Just Cause Eviction: A Trojan Horse for Boston

Out of the Trojan horse will come RENT CONTROL

The just cause eviction proposal making rounds at Boston City Hall is the fourth attempt of the same players – City Life/Vida Urbana and Harvard Legal Aid Bureau, which are tenant advocates and free tenant lawyers – to bring rent control back to Boston after it was outlawed in 1994 in a statewide vote spearheaded by the Small Property Owners Association. SPOA defeated these bring-back efforts in the past and will make every effort to defeat it again.

Their proposal would give Boston “just-cause eviction” and “mediation of rent increases,” measures they claim are not rent control and will apply to “corporate developers only.” These nice-sounding descriptions are dishonest and a veritable Trojan horse for all Bostonians. The proposal would effectively bring rent control to Boston.

It hits far more than just developers, it hits a multitude of small owners

The Trojan horse is two-fold, a deception about who the proposal applies to and a claim that it is not rent control.

Advocates say the proposal affects “Only corporate developers,” as heard on WBUR recently and echoed in the introductory remarks to the proposal, which go on and on about high rents. This claim is most definitely not true. Based on the city assessor’s database, the proposal would apply to roughly 40% to 50% of all Boston’s residential housing. “Corporate developers” refers to those builders buying dilapidated houses, renovating them, and selling the units as condos. These developers are few in number compared to all the owners that would be controlled under the proposal. The economic impact on the city would be huge (see page 1).

The proposal coming out of the Trojan horse would apply to all non-owner-occupied rental housing, from rented single-family homes all the way up to high-rise apartment buildings, and to buildings of five units or larger, even if they are owner-occupied. Many of these units to be controlled would involve small owners, often next door or down the street from their tenants. Only owner-occupied one- to four-unit buildings are exempt. Those corporate developers are few in number compared to all the owners of potentially controlled housing.

A “just cause” is required for every eviction in controlled housing

Half the proposal concerns just-cause eviction, the other half concerns rent increases. A carefully defined “just cause” would be required for every eviction in controlled housing, and the final decision allowing or not allowing eviction would lie with the Rental Housing Resource Center (RHRC). That’s the former rent control board, resurrected!

Nine “just causes” are allowed, and these are carefully defined in favor of tenants. Noise and disturbance of the peace must be “so disorderly as to destroy the peace and quiet of other tenants.”  Damage to the unit must be “willful” and “substantial.” Nonpayment of rent must be “habitual.” So long as tenants only skip a few months of rent each year, they can’t be evicted? Obviously, landlords and tenants would have to put up with quite a bit of unchecked behavior from some tenants and a cavalier attitude from most tenants.

Limiting rent increases to 5% using hostility, high cost, threats & legalese

For the other major part of the proposal – rent increases – the advocates tiptoe around the edges of rent control, claiming not to step over the line. They fail. All proposed rent increases over 5%, even between tenancies, must go through so-called “mediation.” Rent increases are defined as “any notice...to increase the monthly rental amount...greater than a 5 percent increase.”

Between tenancies, when an old tenant has moved out, rent increases are also limited to 5% without going through mediation. But that time between tenancies is when most work is usually done on apartments. So no rent increase at all is allowed for repairs, upgrading, or renovation without going through mediation. The alleged goal is to stop condo conversions and “flipping,” but the impact of this part of the proposal would be far, far wider. It would stop almost all renovations in all controlled housing.

“Mediation” is turned into an extremely hostile ordeal for the landlord

Wouldn’t “mediation,” that nice-sounding word, be a calm, reasonable experience? Not at all. Technically, landlords would be free, after mediation, to set a rent increase as they please, “voluntarily.” But the goal of tenant advocates is rent control, and this is their best chance. Here’s how they would achieve it.

In the absence of direct, explicit control of rents, the critical leverage point against rent increases is to make the mediation process such an awful ordeal that most landlords, especially small ones, won’t even try to go for a rent increase. We can infer that ordeal from the resources given to the tenant in mediation:

A pro-tenant RHRC “mediator,” a free lawyer, tenant advocacy groups invited into the process, with whom the landlord “must mediate,” and all the landlord’s own tenants, who will be fighting to keep their future rent increases low.

Landlords, meanwhile, get nothing except the burden of proof. These tenant advocacy groups are no friends of landlords. Consider the following language from the proposal:

• Landlords shall simultaneously send a copy of all notices ... to the Rental Housing Resource Center. These notices shall be accessible to tenant advocacy groups....
• When presented with a notice..., tenants may file a request for a City-Sponsored, or City approved, mediation...
• The tenant’s request [for mediation] shall prompt referral, from the Rental Housing Resource Center, to a...tenants’ advocacy organization....
• Landlords, or their authorized agent, must mediate with individual tenants over the rental increase, or [with] a tenants’ advocacy organization.... 

It’s not mediation in the ordinary sense of the word. It’s rent control, we can infer, by intimidation, harassment, and threats. A key supporter of this proposal is Boston’s City Life/Vida Urbana, an advocacy group that proudly organizes pickets, rent withholding (the free rent trick), and rent strikes (all tenants). Many owners, especially small ones, simply won’t go through the ordeal and, perhaps worst of all, end up with all or most of their tenants withholding rent and becoming hostile year round. Soon, 5% rent increases look very good.

Complex legalese, threats, and penalties, penalties, penalties

As if that hostility were not enough, the proposal goes on to create a host of complex procedures with corresponding penalties.

• “1. Failure by the landlord [to send a copy of a notice] … grounds for dismissal.”
• “2. Failure by the landlord [to inform a tenant of a right] … grounds for dismissal.”
• “3. …failure by the landlord [to obtain a mediation certificate] …grounds for dismissal.”
• “4. …where the landlord failed … [the tenant] shall be entitled to recover actual damages or three months rent, whichever is greater, [plus] costs, and reasonable attorney’s fees.”
• “5. An owner…who evicts…in violation of this chapter…shall be punished by a fine of not less than $1,000….Each such illegal eviction shall constitute a separate offense.”
• “6. The remedies available in this section shall be in addition to any other existing remedies, which may be available to the tenant.”

Do you get the feeling that this whole procedure is anti-landlord? No landlord will want to go into this process without an attorney, and the following just clinches it.

“B. 3. Where a landlord seeks to evict a tenant ..., she or he must do so according to procedure established in all applicable Massachusetts and municipal ordinances for landlord tenant disputes including, but not limited to, MGL c. 239, MGL c. 121B,s.32 MGL c. 121B, s.32 MGL c. 139, s.19 MGL c. 184, s.18 MGL 186, MGL c. 186, s.13 MGL c. 186, s.13A MGL c. 186, s.14.”

The result would be: Very high rents & many small landlords pushed out

To get through all these obstacles and threats will require a costly attorney with fees mounting up to tens of thousands of dollars. Ironically, if landlords manage to go through and complete the mediation process and are free to set the rent as they please, the new rent will be extremely high, not only to cover attorney’s fees but to cover all the delayed capital improvements and put off any future mediation ordeal for a rent increase.

Moreover, when small landlords can’t out of fear go through the mediation process needed for rent increases, they will go into foreclosure and be forced out, to be replaced with the very developers and big landlords that tenant advocates claim to hate.

Does it violate the Massachusetts Rent Control Prohibition Act?

The 1994 statewide referendum ending rent control was incorporated into state law as M.G.L. Ch. 40P and reads, in part: “No city or town may enact, maintain or enforce rent control of any kind...Compliance on the part of property owners as to [any] rent control regulation...shall be entirely voluntary and uncoerced.” Advocates claim that the just-cause eviction proposal, half of which regulates rent increases, does not violate this law. That flies in the face of a plain reading of the law. Rent control “of any kind” is prohibited, or if a city or town has “rent control,” it must be “entirely voluntary and uncoerced.”

All rent increases over 5% must go through mediation. That’s not voluntary and uncoerced. Landlords “must mediate” with tenants and advocacy groups. That’s not voluntary and uncoerced. Pressure from advocacy groups during mediation in the form of chants and booing and threats of continuous harassment and rent strikes (which these groups already do to landlords they want to attack) will surely happen. That’s not voluntary and uncoerced.