

       7             DELSENIA GLOVER:  Low- and moderate-income

       8      tenants in New York City are regularly experiencing

       9      the pressures of displacement, escalating rents, and

      10      in many communities, particularly communities of

      11      color, are experiencing displacement and being

      12      priced out at a very rapid rate.

      13             For decades, city, state, and federal laws

      14      and policies have put landlords' interests and

      15      profits above people's ability to stay in their

      16      homes.

      17             I am also a rent-stabilized tenant who's been

      18      living in my apartment for decades, in a complex in

      19      Central Harlem called Lennox Terrace, and I have

      20      experienced MCIs since I've been there.

      21             As a matter of fact, I remember, the year

      22      that we had an 8 point -- an 8.5 percent increase

      23      from the Rent Guidelines Board was the year that

      24      I got an MCI which was $15 per room, which was $60

      25      in my apartment.  And my rent was -- my rent went up







                                                                   196
       1      that year 14.5 percent.

       2             So I'm not just an organizer or the leader of

       3      an organization, I am a tenant.

       4             I have also been the president of my tenant

       5      association or vice president for the past 14 years,

       6      now immediate past president, thank the Lord.

       7             So I wanted to come here today to testify

       8      before you.

       9             And I'm really happy that, this year, the

      10      Assembly and the Senate of New York State is holding

      11      these hearings around the state.

      12             It's really important to hear from tenants

      13      who are actually experiencing these issues.

      14             I lead an organization that is a membership

      15      organization, and we have about -- we have over

      16      4,000 dues-paying members.

      17             And I get calls every day from tenants who

      18      are experiencing MCIs, and especially from seniors

      19      who are scared to death that they're going to be

      20      priced out of their homes with the next MCI and they

      21      may not be eligible for SCRIE.

      22             So Tenants and Neighbors is calling for the

      23      passage of the full Housing Justice For All

      24      platform, and anything less is unacceptable, and

      25      here's why:







                                                                   197
       1             It's pretty common knowledge among the people

       2      who are here in this room that rent regulation is

       3      the largest source of affordable housing in New York

       4      City and across this state.

       5             The laws were strong when they were enacted

       6      in 1969 and 1974, but they have been increasingly

       7      weakened with loopholes inserted into the laws at

       8      the behest of the real estate lobby.

       9             We have lost over 291 units of rent-regulated

      10      housing, and including -- that's the wrong number --

      11      in communities of color where income averages are

      12      typically half that of the statewide average of

      13      $64,000 a year.  This is an emergency.

      14             It is as if it is okay for folks who do the

      15      hard work of keeping this city moving, like nurses

      16      and teachers and home health-care aides, bartenders,

      17      are disposable.

      18             And it is unacceptable that folks are treated

      19      this way in this city, in this state.

      20             It's unacceptable.

      21             So my position, and the position of the

      22      Housing Justice For All campaign, is that we must

      23      pass good-cause eviction and expand ETPA.

      24             Gentrification is not just a New York City

      25      issue.  It is an issue that is running rampant







                                                                   198
       1      across the state.

       2             And we are witnessing a relatively new

       3      phenomenon, which is the corporate takeover of small

       4      homes all across the state, particularly where there

       5      is no rent regulation, followed by tenant

       6      harassment, by neglect, and then tenant eviction.

       7             This is greed and callousness.

       8             We pride ourselves on being one of the most

       9      progressive, if not the most progressive, state in

      10      the country, except for housing.

      11             Look at what the Legislature has done this

      12      session; passed piece after piece of progressive

      13      legislation, but rent appears to be the most

      14      difficult.

      15             Why is that?

      16             I suggest to you that we finally have in

      17      New York State three branches of government led by

      18      folks who say they are concerned about this issue.

      19             Prove it, by passing these bills, and I'm

      20      going to name every one, just in case you haven't

      21      heard it.

      22                [Laughter.]

      23             DELSENIA GLOVER:  S5040/A7046, to expand

      24      ETPA.

      25             Snaps (motions with fingers).







                                                                   199
       1             S2891/A5030, for good-cause eviction

       2      legislation.

       3             Snaps (motions with fingers).

       4             S2591 and A1198 and S2591 -- oh, I did that

       5      twice -- to end vacancy decontrol.

       6             SENATOR KAVANAGH:  (Inaudible) Rivera; right?

       7             DELSENIA GLOVER:  Yes, what?

       8             SENATOR RIVERA:  Because I'm not --

       9             SENATOR KAVANAGH:  Twice for Senator Rivera?

      10             SENATOR RIVERA:  Twice, because I'm not a

      11      good -- you know, I can't hear you.

      12             DELSENIA GLOVER:  Oh, I have no problem with

      13      that.

      14                [Laughter.]

      15             DELSENIA GLOVER:  S2591 and A1198, to end

      16      vacancy decontrol.

      17             S2845 and A4349, to make preferential rents

      18      permanent.

      19             S185 and A2351, to eliminate the eviction

      20      bonus.

      21             S3693 and A6322, to end major capital

      22      improvements, and, individual apartment

      23      improvements, S3770 and A6465.

      24             And S299A and A167, to fix rent control.

      25             Thank you very much for the opportunity to







                                                                   200
       1      testify.

       2             Any questions, please?

       3             SENATOR KAVANAGH:  Thank you.

       4             Oh, are you part of -- sorry.

       5             ONA BURNS:  No.

       6             SENATOR KAVANAGH:  Okay, you --

       7             ONA BURNS:  But I -- it's right in line with

       8      everything that she just said.

       9             SENATOR KAVANAGH:  But you're for the next

      10      panel, though, sorry?

      11             SENATOR RIVERA:  She's just basically saying

      12      "ditto."

      13             MARCELA MITAYNES:  She just took over.

      14             SENATOR KAVANAGH:  Okay.

      15             Any questions, comments?

      16             Okay.

      17             Again, thank you for all your work, and thank

      18      you for coming today.

      19             MARCELA MITAYNES:  Thank you.

      20                [Applause.]

      21             SENATOR KAVANAGH:  And so the next panel,

      22      we're going to have Martin Kofman and Ona Burns

      23      and -- forgive me -- Diamond Harding.

      24             And then immediately after that we're going

      25      to have Paimaan Lodhi, if I'm saying that properly,







                                                                   201
       1      as a separate panel.

       2             ONA BURNS:  Who's first?

       3             SENATOR KAVANAGH:  Whichever -- since you're

       4      sitting there, you're first.

       5             ONA BURNS:  Okay.

       6             SENATOR KAVANAGH:  If you could just identify

       7      yourself for record, and then testify.

       8             DELSENIA GLOVER:  Right.

       9             My name is Ona Burns.

      10             I'm a rent-stabilized tenant at

      11      215 East 68th Street.

      12             And I thank you, Committee Members, for so

      13      graciously making the preservation of neighborhood

      14      affordability and protecting New York's renters a

      15      priority.

      16             We appreciate your giving us this opportunity

      17      to offer support to your efforts to that end.

      18             My husband has lived in this building that

      19      I mentioned before for approximately 40 of his

      20      81 years.

      21             When we married 25 years ago, we had a brief

      22      debate about, his place or mine.

      23             I lived in Queens, and he said, "I'm not

      24      moving to Queens."

      25             End of debate.







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       1                [Laughter.]

       2             ONA BURNS:  At 74, I'm not prepared to move

       3      again.

       4             While the nature of the tenancy at the

       5      building has changed dramatically, there were few

       6      kids and few dogs 25 years ago.

       7             Now the building is teeming with both.

       8             This is a happy circumstance for the

       9      landlord.

      10             We love kids and dogs too, but not at a cost

      11      of $200-a-room increase for those of us who have no

      12      kids and dogs.

      13             The landlord's using an MCI and a mere

      14      $180,409 for asbestos removal couched under the term

      15      "environmental."  This was in the computation of

      16      their permanent rent-increase justification to

      17      replace the exterior brick facade with a

      18      long-lasting, maintenance-free terracotta cosmetic

      19      ornamental facade.

      20             The replacement of bricks originally used on

      21      the facade with terracotta saves the landlord a

      22      fortune in annual maintenance costs for the next

      23      50 years, and has facilitated enhancements which

      24      help draw young families to the building; i.e., a

      25      playground, artificial grass for kids to play on, as







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       1      well as an indoor playroom.

       2             With a total of 608 apartments, only

       3      22 percent of the tenants are required to pay nearly

       4      $57 million outlined in an MCI submitted to the

       5      division of housing and community renewal.

       6             70 percent or more of these rent-stabilized

       7      tenants are 65 or older and living on fixed incomes.

       8             This is a blatant form of age discrimination,

       9      and the landlord is using it to force undesirable,

      10      in quotes, older tenants out of buildings.

      11             It is illegal to discriminate based on age in

      12      the workplace.

      13             It should also be illegal to do so in

      14      determining where people may rent apartments as

      15      well.

      16             In conclusion:

      17             We believe, that while a landlord may

      18      reasonably charge tenants for improvements that may

      19      directly improve their health risks, such as

      20      asbestos removal required by New York State law, it

      21      is an outrage for a landlord to improve the facade

      22      of his building under the guise of an MCI, and

      23      charge only his oldest and most loyal tenants for

      24      what are, essentially, cosmetic and ornamental

      25      improvements.







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       1             The total environmental charge of $180,000

       2      and change would be a more reasonable cost the

       3      landlord might seek coverage for than the nearly

       4      $57 million, that total noted as "owner's claim

       5      cost" on the MCI rent-increase application.

       6             A copy of the not -- I attached a copy of the

       7      notice to the form.

       8             There's a small group of elder tenants that

       9      stand ready to speak in defense of our appeal to the

      10      division of housing and community renewal.

      11             Unfortunately, many of the others fear

      12      reprisals by the landlord.

      13             We appreciate your help.

      14             Please terminate MCIs.

      15                [Applause.]

      16             SENATOR KAVANAGH:  Thank you.

      17             Sir.

      18             MARTIN KOFMAN:  Good evening, Senators.

      19             SENATOR KRUEGER:  Bring the microphone up a

      20      little closer.

      21             MARTIN KOFMAN:  Oh, yes.

      22             Good evening, Senators.

      23             I would like to speak to you about a little

      24      different subject than we have been discussing till

      25      now, which is the loft law and the compliance







                                                                   205
       1      regulations of the loft law.

       2             SENATOR KAVANAGH:  Can you just state your

       3      name for the record.

       4             MARTIN KOFMAN:  My name is Martin Kofman.

       5             I'm the president of American Package

       6      Company, the owner of an IMD building in Greenpoint.

       7             I would like to speak to you about the

       8      legalization process under the loft law, and the

       9      unrealistic milestones as described in the law.

      10             I registered my building with the loft board

      11      on June 1, 2012.

      12             Upon registration, we hired an architect to

      13      begin to prepare the plans so that we could get a

      14      building permit and do the necessary construction to

      15      legalize the building.

      16             We hoped to finally get our construction

      17      period -- a construction permit in the next few

      18      weeks.

      19             It has taken us seven years to complete the

      20      first step in the legalization process for which the

      21      loft law provides a six-month compliance deadline.

      22             The architects began the process by surveying

      23      the entire building, including all of the tenants'

      24      spaces.

      25             In order to do that, we had to make







                                                                   206
       1      appointments with all of the 42 tenants, and many

       2      tenants made this as difficult as possible.

       3             Tenants did not want us to complete the

       4      legalization process.

       5             In many cases, the legalization requires us

       6      to reduce the number of rooms in their loft, and

       7      reduces the number of roommates or subtenants that

       8      can share the space and its cost.

       9             Legalization also increases their rent and

      10      requires them to pay for a substantial part of these

      11      construction costs.

      12             The tenants prefer to live in illegal and

      13      unsafe lofts if it saves them money.

      14             In addition, the process of getting the

      15      appropriate approvals for the construction is very

      16      time-consuming.

      17             Plans have to be submitted and approved by

      18      the DOB, the loft board, and the tenants.

      19             It takes months just to get an appointment

      20      with the appropriate DOB examiner.

      21             The law also requires the tenants' approval

      22      of the construction plans.

      23             This involves serving the plans on the

      24      tenants, scheduling a conference with the tenants

      25      and the loft board, and, in some cases, two or







                                                                   207
       1      three conferences, and then allowing 45 additional

       2      days for additional tenants' comments.

       3             And all of this work is supposed to be

       4      completed within six months.

       5             All of this, preparing the plans, getting the

       6      approval of the DOB and the loft board, must be done

       7      in order for the building to be considered in

       8      compliance.

       9             As you can see, we have been diligently

      10      pursuing our building permit, and are close to

      11      success, but we are not in compliance with the

      12      loft-law regulations which are impossible to comply

      13      with.

      14             The next step in our process, after obtaining

      15      the permit, is to do the actual construction.

      16             We have selected a contractor and prepared a

      17      construction schedule which will complete all the

      18      necessary reservations with a minimum of disruption

      19      to the tenants.

      20             We hope to complete this process in

      21      four years.

      22             Once again, in order to be in compliance with

      23      the loft law, we would need to complete this

      24      construction in 12 months.

      25             The loft law was created to legalize illegal







                                                                   208
       1      living spaces and to make them safe for the people

       2      living in these spaces.

       3             This is an admirable goal, but it has to be

       4      done realistically.

       5             There are many loft buildings that have not

       6      completed the process in over 30 years.

       7             And I am not aware of even one building that

       8      has completed the process within the time frame as

       9      outlined in the regulations.

      10             The law needs to be changed to revise the

      11      definition of "compliance" so that diligent owners

      12      who are trying to do the right thing are not

      13      considered non-compliance because of unrealistic

      14      expectations.

      15             Thank you.

      16             SENATOR KAVANAGH:  Thank you.

      17                [Applause.]

      18             I just -- we had called earlier,

      19      Diamond Harding.

      20             Is Mr. Harding here?

      21             If you want to come up.

      22             You can stay, Mr. Kofman.

      23             DIAMOND HARDING:  Hi, Senators, how you

      24      doing?

      25             I'd just like to say, you know, speaking in







                                                                   209
       1      front of crowds freaks me out, so I may be looking

       2      down most of the time, you know.

       3             You know, these are all my own words, but

       4      I have to it write down, 'cause I will come up here

       5      and just blank out and just sit here staring at you

       6      guys, or staring at the floor, or something.

       7             So, anyway, my name is Diamond Harding.

       8             I am a member of the Fifth Avenue Committee,

       9      and Stabilizing NYC Citywide Tenant Union.

      10             So I've lived in my apartment at

      11      323 Lincoln Place in Brooklyn for over 30 years, so,

      12      since was 11, with my parents, actually.

      13             Let's see.

      14             My landlord right now and management company

      15      as related companies, and Simply Better Apartment

      16      Homes, they own 70 buildings throughout New York

      17      City.

      18             They also are one of the main developers

      19      Hudson Yards.

      20             I'm here to talk about why we need the

      21      Assembly to end harassment caused by the 20 percent

      22      vacancy bonus, and, well, along with most of these

      23      other policies that they need passed.

      24             Okay, so like I've said, I've lived there for

      25      over 30 years, through some horrible conditions from







                                                                   210
       1      the previous landlord.

       2             We -- I mean, from no heat in the wintertime,

       3      the family sitting at the dinner table with coats on

       4      through the winter.  You know, using the bathroom

       5      with an open umbrella because the ceiling is

       6      leaking.

       7             You know, pre-gentrification, I renovated my

       8      apartment myself.  It was me, my dad, and my

       9      daughter.

      10             My mom had passed away, and my dad took ill,

      11      and, you know, I took over and had to take care of

      12      him.

      13             So I took out all the permits with the City,

      14      I paid for all the permits.

      15             Let's see.

      16             From the original landlord, I wouldn't let

      17      him spend a dime because, of course, he would raise

      18      the rent uncontrollably if he fixed anything.

      19             So, I had to do it all myself.

      20             So everything was good until he sold the

      21      buildings to this new company, and that's when the

      22      harassment began.

      23             They tried to buy me out, scare me out,

      24      threaten me out, you know, harassing phone calls,

      25      letters.







                                                                   211
       1             They wouldn't cash my rent checks for

       2      sometimes a whole month.  They would just -- I mean,

       3      like, four months, they would stack them up, and

       4      then cash them all together, I guess, you know,

       5      maybe hoping to crash my accounts, I don't know.

       6             But this went on for some time, until

       7      I actually got an attorney to help me out and send

       8      them letters.

       9             So they did this to my neighbors, threatened

      10      the neighbors.

      11             Some of my neighbors that I've known since

      12      I was a kid, all my life, they moved out because

      13      they couldn't stand the conditions that they were

      14      living under, they couldn't deal with the harassment

      15      by the new owners.

      16             So when they successfully bullied out my

      17      neighbors, they started to renovate those

      18      apartments, made them look beautiful, and charged

      19      the new tenants thousands of dollars to move in.

      20             They didn't make any repairs to the

      21      apartments where, you know, tenants that lived there

      22      for their whole entire lives, they didn't touch any

      23      of those.

      24             But, of course, they made the other

      25      apartments beautiful, and charged them extravagant







                                                                   212
       1      amounts of money.

       2             This hurts, because the landlord used these

       3      loopholes and lack of protection to raise their

       4      rents once they evicted the regulated tenants, which

       5      they did.

       6             This gives landlords financial incentive to

       7      harasses and evict regulated tenants.

       8             When those -- when the harassments tactics

       9      didn't work for the rest of us, the ones that

      10      stayed, they started to build around us.

      11             For over a year we lived behind a net, with

      12      noise past the hours of the work permits; dust

      13      beyond breathable limits; anything they could get

      14      away with, until we called the City and had them

      15      shut down or forced them to make changes.

      16             And then they would go right back to doing

      17      something else.

      18             We had days without heat, without water,

      19      without electricity, one thing after the other,

      20      until the work was completed.

      21             This work was an illegal addition of a

      22      penthouse spanning across four buildings, mine being

      23      one of them.

      24             It was shocking to see, after all this time,

      25      they built a fifth floor on top of our ceilings.







                                                                   213
       1             They never told us what was going on or what

       2      they were doing, and we had no idea there was now a

       3      fifth floor, until the scaffolding came down.

       4             So now we're still dealing with the effects

       5      from this construction, and because it was built

       6      without permits, it has major structural issues,

       7      which the affects most -- which affects most

       8      apartments in the four buildings now, now connected

       9      by this fifth-floor penthouse.

      10             My building already has most of the original

      11      tenants gone due to the harassment.

      12             We're living with things, like -- we're

      13      still -- we're having leaks because of the

      14      structural damage caused by this fifth floor; leaks,

      15      no water pressure, you know, things of that sort

      16      that's still going on now.

      17             I don't want to see anyone else bullied out

      18      of their neighborhoods because they can't afford to

      19      live in it.

      20             We need the universal rent control to stop

      21      the displacement of hard-working people and the

      22      elderly, whose families are becoming homeless or

      23      having to leave the state.

      24             I myself could have been a victim of this.

      25             I have a great job, but I've only just







                                                                   214
       1      returned to work a month now, after having an

       2      on-the-job injury that resulted in a bulging disk

       3      and a large herniated disk in my lower back.

       4             I was on disability for a year, four months,

       5      and two weeks.

       6             I count the time because disability pay is

       7      nothing, you know, and I watched my savings dwindle

       8      to a scary point.  You know, I was afraid at times,

       9      because missing a rent at this time is like a death

      10      sentence.

      11             I mean, I say it, it sounds harsh, but, you

      12      know, that's what it feels like.

      13             You know --

      14             SENATOR KAVANAGH:  I'm going to ask you to

      15      wrap up, and I think we do have a couple questions.

      16             DIAMOND HARDING:  -- okay.

      17             So I'm telling you, if my apartment wasn't

      18      stabilized, me and my daughter would have been

      19      homeless right now, you know.

      20             So, we look to you guys now for help, you

      21      know, the lawmakers, politicians, our leaders,

      22      that's what you guys are, you know, just please help

      23      us to make these changes, to change the system.

      24             The system, it's rewarding landlords who are

      25      willing to play the game of harassment.







                                                                   215
       1             SENATOR KAVANAGH:  I'm going to ask you -- we

       2      really appreciate your testimony, but we have about

       3      40 more people.

       4             DIAMOND HARDING:  Yes, that's good.

       5             SENATOR KAVANAGH:  So, thank you so much for

       6      your testimony.

       7             I'm going to go to the panel.

       8                [Applause.]

       9             SENATOR KAVANAGH:  Senator Krueger.

      10             SENATOR KRUEGER:  I just wanted to thank you,

      11      Ona, for coming from my district to Brooklyn to

      12      testify.

      13             We're very aware of the problems with your

      14      building, and it's a disturbing example of how far

      15      out of control this MCI situation can get.

      16             And, again, you also highlight what many of

      17      us from Manhattan always talk about, that we have

      18      large numbers of rent-regulated tenants in our

      19      districts.

      20             Brian Kavanagh on the Manhattan side,

      21      Brad Hoylman, myself, and farther north, and they

      22      are, disproportionately, seniors living on fixed

      23      incomes, trying to make sure that they can stay in

      24      their homes and continue to live where they have

      25      lived, as you just said, your husband has lived







                                                                   216
       1      there 40 years.

       2             And the most horrible stories that we get in

       3      our office every day are seniors from my district

       4      being -- describing how they are being priced out or

       5      harassed out of the homes they have lived in for so

       6      long.

       7             And so you are just another example, I think,

       8      representing the disproportionate impact on

       9      fixed-income seniors everywhere in the city for our

      10      not getting the right laws passed.

      11             So, thank you.

      12             And I have to say, I don't have a loft-tenant

      13      scenario in my district.  I know some things about

      14      it.

      15             But, we've got to be able to make it a

      16      system, that when you were trying to do the right

      17      thing, that you were actually capable of doing that.

      18             We have to have a system in place that

      19      provides the kind of assistance and technical

      20      support, to make sure that a landlord who is trying

      21      to do the right things under our law can actually

      22      meet the time frames we have set up for them.

      23             MARTIN KOFMAN:  I agree with you completely.

      24             I think the loft law has got a lot of value

      25      to it, but it has some serious faults.







                                                                   217
       1             And I am available, at any time, if anyone

       2      wants to discuss this with me, I'll be glad to offer

       3      my suggestions as to how we can make this law into

       4      what it was intended to be.

       5             SENATOR KRUEGER:  Thank you.

       6             Thank you, Brian.

       7             SENATOR KAVANAGH:  Thank you,

       8      Senator Krueger.

       9             I would just note, you know, in the interest

      10      of time, I will -- you know, perhaps we'll take you

      11      up on that at some future time.

      12             And I also note that we do have -- I wasn't

      13      actually expecting to get into this issue on this

      14      panel, but we do have a number of people here to

      15      testify on the issue of the loft law, and some --

      16      including many loft tenants, some of who have signed

      17      up, and many of whom joined us when they got here,

      18      signed up when they got here.

      19             So we will -- we will hear more about this

      20      issue during the course of this hearing.

      21             But, any other questions from senators?

      22             Okay.

      23             Thank you all very much for your testimony.

      24             ONA BURNS:  Thank you.

      25             MARTIN KOFMAN:  Thank you.







                                                                   218
       1                [Applause.]

       2             SENATOR KAVANAGH:  So next up we have

       3      Paimaan Lodhi, if I'm saying that properly.

       4             A little sound effects.

       5             Perhaps he stepped out of the room, so I'll

       6      ask my staff to see if we can determine what's going

       7      on.

       8             Thank you for being with us.

       9             If you'd begin by stating your name for the

      10      record, and proceed.

      11             PAIMAAN LODHI:  Sure.

      12             Okay, got it.

      13             Good afternoon, Senators.

      14             My name is Paimaan Lodhi, senior vice

      15      president with the Real Estate Board of New York.

      16             Thank you for taking this time to hear our

      17      testimony about the city's housing stock, and to

      18      provide our perspective regarding rent-regulated

      19      housing in the city of New York.

      20             The stories you've heard today are

      21      undoubtedly and truly heartbreaking, and what is

      22      needed is responsible rent reform to root out the

      23      minority of bad actors in the system.

      24             New York City is a city of renters.

      25             The current rent-regulated system has allowed







                                                                   219
       1      for continued capital investment in buildings that

       2      have resulted in a historically low dilapidation

       3      rate of 0.2 percent citywide.

       4             With 71 percent of the rent-stabilized

       5      housing stock built prior to 1947, maintenance and

       6      operational costs are expected to rise as these

       7      older buildings will require major system overhauls.

       8             Recently, policy leaders and advocates have

       9      proposed drastic and sweeping changes to the

      10      rent-regulation system without a detailed analysis

      11      of the consequences or an appreciation for the

      12      interconnectedness of the system.

      13             Changes that severely limit or eliminate

      14      necessary streams of revenue will lead to

      15      deteriorating housing conditions, discourage the

      16      creation of new stabilized housing needed to

      17      alleviate the housing crisis, and hurt the

      18      households most in need of help.

      19             The real estate industry acknowledges that

      20      statutory changes are necessary to increase

      21      transparency and better protect tenants from a

      22      minority of unscrupulous landlords.

      23             To be clear, we are not calling for the end

      24      of the rent-regulated system, as these units serve

      25      an important role in providing safe housing to many







                                                                   220
       1      New Yorkers.

       2             What is needed is responsible rent reform

       3      that protects tenants while maintaining the quality

       4      of our housing stock.

       5             Rent collected pays for expenses like taxes,

       6      insurance costs, fuel, labor, utilities, and

       7      maintenance.

       8             The difference between revenue and expenses

       9      is known as "net operating income," and while some

      10      have confused NOI for profit, it is important to

      11      note that NOI is a measure of a building's ability

      12      to meet three criteria: repayment of mortgage or

      13      financing costs, reinvestment in the property, and

      14      profit.

      15             Today the Rent Guidelines Board is a system

      16      ill-equipped to match appropriate rent increases

      17      with expense growth.

      18             Over a 20-year period and across multiple

      19      mayoral administrations, RGB increases averaged

      20      2 1/2 percent, while expenses for property owners

      21      increased more than twice that rate, at 5.5 percent.

      22             This incongruence is a result of a

      23      highly-politicized process that relies on a flawed

      24      methodology that artificially inflates NOI and

      25      arbitrarily reduces expenses.







                                                                   221
       1             Data used by the RGB staff to calculate NOI

       2      is incomplete, inaccurate, and outdated.

       3             A 27-year-old analysis is used as the basis

       4      for adjusting expenses downward 8 percent, and a

       5      35-year-old price index does not account for the

       6      costs associated with government mandates, like

       7      building facade maintenance, increased elevator

       8      inspections, and lead-paint abatement, to name a

       9      few.

      10             Additionally, while the RBG studies exclude

      11      smaller 1- to 10-unit buildings that account for

      12      half of the rent-stabilized buildings, they do

      13      include larger builds with at least one

      14      rent-stabilized unit.

      15             This approach inevitably captures buildings

      16      created through programs like 421a, that include

      17      predominantly unregulated units and greatly inflates

      18      reported income for rent-stabilized buildings.

      19             Proposed changes to the rent-regulation

      20      system contemplate the wholesale elimination of

      21      increases beyond those provided for by the

      22      Rent Guidelines Board, including MCIs, IAIs,

      23      vacancy allowance, preferential rents, and high-rent

      24      decontrol.

      25             To better understand the impacts of any







                                                                   222
       1      changes to the rent-regulation system, REBNY

       2      commissioned the consulting group of HR&A Advisors

       3      to develop models based on publicly-available data

       4      that could analyze changes to various building

       5      typologies that collectively represent 84 percent of

       6      the city's housing stock.

       7             The results were startling.

       8             The legislative proposals would dramatically

       9      change the economic viability of the operations and

      10      maintenance assumptions for apartment buildings

      11      across the city.

      12             Within 5 years, approximately 414,000 units

      13      could be financially distressed and won't be able to

      14      afford any investment beyond basic maintenance,

      15      taxes, and utilities.

      16             As NOI decreases across these buildings, the

      17      department of finance's property assessments and

      18      related tax bills will be adjusted downward.

      19             The potential policy changes to rent

      20      stabilization could reduce annual property-tax

      21      revenue by up to $2 billion per year due to steep

      22      drops in real estate value, as calculated by an

      23      analysis.

      24             Finally, if the proposed funding streams are

      25      eliminated, it will place greater pressure on the







                                                                   223
       1      Rent Guidelines Board to raise rents approximately

       2      7 1/2 percent annually to make up the difference.

       3             This is not the kind of rent reform that

       4      helps tenants or owners.

       5             The New York State Senate has an opportunity

       6      to be responsible, to rely on the data presented,

       7      and to provide revenue streams that continue for the

       8      allowed maintenance of quality housing for millions

       9      of New Yorkers.

      10             In terms of responsible reforms, within the

      11      construct of the rent stabilization law, the RGB

      12      process itself provides an opportunity for needed

      13      reform.

      14             It is no secret that this process and

      15      historic results are ones that landlords and tenants

      16      alike find frustrating.

      17             Serious consideration should be given to

      18      moving to a new standard model that inputs various

      19      indices for generating RGB increases that can

      20      operate independent of political machinations.

      21             The board's determination should be the

      22      result of a consistent framework year to year to

      23      provide predictability in balancing tenant and owner

      24      needs.

      25             There are merits to a formula system that







                                                                   224
       1      encompasses the following:  CPI and wage growth,

       2      property taxes, unfunded regulatory requirements,

       3      labor, maintenance, insurance, administrative costs,

       4      to name a few.

       5             Public input is an important part of good

       6      government, and it should be used to provide data

       7      discrepancies, new methodologies, or to highlight

       8      sudden shifts in the market.

       9             Regarding enforcement and transparency, REBNY

      10      unequivocally supports better enforcement and

      11      transparency, and it is critical that DHCR be

      12      adequately resourced so that they are equipped to

      13      improve data collection and more effectively target

      14      bad actors.

      15             A modern computer system that can process

      16      digital collection and retention of receipts would

      17      dramatically improve recordkeeping.

      18             Additionally, DHCR should release an annual

      19      public report on the number of MCIs granted and

      20      the number of AI -- IAIs filled --

      21             SENATOR KAVANAGH:  I'm going to ask you to

      22      wrap up, and I think you will have quite a bit more

      23      time to talk as people ask some questions.

      24             PAIMAAN LODHI:  -- the average cost and type

      25      improvement, and the average amount of rent







                                                                   225
       1      increase.

       2             The current process for self-reporting of

       3      IAIs can only be improved.

       4             SENATOR KAVANAGH:  I really do need -- I need

       5      you to wrap up your testimony.

       6             PAIMAAN LODHI:  I got you.

       7             I really think it's important that we get

       8      to --

       9             SENATOR KAVANAGH:  I -- I'm sure -- lots of

      10      us want to hear from everybody, but we've got, you

      11      know, another 30 people on the list.

      12             SENATOR KRUEGER:  Do you have copies that you

      13      can give to us?

      14             SENATOR KAVANAGH:  And, again, we'll take --

      15             PAIMAAN LODHI:  Yes, I emailed them.

      16             SENATOR KRUEGER:  Okay.

      17             SENATOR KAVANAGH:  -- okay, so we have your

      18      written testimony as a matter of record.  We will be

      19      reviewing it.

      20             And I think -- again, I think this dialogue

      21      will continue.

      22             But thank you for your testimony.

      23             PAIMAAN LODHI:  Sure.

      24             SENATOR KAVANAGH:  I do want to -- have

      25      questions?







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       1             SENATOR RIVERA:  Oh, yeah.

       2             SENATOR KAVANAGH:  Senator Rivera to begin.

       3             SENATOR RIVERA:  First of all -- first of

       4      all, for the record, and in all honesty, thank you

       5      for being here.

       6             It definitely takes some guts to come into

       7      the lion's den, if you will.

       8             PAIMAAN LODHI:  It's an important issue.

       9             SENATOR RIVERA:  Now, number one, are MCIs

      10      maintenance?

      11             PAIMAAN LODHI:  I'm sorry?

      12             SENATOR RIVERA:  "MCIs" are major capital

      13      improvements.

      14             Are they maintenance?

      15             Are they --

      16             PAIMAAN LODHI:  No.

      17             SENATOR RIVERA:  -- no, they're not.

      18             PAIMAAN LODHI:  I mean, it is important that

      19      capital improvements are used in -- are done and --

      20      for buildings, so that buildings can be maintained

      21      over the course of time.

      22             But, in the context of the rent-regulation

      23      system, maintenance itself is considered a separate

      24      bucket.

      25             SENATOR RIVERA:  Okay, so, I just want to







                                                                   227
       1      make sure.

       2             So if MCIs are not maintenance, would you

       3      acknowledge that -- you know, and we can all -- we

       4      can certainly have the conversation of responsible

       5      and not responsible landlords, as you made the --

       6      one of the first points that you made was that, any

       7      responsible reform should take into account that

       8      there are bad actors.  Right?

       9             So I want to make sure that we don't attack

      10      the good actors.

      11             But would you acknowledge, then, that there

      12      is -- there's all words that can be used -- let's

      13      just say, a lot of, either your members, good actors

      14      and bad actors, that kind of use MCIs for the

      15      purpose of maintenance?

      16             PAIMAAN LODHI:  Well, so -- so the data has

      17      stated that -- for DHCR, that the level of MCI use

      18      has been consistent.  It's been about 1,000

      19      applications a year.

      20             SENATOR RIVERA:  Okay, so I guess what you're

      21      saying is, that you wouldn't necessarily acknowledge

      22      that you put the responsibility in DHCR?

      23             PAIMAAN LODHI:  I'm sorry, I don't follow.

      24             SENATOR RIVERA:  Okay, so my question was,

      25      right, if MCIs are not maintenance, major capital







                                                                   228
       1      improvements are not supposed to be maintenance, you

       2      acknowledge that?

       3             PAIMAAN LODHI:  It is maintenance in terms of

       4      maintaining the quality and the safety of a

       5      building.  Right?

       6             SENATOR RIVERA:  Perhaps I should be more

       7      clear.

       8             Is the process of MCIs supposed to be for a

       9      building to be maintained to a level where people

      10      can live in it with basic things, like heat, hot

      11      water, you know, no holes in the walls or ceilings,

      12      a working door.

      13             PAIMAAN LODHI:  A lot of repair, yeah.

      14             SENATOR RIVERA:  Right, stuff like that.

      15             So would you acknowledge, then, that there

      16      are many individuals -- there are many landlords,

      17      either mom-and-pop or big ones or bad ones, that --

      18      that are using, as opposed to maintaining their

      19      buildings, and then having MCIs cover for other

      20      things that are not just straight-up maintenance,

      21      that they are being used for maintenance?

      22             Would you agree or disagree with that?

      23             PAIMAAN LODHI:  I think there's a disconnect

      24      here, because --

      25             SENATOR RIVERA:  Certainly there is.







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       1             All right, moving on, since I know that my

       2      question --

       3             SENATOR KAVANAGH:  Senator, I'm going to ask

       4      people, you know, people have been very respectful

       5      and disciplined.

       6             I did notice an uptick of allergies and

       7      coughing a little bit before.

       8             But, if everybody could please allow us to

       9      have this dialogue with this witness.

      10             Proceed, Senator Rivera.

      11             SENATOR RIVERA:  Yeah, so I just have a

      12      couple more.

      13             You talked about the dilapidated rate, this

      14      is -- at the beginning of your testimony.

      15             Could you tell me what the definition of

      16      "dilapidated rate" is?

      17             PAIMAAN LODHI:  Sure.

      18             It's what the census uses in the Housing and

      19      Vacancy Survey to determine whether or not a

      20      building or a unit is dilapidated.

      21             And over the course of the past 20-something

      22      years, the city's private housing stock, it's

      23      dilapidation rate is at an all-time low.

      24             SENATOR RIVERA:  Got you.

      25             So "dilapidation" means, the definition







                                                                   230
       1      that's used by the census, I was unaware of it.

       2             So is the definition that's used in the

       3      census, I guess, totally unliveable, like a husk of

       4      a building, or something?

       5             PAIMAAN LODHI:  No.

       6             I mean, it is in poor -- it is in a poor

       7      state, but, yeah, that people can live in there.

       8      But it's just, you know, incredible high amount of

       9      violations.  It is just not a good place to be

      10      living in.  There could be mold.  There could be --

      11             SENATOR RIVERA:  Got you.

      12             So let's say, in the last year -- how long

      13      have you been working for these folks, for REBNY.

      14             PAIMAAN LODHI:  Several years.

      15             SENATOR RIVERA:  Several years.

      16             So say, in the last year, the last 12 months,

      17      how many apartments have you been in physically that

      18      you would consider dilapidated?

      19             I mean, just, actually, how many apartments

      20      have you been in that are either owned by your

      21      members or that you go to, you know, just to visit,

      22      not a social visit, but some, maybe, to kind of look

      23      at what the conditions in that building and in that

      24      particular apartment are?

      25             PAIMAAN LODHI:  You know, my members own and







                                                                   231
       1      operate several buildings.

       2             SENATOR RIVERA:  You personally, I'm sorry.

       3             PAIMAAN LODHI:  Yeah, and I've been and

       4      visited several of them.

       5             SENATOR RIVERA:  "Several" of them.

       6             "Several," dozen?

       7             "Several," hundred?

       8             "Several," thousand?

       9             PAIMAAN LODHI:  You know, it is not --

      10             SENATOR RIVERA:  A bunch.

      11             All right.

      12             PAIMAAN LODHI:  -- yeah.

      13             SENATOR RIVERA:  How many of them have you

      14      seen that would fit that category of "dilapidated"?

      15             PAIMAAN LODHI:  None.

      16             SENATOR RIVERA:  All right.

      17             I would invite you, by the way, you have an

      18      invitation to my district, anytime, where I will

      19      take you to five random buildings in my district,

      20      and I can guarantee you that I will show you many

      21      dilapidated buildings that -- that that

      22      percentage -- I'm just saying that percentage

      23      doesn't speak to the truth of what I've seen with my

      24      own eyes.

      25             PAIMAAN LODHI:  Well, no, I mean, so the data







                                                                   232
       1      should be clear, and I should be clear, that, in all

       2      likelihood, those are not our members whose

       3      buildings that you visit.

       4             But there is certainly concentration in -- in

       5      areas throughout this city.

       6             And your district could be one in which you

       7      have a higher rate of bad actors.

       8             SENATOR RIVERA:  Oh, I guarantee you that's

       9      the case, sir.

      10             There's actually this -- there were some

      11      folks that testified earlier, the Association for

      12      Neighborhood and Housing Development, which have

      13      this handy table, which kind of shows all sorts of

      14      different categories that impact what makes, you

      15      know, certain districts unaffordable.

      16             There are -- and there are 12 community

      17      boards in The Bronx.  Seven of them are in the "red"

      18      category, as it relates to threats to affordable

      19      housing, and four of them are in my district.

      20             So I can guarantee you that I definitely know

      21      that.

      22             I know that my colleagues probably want to

      23      jump in in a couple of things.

      24             I just will ask one more question.

      25             The -- it is -- it is -- is it still your







                                                                   233
       1      contention, on the record, that should the process

       2      of major capital improvements go away, that if we do

       3      away with it, that, then, the -- this "dilapidated"

       4      score that we talked about is going to skyrocket

       5      because it will then become impossible for landlords

       6      to be able to maintain their buildings to a liveable

       7      state?

       8             Is that still what you're saying on the

       9      record?

      10             PAIMAAN LODHI:  It's two things.

      11             SENATOR RIVERA:  Okay?

      12             PAIMAAN LODHI:  Not only would the

      13      dilapidation rate -- you can anticipate the

      14      dilapidation rate to go -- to increase, but, you

      15      know, as part of the entire rent-regulation system,

      16      Rent Guidelines Board sets their annual increases

      17      based on the fact that they understand that there

      18      are other tools out there for property owners to

      19      use; MCIs, IAIs.

      20             If those tools go away -- so you have

      21      1,000 MCI applications a year, which there are, just

      22      to put this in perspective, over 900,000

      23      rent-regulated housing units throughout the city.

      24             If those -- if those MCIs go away,

      25      Rent Guidelines Board has to increase rents to make







                                                                   234
       1      up for that delta, to recognize the fact that the

       2      MCI -- MCI tool is no longer there.

       3             Rent Guidelines Board increases impacts the

       4      entire universe of rent-stabilized housing stock.

       5             So you're talking about rent increases on the

       6      entire housing stock versus the small percentage

       7      that apply for MCIs.

       8             SENATOR RIVERA:  Thank you for being here.

       9             SENATOR KAVANAGH:  Thank you.

      10             And just before we get to the -- we'll have

      11      some additional questions, but just to mention the

      12      next panel, it will be Nakeeb Siddique and

      13      Esther Diaz and Gisela Matza.

      14             But next up, I think Senator Krueger has some

      15      questions.

      16             SENATOR KRUEGER:  Thank you.

      17             So I don't know if you were here earlier when

      18      ANHD was testifying, but the testimony involved the

      19      statement that, sort of historical documentation is,

      20      that if you buy your building for 10 or 11 times the

      21      annual rent rolls, that you can, in fact, you know,

      22      continue to operate, make a profit, leave your

      23      tenants in place.

      24             But, that we have seen a skyrocketing over

      25      the last, I believe it was 20 years, maybe was it







                                                                   235
       1      just a decade, of people suddenly buying buildings

       2      for 20 and 30 times the rent rolls.

       3             Does REBNY keep data on the purchase price of

       4      buildings vis-a-vis a percentage of the rent rolls?

       5             PAIMAAN LODHI:  We don't.

       6             SENATOR KRUEGER:  You don't.

       7             Do you agree that that has been happening,

       8      that the underlying price of buildings has been

       9      skyrocketing far faster than the rent rolls could

      10      possibly keep up with?

      11             PAIMAAN LODHI:  I agree that there are bad

      12      actors in the system which, you know, take into --

      13      that do the predatory equity, and they have every

      14      intention to game the system and do exactly what you

      15      say, which is to purchase a building at 20, 30 times

      16      the rent roll.

      17             But I think that they are the minority.

      18             SENATOR KRUEGER:  So when I am paying back an

      19      MCI or an IAI as a increase in my annual rent,

      20      inflation adjusted year after year, technically, I'm

      21      sort of becoming a partial owner of the building.

      22             Should I get stock?

      23                [Applause.]

      24             PAIMAAN LODHI:  What was...

      25             SENATOR KRUEGER:  I'm sorry, I didn't hear







                                                                   236
       1      your answer.

       2             PAIMAAN LODHI:  No.

       3             SENATOR KRUEGER:  No?

       4             PAIMAAN LODHI:  No.

       5             SENATOR KRUEGER:  Why?

       6             I mean, it's not just -- I'm not just paying

       7      the rent.  I'm increasing the dollar value of the

       8      underlying building that will eventually be sold or

       9      held by the landlord, based on their determination

      10      that it's a great investment, or they could sell it

      11      and move on and do something else with their money.

      12             So, if this was -- if this was a company that

      13      sold stock, I would get stock.

      14             But in this case --

      15             PAIMAAN LODHI:  No, you're also paying for

      16      the continued maintenance of the building.  That's

      17      what you're paying for, that's what your rent goes

      18      to.

      19             SENATOR KRUEGER:  So that sort of goes to --

      20             SENATOR RIVERA:  So it is maintenance.

      21             (Claps hands.)  Thank you.

      22                (Indiscernible cross-talking.)

      23             SENATOR KRUEGER:  -- so it's maintenance of

      24      the --

      25             SENATOR RIVERA:  It is maintenance.







                                                                   237
       1             Got you.

       2             SENATOR KRUEGER:  -- thank you.

       3             SENATOR RIVERA:  You all think it's

       4      maintenance.

       5             Got you, got you, got you.

       6             (Indiscernible.)

       7             SENATOR KRUEGER:  Okay, sorry.

       8             Do you -- you're familiar with weatherization

       9      programs for redoing windows, and, actually,

      10      sometimes they do building -- you know, siding of

      11      building, and other things, to keep -- to ensure

      12      that the building is more energy-efficient.

      13             Do you think that I should able to get an MCI

      14      for the same work that I got weatherization funds

      15      for?

      16             PAIMAAN LODHI:  I don't know to what extent

      17      the weatherization program is being used, so I can't

      18      really answer that question.

      19             SENATOR KRUEGER:  Okay.

      20             You know what the J-51 program is?

      21             PAIMAAN LODHI:  Yes.

      22             SENATOR KRUEGER:  Do you think I should be

      23      able to get MCIs and IAIs if I'm drawing down J-51s

      24      for the same the work in the same buildings?

      25             PAIMAAN LODHI:  Well, again, I think you need







                                                                   238
       1      to find ways in which, you know, an owner can

       2      reinvest in the property.

       3             SENATOR KRUEGER:  But do you see those

       4      double-dipping on multiple programs to get --

       5             PAIMAAN LODHI:  No.

       6             SENATOR KRUEGER:  -- my costs reimbursed?

       7             PAIMAAN LODHI:  No.

       8             SENATOR KRUEGER:  Do you do any research on

       9      that at REBNY to see how often that happens?

      10             PAIMAAN LODHI:  No.

      11             SENATOR KRUEGER:  Senator Zellnor.

      12             Thank you.

      13             SENATOR MYRIE:  Thank you very much,

      14      Senator Krueger.

      15             The Chair has stepped out for a moment and

      16      has asked me to temporarily chair, but I'm going to

      17      ask the questions that I would have been recognized

      18      for.

      19             So, firstly, thank you for coming to -- to --

      20      to testify.

      21             I know that it is not an easy thing,

      22      particularly with some of the views that you guys

      23      hold.

      24             So, I appreciate you coming.

      25             I have a comment, and then a question.







                                                                   239
       1             I noticed during your testimony, I'm a fan of

       2      the English language, there were -- there was an

       3      alliteration with words that begin with "D."

       4             You used the words "drastic";

       5             You used the word "deterioration";

       6             You used the word "discouragement";

       7             OFF-CAMERA SPEAKER:  Dilapidated.

       8             SENATOR MYRIE:  You used the word

       9      "dilapidated";

      10             And you used the word "dramatic."

      11             And I want to use those words to explain how

      12      the tenants feel right now.

      13             So you said we have -- we have --

      14                [Applause.]

      15             SENATOR MYRIE:  And if we could hold the

      16      applause, thank you.

      17             -- you said, "We are seeking to make drastic

      18      and sweeping changes."

      19             And of course we are, because we are facing a

      20      drastic and sweeping affordability crisis.

      21             You mentioned the deterioration of our

      22      buildings.

      23             And of course we're facing deterioration

      24      because there has been an increase in the violations

      25      in those very buildings.







                                                                   240
       1             You said -- you used the word "dramatically."

       2             Well, we are facing a dramatic increase in

       3      evictions.

       4             Two decades ago --

       5             PAIMAAN LODHI:  That's not true.

       6             SENATOR MYRIE:  -- the eviction --

       7             PAIMAAN LODHI:  That's not true.

       8             The citywide eviction rate is the lowest it's

       9      ever been.

      10             SENATOR MYRIE:  So if you could let me -- so

      11      if -- if you could -- if you could only respond when

      12      I ask a question.

      13             You used the word "dramatically."

      14             And we are facing a dramatic increase in

      15      evictions.

      16             And you used the word "discouragement."

      17             And of course people are discouraged, not

      18      only from living in their communities because they

      19      are priced out, but I'm going to add a fifth "D,"

      20      that we are "displaced" because of this price

      21      increase.

      22             So my question to you is:  If the NOI has

      23      increased over the past 13 years straight, and you

      24      contend that not all of that goes to profit, and

      25      that some of it goes to paying the mortgage and some







                                                                   241
       1      of it goes to reinvestment, if we eliminate MCIs

       2      and we eliminate IAIs, and it's still going up,

       3      could you bring down the profit and bring up the

       4      reinvestment?

       5             PAIMAAN LODHI:  So, Senator, to your

       6      question, yes, New York City has an affordability

       7      crisis.

       8             The biggest driver for rent is the increase

       9      in property taxes.

      10             New York City has, quite possibly, the most

      11      inequitable and racist property-tax structure in the

      12      country.

      13             A family renting an apartment in

      14      Crown Heights pays more in its property taxes than

      15      two townhouses in Park Slope.

      16             Okay?

      17             What most renters do not understand is that a

      18      third of your rent goes towards property taxes.

      19             And over the -- and since 2009, property

      20      taxes have increased by more than double.

      21             It's -- this is a tax policy that is not

      22      aligned with values that all New Yorkers should

      23      support, which is the production of rental housing.

      24             The affordability crisis is also compounded

      25      by the fact that there is not enough housing







                                                                   242
       1      production going on citywide.

       2             To meet population growth by 2030, the City

       3      needs to produce 400,000 units of housing, which is,

       4      roughly, the size of Staten Island, just to maintain

       5      what's needed for population growth.

       6             That delta, that lack of production, is

       7      the -- along with property taxes, is the biggest

       8      driver in the affordability crisis for housing.

       9             SENATOR MYRIE:  So if I may, because I'm not

      10      sure my question was answered.

      11             And I don't disagree that our property taxes

      12      need to be reformed, and that there are racist

      13      elements to it.

      14             I represent both of those neighborhoods,

      15      Crown Heights and Park Slope, and I'm very

      16      empathetic to my constituents who are being

      17      oppressed by this tax system.

      18             But my question directly pertains to NOI and

      19      the increase over the past 13 years.

      20             The response has always been, well, that

      21      increase doesn't always go to profit.  We have to

      22      split that in three buckets.

      23             My question is:

      24             If you -- if we eliminate MCIs and IAIs, we

      25      are told that there will be no more investment.







                                                                   243
       1             I want to know, that is that because you

       2      don't want to give up profit?

       3             That is the question.

       4             PAIMAAN LODHI:  So I think what you're

       5      referencing, the 13-year increase as the NOI

       6      increase, as reported by the Rent Guidelines Board.

       7             Again, it's really important to state, NOI is

       8      not a substitute for profit.

       9             So, NOI can increase without profit margins

      10      increasing.  Right?

      11             So --

      12             SENATOR MYRIE:  So are you contending that

      13      profits have not gone up over the past 13 years?

      14             PAIMAAN LODHI:  I would argue that they have

      15      stayed consistent.

      16             SENATOR MYRIE:  Okay.

      17             Do you have any data to back up that

      18      assertion?

      19             PAIMAAN LODHI:  I mean, the fact that the

      20      NOI, as reported by the Rent Guidelines Board, has,

      21      actually, this past year, remained consistent,

      22      states to me that it's not increasing.

      23             SENATOR MYRIE:  Okay, and so -- and I'm going

      24      to -- after this question, I just want to make

      25      REBNY's position clear, that over the past 13 years,







                                                                   244
       1      profits by property owners has remained stagnant?

       2             PAIMAAN LODHI:  I think, across the board,

       3      you can't paint a picture like that.

       4             The city's housing stock is incredibly

       5      diverse, both by -- I mean, by age, geography, and

       6      size, and by owner.

       7             SENATOR MYRIE:  So I'm specifically referring

       8      to rent-regulated properties.

       9             Is it REBNY's position that property owners

      10      that own rent-regulated properties have not seen

      11      their profits go up over the past 13 years?

      12             PAIMAAN LODHI:  I guess some have, but

      13      I would say that it's stayed consistent throughout

      14      the system, given the data that disputes it

      15      otherwise.

      16             SENATOR KAVANAGH:  Thank you.

      17             Next up we're going to have Senator Salazar.

      18             SENATOR SALAZAR:  Thank you.

      19             I -- remarkably, I think that we may actually

      20      agree about something, based on one of your

      21      responses to Senator Myrie's question, that -- that

      22      the very wealthy need to pay their fair share of

      23      taxes, including higher property taxes than

      24      working-class New Yorkers.

      25             But my question is:  Is -- in your opinion,







                                                                   245
       1      why should tenants who -- tenants, who didn't have

       2      the capital or ability, nor make the decision in the

       3      first place, to buy a property, why should those

       4      tenants -- tenants need to bear the financial

       5      responsibility of repairing the property owner's

       6      building for the property owner?

       7             PAIMAAN LODHI:  The current rent-regulated

       8      system that's in place takes into account various

       9      factors, which include property taxes, maintenance

      10      costs, labor, fuel.

      11             These are costs that are borne by the

      12      property owners, and, you know, property owners own

      13      and operate businesses.  It's private housing stock.

      14             In order to get financed, you have to prove

      15      to the banks that you can make a profit.

      16             And unless a property owner -- I don't know

      17      how a property owner could go to a bank and say, I'm

      18      going to take $200,000 out of my own pocket to pay

      19      for facade improvements.

      20             It's, like, it's not a viable financing

      21      option.

      22             SENATOR SALAZAR:  It's your opinion that it

      23      should come from the pockets of the tenants instead?

      24             PAIMAAN LODHI:  No, it's a shared system.

      25                [Laughter.]







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       1             SENATOR KAVANAGH:  Let's get through --

       2      everybody will have an opportunity to express their

       3      point of view, but let's let this dialogue continue.

       4             SENATOR SALAZAR:  So 20,000 tenants were

       5      evicted last year in 2018 in New York City alone.

       6             Is it your opinion that tenants should have

       7      to face eviction if they cannot pay for a major

       8      capital improvement-induced represent increase?

       9             PAIMAAN LODHI:  No, I think that that's

      10      making the prime case as to why rent subsidy is

      11      critical.

      12             SENATOR SALAZAR:  Okay.

      13             I mean, just my final question is:  Is -- is

      14      it then your opinion that rent subsidies, presumably

      15      coming from the City or the State, or from tax

      16      subsidies, so, from the public, from taxpayers, that

      17      the burden of repairing property-owners' buildings

      18      should be from that source rather than the property

      19      owner?

      20             PAIMAAN LODHI:  I think keeping families off

      21      the street and out of homeless shelters is a public

      22      good that the public should bear the responsibility

      23      for.

      24             Yes.

      25             SENATOR SALAZAR:  Okay.







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       1             Okay, but -- okay.

       2             Thank you.

       3             SENATOR KAVANAGH:  Again, please, let's

       4      continue.

       5             I'm going to -- I have a few questions, but

       6      I think Senator Krueger has a follow-up, first.

       7             SENATOR KRUEGER:  So you reference in a

       8      number of your answers, sort of on behalf of REBNY

       9      owners, so -- but you don't have any data.

      10             So how many rent-regulated units are

      11      represented by REBNY owners; do you know?

      12             PAIMAAN LODHI:  I'd have to get back to you

      13      on that.

      14             SENATOR KRUEGER:  So you don't know that.

      15             Because -- because I'll accept that maybe

      16      there's one universe of people who are REBNY

      17      members, and they run terrific buildings and follow

      18      all the rules, and don't, you know, overinflate all

      19      their costs.

      20             And then there's that other world that is not

      21      REBNY owners, that -- where everything we're seeing

      22      happening is happening.

      23             But I sort of don't think that's probably

      24      true.

      25             But I actually think it's pretty important,







                                                                   248
       1      if REBNY's going to --

       2             PAIMAAN LODHI:  What part's not true?

       3             SENATOR KRUEGER:  -- if REBNY's going to

       4      represent these things aren't true in REBNY members'

       5      buildings --

       6             PAIMAAN LODHI:  What part's not true?

       7             SENATOR KRUEGER:  -- I think you need to

       8      prove it.

       9             Dilapidation.

      10             PAIMAAN LODHI:  Right.

      11             SENATOR KRUEGER:  Abuse of --

      12             PAIMAAN LODHI:  So they're not --

      13             SENATOR KRUEGER:  -- MCIs that are

      14      double-dipping (indiscernible) --

      15             PAIMAAN LODHI:  -- so there are over

      16      900,000 rent-stabilized units throughout the city.

      17             SENATOR KRUEGER:  Yep.

      18             PAIMAAN LODHI:  I wouldn't -- I would guess

      19      that REBNY members do not operate more than

      20      50 percent of those.

      21             I mean, it's an incredibly high number.

      22             SENATOR RIVERA:  But you don't have the data,

      23      though?

      24             PAIMAAN LODHI:  Right, no.

      25             SENATOR KRUEGER:  Can you get it?







                                                                   249
       1             SENATOR RIVERA:  Okay.

       2             SENATOR KRUEGER:  No, I mean, I'm

       3      (indiscernible) being serious about, are -- I've

       4      asked a series of questions based on data.

       5             Are you able to go back to REBNY and get that

       6      data for us?

       7             PAIMAAN LODHI:  I could try -- yeah, I could

       8      try.

       9             SENATOR KRUEGER:  Okay.

      10             Thank you.

      11             PAIMAAN LODHI:  I mean, I will go back,

      12      I will try to produce an answer for you.

      13             SENATOR KAVANAGH:  You'll definitely go back

      14      and try to get an answer.

      15             Thank you.

      16             Just -- so just a couple of my questions are

      17      follow up with this dialogue we've already begun.

      18             But you -- so in your dialogue with

      19      Senator Myrie, I just want to make sure

      20      I understood, and I think he seemed a little

      21      perplexed, and I think I am as well.

      22             You're -- so you have presented us quite a

      23      bit of data, you know, during your testimony, and

      24      also, you know, in your advocacy, in talking about

      25      what you want to -- what you might want to see in







                                                                   250
       1      this rent-law renewal.

       2             A lot of data about the net operating income

       3      of buildings, and then RGB increases, and how they

       4      vary -- how each of them has varied over time.

       5             Can you just -- I mean, just, let's begin,

       6      can you just talk a little bit more about that

       7      analysis?

       8             PAIMAAN LODHI:  So the Rent Guidelines Board,

       9      when they're doing their calculations, they try to

      10      assess what the price index and the costs are for

      11      the rent-regulated housing stock throughout the

      12      city.

      13             What they do not do is count those buildings

      14      that are under 10 units, which represent 50 percent

      15      of the rent-stabilized buildings throughout the

      16      city.

      17             Those buildings that are under 10 units

      18      presumably have much lower NOIs as opposed to the

      19      larger, blended 80/20 buildings in Manhattan, net

      20      operating income.

      21             And so what RGB data does, through its flawed

      22      methodology, is skew NOI much higher than what it

      23      actually is, and doesn't account for operating

      24      expenses and costs, and not net operating income,

      25      for the smaller buildings which are, predominantly,







                                                                   251
       1      completely rent-stabilized, and in the boroughs

       2      outside of Manhattan, predominantly.

       3             SENATOR KAVANAGH:  So can you provide -- so

       4      what you're suggesting is that, to the extent we

       5      were to reform these laws, it would have a greater

       6      impact on smaller buildings?

       7             PAIMAAN LODHI:  Yes.

       8             SENATOR KAVANAGH:  But a greater adverse

       9      impact on landlords of smaller buildings?

      10             PAIMAAN LODHI:  For sure.

      11             Okay.

      12             SENATOR KAVANAGH:  And among your -- you say

      13      you don't -- again, I'm -- I join other members of

      14      this panel on being surprised that you don't have a

      15      good sense of how many rent-regulated units your

      16      members are managing and owning.

      17             But is it fair to say that --

      18             PAIMAAN LODHI:  Granted, it's the data point

      19      that I just take from this, that we have to get

      20      better at.

      21             SENATOR KAVANAGH:  -- ah, we got it.

      22             But is it fair to say that your members,

      23      generally speaking, are owning larger buildings

      24      rather than smaller buildings?

      25             PAIMAAN LODHI:  Larger buildings?







                                                                   252
       1             I mean, it's a mix, right, because their

       2      portfolios include ownership, partnerships in which

       3      they have a minority stake in, you know, another

       4      portfolio of buildings.

       5             So I would say that they're impacted across

       6      the board.

       7             SENATOR KAVANAGH:  Are most of the large

       8      owners of rent-stabilized real estate members of

       9      REBNY?

      10             PAIMAAN LODHI:  I'm sorry, repeat that?

      11             SENATOR KAVANAGH:  Are most of the larger

      12      owners of rent-stabilized real estate in New York

      13      City members of REBNY?

      14             PAIMAAN LODHI:  I would say that -- I don't

      15      know.  I don't know.

      16             I would -- I know that our owners manage and

      17      build and operate large buildings which have a blend

      18      of stabilized units and market rate.

      19             SENATOR KAVANAGH:  So to the extent that you

      20      are asserting to us today that it is the smaller

      21      buildings and the owners of the smaller buildings

      22      that will suffer more greatly were we to pass the

      23      many bills that people have been discussing today,

      24      are you suggesting that we ought to take greater

      25      pains to protect the income and the ability of







                                                                   253
       1      smaller landlords to cover their costs, compared to

       2      the larger owners that are your -- that tend to be

       3      your members?

       4             PAIMAAN LODHI:  The smaller-building property

       5      own -- the smaller property owners will undoubtedly

       6      be hurt worse by these changes.

       7             But I think it's also important to note that

       8      it's not just going to be the rent-stabilized

       9      housing stock that's impacted.

      10             The potential $2 billion annual property-tax

      11      loss that would result from these changes, if all

      12      these changes were to go through, would shift the

      13      share of $2 billion onto co-ops and condos

      14      throughout the city as well.

      15             So, in effect --

      16             SENATOR KAVANAGH:  How would it do that?

      17             PAIMAAN LODHI:  Because of our city's

      18      property-tax system, in which co-ops and condos are

      19      in the same class as rentals.

      20             SENATOR KAVANAGH:  How would it shift the

      21      tax --

      22             PAIMAAN LODHI:  Because if NOI goes down for

      23      property taxes, property-tax value goes down.

      24             And unless the City decides that it's going

      25      to collect $2 billion less in revenue a year --







                                                                   254
       1             SENATOR KAVANAGH:  Right, so that's --

       2             PAIMAAN LODHI:  -- it would shift the burden

       3      onto co-ops and condos --

       4             SENATOR KAVANAGH:  -- so your point -- your

       5      point is that the City might choose to shift this

       6      tax burden to some other folks.

       7             There's nothing --

       8             PAIMAAN LODHI:  No, it's two choices.

       9             Either you collect $2 billion less in revenue

      10      and have 20,000 less teachers and police officers,

      11      or you shift the burden --

      12             SENATOR KAVANAGH:  Forgive me, please.

      13             Or you raise the income tax, or you have a

      14      personal income tax surcharge --

      15             PAIMAAN LODHI:  -- no, because the tax

      16      levies -- the levy would stay the same, so that you

      17      would then -- you would shift it over --

      18             SENATOR KAVANAGH:  Right, I just -- let me --

      19      I don't want to -- I don't want to be argumentive

      20      here.  I just want to understand.

      21             What you're saying is, that if the value of

      22      residential real estate does not go up as rapidly as

      23      it has in recent years, that --

      24             PAIMAAN LODHI:  No, I'm saying, if property

      25      values go down.







                                                                   255
       1             SENATOR KAVANAGH:  -- if property values go

       2      down or fail to go up as rapidly as they have in

       3      recent years, that that has a negative impact on the

       4      City's ability to collect taxes from those

       5      properties because property -- because taxes are

       6      related to property values?

       7             PAIMAAN LODHI:  Yes.

       8             SENATOR KAVANAGH:  Okay.

       9             You're not -- there's nothing about that

      10      scenario that somehow automatically shifts that tax

      11      burden to co-op and condos.  Right?

      12             That would be a -- if the City were to lose

      13      revenue, that would be a policy choice of the state

      14      Legislature and the city council, and others, what

      15      to do about that.

      16             Is that -- I mean, that's a fair statement;

      17      right?

      18             PAIMAAN LODHI:  I mean -- yes.

      19             SENATOR KAVANAGH:  Okay.

      20             SENATOR KRUEGER:  I have to jump in

      21      (inaudible).

      22             SENATOR KAVANAGH:  Apparently,

      23      Senator Krueger can't wait to ask a question.

      24             But if --

      25             SENATOR RIVERA:  She's the Finance Chair.







                                                                   256
       1             SENATOR KAVANAGH:  -- and she is the Chair of

       2      the Finance, which means she knows more about

       3      finance that I.

       4             So do you want to jump in now?  Or --

       5             SENATOR KRUEGER:  Well, I just want to point

       6      out that, because we've already actually agreed,

       7      I think, the panel in front of you and you, and most

       8      of the people in the audience, that New York City's

       9      assessment system for property taxes is so

      10      fundamentally flawed and messed up, I don't even

      11      think you can, with a straight a face, make the

      12      argument, if a value of some given building goes

      13      down because landlords --

      14             PAIMAAN LODHI:  No, 'cause --

      15             SENATOR KRUEGER:  -- don't invest as much in

      16      their buildings, because of something we change

      17      about rent regulation, that that will lose us

      18      $2 billion in property taxes.

      19             PAIMAAN LODHI:  No, so the -- what our

      20      analysis shows is that the net operating income for

      21      the rent-regulated housing stock would go down

      22      across the board, about, like, 20 percent.

      23             Income -- properties are assessed based on

      24      income and expense.

      25             And so, when NOI goes down, values of these







                                                                   257
       1      buildings go down, and, therefore, the property tax

       2      generated goes down.

       3             SENATOR KAVANAGH:  Do --

       4             SENATOR KRUEGER:  No, I have a follow-up.

       5             Sorry.

       6             I'm -- I know, he's going to kill me.

       7             SENATOR KAVANAGH:  I think I had the floor,

       8      but I'll yield it again.

       9             SENATOR KRUEGER:  I find it really

      10      interesting that you could do that analysis, when

      11      you can't answer questions about the rent-regulated

      12      housing stock.

      13             So, at Assembly hearings we learned from the

      14      City and the State, that 80 percent-plus of

      15      rent-regulated units are in buildings of eleven or

      16      larger.

      17             So it's not a 50/50 story.

      18             And, actually, the DHCR commissioner at the

      19      same Assembly hearing testified that the median size

      20      of a building with rent-regulated units is fifteen,

      21      radically larger than what you're projecting.

      22             So I don't --

      23             PAIMAAN LODHI:  There's --

      24             SENATOR KRUEGER:  -- I don't think you

      25      have --







                                                                   258
       1             PAIMAAN LODHI:  -- there are 16,000 buildings

       2      that are not accounted for in Rent Guidelines Board

       3      methodology.  50 percent of the buildings are not

       4      accounted for.

       5             That's not a valid method to value income and

       6      expense.

       7             SENATOR KRUEGER:  But you're not even

       8      prepared to offer legitimate data about what

       9      universe we're talking about.

      10             I don't think it's acceptable to say, you did

      11      analysis and you have the numbers, that we would

      12      lose this much in property taxes, which, of course,

      13      that would be a City decision, whether they change

      14      their assessment formula, whether they went to other

      15      tax realities, whether they increased the taxes on

      16      the higher-rent buildings.

      17             PAIMAAN LODHI:  That might be a City

      18      decision, but that is a State -- that is a State

      19      change that would impact the city's properties.

      20             SENATOR KRUEGER:  You're right, these are

      21      State changes that impact city properties.

      22             And, again, I don't want to speak for the

      23      City --

      24             PAIMAAN LODHI:  And City's property-tax

      25      revenue.







                                                                   259
       1             And so, you know --

       2             SENATOR KRUEGER:  -- but the city

       3      leadership --

       4             PAIMAAN LODHI:  -- this idea that the

       5      changes --

       6             SENATOR RIVERA:  You want to not interrupt,

       7      bro.

       8             SENATOR KRUEGER:  No, no, it's okay.

       9             City leadership has come to Albany and said,

      10      We need to make these changes.

      11             So I'm actually not sure that we're in

      12      conflict with what the City of New York wants for

      13      itself either.

      14             Now I'll stop being rude.

      15             SENATOR KAVANAGH:  And not rude at all.

      16             And thank you, Senator Krueger.

      17             Just -- so -- I mean, I would just note that

      18      the rent-regulation system is a -- is subject to

      19      home rule, so it is the City of New York that adopts

      20      rent-regulation, pursuant to authorization by the

      21      State.

      22             So, you know, this is not -- this is not what

      23      sometimes people like to call an "unfunded mandate."

      24             Just a few more questions.

      25             Just -- since we got into this question of,







                                                                   260
       1      you know, forgone tax revenue being a big problem,

       2      in your view, with reforming the rent laws, do you

       3      have any sense of how much revenue the City forgoes

       4      through the 421a program and other programs that

       5      give tax exemptions to developers?

       6             PAIMAAN LODHI:  Yeah, so I think what you're

       7      getting at is the -- the need for 421a.

       8             SENATOR KAVANAGH:  I'm just asking a

       9      question, actually.

      10             PAIMAAN LODHI:  No --

      11             SENATOR KAVANAGH:  Do you have a sense of the

      12      amount of revenue the City forgoes for -- in 421a?

      13             And, again, perhaps you're not prepared to

      14      answer that today.

      15             But, do you have -- do you have --

      16             PAIMAAN LODHI:  So I think the last estimate

      17      was $1 billion.

      18             But I think it's most important to note that

      19      421a now is currently constructed with the

      20      Affordable New York Program, is an affordable

      21      housing program, and it is -- it is a direct

      22      result -- the need for the 421a program is the

      23      direct result of our inequitable property-tax system

      24      in which, you know, it's impossible to build rental

      25      housing without a property-tax abatement.







                                                                   261
       1             SENATOR KAVANAGH:  So these are -- and just

       2      so we understand, I think some people in the room

       3      may, and some may not, but this is a -- this is a

       4      full decades-long abatement of taxes for new

       5      developers of buildings that are largely market

       6      rate, and, often, very high-end buildings.

       7             Is that a fair summary?

       8             PAIMAAN LODHI:  So 421a is a tool in which it

       9      allows for affordable units, lower-income units, to

      10      be built in higher-income neighborhoods.

      11             It is one of the biggest tools for economic

      12      integration, and it can produce affordable housing

      13      at scale like no other program can.

      14             SENATOR KAVANAGH:  But just the same -- the

      15      same analysis applies, if we were to think that it

      16      were beneficial to change the rent laws, as we're

      17      talking about today, and that we were to forgo some

      18      tax revenues, that we might also think that it would

      19      be beneficial to stop forgoing so much tax revenue

      20      through 421a, and similar programs, and offset a lot

      21      of the lost revenue that you assert we will have in

      22      repealing the rent law?

      23             PAIMAAN LODHI:  Yes, except, you know,

      24      rent-regulated housing is not affordable.  By it's

      25      definition, it is not income-restricted.  Affordable







                                                                   262
       1      New York is.

       2             SENATOR KAVANAGH:  What's the median rent in

       3      rent-stabilized apartments in New York?

       4             SENATOR RIVERA:  I'm sure these folks could

       5      tell you.

       6             (Indiscernible.)

       7             SENATOR KAVANAGH:  Just one senator and one

       8      witness at a time, please.

       9             Thank you.

      10             PAIMAAN LODHI:  I can get you the data, but,

      11      I mean, I think it includes -- it still includes

      12      rents that are over 2700.

      13             And I can tell you that there are units that

      14      are in rent stabilization that are in excess of

      15      $5,000 a unit.

      16             Those are not affordable.

      17             SENATOR KAVANAGH:  And those are mostly

      18      because of some illegal deregulations that were then

      19      undone --

      20             PAIMAAN LODHI:  No --

      21             SENATOR KAVANAGH:  -- by -- by -- by -- by

      22      a -- by a large -- by a large company that was a

      23      member of REBNY at the time.

      24             PAIMAAN LODHI:  That's not true.

      25             SENATOR KAVANAGH:  Forgive me, but







                                                                   263
       1      Tishman Speyer was a member of REBNY when they

       2      purchased --

       3             PAIMAAN LODHI:  Tishman Speyer is a member of

       4      REBNY.

       5             SENATOR KAVANAGH:  -- yes, and they purchased

       6      Stuyvesant Town and Peter Cooper Village?

       7             PAIMAAN LODHI:  Yes.

       8             SENATOR KAVANAGH:  And they purchased it with

       9      the explicit intention, stated publicly, of creating

      10      an iconic market-rate luxury community in the middle

      11      of Manhattan?

      12             PAIMAAN LODHI:  Okay.

      13             SENATOR KAVANAGH:  And they -- the way

      14      one would do that would be to remove the

      15      28,000 residents of Staten -- of Stuy Town and

      16      Peter Cooper from their homes, the great majority

      17      whom were not --

      18             PAIMAAN LODHI:  But you said illegally

      19      deregulate?

      20             SENATOR RIVERA:  Yeah, which is what he is

      21      describing --

      22             SENATOR KAVANAGH:  Yes, (indiscernible) --

      23      okay, so I think we -- sounds like we have a general

      24      understanding of the same facts.

      25             -- illegally, because the court -- the







                                                                   264
       1      highest court in the state ruled that those

       2      deregulations were a violation of black letter law,

       3      and, nonetheless, the landlord continues to benefit

       4      from the multiple rent increases that were took

       5      while they were deregulated, contrary to law.

       6             I don't want to -- that's not a question, so

       7      I -- forgive me.

       8             Just back to the question of profit and loss:

       9             So you have data on -- that you have

      10      presented on the net operating income, and the

      11      Rent Guidelines Board increases and how those

      12      compare.

      13             Is it your testimony that you do not have an

      14      ability to estimate the profits of rent-stabilized

      15      landlords in recent years, if somebody were to come

      16      to you --

      17             PAIMAAN LODHI:  Across the board, correct.

      18             SENATOR KAVANAGH:  -- if somebody were to

      19      come to you, say, a large developer or a large

      20      landlord, or somebody who wanted to get into the

      21      rent-stabilized housing market in New York, and they

      22      were to ask you, "How do I know that it is

      23      profitable to be a rent-stabilized landlord in

      24      New York?" REBNY's answer would be that sort of

      25      thing, just can't be estimated?







                                                                   265
       1             PAIMAAN LODHI:  No, I think that, you know,

       2      it's a case-by-case basis in which, you know,

       3      someone -- a perspective buyer would go to a bank,

       4      look at rent-roll information, and assume a proforma

       5      that's based on what the industry standard is.

       6             SENATOR KAVANAGH:  Okay, but, again,

       7      you're -- you -- net operating income, and many

       8      other things, are also on a case-by-case basis.

       9             Obviously, buildings vary, profits vary,

      10      operating income varies, maintenance expenses vary;

      11      but yet, you know, again, you are making assertions

      12      about the house -- the rent-regulated housing stock

      13      as a whole, with respect to net operating income,

      14      and a very specific assertion that the rent

      15      increases are not keeping up with net operating

      16      income.

      17             But you can't make any assert -- you can't --

      18      we -- we can't conclude anything, and your

      19      organization can't conclude anything, about profit.

      20             It's just perplexing to us, I think.

      21             The -- let's talk about net operating income

      22      versus RGB increases.

      23             The -- the full rent of an apartment, and you

      24      certainly understand real estate finance better than

      25      we -- perhaps, our Finance Chair understands it







                                                                   266
       1      better that I do, but, the -- if I'm paying rent on

       2      an apartment, the full rent, every dollar of my

       3      rent, is going to cover the net operating income of

       4      the building?

       5             PAIMAAN LODHI:  It should, for that unit,

       6      right, if you take it per-unit basis.

       7             SENATOR KAVANAGH:  Okay.  So -- and in a

       8      building as a whole --

       9             PAIMAAN LODHI:  No, it should cover expenses.

      10             Net operating income is the delta between

      11      income and expense.

      12             SENATOR KAVANAGH:  I'm sorry, forgive me.

      13             Right.

      14             It goes -- it -- it -- it -- it goes

      15      toward -- so you're -- you're looking at the overall

      16      expenses of a building, including -- when you talk

      17      about net operating income, it is the amount of

      18      money above the expenses of the building, is that

      19      right, that's why it's "net"?

      20             PAIMAAN LODHI:  Yes, the delta between the

      21      revenue collected and the expenses.

      22             SENATOR KAVANAGH:  And I'm going to suggest

      23      to you, and a "delta" is a --

      24             PAIMAAN LODHI:  The difference.

      25             SENATOR KAVANAGH:  -- it's the difference







                                                                   267
       1      between one number and another number?

       2             PAIMAAN LODHI:  Yes, correct.

       3             SENATOR KAVANAGH:  Okay.

       4             So the net operating income includes, what?

       5             PAIMAAN LODHI:  I'm sorry?

       6             SENATOR KAVANAGH:  What ele -- what are the

       7      elements of -- it includes --

       8             PAIMAAN LODHI:  So net operating income is

       9      generally used for three purposes, which is,

      10      repayment of debt --

      11             SENATOR KAVANAGH:  Just -- just -- yeah,

      12      okay, sorry.  Go ahead.

      13             PAIMAAN LODHI:  -- reinvestment in the

      14      property, and profit.

      15             SENATOR KAVANAGH:  I'm asking -- I'm

      16      asking -- I'm asking, before we get to that, the

      17      elements of net op.

      18             So it is the amount of -- it is -- it is the

      19      amount of -- the total amount of income received

      20      from the rent roll, minus certain things that are

      21      expenditures?

      22             PAIMAAN LODHI:  Roughly speaking, yes.

      23             Yeah.

      24             SENATOR KAVANAGH:  Okay, so -- and it is

      25      minus taxes?







                                                                   268
       1             PAIMAAN LODHI:  Yes.

       2             SENATOR KAVANAGH:  And minus maintenance

       3      expenses of the building?

       4             PAIMAAN LODHI:  Yes.

       5             SENATOR KAVANAGH:  And minus any staff costs?

       6             PAIMAAN LODHI:  Yes.

       7             SENATOR KAVANAGH:  And minus any debt service

       8      on the building?

       9             PAIMAAN LODHI:  No.

      10             SENATOR KAVANAGH:  Okay, so it does not

      11      include debt service?

      12             PAIMAAN LODHI:  It does not.

      13             SENATOR KAVANAGH:  It's just the basic cost

      14      of running the building irrespective of any money

      15      that may have been borrowed?

      16             PAIMAAN LODHI:  Correct.

      17             SENATOR KAVANAGH:  Okay.

      18             And we've had some opportunities to have

      19      these conversations, but I just want to make sure,

      20      for the record, we're clear.

      21             If -- so now I'm trying to understand the

      22      comparison.

      23             When you were comparing increases in -- the

      24      RGB increases, which are increases in the total

      25      amount of rent that gets collected; right?







                                                                   269
       1             Like -- sorry.

       2             In the -- it is the -- the RGB increase is an

       3      increase in the total amount of rent that may be

       4      collected, the legal amount of rent that may be

       5      collected, on that building?

       6             PAIMAAN LODHI:  The RGB increases annually?

       7             SENATOR KAVANAGH:  Yes.

       8             PAIMAAN LODHI:  Yes, it's the baseline rent

       9      increases for the entire rent-stabilized housing

      10      stock.

      11             SENATOR KAVANAGH:  Right.

      12             So, whereas net operating income is the

      13      amount of money that is left over after all the

      14      incomes have been -- after all of the expenditures

      15      have been made?

      16             PAIMAAN LODHI:  Minus --

      17             SENATOR KAVANAGH:  So, effectively --

      18             PAIMAAN LODHI:  -- not including debt.

      19             SENATOR KAVANAGH:  -- so it's sort of what we

      20      would think of as profit, except, that we understand

      21      that there may be some other things, like debt

      22      service, that are impeding the profit on the

      23      building?

      24             PAIMAAN LODHI:  Profit is one of three

      25      components of NOI.







                                                                   270
       1             SENATOR KAVANAGH:  Right.

       2             So why should NOI go up -- why is it a

       3      problem -- sorry, let me ask it differently.

       4             At what point does it become a problem if the

       5      rent -- the legal rent increase doesn't go up as

       6      rapidly as NOI, as you assert?

       7             I mean, isn't -- isn't part of NOI going up,

       8      the profit on buildings increasing over time?

       9             PAIMAAN LODHI:  No.

      10             So, NOI is -- there can -- there are various

      11      factors as to why NOI can increase over time.

      12             If you purchase a building, or if -- if the

      13      purchase price is high, land-acquisition cost is

      14      high, like, that mortgage and that financing cost is

      15      not accounted for in your NOI.

      16             But, the total rent, which might be high in

      17      that case, reflect -- and the expenses, though,

      18      remain relatively modest, right, regardless of

      19      acquisition costs, that NOI can increase, but profit

      20      margin can stay the same, if not go down, go up.

      21             There is no correlation there.

      22             SENATOR KAVANAGH:  But the profit is -- the

      23      profit mar -- the NOI has three components.  It's

      24      profit, debt service, and --

      25             PAIMAAN LODHI:  It's primarily debt service.







                                                                   271
       1             SENATOR KAVANAGH:  -- payment to prin --

       2      payment to principal, interest, and profit?

       3             PAIMAAN LODHI:  And reinvestment in the

       4      property.

       5             SENATOR KAVANAGH:  And reinvestment in the

       6      property, okay, including what we might think of as

       7      capital improvements?

       8             PAIMAAN LODHI:  Correct.

       9             SENATOR KAVANAGH:  Okay.

      10             And I appreciate people's patience with our

      11      economics seminar up here.

      12             I want to shift gears a little bit, and then

      13      I have -- may have a couple more senator questions.

      14             Just -- you asserted in your testimony that

      15      there are certain changes that would be acceptable,

      16      you recognize there's a crisis, you recognize that

      17      some, you know, tightening up of the enforcement.

      18             I would note your organization has lobbied

      19      against recognizing the tenant-protection unit in

      20      prior years.

      21             And for the first time, this year, the

      22      tenant-protection unit is included in the state

      23      budget, because the Senate changed and was willing

      24      to permit that.

      25             And we talked about this before, but we added







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       1      money to HCR, to the office of rent administration

       2      and the tenant-protection unit, so they can hire

       3      94 new people to administer the laws.

       4             And that is -- those are things that REBNY

       5      has formally opposed in the past.

       6             But it's good to hear that, you know, we want

       7      to look at regulation this year, at sort of reform

       8      and enforcing the rules this year.

       9             And we've had conversations about that, and

      10      we appreciate that, and sincerely.

      11             My question is:  Are there aspects of this

      12      system that relate to the dollars and cents of this

      13      program that REBNY would be willing to accept

      14      reforming?

      15             PAIMAAN LODHI:  Yes.

      16             SENATOR KAVANAGH:  Okay, can you -- can you

      17      talk -- can you talk a little bit about those?

      18             PAIMAAN LODHI:  I can't expand on that

      19      because I don't know what framework we're dealing

      20      with.

      21             So, you know, the system is incredibly

      22      interconnected.

      23             So if -- you know, if Rent Guidelines Board

      24      goes to a formula-based system that is more

      25      consistent and transparent, you would have less







                                                                   273
       1      impact on the other levers.  Right?

       2             But if -- if one of the other levers are

       3      changed, right, it impacts one of the others.

       4             SENATOR KAVANAGH:  And I just, with great

       5      respect, I respect that you're in a difficult

       6      position here.

       7             But I'm just asking, as of today, which is

       8      29 days before these laws expire and need to be

       9      renewed, and as your organization has acknowledged,

      10      there are likely to be very substantial change in

      11      this, talking about changes in the levers, are there

      12      changes -- are there particular ways we might reform

      13      the "levers," as you call them, that relate to the

      14      incentives of landlords to engage in some of the

      15      behavior we've heard about today, that REBNY would

      16      be willing to discuss?

      17             Because we've heard a great deal about the

      18      problem from REBNY's perspective, and the difficulty

      19      that reform or repeal of these provisions will, you

      20      know, inflict upon our landlords.

      21             We have not, at this point, heard much by way

      22      of what REBNY might be willing to accept.

      23             And I know, you know, there will be other

      24      opportunities to do that, perhaps, but time is

      25      getting short.







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       1             PAIMAAN LODHI:  Yeah, we understand time is

       2      getting short.

       3             SENATOR KAVANAGH:  Okay, but you're not

       4      prepared today, in your testimony --

       5             PAIMAAN LODHI:  No.

       6             SENATOR KAVANAGH:  -- to discuss this.

       7             Okay, thank you.

       8             Again, we do appreciate your testimony, and

       9      we appreciate everybody's patience.

      10             But, we also do have additional questions

      11      on -- perhaps, a couple follow-up questions from

      12      Senator Rivera.

      13             SENATOR RIVERA:  Are you familiar with the

      14      con -- with the debate -- well, not debate, but some

      15      of the criticism from some folks related to the

      16      elimin -- the potential elimination of MCIs, and the

      17      apparent loss of jobs that there might be?

      18             There's a -- there was -- there was a -- I'm

      19      not sure if you were here earlier.  There was a

      20      protest in front, et cetera.

      21             PAIMAAN LODHI:  I heard about it.

      22             SENATOR RIVERA:  You heard about it.  Okay.

      23             Are you familiar -- and I'm -- I'm about to

      24      perform a magic trick, by the way.

      25             Are you familiar with the Alliance for Rental







                                                                   275
       1      Excellence in New York?

       2             PAIMAAN LODHI:  No.

       3             SENATOR RIVERA:  Ta-dah (holds up piece of

       4      paper.)

       5                [Laughter.]

       6             SENATOR RIVERA:  So, if I was to look for --

       7      this is ARENYC, which is putting out a lot of ads,

       8      I'm looking at one online right now:  Tell New York

       9      lawmakers, don't kill our jobs.

      10             So if I was to look in your -- that you know

      11      of, the Alliance for Rental Excellence in New York,

      12      if we looked at some of the money that went into

      13      that particular organization, would we see your

      14      organization's funding it?

      15             PAIMAAN LODHI:  I'm the policy guy, I can't

      16      speak to that.

      17             SENATOR RIVERA:  Which is I figure precisely

      18      the reason why you're here.

      19                [Laughter.]

      20             SENATOR RIVERA:  I would say, sir -- well,

      21      to -- but --

      22                (Indiscernible cross-talking.)

      23             PAIMAAN LODHI:  (Indiscernible.)

      24             SENATOR RIVERA:  -- but -- but -- but let me

      25      ask you just this one thing --







                                                                   276
       1             I got two more --

       2             SENATOR KAVANAGH:  (Indiscernible.)

       3             SENATOR RIVERA:  -- two more.

       4             Would you agree with the -- with the argument

       5      being made in these series of ads, that, if we

       6      indeed get rid of MCIs and IAIs, that we would then

       7      kill a bunch of jobs for people that are performing

       8      maintenance in -- as you yourself put it earlier

       9      when you were speaking to Senator Krueger --

      10             PAIMAAN LODHI:  It's as though --

      11             SENATOR RIVERA:  -- would you agree --

      12             PAIMAAN LODHI:  -- "maintenance" is a dirty

      13      word.  I don't understand where this is coming from.

      14             Maintenance of housing is necessary.

      15             SENATOR RIVERA:  Absolutely, which is

      16      precisely the reason why you shouldn't get a bonus

      17      for doing such maintenance.

      18             But, anyway, that's not the question.

      19                [Applause.]

      20             SENATOR RIVERA:  Hold on, hold on, I got one

      21      more.

      22             So -- and so the -- so would you agree -- so

      23      the question is:  Would you agree with the argument

      24      that is being made by these folks, who, obviously,

      25      you do not know anything about, that, if we get rid







                                                                   277
       1      of MCIs and IAIs, that we will indeed be impacting

       2      a bunch of jobs in the city and the state?

       3             PAIMAAN LODHI:  Yeah, construction industry

       4      is really important in New York City.  It provides

       5      good-paying jobs.

       6             And the work that's being done in these

       7      apartments are paid -- you know, are good-paying

       8      construction jobs.

       9             SENATOR RIVERA:  Ground to a halt,

      10      apparently.

      11             Okay, last, but not least, I'm just -- I --

      12      I -- I hope that you're making a mint, my brother,

      13      because you have been sent somewhere with very

      14      little information --

      15             PAIMAAN LODHI:  That's not true.

      16             SENATOR RIVERA:  -- (indiscernible) -- oh, it

      17      is true, because the fact is, if we're talking

      18      about, some of the questions that we've asked --

      19      some of the questions that we've asked --

      20                (Indiscernible cross-talking.)

      21             PAIMAAN LODHI:  The testimony that you've

      22      heard today --

      23             SENATOR RIVERA:  Hold on.

      24             PAIMAAN LODHI:  -- has been mostly anecdotal.

      25             I've come here with data --







                                                                   278
       1             SENATOR RIVERA:  No, but I got you.

       2             Let me ask the question, though --

       3             PAIMAAN LODHI:  -- I've come here with facts.

       4             SENATOR RIVERA:  -- sir, let me ask the

       5      question.

       6             The -- this is -- this is -- we asked

       7      questions about membership of revenue --

       8             PAIMAAN LODHI:  And I told you --

       9             SENATOR RIVERA:  -- which you could not

      10      actually provide.

      11             You gave us some estimations, but you don't

      12      have data.

      13             And you talked about the breakdown, when you

      14      were talking to the Senator -- with Senator Krueger,

      15      about some of the breakdown of how much is

      16      50 percent, or what have you, we just got some data

      17      that tells us that that's not accurate.

      18             PAIMAAN LODHI:  I would say --

      19             SENATOR RIVERA:  I've asked you questions --

      20             PAIMAAN LODHI:  -- I'd be surprised if it was

      21      more than 50 percent.

      22             SENATOR RIVERA:  -- I'm not done with the

      23      question.

      24             The question is, very simply -- the question

      25      is very simply:  Do you think it is fair to you that







                                                                   279
       1      you're put in this situation with, basically, no

       2      information for us?

       3             (Indiscernible.)

       4             PAIMAAN LODHI:  I reject that narrative.

       5             I came here with a lot of information, and

       6      I came here to present facts --

       7             SENATOR RIVERA:  Yeah, just not the --

       8             PAIMAAN LODHI:  -- on the implications that

       9      are going to impact the law.

      10             SENATOR RIVERA:  -- not the ones that we're

      11      asking for.

      12             SENATOR KAVANAGH:  I thank -- I thank --

      13             SENATOR RIVERA:  Thank you so much, Senator.

      14             Thank you Mr. Chairman, thank you,

      15      Mr. Chairman.

      16             SENATOR KAVANAGH:  Any other questions for

      17      the witness?

      18             Any further -- any further questions or

      19      comments of this witness?

      20             SENATOR SALAZAR:  Yes.

      21             SENATOR KAVANAGH:  (Indiscernible.)

      22             I think you have one more question from

      23      Senator Salazar.

      24             SENATOR SALAZAR:  Hello, again.

      25             So there was a ProPublica report in 2016 that







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       1      showed that the requirements of the 421a program

       2      have consistently been ignored by property owners

       3      who take advantage of the program; that nearly

       4      two-thirds of the, roughly, 6400 rental properties

       5      in the city, whose owners pay reduced taxes through

       6      the 421a program, do not even have an approved

       7      application on file, the most basic requirement to

       8      be eligible for the program.

       9             Two-thirds.

      10             Some landlords -- some of those landlords,

      11      therefore, have been pocketing the tax break for the

      12      program for more than two decades now, without even

      13      actually being approved for the program.

      14             We're talking about over $300 million in tax

      15      subsidies at this point.

      16             What do you think the consequences should be

      17      for those property owners?

      18             PAIMAAN LODHI:  Should be punished to the

      19      highest extent of the law.

      20             SENATOR SALAZAR:  Could you -- could you

      21      maybe specify, like, what you think the consequences

      22      should be?

      23             Are they -- should they -- should their

      24      properties be expropriated?  Should they be --

      25      should they, you know, have to pay a penalty for --







                                                                   281
       1      you know, for taking hundreds of millions of dollars

       2      in tax subsidies, without even demonstrating they

       3      should be eligible for them?

       4             PAIMAAN LODHI:  I think it's pretty clear,

       5      highest -- punished to the highest extent of the

       6      law.

       7             I don't know what the law is, but, punish to

       8      the highest extent.

       9             I'm not here to defend bad behavior.

      10             I come here with the full backing of my

      11      entire membership to say that we have to root out

      12      bad behavior in the system.

      13             And the way to do that is to get rid of bad

      14      actors, and stricter enforcement, stiffer fines,

      15      treble damages.

      16             SENATOR SALAZAR:  Okay.

      17             SENATOR KAVANAGH:  And I will just -- I will

      18      just conclude again by -- I do want to thank this

      19      gentleman who has come here to speak on behalf of an

      20      industry in a room that there may be some scepticism

      21      of his perspective.

      22             And I do want to note that, your industry, to

      23      the extent -- and on a serious point, to the extent

      24      that you are serious about eliminating incentives to

      25      engage in this market badly, I think your







                                                                   282
       1      association knows a great deal about what

       2      incentivizes landlords to operate one way or to

       3      operate a different way.

       4             And to the extent that you have practical

       5      proposals for that, you know, I think that -- and

       6      it's not -- this wasn't -- isn't your personal

       7      decision.

       8             I think your association has decided not to

       9      come forward with particular proposals.

      10             But I think -- again, I think the time is

      11      near when it might be useful -- it might be

      12      constructive for REBNY to come forth with those.

      13             PAIMAAN LODHI:  We'll be in touch.

      14             SENATOR KAVANAGH:  But, again, thank you for

      15      your testimony today.

      16             PAIMAAN LODHI:  Thank you.

      17             SENATOR KRUEGER:  Paimaan, thank you.

      18                [Applause.]

      19             SENATOR KAVANAGH:  That's for you (indicating

      20      to the witness.)

      21             Next up we have somebody who's been here for

      22      a very long time, Amshula, I'm not sure how to say

      23      it, Jayaram, of Demos, which is a place I had the

      24      privilege of working at when it was a much smaller

      25      but very impactful organization.







                                                                   283
       1             But if you can come up.

       2             And then after that, we are going to have a

       3      panel of New York City loft tenants.

       4             Oh, forgive me.

       5             No.

       6             I -- actually, sorry, you're -- you're --

       7      forgive me, you're part -- your actually part of

       8      this panel.

       9             Forgive me.

      10             I'm dealing with a very -- since many people

      11      have added themselves upon arrival, we're dealing

      12      with a complicated list.

      13             But, both of these folks have been waiting a

      14      very long time, and we appreciate your testimony.

      15             And as I said, the next panel will be some

      16      loft tenants.

      17             AMSHULA JAYARAM:  Good afternoon, and -- or,

      18      good evening, and thank you to Chairman Kavanagh and

      19      members of the Committee for the opportunity to

      20      testify here today in support of all nine bills on

      21      the Housing Justice For All platform.

      22             My name is Amshula Jayaram, senior campaign

      23      strategist at Demos, a public-policy organization

      24      that is dedicated to racial and economic justice.

      25             I am also a resident of the 20th District,







                                                                   284
       1      which, like too many neighborhoods throughout

       2      New York City, is visibly buckling under the housing

       3      crisis.

       4             We are in full support of the reforms today,

       5      and ask the Committee to pass this strong and urgent

       6      package of rent laws.

       7             Just last month Demos issued a report on the

       8      affordable housing crisis in the U.S.

       9             Unsurprisingly, the factors that have

      10      contributed to these crises are consistent across

      11      the country, as are the solutions.

      12             And the report concludes with a series of

      13      recommendations, including establishing national

      14      rent control and good-cause eviction, two powerful

      15      policy mechanisms that can stem the bleeding of

      16      affordable units and the dissolution of communities.

      17             So I just wanted to say at the outset, that

      18      I hope that the remarks are helpful and relevant to

      19      the discussion.  It's a little bit of a broader

      20      look.

      21             But, we wanted to be here, both to kind of

      22      share the findings with the Committee, but also to

      23      show solidarity with our brothers and sisters in the

      24      room.

      25             So with that disclaimer said:







                                                                   285
       1             The U.S. already spends enough money to solve

       2      the housing crisis.

       3             The problem is that this money goes towards

       4      subsidizing the rich rather than the poor.

       5             Robert Friedman, in his book "A Few Thousand

       6      Dollars: Sparking Prosperity for Everyone," notes

       7      that, "The wealthiest 5 percent of taxpayers get

       8      more than $200 billion in annual home-ownership tax

       9      breaks, more than the bottom 80 percent combined."

      10             He also notes that the "upper-income tax

      11      subsidies are four times the entire annual budget of

      12      the federal department of housing and urban

      13      development," the agency that's supposed to provide

      14      housing for the poor.

      15             The Center on Budget and Policy Priorities

      16      found that a larger share of federal spending on

      17      housing went to the 7 million households with

      18      incomes of $200,000 or more, than to the more than

      19      50 million households with incomes of 50,000 or

      20      less.

      21             In New York -- in the 2019 session, in

      22      New York State, the proposal for a pied-a-terre tax

      23      was one attempt to push back against a system that

      24      favors rich homeowners, in this case, homeowners

      25      with multiple homes, over poor renters.







                                                                   286
       1             The failure of this legislation to pass at a

       2      time when the lack of affordable housing has reached

       3      an apex speaks volumes about the power of private

       4      interests who have blocked meaningful reform for so

       5      long.

       6             The second finding, and the second point

       7      I want to lift up, is the lack of affordable housing

       8      not only creates a daily struggle to survive for

       9      many families, but it also prevents families from

      10      building wealth.

      11             According to the Joint Center for Housing

      12      Studies, the New York/New Jersey metro area ranks

      13      41 out of the 101 most cost-burdened metropolitan

      14      areas in America.

      15             Just over 85 percent of families here are

      16      cost-burdened, meaning, they spend more than

      17      30 percent of their income on rent, and 71.5 percent

      18      are severely cost-burdened, meaning, they spend over

      19      half of household income on rent.

      20             Under either of these scenarios, families not

      21      only struggle to pay for necessities, like food and

      22      clothing, but they also are unable to save or

      23      invest.

      24             A Demos analysis of data from the federal

      25      reserve's Survey of Consumer Finances found, that







                                                                   287
       1      while the median value of financial assets of

       2      homeowners, not including homes and other property,

       3      was about $68,000, the median value of assets for

       4      renters was just $2,000.

       5             This is a critical point because it

       6      underscores how policy choices made by powerful

       7      decision-makers can set generational poverty in

       8      motion.

       9             Children of parents with $2,000 in the bank

      10      will have a very different set of choices and

      11      opportunities than children of wealthier families,

      12      to say the least.

      13             The data on housing costs also shows that

      14      there are real barriers to building wealth in this

      15      country for the vast majority of people.

      16             On the other hand, regulation, like rent

      17      control, can help people to start saving.

      18             An analysis of rent control in San Francisco

      19      showed that regulation saved tenants between 2300

      20      and 6600 per year.

      21             And to speak, actually, just to reference the

      22      point made by the REBNY representative, I mean, we,

      23      I think, would agree that there's not enough

      24      affordable housing being built, and, you know, that

      25      says two things.  Right?







                                                                   288
       1             Like, one, they're not incentivized to build

       2      those units, and, you know, surprise, surprise, the

       3      market is not going to solve everything.

       4             And, two, that it's all the more reason why

       5      we need to pass really strong tenant protections, to

       6      stop the existing units from -- you know, from being

       7      converted or tenants from being kicked out.

       8             Nationally, we've lost about 400,000

       9      subsidized-housing units through demolition

      10      and conversion to market-rate units since the

      11      late '80s.

      12             And the Joint Center for Housing Studies

      13      estimates that we will lose over one million more

      14      subsidized rental units over the next decade.

      15             These problems are not intractable; each of

      16      them have known solutions.

      17             Development of affordable housing;

      18      regulations to control the rate of rent increases;

      19      establishing strong tenant protections, like

      20      good-cause eviction, are just some of the proven

      21      solutions to keep families in their homes.

      22             For example, the department of veterans

      23      affairs and the department of housing and urban

      24      development cut homelessness amongst veterans by

      25      half in just eight years because there was an actual







                                                                   289
       1      commitment from the government to do so.

       2             In closing, I would like to add that this

       3      emergency is a result of choices made by

       4      policy-makers over decades, and by the persistent

       5      and toxic impact of money in politics.

       6             The fact that 89,000 people don't have

       7      shelter in this state is not an accident.

       8             There is a direct line between homelessness

       9      and housing insecurity and the power of the real

      10      estate lobby to block meaningful housing reform.

      11             I applaud the Legislature's commitment to

      12      preserving affordable housing and protecting

      13      tenants, but this is just another symptom of a

      14      larger problem.  Lax campaign-finance laws allowed

      15      monied-interests to drown out the voices of people

      16      in need, with shameful consequences.

      17             Fairness and equality demand that we not only

      18      deal with the symptoms, but we ultimately attack the

      19      root.

      20             So thank you for your time today, and take

      21      any questions if you have them.

      22                [Applause.]

      23             NAKEEB SIDDIQUE:  Thank you, Chair Kavanagh,

      24      Senator Myrie, Senator Krueger, and to the

      25      Committee.







                                                                   290
       1             My name is Nakeeb Siddique, and I am the

       2      director of housing for the Brooklyn neighborhood

       3      office of The Legal Aid Society.

       4             And I'm proud to be here to urge passage of

       5      the good-cause eviction bill that's pending before

       6      the Legislature.

       7             We've heard a lot here -- I've provided the

       8      testimony here to the Committee.

       9             And I know we've heard here a lot about

      10      rent-regulated tenants, and, certainly, I would be

      11      preaching to the choir, to some degree, and

      12      I certainly believe, of course, that strengthening

      13      rent regulation is a good thing, is a very necessary

      14      thing.

      15             I'm here today to speak about another huge

      16      category of tenants who don't even have the basic

      17      protections that rent-stabilized tenants or other

      18      rent-regulated tenants have.

      19             You know, those are the tenants who live in

      20      the smaller buildings that are now currently,

      21      relatively, unregulated.

      22             These are five-family -- or, five-unit

      23      buildings, four-unit, three-unit, two-unit

      24      buildings.

      25             The legislation that's before the -- the







                                                                   291
       1      proposed legislation that would allow for

       2      eviction -- evictions based on good cause only would

       3      make a tremendous difference, I think, not only

       4      throughout the city of New York, but here,

       5      especially, in Brooklyn.

       6             Here we have a good third of the units --

       7      rental units in the borough here are unregulated

       8      currently.

       9             And as a housing attorney, I -- I -- me and

      10      my colleagues, we have about 48 attorneys and

      11      several more paralegal social workers.

      12             Every day we're in Brooklyn Housing Court,

      13      and a great majority of our clients certainly are

      14      the rent-regulated tenants.

      15             But we also have this other category of

      16      tenants who -- who we really struggle to defend.

      17      You know, there's not a faint heart among my staff,

      18      and they fight like lions, you know, for their

      19      clients; they love their clients.

      20             But these kinds of cases where we have

      21      holdover eviction proceedings, where a lease is

      22      expired, for example, and the landlord no longer

      23      wants the tenant.

      24             Right now, under current law, the landlord

      25      has to give no reason.  And often the reason is







                                                                   292
       1      retaliatory.  The tenant might have complained about

       2      repairs, or lack of repairs.  It may be that the

       3      landlord simply wants to raise the rent to something

       4      that's unaffordable.

       5             This has a tremendous impact on our

       6      communities throughout the borough, throughout the

       7      city.

       8             And I want to share just a couple of stories

       9      of a couple of clients that I've worked with

      10      recently.

      11             You know, one is a tenant who lives in

      12      Bushwick in a four-family house.  She's lived there

      13      for 41 years, back when Bushwick was not known

      14      throughout the world.  It was known in Brooklyn, and

      15      that's about it.

      16             And this is somebody who, you know, plowed

      17      the -- plowed the sidewalk when it was snowing.

      18      Took care of the building.

      19             She, and her husband who has since passed,

      20      they were, effectively, the maintenance people for

      21      the building.

      22             The building was owned by a family friend.

      23             This is somebody who drove a -- who drove a

      24      subway car, she worked for the MTA, until she

      25      retired.  Raised three children, sent them to







                                                                   293
       1      college.  Is now taking care of two disabled

       2      grandchildren in the house.

       3             Well, the building was sold earlier this

       4      year.

       5             The new landlord, who has really no -- no

       6      issue with her at all.  The new landlord and his

       7      attorneys acknowledge that our -- that our client

       8      is -- is a good tenant.  Has never missed any rent

       9      payments, has been continuing to pay rent.

      10             But, the landlord has been quite -- quite

      11      candid about his goal, which is that, you know, the

      12      neighborhood is hot, and our client is not, I guess.

      13             You know, and the goal is to -- for this

      14      person is -- the landlord is to redevelop the

      15      building and rent it for much higher prices.

      16             So this is somebody who has put her life into

      17      this neighborhood, into this building.  And under

      18      current law, you know, my office, we're fighting

      19      with one arm tied behind our back.

      20             We'll do what we can, but, you know, these

      21      kinds of cases are some of the most challenging in

      22      terms of the emotions involved, for the attorneys,

      23      certainly, obviously, the client.

      24             No matter what we do, the outcome sometimes

      25      is preordained.







                                                                   294
       1             If we can get -- bat this case away on some

       2      technicality, or -- or -- you know, all we're really

       3      doing is forestalling the -- the inevitable.

       4      Another case will follow right behind this one.

       5             I have another client who -- whose case

       6      recently ended.

       7             This is a gentleman who was partially blind,

       8      who has a Section 8 voucher, lives in a three-family

       9      house.  He's lived there for 10 years.  Also, no

      10      issue with rent.  You know, the landlord doesn't

      11      seem to have any sort of personal issue with him.

      12             But, you know, in the winter of 2017, which

      13      was not like this past winter, it was cold, it was

      14      very brutally cold.

      15             He made a complaint to the city's -- to the

      16      city agency HPD, because it was bitterly cold in his

      17      apartment, and he didn't know what else to do.

      18             So we think that that's what precipitated the

      19      landlord bringing him to court.

      20             We managed to get the first case thrown out.

      21             The landlord brought another one, and he was

      22      compelled, ultimately, to do an agreement to move

      23      out of the apartment.

      24             This is somebody who's also reliant on an

      25      oxygen tank.







                                                                   295
       1             And it really -- you know, it pains me deeply

       2      to say that, you know, he was not able to find

       3      another apartment, because he has no income.  He's a

       4      senior, he's, you know, fixed income.

       5             So he is living in a homeless shelter right

       6      now.

       7             You know, and if -- if we had this good-cause

       8      eviction bill, things would be very, very different

       9      for both of these clients, and for thousands of

      10      other New Yorkers, tens of thousands, in fact, and

      11      many of whom live here in Brooklyn.

      12             And so I implore you and your colleagues,

      13      please, pass this bill.

      14             Take off the restraints, give me and my

      15      colleagues the tools that we need, and I promise you

      16      we'll come out swinging with both fists.

      17             I thank you.

      18                [Applause.]

      19             SENATOR KAVANAGH:  Thank you.

      20             We're going to continue, we'll begin by

      21      letting our colleagues speak.

      22             So Senator Myrie first.

      23             SENATOR MYRIE:  Thank you.

      24             And thank you for the work that you're doing.

      25             Opponents of this legislation have suggested







                                                                   296
       1      that this is too -- of the good-cause bill, have

       2      suggested that this is too broad a piece of

       3      legislation, that this would have too-far reach of

       4      an impact, and that it would drastically change

       5      tenant-landlord law.

       6             And so, if you could, explain to the good

       7      landlord who is trying to --

       8             OFF-CAMERA SPEAKER:  What good landlord?

       9                [Laughter.]

      10             SENATOR MYRIE:  -- to -- the.

      11             SENATOR KAVANAGH:  I'm glad we got to this

      12      far into this without, but, please, please do -- you

      13      know, let's let the dialogue continue.

      14             SENATOR MYRIE:  -- to the landlord that has

      15      not violated the law, what this bill would mean to

      16      them, if anything.

      17             NAKEEB SIDDIQUE:  I mean, I -- I -- one thing

      18      I'll point out about this bill, from my

      19      understanding, it applies to buildings -- all

      20      apartments, other than those that are in four- or --

      21      three- or four-family unit -- uh -- I'm sorry, yes,

      22      smaller buildings where the landlord actually lives

      23      there.

      24             So to me, you know, I grew up here in

      25      Brooklyn myself.  I -- you know, these are buildings







                                                                   297
       1      that are investment properties, in effect, that this

       2      legislation would affect.

       3             Being able to displace tenants at will with a

       4      30-day notice, yes, I mean, it would certainly be

       5      convenient for most landlords.

       6             And, you know, I've seen many landlords who

       7      say -- you know, tell a tenant, Oh, it's fine, you

       8      can stay here.  Let's just keep it month-to-month.

       9             But, of course, that -- you know, that

      10      gives -- it's -- there's a bargaining-power issue

      11      right there.

      12             There's nothing really for landlords who are

      13      good landlords to fear from this.

      14             I mean, these are not tenants who -- if the

      15      tenant is not paying rent, the landlord still has a

      16      cause of action.  They can always bring the tenant

      17      to court.

      18             If the tenant is, allegedly, creating a

      19      nuisance or breaching the lease or doing something

      20      that they ought not to be doing, there's still

      21      remedies.

      22             The -- this legislation, what I see it doing,

      23      is giving not just the tenant some protections, but

      24      the landlord also a sense of kind of certainty, or,

      25      you know, a -- a -- a kind of sense that they --







                                                                   298
       1      they -- they can rely on the tenant -- they can keep

       2      this tenant in -- so long as the tenant is paying

       3      the rent and is otherwise complying with the lease.

       4             It doesn't really -- it doesn't really -- it

       5      shouldn't really affect them in any way, other than,

       6      I suppose, obviously, in terms of the marketability

       7      of the building, perhaps, or the units.

       8             But I -- I submit that, you know, this is a

       9      city of renters, this is a state of renters, and it

      10      is certainly within the rights of the people to ask

      11      for this kind of protection.

      12             And, historically, I understand we used to

      13      have these kinds of protections.

      14             The neighborhood I grew up in, the old

      15      Sicilian and Puerto Rican ladies who I grew up

      16      around, you know, they lived in small -- you know,

      17      these sort of smaller buildings.

      18             Many of them had these kinds of protections,

      19      that no longer exist.  They were the glue that held

      20      the neighborhood together, and there's a kind of

      21      intangible value to that.

      22             Again, the client that I just mentioned,

      23      who -- who not just took care of the building, but

      24      really took care of the block and the neighborhood.

      25             SENATOR KAVANAGH:  Thank you, Senator Myrie.







                                                                   299
       1             Just to follow up, as you note, I mean, in

       2      earlier generation, I mean, there were at least

       3      1.6 million rent-regulated units in -- in New York.

       4             So it -- it -- you know, what we're talking

       5      about today is -- is getting back to a broader

       6      protection, but certainly not unprecedented that --

       7      that we would protect tenants more broadly.

       8             And just to -- we had our first hearing of

       9      this Housing Committee, it was in a neighborhood in

      10      Syracuse, where there was a great deal of attention

      11      to this, in housing in neighborhoods where the issue

      12      was not that the neighborhoods were becoming "hot"

      13      neighborhoods, that, you know, where there was

      14      gentrification and a lot -- a big -- a big influx of

      15      people, people living in very tough circumstances,

      16      and at the mercy of their landlords, particularly

      17      when, you know, they might complain about bad

      18      conditions.

      19             But just -- I want to focus, in a New York

      20      context, where we have many neighborhoods that

      21      undergo that change, where, all of a sudden, it is

      22      just plain more desirable for certain people to move

      23      into that neighborhood, who hadn't previously

      24      considered moving in, and rents go up very rapidly.

      25             This bill has a standard that says that







                                                                   300
       1      the -- that upon -- you can't be pushed out for

       2      paying a rent -- for failing to pay a rent increase

       3      that is unconscionable.

       4             In your view, if we pass this bill, does --

       5      is a landlord -- would a landlord be free to argue

       6      that the neighborhood has become more fashionable,

       7      more desirable, people are willing to pay a lot more

       8      in this neighborhood, and that makes my large rent

       9      increase not unconscionable?

      10             NAKEEB SIDDIQUE:  I mean, I think that's

      11      certainly something that would probably be litigated

      12      in the courts.

      13             I -- I don't -- yeah, I imagine that we

      14      probably would encounter some kind argument like

      15      that, or any kind of argument.  I mean, just as our

      16      side adapts, so does the other.

      17             SENATOR KAVANAGH:  Do you think that we

      18      should write a statute that intends for that kind

      19      of -- for that kind of change, to be something that

      20      somebody can -- you know, somebody can raise rent a

      21      lot and say, look, this is a neighborhood where

      22      people are raising rents a lot, so I'm going to

      23      raise rents a lot too?

      24             NAKEEB SIDDIQUE:  I mean, I think in

      25      New York City that would be a disaster.







                                                                   301
       1             I mean, that's sort of -- we -- we don't have

       2      that kind of legislative guidance now, and it is a

       3      full-on disaster.

       4             I do think the more specific guidance that we

       5      can get from the Legislature, I think it would

       6      protect tenants.

       7             But something that allows for, what you just

       8      mentioned as a hypothetical, I think really would

       9      just codify gentrification.

      10             I don't think that's -- that's -- I don't

      11      think that's something that, really, any of us here

      12      support.

      13             SENATOR KAVANAGH:  Okay.

      14             Well, we appreciate your testimony today.

      15             And I also do want to say that, you know, we

      16      have tremendous respect for Legal Aid.  And when

      17      we -- we have very tough housing cases, when we can

      18      get somebody at Legal Aid to take on the case, it's

      19      a huge benefit for our constituents and for us.

      20             And so we have great appreciation for the

      21      work your attorneys do.

      22             And, to Demos, as I mentioned earlier, I had

      23      the great privilege of working there in 2004 when it

      24      was a bit more of a rag-tag, relatively new

      25      organization.







                                                                   302
       1             But it has really become an institution that,

       2      nationally -- here in New York, and nationally,

       3      really is carrying a lot of tremendously important

       4      issues that bring about economic and racial justice.

       5             So thank you for the context you've provided

       6      today.

       7             And thank you both for testifying.

       8             NAKEEB SIDDIQUE:  Thank you.

       9                [Applause.]

      10             SENATOR KAVANAGH:  Okay, next up, I had --

      11      I had mentioned -- sorry, there were two folks that

      12      were supposed to be part of this panel, and

      13      I mentioned them before, but didn't call them up.

      14             So with great respect to the -- and then

      15      we -- we have many -- we'll have many loft tenants,

      16      but I did -- since I did call them earlier, if

      17      Esther Diaz and Gisela Matza are still here?

      18             They are, okay.

      19             JULIAN GOMEZ:  So, everyone, Senators, it is

      20      going to be in Spanish, but we're translating.

      21             And Gisela had to leave because of family

      22      commitments, but I have her testimony.

      23             SENATOR KAVANAGH:  Thank you.

      24             ESTHER DIAZ:  (Speaking Spanish.)

      25             (Translated to English by a translator.)







                                                                   303
       1             So, good afternoon.

       2             My name is Esther Diaz.

       3             I am a member of Make the Road New York, and

       4      I live in Queens.

       5             I am a tenant of a small house without

       6      regulation, and, therefore, I do not have a

       7      contract, and I cannot demand, with good confidence,

       8      good conditions of availability, safety, and

       9      services.

      10             And it is because of this need of a place to

      11      live that I have to keep quiet, and adapt myself to

      12      what I have for now, until I look for something

      13      better.

      14             (Speaking Spanish.)

      15             (Translated to English by a translator.)

      16             So over 5 million tenants in your state, like

      17      me, do not have any legal protections in terms of

      18      rent increases and stability in their apartments

      19      because there is no right to a contract or a

      20      contract renewal/a lease renewal.

      21             (Speaking Spanish.)

      22             (Translated to English by a translator.)

      23             If the good-cause eviction bill that will be

      24      place, which is what we're asking for today,

      25      millions of tenants like me would have a contract







                                                                   304
       1      that would provide security, and we could also plan

       2      for future increases, and not be worried about

       3      exorbitant increases that will eventually lead to

       4      eviction.

       5             (Speaking Spanish.)

       6             (Translated to English by a translator.)

       7             Planned increases a reasonable rates will

       8      relieve the stress of not knowing what increase will

       9      gonna hit us and how much will be.

      10             (Speaking Spanish.)

      11             (Translated to English by a translator.)

      12             So if we had this -- the good-cause eviction

      13      law in place, I will feel comfortable to face my

      14      landlord and demand better conditions,

      15      saftiness (sic) (ph.), and services without any fear

      16      of being evicted.

      17             (Speaking Spanish.)

      18             (Translated to English by a translator.)

      19             It is so frustrating to know that, for a very

      20      long time, we have a rent-control -- a

      21      rent-stabilized system in the state, but that that

      22      system doesn't apply for all the tenants.

      23             Now, it's very difficult to find houses --

      24      rent-stabilized houses or apartments unprotected by

      25      law, as neighborhoods are getting gentrified.







                                                                   305
       1             (Speaking Spanish.)

       2             (Translated to English by a translator.)

       3             Dear Senators, this is a great opportunity to

       4      represent your constituencies and protect millions

       5      of families, passing the good-cause eviction.

       6             This will also help to address the fact that,

       7      every day, 100 families are evicted from their

       8      homes.

       9             (Speaking Spanish.)

      10             (Translated to English by a translator.)

      11             So this opportunity that we have to

      12      (indiscernible).

      13             She is saying, thank you, all, for open this

      14      hearing.

      15             And -- yeah, I think that will be -- that

      16      will be -- yeah.

      17             SENATOR KAVANAGH:  Thank you.

      18             Any questions?

      19             Thank you so much for your testimony.

      20                [Applause.]

      21             SENATOR KAVANAGH:  Okay.  Next up we're going

      22      have a panel of --

      23             JULIAN GOMEZ:  Hold on.

      24             Yeah, so I have Gisela testimony, and --

      25             SENATOR KAVANAGH:  Oh, (indiscernible) --







                                                                   306
       1      I misunderstood.

       2             Okay, so you want to also --

       3             JULIAN GOMEZ:  Yeah.

       4             SENATOR KAVANAGH:  -- you're going to read

       5      that.

       6             I got it.

       7             JULIAN GOMEZ:  And my name is Julian Gomez.

       8             I work at Make the Road as a tenant

       9      organizer.  We are located in Bushwick.

      10             I want to thank Senator Julia Salazar for

      11      just bringing the good-cause eviction bill.

      12             So Gisela Matza testimony, it's pretty

      13      straightforward.

      14             Her name is Gisela Matza.

      15             She lives in Bushwick, 1132 Jefferson Avenue.

      16             She is an unregulated tenant, a

      17      three-building -- three-units building, with her

      18      husband and her children.

      19             She's been there a tenant for five years, and

      20      has spent those years suffering negligence and

      21      harassment from the landlord.

      22             Repeatedly they have called -- they have had

      23      bad conditions and lack of repairs in their

      24      apartment: leaks, holes, plaster and paint that

      25      peels off the walls and ceiling.







                                                                   307
       1             In order to get some minor repairs made, they

       2      had to repeatedly call 311 to file complaints.

       3             Even though they have been good tenants, who

       4      have always paid rent on time, they received a

       5      30-day notice of eviction.

       6             (Holding up paper.)

       7             This is the 30-day notice that they received,

       8      just for being good tenants.

       9             "And the landlord states, that he needs the

      10      apartment vacated for a family member, but I know my

      11      landlord is targeting me because I have demanded

      12      repairs."

      13             And Gisela also told me, we were chatting,

      14      that she thinks that he wants to kick them out

      15      because he want to renovate the apartments because

      16      of what he's done with the other two units already,

      17      just to, you know, rent it out for a higher price,

      18      and -- yeah.

      19             "My vacate order is set for June 30th, but

      20      have I nowhere to go with my family.

      21             "I am going to look for our new apartment,

      22      but it will be impossible to find something

      23      affordable.

      24             "I don't want to end up in a shelter, but

      25      I fear that I might.







                                                                   308
       1             "If we had real tenant protections, like the

       2      good-cause eviction bill, tenants like me will have

       3      protection against bad-actor landlords who neglect

       4      their tenants.

       5             "With protections, more tenants could face

       6      their landlords to demand safe and dignified homes

       7      without the fear of not getting a lease renewal.

       8             "Calling 311 for lack of repairs shouldn't be

       9      the reason my landlord tries to evict, but it is.

      10             "The situation that I'm living is lived by

      11      millions of tenants in the state of New York.

      12             "Without real protection, we will continue to

      13      grow the homeless crisis we face in our state.

      14             "As legislators, you must decide, which side

      15      are you on?

      16             "As tenants, we need stronger and fair and

      17      better rental rules that protect all renters.

      18             "As the representatives with a

      19      (indiscernible) majority in both Houses, you have

      20      the power to give us just that.

      21             "Remember, the majority of New Yorkers,

      22      millions of us, are renters, not owners.

      23             "Maybe before my family eviction you will

      24      act.

      25             "Tenants need your help.







                                                                   309
       1             "We need good-cause eviction legislation now.

       2             "Thank you."

       3             OFF-CAMERA SPEAKER:  What are you all here

       4      for?

       5                [Applause.]

       6             SENATOR KAVANAGH:  Thank you.

       7             OFF-CAMERA SPEAKER:  Okay, that's what I want

       8      to know, what are you all here for?

       9                [Applause.]

      10             SENATOR KAVANAGH:  Thank you very much.

      11             Questions?

      12             Okay, thank you again.

      13             JULIAN GOMEZ:  Thank you.

      14             SENATOR KAVANAGH:  Okay, next -- next up

      15      we're going have, from New York City Lost Tenants,

      16      Christine Malden (ph.), and, forgive me,

      17      Ximena Garnica, and Allison Dell.

      18             I think we'll do it in groups of three, so,

      19      we'll start there.

      20             And let me just thank you all for being here,

      21      and for your patience, and for the patience of

      22      everybody else who's been here for much of the day;

      23      we appreciate it.

      24             XIMENA GARNICA:  (Speaking Spanish.)

      25             Good evening, members of the Senate, and,







                                                                   310
       1      fellow tenants, good evening.

       2             Thank you for the opportunity to share my

       3      testimony with you all.

       4             My name is Ximena Garnica.

       5             I am a multi-disciplinary artist.  I am a

       6      Colombian immigrant.

       7             I am an unprotected live-work tenant.  I am

       8      at risk of eviction, I am at risk of losing my job,

       9      and my home.

      10             I am not a trust-fund Latino artist.

      11             I came here at age 17 by myself to pursue my

      12      passion because I believe in the power of art to

      13      spark curiosity and to question our world and

      14      society.

      15             I am here today to stand in solidarity with

      16      all tenants of New York State seeking protection.

      17             Loft tenants urge the Senate to pass all nine

      18      bills, plus one more bill, S3655B, the loft

      19      (indiscernible) bill, which has full support from

      20      the city, has been a sponsor and negotiated by

      21      Senator Salazar and Assembly Member Glick, and which

      22      will create rent-regulated units and protect

      23      live-work tenants like me from eviction.

      24             My partner, who is here, Shige, moved to our

      25      live-work space in Williamsburg in 1996, 23 years







                                                                   311
       1      ago.  I have been there 15 years.

       2             We are part of a handful of buildings of

       3      artists that have survived New York City cultural

       4      displacement.

       5             Those few buildings with artists that still

       6      exist in our neighborhood are covered by the loft

       7      law, or, are impending litigation because they were

       8      able to (indiscernible) to reconsidered it for

       9      coverage.

      10             Many others didn't know about the loft law

      11      and never applied, and many were ineligible to

      12      register their units due to loopholes added to the

      13      loft law in 2010 by Bloomberg.

      14             Those less lucky were eventually kicked out;

      15      not only kicked out, but replaced by corporate

      16      tenants, luxury office, and luxury housings.

      17             Those who were able to be covered by the loft

      18      law is still in the neighborhood and are now

      19      rent-regulated.

      20             I am personally affected by the Bloomberg

      21      exclusions that were inserted into the law in 2010.

      22             Shige, can you just pass them this photo,

      23      please?

      24                (Audience member hands photograph to dias

      25        members.)







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       1             XIMENA GARNICA:  One of them is the

       2      requirement, that in order to be eligible to apply

       3      for coverage, the unit must have a window that opens

       4      to a street or a legal courtyard.

       5             In my case, I have a window, not just one,

       6      but three windows.

       7             But since landlord lawyers are very

       8      resourceful and extremely litigious, they argued

       9      that my windows are interior windows, opening to a

      10      few inches of space in between a non-existent

      11      roll-up gate, and used to be there, and the windows.

      12             But as you see, I am on the ground floor.

      13             I have a door.

      14             I can poke my head out of those windows that

      15      you see in the picture.

      16             And, in addition, I have several skylights

      17      and back egress.

      18             But, for five years I have been fighting to

      19      be allowed coverage under the loft law.

      20             The loft law is a remedial law that give

      21      landlords an amnesty to legalize their buildings

      22      that they were illegally rented to live-work

      23      tenants, and give tenants like me the opportunity to

      24      come out of the shadows and contribute to the

      25      legalization process.







                                                                   313
       1             Even if I didn't have a window, but in my

       2      unit has the condition to style one, or to comply

       3      with light-and-air code requirements through various

       4      means, then I should be granted coverage, and

       5      I should be allowed to start the legalization

       6      process that, at the end will, bring my unit up to

       7      code and to rent regulation.

       8             Also, it is important to note that all the

       9      legalization costs are split between tenants and

      10      landlords.

      11             However, some landlords like mine, who, in my

      12      case, had a live-work tenant for 23 years, opt not

      13      to register the building, and engaging in

      14      long-lasting legal battles with burden on tenants to

      15      effectuate the law.

      16             In my case, I believe my landlord is a

      17      small-medium landlord.  He died three years ago, and

      18      his wife took over and refused to register the

      19      building.

      20             She hired one of the most litigious law firms

      21      in the city that specializes in emptying buildings

      22      and getting rid of loft tenants.

      23             This firm has been milking my landlord

      24      packet, and had been successfully feeding absurd

      25      arguments in court, such as the one of my invisible







                                                                   314
       1      windows.

       2             They also advised my landlord not to cash my

       3      checks so they could take us to court and start an

       4      eviction case.

       5             They have been able to do that -- they

       6      haven't been able to evict me because I'm pending

       7      loft-law litigation, but, guess what?  The same

       8      legal firms and architects that are now milking my

       9      landlord to keep us all in endless litigation, using

      10      the 2010 Bloomberg exclusions, wait for the right

      11      time to bring a solution to these landlords:

      12      a buyer.

      13             Two weeks ago my landlord told me, that after

      14      five years of paying fees, she fired her lawyer and

      15      architect because, not only once, but threes times,

      16      they had brought her developers with offers to buy

      17      her building.

      18             Mine, I live one block from the luxury Domino

      19      development, and many greedy developers are hunting

      20      for any crumbs left in our neighborhood so they can

      21      develop and rent to high-pay tenants.

      22             So, these legal loopholes attract these legal

      23      firms who are organizing landlords coalition, and

      24      using the small landlords as poster childs, milking

      25      them to the point so they can accept to sell their







                                                                   315
       1      buildings to luxury developers, larger corporations,

       2      and multinationals.

       3             The same landlord-lawyers organizers are also

       4      hiring lobbyists and consultants to go to Albany,

       5      and to feed you all with misinformation regarding

       6      the process of the loft law, blaming the City and

       7      using the Bloomberg exclusions to keep us all in

       8      limbo and in long litigations while our buildings

       9      remain without a certificate of occupation, without

      10      protection, and without City oversight.

      11             I urge you to allow all loft tenants who are

      12      suffering from the 2010 Bloomberg exclusions, such

      13      as incompatible uses, basement and window

      14      exclusions, which did not existed almost 30 years

      15      prior to 2010, to pursue the opportunity to register

      16      their buildings and enter into remedial legalization

      17      process which restore the initial intents of the

      18      loft law, and has full oversights from the City and

      19      its agencies.

      20             And the only way do this is to pass S3655B.

      21             I have been in Albany for three legislative

      22      sessions for the past three years, but, as you all

      23      know, the Senate was Republican-controlled.

      24             And although loft (indiscernible) bill passed

      25      the Assembly each session, our bill was killed and







                                                                   316
       1      it's never reached the Senate floor.

       2             During this year we have lost hundreds of

       3      loft tenants who couldn't hold any longer for the

       4      loft (indiscernible) bill to pass.  Mark here behind

       5      me.

       6             I myself don't know how long more I can hold.

       7             I had to limit and stop many of the community

       8      programs that I once hosted in my live-work space

       9      through my non-profit organization.

      10             I have spent all my income in legal fees.

      11             I came out of the shadows because I thought

      12      I had a chance to live and work without fear, to

      13      keep employing dancers and artists, and to keep

      14      contributing to our communities.

      15             Some landlords complaints regarding

      16      legalization timelines, but they forget they have

      17      been renting their buildings illegally, in my case

      18      for 23 years.  And now they're being held

      19      accountable to comply with the process.

      20             However, we must hold the City accountable so

      21      that all these agencies understand the loft law, so

      22      that good landlords who are actually trying to

      23      legalize their buildings can do so.

      24             But the first step is to pass S3655B.

      25             Without that, displacements of artists out of







                                                                   317
       1      New York will continue.

       2             Live-work tenants will continue to live in

       3      the shadows and landlords will continue to rent

       4      illegally.

       5             Thank you all, Senators, that have supported

       6      us so far.

       7                [Applause.]

       8             SENATOR KAVANAGH:  Thank you.

       9             I'm going to --

      10             XIMENA GARNICA:  The Assembly bill negotiated

      11      between Senator Salazar and Assembly Member Glick

      12      passed the Assembly House yesterday.

      13             Now, I ask, again, on behalf of hundreds of

      14      loft tenants, Senator Kavanagh, as the Chair of the

      15      Housing Committee, to stand behind Senator Salazar

      16      to advance the bill, 3655B --

      17                (Indiscernible cross-talking.)

      18             SENATOR KAVANAGH:  -- okay, we're well over

      19      time, and we're going to hear from many --

      20             XIMENA GARNICA:  -- and to put up for votes

      21      next week so that we can be safe for evictions, and

      22      so that we can be safe from unscrupulous

      23      litigations.

      24                (Indiscernible cross-talking continues.)

      25             SENATOR KAVANAGH:  And, again, I have --







                                                                   318
       1      I have 40 -- I have 40 people --

       2             XIMENA GARNICA:  Here are 300

       3      (indiscernible) --

       4             SENATOR KAVANAGH:  -- I have --

       5      I appreciate --

       6             XIMENA GARNICA:  -- for 300 members of our

       7      community that ask you to do so.

       8             SENATOR KAVANAGH:  -- I have 40 people who --

       9             XIMENA GARNICA:  And I also would like to ask

      10      Senator --

      11                (Indiscernible cross-talking continues.)

      12             SENATOR KAVANAGH:  -- who have been waiting

      13      hours to testify.

      14             I'm going to ask to get the next the --

      15             XIMENA GARNICA:  Thank you.

      16             And I ask --

      17             SENATOR KAVANAGH:  I'm going to ask the next

      18      person to speak.

      19             XIMENA GARNICA:  Thank you so much, but

      20      I want to just say (indiscernible) --

      21                (Indiscernible cross-talking continues.)

      22             SENATOR KAVANAGH:  I have one hour left and

      23      40 people who have signed up speak, and I am going

      24      to ask you to respect --

      25             XIMENA GARNICA:  -- and universal rent







                                                                   319
       1      control.

       2             Gracias.

       3             SENATOR KAVANAGH:  -- the rules that

       4      everybody has been respecting for many hours.

       5             Thank you.

       6             Can we have the next testimony.

       7             CHRISTINE MALDEN (ph.):  Okay.

       8             Hi, everybody.

       9             My name is Christine, and I'm a loft tenant.

      10             10 years ago I answered a Craigslist ad for a

      11      live-work space, advertised for $1 a square foot.

      12             SENATOR KAVANAGH:  Can you say your full name

      13      for the record?

      14             CHRISTINE MALDEN (ph.):  Pardon me.

      15             Christine Malden.

      16             SENATOR KAVANAGH:  Thank you.

      17             CHRISTINE MALDEN (ph.):  10 years ago

      18      I answered a Craigslist ad for a live-work space,

      19      advertised for $1 a square foot.

      20             When I got there, I understood why.

      21             The space I visited had broken windows,

      22      pigeons flying in them; no plumbing, no electric, no

      23      walls.  The facade flooded every time it rained, it

      24      still does.

      25             But for me it was love at first sight.







                                                                   320
       1             I couldn't afford a normal apartment, and as

       2      a self-employed artist and designer, I needed a

       3      place to work where no one would complain if the

       4      floors got dirty.

       5             I had never heard of the loft law, I knew

       6      nothing about zoning.

       7             As a layperson, why would I?

       8             All I knew was, that I answered an ad for

       9      housing and saw apartments across the street and all

      10      around me.

      11             My building was the exception, not the rule.

      12             When I first moved in, the building was

      13      empty, which was scary and pretty intimidating.

      14             There were a few tenants like me and a

      15      manufacturing business on the ground floor.

      16             The people who worked there were kind,

      17      welcoming, and protective.  I was grateful for them

      18      and their presence.

      19             I continued to build up my space, making it

      20      into a home, one which an architect recently told me

      21      is closer to being up to code than many of the new

      22      buildings he inspects.

      23             I also took care of the rest of the building

      24      too because there were no amenities; mopping

      25      hallways, replacing light bulbs, shoveling snow in







                                                                   321
       1      winter so that I could clear the drift that

       2      prevented me from opening my front door.  Even

       3      snaking my neighbor's toilets.

       4             In one year my rent was raised 18 percent.

       5             The same year, the manufacturer that worked

       6      on the ground floor was replaced by a fancy

       7      co-working facility.

       8             Almost overnight my building was transformed,

       9      from a few dozen friendly and familiar faces, to a

      10      couple of hundred new and unfamiliar ones, but these

      11      tenants were different.

      12             They were paying a premium for a tiny desk

      13      space, beer on tap, and 24-hour access, and, by God,

      14      they intended to use it with little regard for the

      15      rest of us.

      16             I felt like a stranger in my own home, and

      17      I thought to myself, if one floor of office space

      18      could destroy our little community, what would

      19      converting the whole building do to this

      20      neighborhood, my neighborhood?

      21             And, yet, this is the likely plan for my

      22      building.

      23             A few years later I was called into the

      24      management office and told my time was up, I had to

      25      leave.







                                                                   322
       1             I reached out to my neighbors.  I called,

       2      I texted, I left notes under their doors, but nobody

       3      answered.

       4             It took me a while to realize they were all

       5      gone.  From a building of 60 tenants, only a handful

       6      remained.

       7             We've been fighting eviction ever since,

       8      living in a state of non-stop, high-alert, waiting

       9      for the final decision to come.

      10             It has been the most expensive, stressful

      11      two years of my life.

      12             I jump when someone knocks at the door or

      13      buzzes, and I don't think I've slept through the

      14      night since.

      15             The building conditions have become difficult

      16      again as in the beginning.

      17             Our movement is restricted, access to basic

      18      services have been cut off, repairs have not made.

      19             My door was broken for weeks and left

      20      flapping in the wind until, recently, before video

      21      cameras were installed everywhere to track my every

      22      movement.

      23             It became the preferred place in the

      24      neighborhood for drug deals and drug consummation to

      25      take place.







                                                                   323
       1             Also, we had no heat or gas for the coldest

       2      days this past winter.

       3             One of my few remaining neighbors finally

       4      gave up.  She was pregnant and couldn't cope.

       5             When they asked us to leave, we said, No.

       6      You brought us here.  We paid our rent.  There is

       7      our home now.

       8             But you don't say no if you're pregnant;

       9             You don't say no if you have small children;

      10             You can't say no if you're living paycheck to

      11      paycheck;

      12             And you won't say no if you're worried about

      13      immigration status.

      14             All of these are examples of tenants who were

      15      forced to leave my building.

      16             Without protection, you just say, yes, okay.

      17             I have watched an entire building of my most

      18      vulnerable friends and neighbors picked off one by

      19      one.

      20             I'm supposed to be the strong one.

      21             Now there's just a few of us who remain,

      22      living day to day, waiting for the Court's final

      23      decision.

      24             It can, and will, come any day now.

      25             The only thing that can save us is the







                                                                   324
       1      immediate passage of Senator Salazar's bill

       2      protecting loft tenants.

       3             Senator Kavanagh, you've called us stubborn,

       4      and, yes, I guarantee, that if a marshal comes

       5      before this decision on the bill comes, my fellow

       6      tenants will stand stubbornly before my front door,

       7      preventing them access so that they cannot execute

       8      this eviction.

       9             We lost enough people this year because of

      10      the delay.

      11             We lost people last year too, and the year

      12      before that, and the year before that.

      13             Enough.

      14             Last year was unconscionable, but

      15      understandable, given the political climate.

      16             This year there is no excuse.

      17             It is within your power to stop the bleeding.

      18             To Senator Salazar, thank you for your

      19      support and for fighting for us, and for all

      20      tenants.

      21             To Senator Kavanagh, respectfully, please do

      22      not stall this bill any longer.

      23             I and others will be the collateral damage.

      24             It's finally time to pass this bill we've

      25      been fighting for for three years, not in June, not







                                                                   325
       1      the last day of session -- today, now.

       2             Thank you.

       3                [Applause.]

       4             SENATOR KAVANAGH:  Thank you.

       5             Third on this panel.

       6             ALLISON DELL:  Hi.

       7             My name is Allison Dell.

       8             I'm a loft tenant at 475 Kent Avenue on the

       9      south side of Williamsburg.

      10             I want to thank you for the opportunity to

      11      speak today, for organizing the hearing.

      12             So many people I see today were here in

      13      Albany yesterday.

      14             Nobody becomes a housing advocate by choice.

      15             Everybody is here because they need to be

      16      here, they're fighting for their homes.

      17             And, I'm going to tell you guys my story,

      18      part of it's a familiar story.

      19             I'm a rent-regulated tenant.

      20             A new building owner, a multinational

      21      conglomerate, with no connection to the

      22      neighborhood, bought our building about a year ago

      23      for 5 1/2 times the value, using the calculator

      24      that's been given today.

      25             Since then, there's been non-stop







                                                                   326
       1      construction and dust, uncontained asbestos

       2      abatement.

       3             Most recently, they have removed the enclosed

       4      gas lines that were in the hallway, and then claimed

       5      that the lack of enclosure constituted an unsafe

       6      system.

       7             Many people in this room know the feeling of

       8      coming home and not knowing if you will find a

       9      notice of termination of lease on your door.

      10             Our previous landlord, if people did not

      11      register under the 2010 loft law, registered the

      12      units, our building of more than 104 units is now

      13      more than half empty.

      14             That is 50 rent-regulated units that are

      15      gone.

      16             So, we have also heard our landlord's

      17      attorneys say at a city meeting, "I empty buildings

      18      for a living."

      19             That means, that for every rent-regulated

      20      tenant here who is struggling, that their landlord

      21      has this staff, people whose job it is, to make sure

      22      they're displaced from their homes.

      23             We are struggling as hard as we can to make

      24      our rent every month.

      25             You know, we have jobs.  And, now, fighting







                                                                   327
       1      for our homes is part of that job.

       2             Coming home and finding a notice of

       3      termination of lease on your door, if you're not a

       4      protected tenant, that means you're choosing between

       5      fighting a lengthy and expensive legal battle, which

       6      you might lose; become on the tenants' blacklist; or

       7      just leave.

       8             I am one of the lucky ones because I am

       9      protected under the loft law.

      10             This is why I'm speaking up today.

      11             It's actually hard for me to speak up for

      12      myself, but I'm here to speak up for the people who

      13      are not protected.

      14             We know that rent regulation is broken, and

      15      we need to pass all nine bills, but not having

      16      protection is worse.

      17             For this reason, Senator Salazar,

      18      Senator Kavanagh, thank you for pushing forward with

      19      S3665.

      20             So pass all nine bills, plus loft law.

      21                [Applause.]

      22             ALLISON DELL:  Since 1998 I have called

      23      475 Kent Avenue, my live-work space there, my home

      24      and my workspace.

      25             I moved there to take a job at the Brooklyn







                                                                   328
       1      Children's Museum.

       2             And, biking here today down Franklin, which

       3      was the bike route I took in 1998 every day to get

       4      to the job, I can see that gentrification and

       5      displacement are undeniable, and something that we

       6      need to fight with more affordable housing, not less

       7      affordable housing.

       8             I spend most of my volunteer efforts and

       9      energies on local environmental outreach, science

      10      outreach, and education.

      11             I worked with La (indiscernible), La Fuentes,

      12      to fight the rezoning along the waterfront in 2005,

      13      to work on power-plant sightings.  I worked as the

      14      PD delegate to bring the Brooklyn Story Voyager,

      15      which is a literacy program.

      16             And I'm very proud of being in my community.

      17             But if I lose my home that I can afford to

      18      pay for, I will not be able to remain in New York

      19      City.

      20             My husband is an artist who uses our space

      21      full-time as a studio, and we had our business

      22      there, fine-art print-making business, in 2008.

      23             There was a brief vacate of 475 Kent for

      24      three months, and we lost our home and our business

      25      at the same time; both home and job gone in one day.







                                                                   329
       1             We were not able to fill contracts because we

       2      could not access the manufacturing space that we

       3      needed to do that.

       4             And if the loft law had been enacted in 2008,

       5      our business would still be on the south side.

       6             But, we were recently -- we were forced to

       7      relocate our print shop to Long Island City.

       8             And we understand and embrace the need for

       9      affordable manufacturing and commercial spaces, as

      10      we share our space with a manufacturer -- furniture

      11      manufacturer that has been there for four decades.

      12      40 years.

      13             And the landlord for that commercial space is

      14      not renewing the lease for the furniture space, and

      15      the rent is going up and up and up.

      16             And, if you're a small-business owner, you

      17      are running the numbers:  The cost of moving.  The

      18      deposit of a new place.  The cost of missed

      19      contracts during the move.

      20             And, this new landlord is looking at

      21      converting the space to WeWork.

      22             Quite honestly, I don't know what we'll do if

      23      we can't afford to keep it anymore.

      24             And, so, I just want to push back on the

      25      equivalence of loft tenants and the destruction of







                                                                   330
       1      manufacturing, since I have seen so many loft

       2      tenants lose their homes when landlords talk about

       3      industry.

       4             And then, as soon as the buildings are

       5      emptied, they get flipped to another owner and just,

       6      immediately, developed as luxury.

       7             So, since this new developer purchased our

       8      place last year, it has been nearly emptied, using

       9      all the same leverage points that displaced so many

      10      of New York affordable-housing communities.

      11             And the only reason that the building is not

      12      luxury right now, the only building -- the only

      13      reason it's not fully empty, is because of the loft

      14      law.

      15             The only reason I can still live and work in

      16      Brooklyn is because of the tenant protections

      17      I receive through the loft law.

      18             And so --

      19             SENATOR KAVANAGH:  Okay, I'm going to ask you

      20      to wrap up, just because --

      21             CHRISTINE MALDEN (ph.):  I would like to say

      22      thank you.

      23             The Bloomberg exclusions -- passing the loft

      24      law as it is now, and removing the Bloomberg

      25      exclusions, would remove a barrier that pits tenants







                                                                   331
       1      and industry against each other.

       2             And I thank you for listening.

       3             I will submit my testimony.

       4             And then, also, I would be happy to talk to

       5      you guys with questions and (indiscernible).

       6             SENATOR KAVANAGH:  Okay, and we appreciate

       7      the testimony.

       8             And we note that there are many other loft

       9      tenants who signed up -- who arrived at the

      10      beginning and signed up.

      11             We are going to -- we will get back to

      12      additional panels on this topic, and -- but I'm

      13      going to hold questions and comments until we've

      14      heard from a few more of the loft tenants, if that's

      15      okay, at least my own.

      16             But, obviously, if my panel mates want to?

      17             SENATOR SALAZAR:  No, that's fine.

      18             SENATOR KAVANAGH:  Okay.

      19             So we'll -- thank you all for your testimony.

      20             CHRISTINE MALDEN (ph.):  Thank you.

      21             ALLISON DELL:  Thank you.

      22                [Applause.]

      23             SENATOR KAVANAGH:  Next up, is

      24      Anthony Drummond here?

      25             In the back.







                                                                   332
       1             Come on down.

       2             And then after -- next up after that, we're

       3      going to have Laura Mascuch.

       4             ANTHONY DRUMMOND:  Thank you very much.

       5             Senator, my name is Anthony Drummond.

       6             I am Brooklyn Borough President Eric Adams'

       7      housing policy analyst.

       8             In addition, I co-chair the Mitchell-Lama

       9      Task Force on his behalf.

      10             So I'll be reading the prepared remarks on

      11      his behalf, so I'll begin.

      12             "My name is Eric L. Adams, and I am Brooklyn

      13      borough president -- and I am Brooklyn's borough

      14      president, representing more than 2.6 million

      15      residents who call this borough "home."

      16             "I would like to thank State

      17      Senator Brian Kavanagh, Chair of the Standing

      18      Committee on Housing, Construction, and Community

      19      Development, for holding this hearing on rent

      20      regulations and tenant protection in Brooklyn, the

      21      epicenter of an affordable-housing crisis that

      22      threatens our families' future.

      23             "Also -- I also thank State

      24      Senator Zellnor Myrie for hosting us here in his

      25      district at Medgar Evers College.







                                                                   333
       1             "The provision and protection of affordable

       2      housing continues to be the most important issue

       3      facing New Yorkers all across the city and within

       4      the borough of Brooklyn.

       5             "Brooklyn is one of the fastest-growing

       6      communities in the New York City metropolitan area,

       7      and the ongoing Brooklyn renaissance has ushered in

       8      extraordinary changes and land-use pressures that

       9      continue to manifest today.

      10             "Unfortunately, Brooklyn's success has led to

      11      the displacements of longtime residents who can no

      12      longer afford to live in the neighborhoods where

      13      they grew up or raised families.

      14             "According to a recent Kiplinger study,

      15      Brooklyn has the fourth most-expensive cost of

      16      living in the nation, at 82 percent above the

      17      average cost.

      18             "Our borough is home to neighborhoods

      19      experiencing the highest rates of rent increases

      20      over the last decade, and every community is now

      21      considered desirable.

      22             "We have a crisis of affordability at a wide

      23      range of levels, from extremely low, to middle

      24      income, and we have a responsibility to solve the

      25      crisis for every level.







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       1             "As borough president, I have committed

       2      myself to addressing the borough's

       3      affordable-housing crisis, due to creation and

       4      preservation of much-needed affordable-housing units

       5      for low- to middle-income Brooklynites.

       6             "To date, I have allocated more than

       7      $20 million in capital funding to preserve or build

       8      thousands of units since 2014.

       9             "In addition, I launched the Faith-Based

      10      Development Initiative which connects houses of

      11      worship with capital funding and technical support

      12      that is used to help construct affordable housing.

      13             "This policy initiative has been replicated,

      14      even by Mayor Bill de Blasio, across our city.

      15             "It is imperative that we maintain and

      16      strengthen our rent-regulation laws so we do not

      17      lose the millions of existing affordable-housing

      18      units, which would further extend the loss of

      19      families being displaced.

      20             "Advance in legislation and policies being

      21      heard today are integral in ensuring that families

      22      can remain in their affordable housing, and also

      23      make certain that more affordable housing is added

      24      to our growing city.

      25             "There are a number of worthy policies that







                                                                   335
       1      are currently up for discussion in our public

       2      discourse, and I would like to speak on a few of

       3      them in this testimony.

       4             "For example, I have been supportive of the

       5      House Our Future NY campaign's recommendation to

       6      build 24,000 new apartments, and preserve at least

       7      6,000 more, for homeless families and individuals.

       8             "We need to fully fund and create

       9      20,000 units of supportive housing, and, by doing

      10      so, help break the cycle of homelessness, by pairing

      11      permanent housing with on-site services for people

      12      with a history of substance abuse and/or who have

      13      mental and physical health needs.

      14             "We cannot turn our backs on our most

      15      vulnerable citizens just because they may be down on

      16      their luck.

      17             "I fully support the home stability support

      18      (HSS) legislation, which will provide a new

      19      statewide rent supplement for low-income families

      20      and individuals who are facing eviction,

      21      homelessness, or loss of housing due to domestic

      22      violence or hazardous conditions.

      23             "Our homelessness crisis did not appear

      24      overnight, and it will not disappear without an

      25      all-in innovative strategy that introduces stability







                                                                   336
       1      into a highly-unstable situation for hundreds of

       2      thousands of New York's childrens and families.

       3             "One of our strongest tools for preventing

       4      homelessness is to make sure that people and

       5      families are able to stay in their homes.

       6             "HSS will help accomplish this by simplifying

       7      our opaque subsidy structure, to ensure those in

       8      greatest needs have the easiest path to safe and

       9      secure affordable housing.

      10             "I fully support legislation to end

      11      vacant" -- "vacancy decontrol, which allows

      12      landlords to permanently deregulate apartments once

      13      the rent reaches $2,733 a month and the current

      14      occupant leaves the unit.

      15             "We have lost far too many units of

      16      affordable housing because of this legal loophole.

      17             "In addition, let's repeal preferential rents

      18      and align rents to New York City's Rent Skyline's

      19      Board policies.

      20             "Some 266,000 families in New York City have

      21      preferential rent, meaning, that they may be one

      22      lease away from eviction if preferential rent is

      23      revoked.

      24             "We need to do away with this policy, as this

      25      is a quick way to force longtime tenants out of







                                                                   337
       1      their homes.

       2             "I also support, and ask the state

       3      Legislature, to pass good-cause eviction legislation

       4      in order to bring renter rights to tenants in

       5      smaller buildings and in manufactured-home

       6      communities.

       7             "Additionally, we should reform the four-year

       8      look-back rule for investigating rent-overcharge

       9      complaints, by changing the look-back period to

      10      six years, and providing exceptions to the rule, so

      11      that tenants can hold landlords accountable to

      12      following the rent-regulation law.

      13             "There is much more for us to do together.

      14             "In addition to the measures I just

      15      referenced, I ask this Committee to continue to

      16      examine how we can encumber rent-burdened households

      17      in the lottery process.

      18             "There are too many New Yorkers who are

      19      paying higher rent than what they would pay if they

      20      were awarded units through the lottery process, yet

      21      tens of thousands of potential applicants are

      22      disqualified because they do not earn enough income

      23      to apply.

      24             "This challenge obstructs our ability to

      25      reduce rent burden.







                                                                   338
       1             "It also" -- "it is also long overdue that

       2      the state Legislature repeals the Urstadt Law.

       3             "New York City should have control of its own

       4      rent-regulated housing stock.

       5             "Finally, perhaps most importantly, I urge my

       6      colleagues in Albany to work with my administration

       7      and housing-right advocates to get the State's full

       8      cooperation and collaboration on a realtime,

       9      transparency, tracking mechanism of our

      10      rent-regulated housing stock.

      11             "You cannot begin to combat a crisis without

      12      fully visualizing its magnitude and analyzing the

      13      various factors that help or hinder.

      14             "Our housing regulatory apparatus is

      15      disjointed and passive in combating this crisis.

      16             "There is limited interagency collaboration,

      17      minimal proactive intervention, and outdated

      18      technology infrastructure to keep track of it all.

      19             "For years I have been advocating for a

      20      CompStat for affordable housing, what I have termed

      21      "housing stat," that could visualize, in realtime,

      22      all the available data impacting the potential for

      23      eviction and vacancies, which could then guide

      24      investigators and lawyers and triage in buildings at

      25      risk.







                                                                   339
       1             "We need to be able to highlight at-risk

       2      affordable units in bright red, if necessary, and do

       3      whatever we can to save them.

       4             "We have received support from the New York

       5      City Department of Housing, Preservation, and

       6      Development (HPD), and our New York State Unified

       7      Court System, but, the New York State Department of

       8      Housing and Community Renewal (DHCR) continues to be

       9      a roadblock in our efforts.

      10             "I want to thank the Chair and members of

      11      this Committee for hosting this hearing in Brooklyn,

      12      and allowing me to address you on this important

      13      issue.

      14             "I know this year has been an active and busy

      15      one for the body.

      16             "It is my hope that these actions make it

      17      through this legislative session.

      18             "Thank you for your time."

      19             SENATOR KAVANAGH:  Thank you for your

      20      testimony --

      21             ANTHONY DRUMMOND:  Thank you.

      22             SENATOR KAVANAGH:  -- and thank you to the

      23      borough president.

      24             ANTHONY DRUMMOND:  All right.  Thank you.

      25             SENATOR KAVANAGH:  Any questions?







                                                                   340
       1             Thank you so much for being here.

       2             ANTHONY DRUMMOND:  Thank you.

       3             SENATOR KAVANAGH:  Next up we're going to

       4      have Laura Mascuch and Jackie Del Valle and

       5      Emily Mock, if they're all still here.

       6             Following that we will have Matthew Berman

       7      and Nancy Sher and Phara Souffrant, if I'm saying

       8      that properly.

       9             LAURA MASCUCH:  Good evening.

      10             My name is Laura Mascuch.

      11             I'm the executive director of the Supportive

      12      Housing Network of New York.

      13             We are a 30-year-old membership organization

      14      of over 200 non-profits that own and operate

      15      52,000 units of supportive housing through New York

      16      State, 32,000 of which are in the city.

      17             And I'm here tonight to talk about

      18      legislation particular to supportive housing.

      19             As you know, supportive housing is permanent

      20      housing with on-site support services to help

      21      individuals and families and youth and veterans that

      22      are experiencing chronic homelessness, return to the

      23      community with on-site support services.

      24             There are two models:

      25             One where, a single site, where services are







                                                                   341
       1      provided on-site;

       2             And then there's a second model called the

       3      "scattered-site model," where non-profits rent

       4      apartments in the community, and the services are

       5      brought into the apartment to help the individual or

       6      family really reintegrate and stabilize.

       7             And I want to thank Senator Kavanagh for

       8      sponsoring and advancing a bill, 03703, this

       9      session, that would provide rent stabilization for

      10      non-profit housing providers for new scattered-site

      11      apartments.

      12             Currently, non-profits lease rent-stabilized

      13      apartments on behalf of vulnerable tenants, and

      14      these scattered-site apartments are temporarily --

      15      temporarily lose their rent-stabilization status.

      16             Landlords are able to charge significantly

      17      higher rents to the non-profits, and are able to

      18      effectively displace tenants through non-renewal of

      19      leases after sometimes as little as one year.

      20             This loophole results in significantly higher

      21      costs to provide housing for the most vulnerable,

      22      and significant trauma to an already fragile tenant

      23      when they need to move apartments on a continuous

      24      basis.

      25             The 14,000 existing scattered-site apartments







                                                                   342
       1      in the city are in grave danger due to unregulated

       2      rent increases and frequent non-renewal of leases,

       3      which are, effectively, evictions of vulnerable

       4      tenants without cause.

       5             Further, these apartments are in danger of

       6      being lost permanently to rent stabilization,

       7      because it is in the landlord's realm for them to go

       8      back and register the apartment once a non-profit is

       9      no longer renting it.

      10             The system for ensuring that that happens, as

      11      you can imagine, is very -- not very robust, and

      12      landlords, really, it's the responsibility of them

      13      to do it.  And once they're incentivized to rent

      14      higher rents, they're not going to really go back

      15      into rent stabilization.

      16             So the best safeguard against this risk would

      17      be to ensure units do not exit rent stabilization in

      18      the first place.

      19             While the current proposed legislation will

      20      ensure future non-profit scatter-site contracts

      21      remain under rent stabilization, we offer two

      22      friendly amendments, which we have attached.

      23             One is, to extend it to existing units upon

      24      lease renewal;

      25             And the second, for it to apply to supportive







                                                                   343
       1      housing scattered-site providers, providing

       2      permanent housing with services to formerly homeless

       3      or vulnerable residents with disabilities.

       4             Thank you for this opportunity to testify.

       5             SENATOR KAVANAGH:  Thank you.

       6                [Applause.]

       7             EMILY MOCK:  Good afternoon -- or, good

       8      evening.

       9             My name is Emily Mock.

      10             I'm a tenant organizer with CAAAV, organizing

      11      Asian communities.

      12             I'm speaking today on behalf of the Chinatown

      13      Tenants Union, which is a member of the Housing

      14      Justice for All Coalition.

      15             CAAAV has been working since 1986 to build

      16      grassroots community power across diverse poor and

      17      working-class Asian immigrant and refugee

      18      communities in New York City.

      19             I'm here today, with many allies, to call for

      20      passage of all nine tenant bills.

      21             Secure housing is an economic issue, a

      22      physical and mental-health issue, a family issue, an

      23      education issue, a language-justice issue, a

      24      racial-equity issue.

      25             As a working-class immigrant community







                                                                   344
       1      limited by language access, Chinatown has faced

       2      tremendous gentrification and displacement.

       3             Tenants in our neighborhood are being

       4      harassed and forced from their homes.

       5             Every day our members face the stress of

       6      landlord harassment, rising rents, unsafe

       7      construction, frivolous lawsuits, and the loss of

       8      our community.

       9             Chinatown Tenants have always fought, and we

      10      always will, because our community, our culture, our

      11      elders, our youth, are being attacked by the drive

      12      for profit.

      13             Your constituents cannot wait another month,

      14      another year, or another election cycle to secure

      15      rights and protections.

      16             The Chinatown Tenants Union works with

      17      tenants to organize associations in their buildings

      18      and partner with legal services to fight bad

      19      landlords.

      20             In Chinatown, it is obvious that forcing out

      21      rent-stabilized tenants is not an unusual

      22      occurrence.  It is, in fact, a well-documented

      23      business practice.

      24             Predatory equity landlords buy

      25      rent-stabilized buildings in our neighborhood and







                                                                   345
       1      strategically make changes to force old tenants to

       2      leave and deregulate units.

       3             Then they make enormous profits by renting

       4      those apartments to young professionals who can

       5      afford rents of 3,000 a month and up.

       6             The REBNY representative, I heard him say

       7      something, like, that all New Yorkers should support

       8      values such as the production of rental units.

       9             The production of rental units, I think you

      10      agree with me, is not a value, but it is something

      11      that REBNY values and landlords value.

      12             The 20 percent vacancy bonus incentivizes

      13      landlords to kick out longtime tenants so that they

      14      can increase the legal rent for rent-stabilized

      15      units.

      16             This past winter, while door-knocking in over

      17      a dozen Chinatown tenements, we visited over -- or,

      18      I'm sorry, in Chinatown tenements, we visited over a

      19      dozen buildings without adequate heat and hot water,

      20      sometimes for as long as 20 months.

      21             In many of these buildings we heard a similar

      22      story.

      23             Landlords were bringing in new tenants,

      24      signing them on to leases, and not telling them that

      25      the building doesn't have heat and hot water.







                                                                   346
       1             So these new tenants who expect functioning

       2      utilities get frustrated in a month, three months,

       3      they move out.

       4             The landlord has another opportunity to

       5      increase the rent by 20 percent.

       6             This is a business practice that we see all

       7      over Chinatown and in many other neighborhoods.

       8             The 20 percent increase, of course, brings

       9      the unit closer and closer to deregulation.

      10             The vacancy decontrol rule incentivizes

      11      landlords to increase rents past the 2,733 cap so

      12      they can make more money at market rate.

      13             I want to talk very specifically about how

      14      MCI rent-increase applications have impacted our

      15      neighborhood.

      16             Motivated by the opportunity to increase

      17      legal rents, landlords conduct unnecessary major

      18      construction, like roofing, facade work,

      19      facial-recognition intercoms, and ignore the basic

      20      repair needs of tenants.  Then the cost of major

      21      construction are directed back at tenants.

      22             A few case studies.

      23             At 135 Eldridge Street, one of our tenant

      24      leaders, Ms. Chen, you heard from her earlier, the

      25      landlord, Ari Cohen & Associates has claimed







                                                                   347
       1      $667,639 in costs for two separate MCI applications.

       2             If approved by DHCR in full, this would mean

       3      a rent increase of approximately $227.92 per

       4      apartment per month.

       5             For context, rent-stabilized tenants in this

       6      building are paying between, approximately, 500 and

       7      1500 dollars a month.

       8             This means the tenants face an increase of

       9      anywhere from 45 to 15 percent of their current

      10      rent.

      11             At 123 Madison Street, the same landlord,

      12      Ari Cohen & Associates, filed four separate MCI

      13      applications.

      14             In total, these applications claimed

      15      $207,425.62 of construction costs, and if approved

      16      in full, would have rent-stabilized rents increased

      17      by $235.85 a month.

      18             In each of these buildings, the process of

      19      opposing MCI applications is very challenging for

      20      tenants to navigate, even with support from lawyers

      21      and organizers.

      22             There is a whole industry built around real

      23      estate, from lawyers, to property management, to

      24      lobbies, that mechanizes landlords' MCI

      25      applications.







                                                                   348
       1             We often say in the Chinatown Tenants Union

       2      that landlords have all kinds of tactics.  They gain

       3      more experience at how to be landlords.

       4             But tenants consistently want safe and secure

       5      housing.

       6             This landlord, Ari Cohen & Associates, owns

       7      94 buildings, and has initiated similar construction

       8      in MCI rent-increase applications in buildings

       9      across the neighborhood.

      10             This demonstrates that MCI rent increases are

      11      a tactic used strategically by predatory equity

      12      landlords.

      13             The MCI program is not being used by small

      14      landlords to maintain old and dilapidated buildings.

      15      It is used by the predatory equity landlords as a

      16      tactic to deregulate rent-stabilized apartments and

      17      increase the profit value of residential buildings.

      18             The real estate lobby parades supposed

      19      mom-and-pop landlords to have you believe that those

      20      who own capital for the sake of profit are

      21      working-class New Yorkers, but that's not true.

      22             The average portfolio size is 21 buildings,

      23      and according to the RPIE statements, 95 percent of

      24      landlords make money from their rent-stabilized

      25      buildings; meanwhile, tenants are rent-burdened to







                                                                   349
       1      an extreme degree.

       2             The MCI rent-increase program is deeply,

       3      structurally flawed and cannot be reformed.

       4             Reform would cause displacement because the

       5      MCI program is fundamentally ripe for abuse.

       6             I want to be very clear that the MCIs

       7      function as an incentive to not maintain buildings.

       8             In Chinatown we know that MCI and IAI

       9      construction is shoddy.

      10             We know that landlords misreport and

      11      exaggerate the cost of these so-called

      12      "improvements."

      13             We know that getting an MCI means many

      14      low-income households who don't qualify for DRIE and

      15      SCRIE are forced out of their homes.

      16             SENATOR KAVANAGH:  Reluctantly, I'm going to

      17      ask you to wrap up.

      18             EMILY MOCK:  Okay.

      19             How do we know that landlords can't afford to

      20      maintain their property if they don't open their

      21      books?

      22             Why aren't small and struggling landlords

      23      using J-15 tax -- -51 tax abatements and HPD's Green

      24      Housing Preservation Program?

      25             By continuing to incentivize MCI rent







                                                                   350
       1      increases, and allow predatory equity landlords to

       2      abuse this loophole, the State is actually

       3      compromising the efficacy of J-51 and JHPP?

       4             SENATOR KAVANAGH:  Again, just in fairness,

       5      I'm going to ask you to (indiscernible).

       6             EMILY MOCK:  Okay.

       7             I'm going to have --

       8             SENATOR KAVANAGH:  You can submit the rest of

       9      your testimony, if you would.

      10             EMILY MOCK:  Okay.

      11             Thank you.

      12             SENATOR KAVANAGH:  Thank you very much.

      13             JACKIIE DEL VALLE:  Can you hear me?

      14             Yes.

      15             Good evening.

      16             My name is Jackie Del Valle, and I work at

      17      the community development project of the Urban

      18      Justice Center as the stabilizing NYC coordinator.

      19             The community development project (CDP) at

      20      the Urban Justice Center was formed in

      21      September 2001 to strengthen the impact of

      22      grassroots organizations in New York City's

      23      low-income and other excluded communities by winning

      24      legal cases, publishing community-driven research

      25      reports, assisting with the formation of new







                                                                   351
       1      community organizations, and providing technical and

       2      transactional assistance in support of their work

       3      towards social justice.

       4             Stabilizing the NYC is a New York City-wide

       5      coalition formed in 2013 to fight the depletion of

       6      affordable housing in New York City at the hand of

       7      predatory landlords.

       8             Alongside CDP, the Stabilizing

       9      (indiscernible) Coalition is made up of

      10      16 community-based organizations and

      11      housing-advocacy organizations.

      12             UHAB, our work combines organizing and legal

      13      resources into a citywide network to help tenants

      14      take their predatory equity landlords to task for

      15      patch-up repairs, bogus eviction cases, unfair

      16      illegal rent increases, and affirmative action.

      17             Many of our members are here now or were here

      18      earlier.

      19             It's been a long day, which -- yeah, was

      20      started out very excitingly at a press conference at

      21      Ebbets Field.  And we marched through the, I guess,

      22      (indiscernible) folks, and are here now.

      23             So I want to say that CDP and Stabilizing

      24      (indiscernible) support the entire universal

      25      rent-control platform.







                                                                   352
       1             New York State's homeless population, I don't

       2      need to tell you, but it's, you know, soaring above

       3      89,000 people.

       4             And our service budget is -- nears

       5      $2 billion.

       6             And we really urge the Senate to pass all

       7      nine bills, and these bills will strengthen tenant

       8      protections, stem sharp rent hikes, and meaningfully

       9      address many of abuses that our clients and partners

      10      face.

      11             Our weak rent laws have been the blood in the

      12      water for big investment for too long.

      13             When private-equity companies began buying up

      14      large portfolios all over the five boroughs in the

      15      mid-2000s, their promotional brochures boasted the

      16      ease in which long-term tenants could get evicted in

      17      order to bring in new tenants, paying two, three,

      18      and four times as much rent.

      19             This uber speculation created a huge housing

      20      bubble, which crashed, and left hundreds of tenants

      21      in foreclosed and deteriorating buildings with no

      22      one taking responsibility for their upkeep.

      23             Steve Croman, Moshe Piller, R.A. Cohen,

      24      Pinnacle, Blackstone, Vantage, Trump.

      25             The New York City real estate industry is







                                                                   353
       1      fueled by hedge fund and private equity, and is led

       2      by very nasty developers and speculators.

       3             Lessons were not learned with the crash of

       4      2008, and foreign and dark money continues to pour

       5      into our housing market, and, well, to New York

       6      State Legislature.

       7             We all know in this room that the reason that

       8      the rent laws have been weakened, and continue to

       9      have been weakened --

      10             I've been doing this work for almost

      11      20 years, and every four years it gets worse and

      12      worse.

      13             -- it's because of all the real estate money

      14      that's gone into Albany.

      15             And I actually applaud our senators up here

      16      now, and I'm real excited for the new change that's

      17      coming.

      18                [Applause.]

      19             JACKIIE DEL VALLE:  You know, I walked in and

      20      I was, like, wow, this really may be a new day.

      21      Like, our time is here.

      22             There's, like -- and it's long overdue.

      23             It's time to protect tenants, stop the loss

      24      of affordable housing, and the destabilization of

      25      our communities.







                                                                   354
       1             Tenants are mobilizing in huge numbers, and

       2      we need to listen to them.

       3             Walking in here, and somebody I hadn't seen

       4      in a few years, was, like, Oh, so -- so what's the

       5      ask now?  You're going to index it higher?

       6             And, we're, like, no, that is off the table.

       7             We're repealing vacancy control, we're

       8      eliminating MCIs, we're eliminating IAIs.

       9             So there's major reforms on the table that

      10      we're really excited about.

      11             And, in particular, I want to take a couple

      12      of minutes to talk about MCI increases.

      13             The current way that they are, they allow

      14      corporate landlords and predatory equity firms,

      15      anyone to apply for rent increases, even though many

      16      of these landlords are in a sound financial position

      17      and could afford necessary capital improvements

      18      without the MCI increases.

      19             It's still a very valuable and lucrative

      20      business to own rent-regulated properties in

      21      New York City, and they do not need the MCIs.

      22             And all it's doing is fueling speculation,

      23      leading to this neglect and harassment.

      24             The reason that these buildings get to the

      25      place where they need the MCIs is because the







                                                                   355
       1      landlords deliberately choose to neglect their

       2      properties, so that they can create this situation,

       3      and keep passing on the costs to tenants, who, as

       4      was stated I think by Senator Krueger, it's not like

       5      they're getting stock in these companies.

       6             The landlords are still keeping all the

       7      profits from there.

       8             Like I said, I've been an organizer close to

       9      20 years.

      10             I remember when Senator Krueger was first

      11      elected, and it was the first kind of feeling that

      12      maybe there's going to be some pro-tenant people up

      13      in Albany.

      14             I was there, and I even took time off my job

      15      to campaign, to make sure that the Senate flipped

      16      that first time, what was it, eight or nine years

      17      ago, and then there was a coup.

      18             That was crazy.

      19             We had the IDC, which you guys put an end to.

      20                [Applause.]

      21             JACKIIE DEL VALLE:  So I'm really -- it's a

      22      sign that Albany is evolving into the progressive

      23      government, committed to its constituents, and not

      24      just the lobbyists for the rich and powerful.

      25             And I thank you.







                                                                   356
       1             SENATOR KAVANAGH:  For the record, it was

       2      11 years ago.

       3             Thank you.

       4                [Applause.]

       5             SENATOR KAVANAGH:  Any questions for this

       6      panel?

       7             Okay.

       8             Again, we really appreciate your patience,

       9      and thank you for your testimony.

      10             And we'll follow up about the amendments to

      11      the bill, but we appreciate your support.

      12             Next, as I mentioned, we have Matthew Berman

      13      and Nancy Sher.

      14             And I understand that Sarah Souffrant has

      15      left.

      16             So, I'm going to add to -- I'm going to ask,

      17      Alicia Boyd, if you're here?

      18             OFF-CAMERA SPEAKER:  No.

      19             SENATOR KAVANAGH:  Okay.

      20             And let me get another.

      21             Is Frederick Johnson here?

      22             Okay.  So, Frederick Johnson, you're up as

      23      well.

      24             MATTHEW BERMAN:  This is Ms. Sher.  She's

      25      going to go first.







                                                                   357
       1             SENATOR KAVANAGH:  Welcome.

       2             NANCY SHER:  Hi.

       3             Thanks again for convening this really

       4      important forum.

       5             My name is Nancy Sher.

       6             I live at 125 Court Street, which is a

       7      Two Trees, 421a, 8020, development, that requires

       8      all the apartments should be rent-stabilized for the

       9      duration of their -- of their tax exemption.  They

      10      have a 25-year tax exemption.

      11             But you've heard my story before.

      12             You know, it's -- it has many faces, many

      13      voices; it comes in different sizes and different

      14      colors; and you've heard it over and over and over

      15      again.

      16             I know that you haven't done much with 421a,

      17      but it, you know, intersects with rent

      18      stabilization.

      19             So I'm just going to give you some highlights

      20      and facts of 125 Court Street, and everything I say

      21      is -- has evidence to back it up.  Nothing is just

      22      an allegation.

      23             As of December 2015, 10 years after the

      24      building opened, they had not qualified for the

      25      421a tax exemption, yet received $10 million.







                                                                   358
       1             The first lease is not a rent-stabilized

       2      lease.

       3             They came up with a fraud scheme, using the

       4      preferential rent, and they came up with this absurd

       5      legal rent.

       6             And so whenever you want to renew, they could

       7      charge you anywhere from 3,000 to 10,000.

       8             My first legal rent was 9,175.

       9             And it drove a lot of people out, you know,

      10      involuntarily.

      11             And, in 2001 and '12, HPD sent them a memo

      12      each year, telling them that their DHCR

      13      registrations were non-compliant, that their rents

      14      were above the HPD-approved, and that 256 units were

      15      listed as exempt.

      16             Did they change them?  No.

      17             But they did change them in September of

      18      2003.

      19             I suspect a crony of theirs at DHCR gave them

      20      a heads-up, because their intention was to change

      21      2,568 rent registrations for 321 units over an

      22      8-year period.

      23             That's the period they did their fraud

      24      scheme.

      25             According to the New York State Public







                                                                   359
       1      Service Commission, they -- the way they metered for

       2      electricity is illegal.

       3             They collect 100 percent of tax benefits on

       4      non-residential space when the law limits them to

       5      12 1/2 percent.

       6             At the time they were built, they were the

       7      largest non-union construction in the history of

       8      New York.

       9             They've never submitted a notarized

      10      construction cost.

      11             And we want to know, really, how much it

      12      cost.

      13             And the main contractor on it was

      14      30 Main Street, which is just Two Trees; so you had

      15      the developer and the contractor.

      16             Let's see.

      17             Oh, and I'm just going to go over this

      18      briefly.

      19             The building, on first look, appears -- makes

      20      a good first impression, it really does.  But the

      21      truth of the matter is, the construction and

      22      fixtures are quite substandard.

      23             I lived in an apartment with my children,

      24      where the floors buckled up like this.  There was

      25      mold -- an assortment of mold underneath, some of it







                                                                   360
       1      toxic.  And it stayed that way for five years.  They

       2      never fixed it.

       3             And HPD came and gave it four C violations.

       4             C violations are emergency, correct in

       5      24 hours.

       6             Of course they didn't.

       7             Now I'm in my eighth year of litigation with

       8      Two Trees.  And I got -- the appellate -- I appealed

       9      the housing court's decision with their $100,000

      10      judgment, and went to the appellate term.

      11             The appellate term reversed housing court and

      12      held Two Trees in noncompliance with the

      13      rent-registration law, that they had submitted

      14      falsified registrations.

      15             I've not been able to find a lawyer who will

      16      represent me.

      17             They feel the case is so soiled by Two Trees,

      18      by, you know, a cascade of mediocre lawyers; nobody

      19      wants to touch it.

      20             So when I went to the judge to ask him for

      21      additional time, he said, No.  You'll go pro se.

      22             So, there I am, I'm going to go pro se

      23      against Rosenberg & Estis representing Two Trees.

      24             I said to the judge, Do you have any concern

      25      that my due-process rights are in jeopardy?







                                                                   361
       1             "Nope."

       2             And -- but I invite you all to come because

       3      you haven't seen this match-up since the glory day

       4      of the coliseum.

       5             It's on --

       6                [Laughter.]

       7             NANCY SHER:  -- it's on -- it's on Tuesday,

       8      Room 403, at 9:30, is when my trial starts.

       9             So my recommendations are:

      10             To impose significant and meaningful monetary

      11      penalties to the extent that a developer and

      12      landlord might think twice before degrading the law.

      13             It must be enforceable and carry the message,

      14      we are all equal under the law.

      15             Huge fines, the kind that say "ouch."

      16             Enforce the law, because there is -- it's

      17      MIA.

      18             SENATOR KAVANAGH:  And I'm going to ask

      19      you -- just, in fairness to everybody, I'm going to

      20      ask you to wrap.

      21             I appreciate (indiscernible).

      22             And we will -- I see you have a document.

      23             We will also take it for the record.

      24             NANCY SHER:  Well, you know -- okay.

      25             It's -- it's, the enforcement is MIA.







                                                                   362
       1             So I really encourage to you think about

       2      making triple damages, apply to class-action suits,

       3      because there's just no way.

       4             Everybody can't go like me up against, you

       5      know, this (indiscernible) -- (indiscernible), you

       6      know.

       7             SENATOR KAVANAGH:  We appreciate it.

       8             I'm going to ask --

       9             NANCY SHER:  So is that a possibility you'd

      10      ever think about?

      11             SENATOR KAVANAGH:  I'm going to ask the next

      12      person to testify --

      13             NANCY SHER:  Oh, okay.

      14             SENATOR KAVANAGH:  -- and then people on

      15      the --

      16             NANCY SHER:  Okay.

      17             SENATOR KAVANAGH:  -- I don't want to

      18      comment.

      19             Appreciate it.

      20             Sir.

      21                [Applause.]

      22             MATTHEW BERMAN:  Thank you, Senator Kavanagh.

      23             My name is -- and members of the Committee.

      24             My name is Matthew Berman.  I'm a civil

      25      rights class-action lawyer.







                                                                   363
       1             My job is remediating racial discrimination,

       2      disability discrimination, and now, unfortunately,

       3      housing discrimination and displacements.

       4             The game is rigged against tenants, but the

       5      good news is, you guys make the rules and they have

       6      to play by it, and you have the power to change to

       7      the rules.

       8             I'd like to engage Senator Salazar because

       9      she mentioned the ProPublica piece.

      10             That's the genesis of a lot of the reason why

      11      I'm here today, because ProPublica exposed the fact

      12      that many of the city's most prominent realty

      13      companies are flouting the rules.  Many of them have

      14      not registered their units as they are required to

      15      do.

      16             Ms. Sher was featured in the ProPublica

      17      series of articles because she lived in the

      18      Two Trees building, which is a 421a building.

      19             That means that building was made with your

      20      money, with the people's money.

      21             In fact, Two Trees got the property from the

      22      EDC.

      23             Okay?

      24             They built -- they built up the property and

      25      constructed the property using public funds that







                                                                   364
       1      were obtained through public bond offerings.

       2             Then they collected fees from constructing

       3      the property, from managing the property as the

       4      managing agent, and from their equity interest in

       5      owning the property, and all of this is unremediable

       6      by the tenants because there's no teeth in the law.

       7             The landlord can get away with not

       8      registering, and there's nothing anyone can do about

       9      it.

      10             The political bodies that are in charge of

      11      enforcement of the laws are unable or unwilling to

      12      do so.

      13             DHCR has custody of the registrations.  They

      14      keep them secret, no one can get them.  There's no

      15      transparency.

      16             A tenant has to apply for their own

      17      individual rent history, and even then they have to

      18      fight for it.  They sometimes have to submit a FOIL

      19      request.  They can't get information about the rest

      20      of the buildings.

      21             Therefore, what lawyer is going to take their

      22      case?

      23             Okay?

      24             Like, there's no -- there's no ability for

      25      these tenants to get representation to fight against







                                                                   365
       1      the well-heeled, well-represented landlords.

       2             We've got to even the field.

       3             So you have a number of bills that are

       4      presently before the Committee, many of them have

       5      substantial merit and will go a certain degree

       6      towards fixing the problem.

       7             But you've also got existing laws that you

       8      can improve, and I'm here to tell you how I think

       9      you can do it.

      10             A lot of the comments that I'm making today

      11      are echoed in the statements you've heard previously

      12      from the Legal Aid attorneys and from the borough

      13      president's office.

      14             Would I say the number-one and number-two

      15      things are:

      16             Change the look-back period.

      17             Okay?

      18             That four-year period is not enough.

      19             In New York State, a breach-of-contract

      20      action can be brought within six years.

      21             Leases are contracts.  Why not have the same

      22      statutes of limitations?

      23             Don't leave it to DHR.

      24             An overcharge brought before DHR, there's

      25      very little they can do.







                                                                   366
       1             Tenants can go to the court system if they're

       2      empowered to do so, and if they can get

       3      representation.

       4             Another issue that's been raised is the

       5      vacancy increase.

       6             That is what is providing the incentive for

       7      the landlords because, they know, that if they can

       8      get away with -- you know, you've heard about money

       9      laundering?

      10             They're apartment laundering, because if they

      11      can get away with faking the registrations for

      12      four years, they are home-free.

      13             Okay?

      14             They have effectively deregulated behind your

      15      back, without your permission, without your

      16      approval; without anyone's approval.

      17             It's unlawful, it needs to be stopped.

      18             So you've got to end the vacancy increase of

      19      20 percent.

      20             You're got to change the look-back period.

      21             And there's something else very important

      22      that you can do to equalize the playing field, and

      23      that's to allow class-action lawyers to sue under

      24      New York law, without waiving their tenants' rights

      25      to treble damages under overcharge law.







                                                                   367
       1             Right now, an individual tenant can bring a

       2      suit, if they can find a lawyer, to bring an

       3      overcharge claim, but it's almost impossible for

       4      them to gather the information to prove their case

       5      because there's no transparency.

       6             Even if they can get a law, they have to go

       7      one unit at a time.  They have to fight their way

       8      through the Supreme Court, which could take eight

       9      years for one case.

      10             Let us bring class-actions.

      11             We can't do it.

      12             Why?

      13             Because New York State's class-action law

      14      prohibits a class-action seeking penalties.

      15             They have to waive their right to triple

      16      damages, which means there's no incentive for the

      17      lawyers to step in and to try to remediate

      18      building-wide.

      19             There's a -- it's impossible for us to do

      20      that.

      21             So please empower the lawyers to help the

      22      tenants to fix it.

      23             And if you empower some of us, believe me,

      24      it's going to be monkey see, monkey do, there's

      25      going to be a legion of attorneys jumping in to fix







                                                                   368
       1      it.

       2             And the landlords are not afraid of DHR, but

       3      they're afraid of us if you give us the power to fix

       4      it.

       5                [Applause.]

       6             SENATOR KAVANAGH:  Thank you.

       7             MATTHEW BERMAN:  So --

       8             SENATOR KAVANAGH:  I am going -- every clap

       9      is somebody else not testifying.

      10             So we would appreciate (indiscernible) --

      11             MATTHEW BERMAN:  So I'm going make it quick.

      12             You know, I've submitted my testimony in

      13      writing for the benefit the Committee.

      14             I'd encourage you to provide the tenants with

      15      the private right of action, to be able to sue, to

      16      force the landlord to file the registrations

      17      correctly.

      18             Right now, they can't do that.

      19             And there's no damages (making air-quotes

      20      motion) under the law for having a wrong

      21      registration.

      22             So I would suggest a statutory award to a

      23      tenant who prevails in the case, along with legal

      24      fees if they're successful, to even the playing

      25      field.







                                                                   369
       1             And, importantly, I think you've heard a

       2      number of stories where tenants are afraid come

       3      forward.

       4             We have to change the law to protect them.

       5             You know, you've got a whole body of law.  It

       6      covers the topics of race discrimination, sexual

       7      harassment, hostile work environments.

       8             There's a well-developed body of law which

       9      provides a means to protect people who are fearful

      10      of coming forward.

      11             Let's use those same provisions as part of

      12      tenant-protection law, and enshrine it in

      13      New York State law, so that tenants cannot be

      14      retaliated against, they can't be singled out for a

      15      non-renewal of a lease, they can't be blacklisted in

      16      a private database used by landlords, that if you

      17      sue to assert your rights, even if you win, sorry,

      18      we won't rent to you, you're a troublemaker.

      19             We have to end that process.

      20             So I would suggest we incorporate, by

      21      reference, the provisions in the New York State

      22      Human Rights Law, to put it into the

      23      tenant-protection law that you guys are working on,

      24      and to declare tenants are a protected class, they

      25      are protected from retaliation.







                                                                   370
       1             The same way someone complaining that their

       2      boss sexually harassed them, let them be protected.

       3             Thank you all for your diligence, commitment,

       4      to this issue.

       5             I appreciate your time today.

       6                [Applause.]

       7             SENATOR KAVANAGH:  Thank you very much.

       8             ALICIA BOYD:  Hello.

       9             My name is Alicia Boyd, and I represent the

      10      Movement to Protect the People, Ban Brooklyn

      11      Anti-Gentrification Network, and FLAC (Flower Lovers

      12      against Corruption).

      13             We are a grassroots organization that's

      14      located right here in this community.

      15             And I just want to start out by saying that,

      16      I'm a homeowner, and yet I fight for tenants, and

      17      the reason why I fight for tenants is for two

      18      reasons.

      19             Once, I was too a tenant, and I believe the

      20      tenants are like a tree; they are the roots of a

      21      tree.

      22             Without them, we crumble.

      23             95 percent of the people in my community are

      24      tenants, and so when my organization fights, we

      25      fight for everyone.







                                                                   371
       1             Now, back in the 1990s, I was a

       2      rent-stabilized tenant, and I saw the legislation,

       3      I saw our elected officials start to deregulate and

       4      destroy rent stabilization, and all the way back

       5      then I knew that this day was going to come.

       6             And so I said, Oh, my God, they are

       7      destroying rent stabilization.  They're telling us

       8      that it's really to make it even, but I know what

       9      was being done.

      10             Now, you did it.

      11             You did it in the 1990s, and you kept on

      12      doing it.

      13             So now we're here.

      14             Now, every elected official comes to us and

      15      tells us the same thing:  Oh, we know how you're

      16      being displaced.  We know gentrification is hurting

      17      us.  We know the apartments are affordable and not

      18      affordable to you.

      19             But we can't do anything about it, as if you

      20      don't create the laws, as if you did not create the

      21      scenario that we currently exist in.

      22             You created this scenario.

      23             You decided that the rent-stabilization laws

      24      that were intact in the 1990s, which I lived under,

      25      which were very strong, needed to breakdown because







                                                                   372
       1      of all the money that you get; all the money that

       2      you get behind closed doors from all the real estate

       3      industry, as they sit there and put their little

       4      fingers all over you and put money in your pockets.

       5             And then you come up here with a -- this

       6      parade in front of us, "Oh, let me hear what you

       7      have to say," as if you don't know what's going on.

       8             You know what's going on.

       9             I know what's going on.

      10             They know what's going on.

      11             We all know what's going on.

      12             You are the fault of why we're sitting here.

      13             You are the reason why there are, now,

      14      90,000 people homeless, because you have chosen to

      15      turn your back on the people that you are supposed

      16      to be representing.

      17             Now, all of a sudden, you have to this

      18      opportunity.

      19             Oh, yes, we have this opportunity, and we're

      20      going to change something.

      21             But you know something?

      22             I don't have a lot of faith in you.

      23             Now, other people do, but I don't, because

      24      I've been seeing the dirt.

      25             I can't even get my representative, who sits







                                                                   373
       1      right there (indicating), to even meet with me.

       2             We called him up, Hey, Zellnor Myrie, where

       3      have you been?  You haven't been to a community

       4      board yet.  We haven't seen you.  Why haven't you

       5      come?  When we call up and ask to meet with you, you

       6      don't even respond.

       7             Senator, why can't we speak to our senators?

       8             Senator Parker, why can't we meet with him?

       9             Can't get him.

      10             Why can't we meet with our Assembly person?

      11             Can't get them.

      12             You call him up, Oh, no, I'm not going to

      13      speak with you.  I'm not going to meet with you.

      14             Here we are, representing the community, and

      15      they won't even meet with.

      16             So then we ask, Well, how can we get

      17      Senator Myrie to sit down and meet with us?

      18             You can't.

      19             You can't.

      20             So ask him, so I have a question for you,

      21      Senator Myrie:  Why haven't you sat down and met

      22      with us?

      23             We called your office, we asked for an

      24      appointment, because we got issues right here.

      25             We've got rent-stabilization buildings that







                                                                   374
       1      are about to be deregulated, and it's your

       2      responsibility to address the issue, but you have

       3      not.

       4             But you'll stand up here on a platform and

       5      act like you're representing us.

       6             But when it comes down to fighting the

       7      nitty-gritty where we're at, you don't do anything.

       8             So why haven't you met with us,

       9      Senator Zellnor Myrie?

      10             Here it is: silence.

      11             That's what we get from our elected

      12      officials:  We get silence.  And we get talk about

      13      how you're going to protect us.

      14             And at the same time, the reason why we're in

      15      the shelter system and why our children are in the

      16      shelter system, and why genocide is going on,

      17      because this is genocide.

      18             When you sit there and take our children and

      19      put them inside of these shelter systems, when they

      20      have to suffer, that's genocide.  That's violence to

      21      us.

      22             You create violence on us.

      23             And then you won't even have the decency to

      24      meet with us.

      25             But you're coming here and parade, put your







                                                                   375
       1      names all out, let people clap for you, as if you

       2      don't know what's really going on, as if you don't

       3      know the laws that will protect us, as if you don't

       4      know that all the laws that are in place you don't

       5      even enforce.

       6             You got tons of laws that would bring these

       7      real estate developers in, but you don't even

       8      enforce them.

       9             You just want to create a couple of more

      10      laws.

      11             Oh, yeah, let's just create a couple of more

      12      laws.

      13             Oh, yeah, let's appease the masses.

      14             Well, why don't you start enforcing the ones

      15      that you've got?

      16             Why don't you put in legislation to put some

      17      teeth into them, make them accountable?

      18             Make all of these -- you heard the testimony.

      19             This is not the first time you've heard

      20      everybody talk about how these landlords just do

      21      what the [censor bleep-out] they want to do, but you

      22      don't put any teeth to them, do you?

      23             You just pass the law.

      24             That's it, pass the law.

      25             But they can violate the law, and you don't







                                                                   376
       1      do anything.

       2             You know why?

       3             Because their money is dependent upon your

       4      money.

       5             You get their money, as you are proud and

       6      say, Oh, I don't take any developer's money.

       7             Oh, yes, you do.

       8             You take it through all your little

       9      associates.  They funnel the money in, it comes in.

      10             Zellnor Myrie, 90 percent of his money came

      11      from out of community.

      12             You wonder why he does not sit here and meet

      13      with us?

      14             You wonder why he does not seat and meet with

      15      us?

      16             He doesn't meet with us because 90 percent of

      17      his income, 90 percent of his money, came from out

      18      of the community, so he doesn't feel like, his

      19      community, he has to represent us.  He doesn't have

      20      to meet with us.

      21             No, you don't.

      22             You can just sit here and parade yourself,

      23      and send out your literature that you're doing

      24      something for us.

      25             SENATOR KAVANAGH:  Okay.







                                                                   377
       1             ALICIA BOYD:  Well, let's see what you wind

       2      up doing.

       3             My 13 seconds, I've still got 12 seconds.

       4             SENATOR KAVANAGH:  You do indeed.

       5             ALICIA BOYD:  So I'm watching the clock.

       6             SENATOR KAVANAGH:  You do indeed.

       7             ALICIA BOYD:  Okay?

       8             I've got six now.

       9             I got five now.

      10             Four.

      11             Now my question has to be asked:  When is

      12      Zellnor Myrie going to meet with his constituent

      13      group?

      14             SENATOR KAVANAGH:  Thank you.

      15             Next.

      16             ALICIA BOYD:  I'm asking a question.

      17             When is he going to meet with us?

      18             SENATOR KAVANAGH:  Excuse me, but we have a

      19      hearing here.  And we have another --

      20             ALICIA BOYD:  When is he going to meet with

      21      us?

      22             SENATOR KAVANAGH:  -- we have another

      23      witness --

      24             ALICIA BOYD:  When is he going to meet with

      25      us?







                                                                   378
       1             SENATOR KAVANAGH:  -- we have another

       2      witness --

       3             ALICIA BOYD:  When is he going to meet with

       4      us?

       5             SENATOR KAVANAGH:  We have --

       6             ALICIA BOYD:  When is he going to meet with

       7      us?

       8             I am a resident in this community.

       9             He is a representative.

      10             I'm asking a very direct question.

      11             When is this man going to sit there and meet

      12      with his constituents?

      13             SENATOR KAVANAGH:  I'm going to ask you to

      14      respect the many people who have been sitting here

      15      for six hours.

      16             ALICIA BOYD:  Right, and I'm asking him to

      17      respect --

      18             SENATOR KAVANAGH:  You have --

      19             ALICIA BOYD:  -- the people who have elected

      20      him.

      21             SENATOR KAVANAGH:  You have had an

      22      opportunity to speak.

      23             We've got --

      24             ALICIA BOYD:  Again, when is he going to meet

      25      with us?







                                                                   379
       1             SENATOR KAVANAGH:  -- dozens of people --

       2             ALICIA BOYD:  When is he going to meet with

       3      us?

       4             SENATOR KAVANAGH:  -- who have been waiting

       5      for hours to speak.

       6             You have --

       7             ALICIA BOYD:  When is he going to meet with

       8      us?

       9             SENATOR KAVANAGH:  You have asked your

      10      question.

      11             ALICIA BOYD:  When is he going to meet with

      12      us?

      13             When is he going to meet with us?

      14             SENATOR KAVANAGH:  I don't --

      15             ALICIA BOYD:  When is he going to meet with

      16      us?

      17             SENATOR KAVANAGH:  I don't want to have to --

      18             ALICIA BOYD:  When is he going to meet with

      19      us?

      20             SENATOR KAVANAGH:  I don't want to have to

      21      ask you to leave.

      22             ALICIA BOYD:  When is he going to meet with

      23      us?

      24             SENATOR KAVANAGH:  I don't want to have to

      25      ask you to leave.







                                                                   380
       1             ALICIA BOYD:  When is he going to meet with

       2      us?

       3             When is he going meet with us?

       4             SENATOR KAVANAGH:  I'm going to ask the next

       5      person to speak.

       6             ALICIA BOYD:  When is he going to meet with

       7      us?

       8             When is he going to meet with us?

       9             SENATOR KAVANAGH:  I'm going to ask -- I'm

      10      going to have you speak.

      11             ALICIA BOYD:  (Microphone turned off.)

      12             When is he going to meet with us?

      13             When is he going to meet with us.

      14             FREDERICK JOHNSON:  Can you hear me okay?

      15             ALICIA BOYD:  When is he going to meet with

      16      us?

      17             When is he going to meet with us?

      18             FREDERICK JOHNSON:  It is on?

      19             Okay.

      20             ALICIA BOYD:  That's right.

      21             SENATOR KAVANAGH:  I'm going to ask the next

      22      person to speak.

      23             Thank you.

      24             FREDERICK JOHNSON:  My name is

      25      Frederick Johnson.







                                                                   381
       1             Thank you.

       2             Dear Senators and Committee members:

       3             Today is my birthday.

       4             My name is Frederick Johnson.

       5             I am 55 years young.

       6             My wife and I live on Rutland Road between

       7      Nostrand and Rogers.

       8             My wife's name is on the deed.

       9             Jesus owns our home.

      10             Please vote immediately for S3693, that

      11      eliminates rent increases based on major capital

      12      improvements.

      13             And if this language is not included, please

      14      eliminate a landlord's ability to receive payments

      15      for an MCI from tenants in perpetuity.

      16             This practice is criminal and must stop now.

      17             Please vote immediately for S2845, that

      18      prohibits a landlord from adjusting the amount of

      19      preferential rent upon the renewal of a lease.

      20             Preferential rents are deceptive, which is

      21      also criminal.

      22             Please vote immediately for S185, that

      23      eliminates the 20 percent bonus a landlord may add

      24      to the cost of rent for an apartment once a renter

      25      moves.







                                                                   382
       1             There are certain landlords who are motivated

       2      by greed, who have, and are, evicting people only to

       3      get more money.

       4             The 20 percent bonus pays the landlords to

       5      remove tenants.

       6             For these three bills, whether the Governor

       7      says yes or no, if he vetoes, you have the

       8      authority, and the responsibility, to override a

       9      governor's veto and enact these bills into law.

      10             In closing:

      11             God has a vision for this community.

      12             When I arrived in Brooklyn in 2003, I was

      13      homeless.

      14             I'm not homeless now for one reason:

      15             The Constitution of the state of New York

      16      opens with these words, "We, the people of the state

      17      of New York, grateful to Almighty God for our

      18      freedom, in order to secure its blessings, do

      19      establish this Constitution."

      20             The only Almighty God is the God of heaven.

      21             He is the God I serve.

      22             He also is the God of the earth.

      23             He is Lord.

      24             He owns everything.

      25             His vision for our community is contained in







                                                                   383
       1      his word, the Bible.

       2             The Bible is about government.  It's about

       3      God's kingdom.

       4             And God's vision is for earth to look like

       5      heaven.

       6             We must change the way that we think, and

       7      seek, first, the kingdom of God.

       8             Do your part and pass these laws.

       9             Thank you.

      10             Frederick Johnson.

      11             SENATOR KAVANAGH:  Thank you.

      12                [Applause.]

      13             SENATOR KAVANAGH:  Thank you.

      14             Questions for this panel?

      15             Okay.

      16             Again, we really appreciate your patience,

      17      and the patience of everyone.

      18             Thank you very much for your testimony.

      19             SENATOR SALAZAR:  Happy birthday.

      20             SENATOR KAVANAGH:  And happy birthday, and,

      21      thank you.  This is a wonderful way to spend your

      22      birthday, I'm sure.

      23                [Laughter.]

      24             SENATOR KAVANAGH:  Let me thank you.

      25             Next up -- so I'm going to read off folks,







                                                                   384
       1      and if you are here, please indicate, and the first

       2      three that are here that I read off are just going

       3      to come up.

       4             So, first up, Estaban Giron; right?

       5             And I'm just going to do these in, you're

       6      going to notice a certain alphabetical order here.

       7             Gretelle Phillips.

       8             Is Gretelle Phillips still here?

       9             Okay, we have Gretelle Phillips.  Great.

      10             And I'm Jen -- no, I'm to skip to a somewhat

      11      different topic.

      12             So I'm going to ask, Lisa Mathis.

      13             Lisa is here.  Great.

      14             And then, Lynne Timko, who I know is --

      15      I believe still in the back.

      16             Great.

      17             Thank you.

      18             And I am going to very reluctantly, for

      19      people who have been patient, I'm gonna -- we've

      20      been doing a 6-minute window.

      21             With your -- can we do -- can you do

      22      4 1/2-minute increments?

      23             Okay.

      24             With apologies for the people who have been

      25      here for a long time, we will take testimony.







                                                                   385
       1             I'm going to shorten the period, just to get,

       2      because we have many more people who have been

       3      waiting, and I want to make sure we get as many of

       4      them as we can.

       5             So we're going to go with 4 1/2-minute

       6      increments from here on in.

       7             And we appreciate, again, your testimony and

       8      your patience.

       9             So, why don't you begin.

      10             ESTEBAN GIRON:  Good afternoon.

      11             My name is Esteban Giron.

      12             I am a member of the organizing committee of

      13      the Crown Heights Tenant Union, and I serve on the

      14      board of Tenants PAC.

      15             I'm also a rent-stabilized tenant, and I live

      16      less than a block and a half from this auditorium.

      17             Welcome to our neighborhood.

      18             Senator Kavanagh, thank you for your

      19      leadership and for bringing this fight to the people

      20      today.

      21             You may or may not remember this, but, four

      22      years ago, the CHTU was one a handful of groups that

      23      spent the night on the lawn in front of the

      24      Capitol Building in Albany --

      25             SENATOR KAVANAGH:  I do.







                                                                   386
       1             ESTEBAN GIRON:  -- in support of

       2      strengthening the rent laws.

       3             I remember very clearly that you were only --

       4      one of only two legislators who stopped by to greet

       5      us that night.

       6             One was our Assembly Member Walter Mosley,

       7      and the other was you.

       8             It meant so much to us to have that support.

       9             So, again, thank you for sticking with us all

      10      these years.

      11             SENATOR KAVANAGH:  Thank you.

      12             ESTEBAN GIRON:  I would also I like to give a

      13      special shutout to our champion,

      14      Senator Zellnor Myrie.

      15             Senator, we sent you to Albany to fight for

      16      us, and here you are, five months later, bringing us

      17      the Senate Housing Committee.

      18             I could go on for hours about how proud we

      19      are of you, but since you live just a short walk

      20      from here, I will simply say, Welcome home,

      21      neighbor.

      22             Crown Heights has been at the epicenter of

      23      this housing crisis for half a decade now.

      24             Real estate speculation has doubled, and

      25      sometimes tripled, the value of the land that you're







                                                                   387
       1      sitting on.

       2             My landlord used to own half a dozen

       3      buildings within a few blocks radius of here, but

       4      now only owns my building, after selling each of

       5      those buildings for upwards of three to four times

       6      what he paid for them.

       7             These aren't regular market forces at work as

       8      landlords would have you believe.

       9             This has all been a carefully crafted plan to

      10      systemically empty our thriving neighbor of

      11      working-class folks of color.

      12             With the help of our local council member and

      13      a mayor and governor who embody the spirit of

      14      Tammany Hall, destructive policies, such as

      15      mandatory inclusionary housing, have only further

      16      accelerated the threat of displacement.

      17             When you leave here, I'd like for you to

      18      think about the fact that, upwards of 2500 new

      19      luxury units will have -- will be online in this

      20      area in the next two years.

      21             That's our reality now.

      22             The loopholes in the rent laws have proven

      23      way too tempting to ignore for our greedy landlords.

      24             And along with our City and State, Crown

      25      Heights represents nothing less than an all-out







                                                                   388
       1      attempt to colonize and ethnically cleanse our

       2      community.

       3             I've lived in my current apartment for

       4      six years.  My rent is currently affordable and

       5      doesn't exceed 30 percent of mine and my husband's

       6      combined income.  But it wasn't always this way.

       7             We spent almost two years in housing court,

       8      fighting fraudulent rent overcharges for individual

       9      apartment improvements.

      10             We ultimately won because my landlord was

      11      using materials from his own chain of hardware

      12      stores to make the renovations, but writing receipts

      13      as though he had paid retail prices for them.

      14             Our rent was reduced by almost 400 a month,

      15      but it was an all-consuming process that up-ended

      16      our lives so completely that it resulted in us

      17      becoming dedicated volunteer tenant advocates and

      18      organizers.

      19             Throughout the process I was appalled at how

      20      easy it was to engage in fraudulent renovations and

      21      inflate the cost of these improvements.

      22             Earlier today, as I watched these independent

      23      contractors take marching orders from their landlord

      24      bosses outside, I was reminded that this is a

      25      well-developed racket that is not going to go







                                                                   389
       1      anywhere without a fight.

       2             Folks often talk about the supposed number --

       3      small number of bad-actor landlords who are

       4      defrauding their tenants and raking in profits that

       5      they're not entitled to.

       6             I don't know about the rest of the people in

       7      this audience, but I have yet to meet a landlord who

       8      could be described as "a good actor" in regards to

       9      IAIs.

      10             Sure, there are laws on the books, and an

      11      agency, DHCR, that is tasked with oversight, but no

      12      amount of funding to that agency can possibly

      13      account for enough staffing to adequately oversee

      14      such widespread fraud.

      15             The individual apartment improvement system

      16      is irreparably broken, and it was landlords, not

      17      tenants or legislators, who broke it through abuse

      18      and fraud.

      19             They have proven that they don't have the

      20      self-control to be trusted with the right to IAIs,

      21      and I strongly urge you to revoke that right

      22      altogether.

      23             To whom much is given, much is required, and

      24      landlords did not rise to meet the challenge of that

      25      requirement.







                                                                   390
       1             Cut them off before the situation gets worse.

       2             Like a large number of my neighbors, I was

       3      once a non-regulated tenant living about a 5-minute

       4      walk from here.  The conditions that I lived in were

       5      unsafe, and affected my health, both mental and

       6      physical.

       7             After waking up at my wits' ends one night,

       8      surrounded by some very aggressive rodents, and

       9      calling 311 in a panic, I found myself wrapped up in

      10      close to a year of eviction proceedings that,

      11      ultimately, resulted in me losing my apartment.

      12             The fear of retaliation for unregulated

      13      tenants is constant and debilitating.

      14             I spoke with a member of the CHC earlier

      15      today who really wanted to be here to testify, but

      16      was afraid that his landlord would find out, and

      17      would retaliate with frivolous court proceedings as

      18      they have done before.

      19             Think about that for a moment.

      20             The state Legislature publically appeals to

      21      residents of the state to exercise their right to be

      22      heard in a public hearing.

      23             And because of a system that, effectively,

      24      makes unregulated tenants second-class citizens, you

      25      won't even be hearing some of the worst stories that







                                                                   391
       1      you took the time to come here to listen to.

       2             So if you believe in tenant protection,

       3      I don't see how anyone, in good conscience, could

       4      ignore the right of non-regulated tenants in

       5      New York City.

       6             I urge to you pass good-cause eviction

       7      protection.

       8             Most renters in New York State will continue

       9      to be subject to the whims of a handful of greedy

      10      landlords, otherwise.

      11             And as long as there are two classes of

      12      tenants, we are not a progressive state and should

      13      stop claiming that mantle altogether.

      14             Until my neighbor can come to a hearing like

      15      this without being worried that he will end up being

      16      homeless for speaking truth to power, we are not all

      17      free and we should stop pretending to be.

      18             Thank you.

      19                [Applause.]

      20             LISA MATHIS:  Thank you for the privilege to

      21      represent and speak for the tenants throughout the

      22      beautiful state of New York.

      23             My name is Lisa Mathis, and I have lived at

      24      80 New York Avenue, an 8-family building in

      25      Crown Heights, on and off, for over 40 years.







                                                                   392
       1             I'm the child of a New York single mother and

       2      civil servant, a product of Brooklyn public school

       3      system, a graduate of a New York State private

       4      college.

       5             Thomas DiNapoli signs my bi-weekly paycheck,

       6      as I'm a court clerk specialist in Kings County

       7      Surrogate's Court.

       8             I'm the mother of two adult children who were

       9      well educated in the public school systems of

      10      Brooklyn, as well as CUNY and SUNY colleges.

      11             My daughter is employed in Albany, New York,

      12      and my son is employed in New York -- by New York

      13      City.

      14             I say all this to say explain that I am fully

      15      invested in this borough, this city, and this state.

      16             I've been voting since 1978, and have trusted

      17      my elected officials to operate in the best

      18      interests of their constituents who put them in

      19      office.

      20             I'm a tenant and an upstanding citizen.

      21             I'm here to say that all nine bills need to

      22      be signed.

      23             We need stronger tenant protection to put an

      24      end to evictions, to put an end to homelessness, in

      25      New York.







                                                                   393
       1             I'm especially advocating for the bills to

       2      end vacancy decontrol, to end preferential rents,

       3      IAIs, and to implement just-cause eviction.

       4             GO Management purchased my building in

       5      December 2014.

       6             I grew up in this building.  It is indeed my

       7      home, my community, my neighborhood.

       8             My landlord started harassing the tenants

       9      before the building was even purchased, and

      10      continues to do so nearly five years later.

      11             GO has inflicted every type of housing

      12      harassment.

      13             They illegally removed five of the eight

      14      apartments from rent stabilization.

      15             We went without heat for three winters

      16      because GO illegally ripped out the boiler.

      17             The two other long-term tenants who chose to

      18      remain and suffer were my 80-year-old aunt and a

      19      65-year-old neighbor.

      20             We have faced every type of construction

      21      harassment:

      22             Dust, debris.

      23             Removal of staircases, walls, ceilings,

      24      mailboxes, and intercoms.

      25             Demolition work during all hours of the day,







                                                                   394
       1      on weekends and even on holidays.

       2             Days without electricity, cooking gas, or

       3      running water.

       4             The DOB stop-work orders were issued and

       5      immediately ignored.

       6             I showed up for ECV hearings where the

       7      landlord didn't show up.

       8             I have met with tenant-harassment prevention

       9      task force.

      10             I have attended hearings regarding the boiler

      11      at DHCR, as well as proceedings for contempt and

      12      housing court brought by HPD.

      13             Why?

      14             Because the current laws make it easy for

      15      landlords and developers to consider this as the

      16      cost of doing business.

      17             It makes sense because, vacancy decontrol,

      18      preferential rents, and IAIs allow them to

      19      illegally and arbitrarily jack up the rents and

      20      remove the few affordable apartments available.

      21             Pass these bills to stop bad-acting

      22      landlords.

      23             I fully understand that the housing markets

      24      and demographic of communities change naturally over

      25      time.







                                                                   395
       1             This is not what is happening in our

       2      neighborhoods.

       3             I have had the privilege to volunteer on

       4      Saturdays to tutor elementary school students in a

       5      Canarsie school.

       6             I was appalled to see signs about busing them

       7      from homeless shelters so they would not have to

       8      change schools when their families were evicted from

       9      their current neighborhood.

      10             I was also told that, in some schools,

      11      40 percent of the students are coming in from

      12      homeless shelters.

      13             There are too many working homeless families

      14      and individuals with little hope of finding

      15      affordable housing.

      16             I would like for my children to be able to

      17      afford to live and raise their families in the

      18      neighborhood they grew up in.

      19             These laws can help make that happen.

      20             I am saddened to know that my two

      21      sister-in-laws, both New York State school teachers

      22      for over 25 years, was forced to move out of their

      23      Brooklyn apartments.

      24             One sister-in-law, because the preferential

      25      rent the new landlord chose to enforce, after







                                                                   396
       1      15 years of residency in the building, made her

       2      apartment unaffordable.

       3             The other because it was an apartment in a

       4      building with less than three tenants, and the

       5      landlord just wanted her gone to collect twice the

       6      amount of rent.

       7             She was an excellent tenant for over

       8      17 years.  She needed the law for just-cause

       9      eviction.

      10             Now she commutes three hours a day to come

      11      and teach in one of our Brooklyn elementary schools.

      12      Her commute used to be 30 minutes.

      13             When one of my judges found out I was coming

      14      here tonight to speak, she wanted me to say that she

      15      could not afford to live in Brooklyn if she hadn't

      16      had a family home.

      17             I was raised on the philosophy to trust, but

      18      verify.

      19             Unfortunately, it is now foolhardy to do so

      20      because landlords, developers, and greedy investors

      21      will not only take advantage of loopholes, but will

      22      lie and break laws with impunity for greed and

      23      profit.

      24             We, the tenants, need to have protections and

      25      viable recourse when they do.







                                                                   397
       1             Please do not sell your constituents out to

       2      these bad actors for their campaign contributions.

       3             Now is the time you can get this done.

       4             We did our part and elected you.

       5             Now do your part.

       6             Let me trust and believe, not just trust and

       7      verify.

       8             We need these protections to continue to have

       9      stable, viable communities with great citizens like

      10      myself and my family.

      11             Therefore, on behalf of all tenants, these

      12      bills are necessary, so stand with us and for us.

      13             Pass all nine bills so our homes can again be

      14      our sanctuaries.

      15             SENATOR KAVANAGH:  Thank you.

      16             LISA MATHIS:  Thank you.

      17                [Applause.]

      18             GRETELLE PHILLIPS:  Good evening, Senators.

      19             My name is Gretelle Phillips.

      20             I'm 72 years old.

      21             I have lived in Apartment 3-B at

      22      8 Rutland Road in the neighborhood of

      23      Prospect Lefferts Gardens, Brooklyn, for 39 years.

      24             I live there were my husband,

      25      Densley Phillips.  He is 83 years old.







                                                                   398
       1             My landlord is 611 Flatbush Avenue Realty,

       2      which is run by greedy landlords, Miriam and

       3      William Shasho.

       4             I'm here to tell you about how my landlord

       5      has harassed me and my neighbors in effort to

       6      decontrol our apartments.

       7             Once they have pushed long-term tenants out,

       8      the landlord turns the unit into Airbnbs and

       9      market-rate apartments.

      10             They renovate the units and install separate

      11      heating and cooling systems for the Airbnb guests

      12      and market-rate tenants, which caused our

      13      electricity in our apartments to flicker and go out

      14      sometimes.

      15             Meanwhile, Densley and I go without heat and

      16      hot water.

      17             I had to buy an electric heater.  The heater

      18      drives up my electric bills.

      19             We also have rodent infestations.  I had to

      20      get a cat.

      21             Our electrical cords spark and burn due to

      22      electrical system shorting out.  We worry about a

      23      fire.

      24             We have notified the Shashos of these issues.

      25             They often do not respond to our complaints,







                                                                   399
       1      and even when they do, their response is delayed or

       2      (indiscernible).

       3             When our stove stopped working, they provided

       4      us with a replacement stove, but the replacement

       5      stove was infested with mice and roaches.

       6             William Shasho has asked me many times, when

       7      I am moving back to Barbados --

       8             OFF-CAMERA SPEAKER:  You already know what's

       9      happening.  What's the remedy?

      10             GRETELLE PHILLIPS:  -- and when I am moving

      11      to Florida?

      12             We have seen our neighbors get pushed out,

      13      but this is our home.  We have lived there for

      14      almost 40 years.

      15             We do not want to move.  We do not want to be

      16      homeless.

      17             Thank you.

      18             SENATOR KAVANAGH:  Thank you very much.

      19             Okay.

      20             And so I am going to -- it is 8:22.

      21             We were supposed to be scheduled by 8:00.

      22             There are many people who work in this

      23      building that need to leave the building soon.

      24             So (indiscernible) I'm going to -- we're

      25      going to reduce the amount of time to two minutes







                                                                   400
       1      per person, with apologies, so that we can get as

       2      many people in as we can.

       3             I think, Lynne, you're up next.

       4             And then I would like to hear -- if -- if --

       5      if people could just come up.

       6             If Tyrone McDonald is here, still?

       7             Perhaps not?

       8             Oh, Tyrone McDonald is here.

       9             Great.

      10             And we're going to go back, and I mentioned

      11      before, but, if Jennifer Weber is here, you will be

      12      up next.

      13             Jennifer Weber is here.  Okay.

      14             Again, with apologies, we're going to do

      15      two minutes, the speed-round.  And we'll take any

      16      written testimony people have.

      17             Go ahead.

      18             LYNNE TIMKO:  All right.

      19             Lynne Timko, 225 East 26th Street, Kips Bay,

      20      Manhattan.

      21             We've recently been taken over by

      22      TriArch Management.

      23             There's been a mass exodus from the building.

      24             32 people have moved out since January.

      25             The landlord is using the full arsenal of







                                                                   401
       1      deregulation tools.

       2             The majority of those apartments vacated were

       3      already renovated with, like, cheap Home Depot sinks

       4      and, you know, like faux granite, and everything,

       5      but charging, you know, market rate.

       6             They want now, 4,000 for a studio, 5,000 to

       7      6,000 for a one-bedroom.

       8             We've, literally, been declared

       9      luxury (making air-quotes with fingers) overnight.

      10             We've had numerous MCIs.

      11             I bought an elevator.

      12             I bought a boiler.

      13             I had asbestosing (sic).

      14             I bought my own surveillance, where they

      15      watch us in the office all day long.

      16             There's no -- it's not security because it

      17      doesn't cover any of the areas where something could

      18      happen that you would need security.

      19             It spies on us.

      20             And also, too, like, what does -- you know,

      21      what does your rent cover?

      22             It should cover basic -- you know, a window,

      23      hot water.

      24             And, also, when I moved in, I was charged for

      25      a refrigerator, stove, and air conditioner.







                                                                   402
       1             My air conditioner is from 1964, and, you

       2      know, you're still paying for that?

       3             You can't even use it because of -- the

       4      quality is so bad.

       5             And the building really has zero amenities.

       6             We've had a handicapped elevator put in that

       7      goes up one foot, and nobody's allowed to use it

       8      unless you pay $100.

       9             But we bought it.

      10             So it's stuff like that.

      11             Everybody's in the same situation.

      12             And then, again, to, like, make some

      13      penalties for them, like, hit them in their

      14      pocketbooks, because that's where their hearts are.

      15             SENATOR KAVANAGH:  Thank you.

      16             Next.

      17             TYRONE McDONALD:  How do you turn this on?

      18             It's on?

      19             Okay, it's on.

      20             Right on.

      21             Thank you, Senators, for providing me the

      22      opportunity to speak.

      23             My name is Tyrone McDonald.

      24             I'm the government and community relations

      25      manager for Neighborhood Housing Services of







                                                                   403
       1      Brooklyn, a community-based not-for-profit, that

       2      envisions affordable, healthy, safe, and sustainable

       3      communities throughout Brooklyn and the city

       4      at-large.

       5             We have an office in East Flatbush in

       6      Canarsie, and serve residents within Community

       7      Board 17 and 18 and surrounding neighborhoods.

       8             Our focus is housing services.  That includes

       9      home ownership, housing preservation, tenant-support

      10      services, foreclosure intervention, just to name a

      11      few.

      12             Due to the issue of the lack of affordable

      13      housing and subsequent displacement, NHS Brooklyn

      14      added tenant-support services to its menu.

      15             The pressing need to assist and guide tenants

      16      was overwhelming, which resulted in long waiting

      17      lists with many of our partner-based organizations.

      18             During our journey of helping tenants better

      19      understand their lease agreements, explaining

      20      succession rights, assisting NY -- assisting them

      21      with NYC housing-connect applications, helping with

      22      rent-freeze applications for Senate -- for seniors

      23      and the disabled, preventing evictions, making

      24      referrals, we noticed that at least half of our

      25      clients needed -- who needed tenant-support services







                                                                   404
       1      were living in shelters and temporary housing,

       2      desperate for housing any kind.

       3             In 2018, just -- with just one tenant

       4      councilor on staff, we served 230 tenants.

       5             Many of these clients have Section 8 or

       6      CITYFEPS in our seniors, which point to another

       7      pervasive issue: discrimination due to source of

       8      income.

       9             New York City is in the midst of a housing

      10      catastrophe, not only losing units, but

      11      the remaining tenants, many of whom are

      12      rent-burdened, spend more than half of their income

      13      on housing.

      14             We simply can't build our way out this

      15      situation.

      16             We must protect affordable housing by

      17      strengthening existing rent laws and closing

      18      loopholes responsible for the massive hemorrhaging

      19      of rent-stabilized apartments.

      20             We owe it to our families and individuals

      21      across the city, and we owe it to ourselves.

      22             Thank you.

      23             SENATOR KAVANAGH:  Thank you so much.

      24             And thank you to the organizations you're

      25      representing, and all your work.







                                                                   405
       1             Next up.

       2             LYNNE TIMKO:  I just have one quick sentence.

       3             Recently, we were under a J-51 that's

       4      expiring.

       5             SENATOR KAVANAGH:  While she's coming up, go

       6      ahead.

       7             LYNNE TIMKO:  And they've given the tenants

       8      that have been there over 40 years, saying now their

       9      apartments will be deregulated.

      10             SENATOR KAVANAGH:  All right, thank you.

      11             LYNNE TIMKO:  That's it.  That was the

      12      latest.

      13             Thank you.

      14             JENNIFER WEBER:  Hi.

      15             SENATOR KAVANAGH:  Please begin.

      16             We're under tremendous pressure to wrap this

      17      up, so go ahead.

      18             JENNIFER WEBER:  Okay.

      19             Good evening.

      20             I'm Jennifer Weber, and I'm thankful for this

      21      opportunity to speak, particularly in this space, as

      22      both a CUNY grad myself, and as a CUNY educator of

      23      20 years.

      24             I'm a New York City, native born, on the

      25      island of Manhattan, and I've lived in lofts in







                                                                   406
       1      Williamsburg for the last 30 years.

       2             I know and care for many of those who do so

       3      also.

       4             I'm now the owner of the loft building where

       5      I live and work, as well as a member of an

       6      organization of loft-building owners, a few of which

       7      might have been here today.

       8             While I'm wearing many hats, I'm speaking

       9      today as a citizen, and I'm very concerned about

      10      what's going on with this loft-law bill in Albany,

      11      and I want to shed some light on the fact that it's

      12      not functional, and it matters to more people than

      13      meets the eye.

      14             That's my purpose here.

      15             A few months ago, when I was at a public

      16      meeting of the New York City Loft Board, I listened

      17      as a board member there, there to represent the

      18      public, said something that I've heard a number of

      19      times before:  That the loft law was critical

      20      legislation being advanced because it's responsible

      21      for keeping the arts and culture and the creative

      22      economy alive in New York City.

      23             And then that followed with something, like:

      24      Without it, we would lose the defining and vibrant

      25      aspects of our city.







                                                                   407
       1             And then this met with applause, as is done

       2      many times in front of me before, and maybe that

       3      same thing has transpired already here today.

       4             That statement makes me very uncomfortable.

       5             First of all, it renders all of my former

       6      CUNY art and design students, hundreds of talented

       7      and hard-working creatives, anything, but live-work

       8      loft beneficiaries, absolutely silent and invisible

       9      and irrelevant.

      10             But even more far-reaching, it illustrates

      11      how inadvertently we can buy into narratives that

      12      validate our acknowledged history of preferential

      13      treatment.

      14             SENATOR KAVANAGH:  I'm going to ask you to

      15      give me one more sentence, and then submit it --

      16             JENNIFER WEBER:  Okay.

      17             SENATOR KAVANAGH:  -- and we're going to get

      18      the rest --

      19             JENNIFER WEBER:  We need to be careful not to

      20      justify efforts to carry that history forward;

      21      that's not progress to me.

      22             SENATOR KAVANAGH:  I'm assuming there was a

      23      semicolon in the middle of that.

      24             And I -- with tre -- with tremendous

      25      appreciation --







                                                                   408
       1             JENNIFER WEBER:  What I'm requesting here is

       2      that, there needs to be a leader in Albany that

       3      takes on gathering some data, because the loft law

       4      is in a data black hole.

       5             And it's irresponsible for my party, the

       6      Dems, to be advancing policy that isn't based on

       7      fact.

       8             SENATOR KAVANAGH:  We appreciate your

       9      testimony.  And, if you want to submit what you

      10      have.

      11             And, I'm going to -- so I'm going to read off

      12      some names.

      13             Is Mark --

      14             Thank you for your testimony.

      15             JENNIFER WEBER:  Okay.  I'm going to send

      16      that in, because it's --

      17             SENATOR KAVANAGH:  Yeah, that's fine.

      18             Is Mark Gerig here?

      19             Mateo Cartegena?

      20             Victoria Hillstrom -- Hillstom, I believe?

      21             And, Sue Yellen.

      22             If you could just come up, and we're --

      23             Sue, I'm told, is not here.

      24             Okay.

      25             Again, speed-round.







                                                                   409
       1             MARK GERIG:  Hell.  My name is Mark Gering.

       2             Senators, you've all met me before.

       3             I am a founding member of New York City Loft

       4      Tenants, since 2011.

       5             And I am a former loft tenant, a recently

       6      former loft tenant, because, although I fought a

       7      January 31, 2019, eviction for 10 weeks --

       8             You know about my case, you know who I am.

       9             My colleagues brought my case up many times

      10      over the past few months.

      11             -- although I fought for 10 weeks to buy

      12      time, until the law bill passed, as was promised

      13      in -- early in the session, January or February, it

      14      hasn't happened.

      15             Senator Kavanagh, you've stalled it.

      16             Senator Salazar, you've stalled it.

      17             And you both promised that you would pass it.

      18             Well, I'm gone.  I lost my space of 26 years.

      19             I spent my last day on August -- on

      20      April 14th -- Sunday, April 14th, a month ago,

      21      I walked away.

      22             I couldn't afford to carry on an appeal.

      23             I would have had to pay a $15,000 bond, and

      24      on top of that, I was required to pay a

      25      use-and-occupation fee of $9,000 a month.







                                                                   410
       1             $27,000 right up front, $9,000 thereafter,

       2      every month after that.

       3             I had to quit.

       4             Please pass this bill for the people who are

       5      about to be evicted.

       6             I was in my space for 26 years.

       7             I am an artist and crafts person.

       8             I will never be able to have a loft space

       9      like that again.

      10             I have been in loft spaces the vast majority

      11      of my adult life, because I needed them for my work,

      12      to live and work, and to be an artist, and to be a

      13      creative contributor to this society.

      14             Thank you.

      15             Please, please, press ahead and pass this

      16      bill.

      17             I'm the person that got the axe because this

      18      went so slow.

      19             SENATOR KAVANAGH:  Thank you.

      20                [Applause.]

      21             MATEO CARTEGENA:  Hi.

      22             My name is Mateo Cartegena.

      23             I have a lot here.

      24             Thank you for having me.

      25             Glad I didn't dress up for nothing.







                                                                   411
       1             I just want to also urge the support -- urge

       2      the passing of all nine tenants' bills --

       3             MARK GERIG:  I do too.  I was up in Albany on

       4      Tuesday.

       5             MATEO CARTEGENA:  -- to go to strengthen

       6      tenants' power throughout the state, in general.

       7             And, also, I am a loft tenant, so I'm here to

       8      also support the passing of the loft-law bill as

       9      soon as possible.

      10             We're part of communities of colors that are

      11      also being displaced in Brooklyn and elsewhere for

      12      the sake of high-rent res development, residential

      13      technology, expensive working and office spaces, and

      14      otherwise.

      15             We are against communities of working artists

      16      and musicians and creators from being displaced from

      17      the city and state at an alarming rate because it's

      18      becoming too unaffordable to live and work.

      19             (Indiscernible) from downtown Jersey City,

      20      which got completely gentrified, I grew up and saw

      21      my community completely decimated.

      22             And I've seen that happen in communities here

      23      where my family and friends have lived, in New York

      24      City, in Brooklyn.

      25             And, years ago I was lucky enough to find a







                                                                   412
       1      cheap loft situation with other creative people in

       2      District 18, which Senator Salazar proudly

       3      represents.

       4             In that place we've been able to have a hub

       5      of creativity, but, also, with an ethic behind it,

       6      where we've raised money for things, such as

       7      Puerto Rico recovery efforts after "Maria," raised

       8      money for the Trans Lifeline, for the Correctional

       9      Association for New York, for sex-workers' rights

      10      and decriminalization efforts, for Make the Road

      11      New York, for Churches United for Fair Housing, for

      12      Planned Parenthood, and many others.

      13             And without that space, we would not have

      14      been able to mobilize people to do any of that.

      15                [Applause.]

      16             MATEO CARTEGENA:  Not to mention, that once

      17      it's gone, we're going to lose this nexus of

      18      creativity that is an important part of our

      19      community.

      20             So I ask you to please pass the loft-law

      21      cleanup bill.

      22             Thank you.

      23             SENATOR KAVANAGH:  Next.

      24             VICTORIA HILLSTROM:  Good evening,

      25      Senator Kavanagh.







                                                                   413
       1             I'm Victoria Hillstrom.

       2             I am your constituent in Tribeca.  We're at

       3      385 Greenwich, a/k/a 71 North Moore, you may know

       4      us.

       5             Justine Almada, chief of staff for

       6      Dan Goradnick, grew up in our lofts.

       7             Her father, Carlos Alamda, Elizabeth

       8      (indiscernible) Guttman.

       9             I am here, some of you know our story, some

      10      of you don't.

      11             385 Greenwich, a/k/a 71 North Moore, our

      12      lofts, since 1982, that we brought up to code with

      13      8 years of full-time workmen.

      14             We own our 28 windows, both of our roofs.

      15      Our lofts are magnificent.

      16             They have been copied at Automat in London,

      17      Smith and Mills in our garage, Tinys.

      18             Our landlord, Century 21, Century Realty

      19      12 Cortland Street Corp, decided that they would

      20      mask themselves as kids in a bar, doing

      21      construction.

      22             They masked as a tenant.  They caused our

      23      ceilings to fall in from improperly installed

      24      air conditioning equipment on a roof with no drain.

      25             They illegally subdivided our electrical on







                                                                   414
       1      100-year-old lines, so old, that we lost two-thirds

       2      of our power.

       3             They cut out all five of our phone lines.

       4             Obstructed our secondary means of egress with

       5      a partial petition that presents a known fire

       6      hazard.  Never passed a full inspection, and started

       7      a fire.

       8             Con Ed just found that they illegally

       9      subdivided our gas lines too.

      10             They almost killed us and took the

      11      surrounding buildings with us.

      12             This is the same tenant in 12 other

      13      buildings, Matabrimsic.

      14             That is our story.

      15             What I would like to say, only because I have

      16      never met the senator, what I would like to say to

      17      you is, our story is very much different than the

      18      struggles of the tenants in Brooklyn.

      19             The artist understood the scale and light.

      20             They understood 14-foot ceilings were

      21      relevant.

      22             They understood 100-year-old buildings were

      23      beautiful, and embraced the industrial design

      24      elements that have impacted design and architecture

      25      around the world.







                                                                   415
       1             We have raised the property values in SoHo,

       2      Tribeca, and Dumbo through the roof.

       3             SENATOR KAVANAGH:  With -- with --

       4             VICTORIA HILLSTROM:  And what I would like to

       5      respectfully --

       6             Just a moment, Senator.

       7             SENATOR KAVANAGH:  With apologies, just give

       8      me --

       9             VICTORIA HILLSTROM:  I understand.

      10                (Indiscernible cross-talking.)

      11             SENATOR KAVANAGH:  15 more seconds, because

      12      I've got 10 other people.

      13             VICTORIA HILLSTROM:  What I would like to

      14      say, most of all, is that it's my understanding that

      15      you are very concerned about the incompatible-use

      16      groups.

      17             What I would like to express is that, under

      18      the 1982 loft laws, many of the courts found that

      19      these were de facto multiple dwellings --

      20             One more sentence.

      21             -- where the artists became the de facto

      22      developer.

      23             And, Senator Kavanagh, if you have sincere

      24      concerns over the use groups, the artists should be

      25      given the same ability to pull permits to correct







                                                                   416
       1      violations.

       2             But I would like you to understand that the

       3      artists invested in these buildings.

       4             MARK GERIG:  That is why I couldn't --

       5             VICTORIA HILLSTROM:  And this is a very

       6      important law.

       7             MARK GERIG:  That's why I could not be

       8      qualified for the loft law, and that's why I had to

       9      fight so hard, and lost.

      10             SENATOR KAVANAGH:  And just --

      11             MARK GERIG:  That is why.

      12             SENATOR KAVANAGH:  -- okay, I -- again, this

      13      is going to be an ongoing conversation, and I do

      14      need to let lots of people who work in this

      15      building, who are on, overtime and we need to

      16      adjourn the hearing.

      17             We are --

      18             VICTORIA HILLSTROM:  Yes, I would like to

      19      once again say, Senator Kavanagh, that there is no

      20      reason that the artists cannot file for permits to

      21      correct violations; otherwise, this is a

      22      discriminatory practice.

      23             And we will file suit, as my neighbors have

      24      at the Tribeca Trust and Friends of the South Street

      25      Seaport.







                                                                   417
       1             We're afraid of no one.

       2             SENATOR KAVANAGH:  And, again, we appreciate

       3      everybody's testimony and your patience.

       4             And with respect to the loft law, obviously,

       5      it is a conversation to be continued.

       6             As you know, we have broad agreement on

       7      almost every element of this bill, and have had so

       8      since February.

       9             And we are working -- we've been working on

      10      one fairly technical difference of opinion, and the

      11      fire department, and some others have some concern

      12      about the bill as written.

      13             And we've been trying to address those with

      14      the loft tenants for some time now.

      15             But we will continue that conversation.

      16             And we have every person who contacted us,

      17      including people who didn't make it here today, we

      18      will follow up with you.

      19             And, again, for everybody who has been here

      20      all day, I would happily go on further and hear from

      21      more of you, but we do really need to get out of

      22      this building.

      23             So, thank you all.

      24             We are adjourned.

      25             But thank you very much.







                                                                   418
       1             And if you have written testimony, we'll take

       2      it.

       3

       4                (Whereupon, the public hearing held before

       5        the New York State Senate Standing Committee on

       6        Housing, Construction, and Community Development

       7        concluded, and adjourned.)

       8

       9                           ---oOo---

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