193 H3744 An Act for a special law authorizing the city of Boston to implement rent stabilization and tenant eviction protections

Yes. Over half of Boston is zoned single-family. See the Metropolitan Area Planning Council Zoning Atlas.

It’s tempting to claim that rent control will help everyone do everything. Rent control will help only people who have an apartment the day the law is passed.

On homelessness in particular, note that in 2009 the American Institute for Economic Research did a survey of all economic research on rent control and found it affected many things, but homelessness was the one area for which there was no signal at all. This is hardly surprising, as homelessness has many causes. None of the folks at Mass and Cass, for instance, could be described as camped there primarily for lack of rent control. Substance abuse and mental health are serious challenges and have separate solutions.

Owner-occupied properties of six units and less are exempt. This is a political divide-and-conquer, not intended to help small owners. Think about the senior landlord in assisted living who depends on her family three-decker for income. She is subject to rent control.

Boston University is exempted under this bill. Megan Sandel, Associate Professor of Pediatric Medicine at Boston University, was one of the 25 Rent Stabilization Advisory Committee (RSAC) members who drafted this bill. Per the Office of Campaign and Political Finance, she personally had donated $1,500 to Boston political races before she was appointed. BU was a major OCPF heavyweight, having collectively donated $597,780.57 prior to appointment.

Developers are exempted. Twelve of the 25 RSAC appointees are developers (Massachusetts has both for-profit and non-profit developers). As we will show later, developers have a particular interest not just in exempting themselves, but also in creating a particularly brutal regime for landlords. Landlords being forced to sell distressed assets at bargain basement prices will create more opportunity for developers. The developers who participated in the RSAC are:

• Kimberly Sherman, president of Related Beal: personally donated $500. Related Beal employees in aggregate had donated $15,381.
• Chanda Smart, CEO at Onyx: donated $1,700.
• Jeanne Pinado, vice president of capital markets at Colliers International: gave $5,004. Colliers employees altogether donated $88,330.12.
• Joe Kriesberg, president of Massachusetts Association of Community Development Corporations, gave $7,260.
• Curtis Kemeny, CEO and president of Boston Residential Group, gave $13,835.50. BRG employees donated $18,485.50.
• Dermot Doyne, local landlord and business owner, gave $18,250.
• Emilio Dorcely, CEO of Urban Edge, donated nothing personally, but Urban Edge employees in aggregate donated $19,494.46.
• Joe Byrne, Executive Secretary-Treasurer for the North Atlantic States Regional Council of Carpenters, donated nothing personally, but the carpenters altogether donated $1,425.
• Kirk Sykes, managing partner at Accordia Partners, gave $40,513.
• Brian Kavoogian, managing director (or partner) of National Development, gave $143,482.35. National Development employees altogether gave $308,222.

Not one landlord organization was on the RSAC.

This is politically clever distraction pricing. Further on, we see the Rent Control Board can and will override this objective-sounding formula.

This is the section that invalidates the objective inflation-based formula. “Fair return standards” require owners to produce a detailed statement of net income (for a for-profit owner, sometimes called a “profit and loss statement”). Rent increases will be denied for many landlords.
During the rent control years, fair net operating income specifically excluded mortgage payments. In other words, the bank was considered a co-investor in the property and if the bank was making interest, the owner didn’t need income.
This is why, after decades of rent control, Boston mayor Raymond Flynn ordered a survey of boarded up properties. “Fair return” was anything but. Hundreds of multifamily properties across the city were boarded up as landlords waited for rent control to be repealed.

The City fails to the tell the Legislature that it already has a rental registry. Last we checked, the Boston rental registry was not working, and was unfairly and unevenly enforced, with many bad operators still unregistered.

Eviction restrictions are necessary to enforce this older, second-generation form of rent control.

Whereas rent control had many exemptions for divide-and-conquer reasons, just-cause eviction is itself a concern for only landlords. So there are no exemptions for dorms, hotels, developers, etc., because none of them must use eviction in the first place. They have alternate procedures to recover their premises from bad actors. Developers condemn their buildings, after which the Board of Health removes the renters. Dorms and hotels are allowed to grant licenses, not tenancies, and license breakers can be removed by police force. Landlords cannot legally grant licenses due to a long history of housing court case law interpreting this as a work-around to tenant protections. Dorms, hotels and developers continue to enjoy the work-around.

Chapter 93A declares that any unfair or deceptive practice in the conduct of a trade or business is unlawful.
This could be reworded as, “(b) the tenant broke the rental agreement, provided the rental agreement wasn’t unfair to begin with.”

Note that if a renter is causing a problem with neighboring businesses (e.g., a Mass and Cass type scenario), the landlord will have no power to evict. It’s not clear even that a landlord could evict for trouble with occupants in another building. As presently used in the Airbnb ban in Boston, “adjacent” means “contained in the same building.”

This could be reworded, “(e) the tenant’s rental agreement lapsed, but they refuse to sign a new rental agreement, provided the new agreement doesn’t raise the rent more than the Rent Control Board permits.”

This section echoes General Law Chapter 186 Section 15B (1), which says a lessor may enter:

• to inspect the premises,
• to make repairs,
• to show the place to a prospective tenant, purchaser, mortgagee or its agents,
• to obey a court order,
• to see if the place has been abandoned, if there is some reason to believe it has been, or
• to inspect for security deposit withholding at the end of the tenancy.

Note that this ordinance removes the landlord’s power to show the apartment to a new renter. It also leaves open for argument at the Rent Control Board whether the landlord has the right to check for abandonment or security deposit damage.

This could be reworded, “(g) the tenant you knew left and you’ve got an unauthorized occupant left in their place.”

The Rent Control Board could set the relocation payment to be astronomically high such that landlords could never recover possession for their own use.

This also puts the state in the business of endorsing Boston’s particular family and interpersonal values. What if an aunt wants the apartment for her niece? In Boston, the aunt-niece relationship is not important enough, she cannot recover her property for this purpose. What about a soul mate who has shared their life with another since high school but with whom they neither cohabit nor plan to marry? This is equally unvalued. And because there are no exemptions for owners of any size, this arbitrary cruelty would apply to the aunt or soulmate who owns no other real estate but the one rental unit.

This clause holds up particularly poorly in view of Ferreira v. Charland 2023, an example of a one-unit owner made homeless by being barred from possession of their only real estate. A single-family owner left her home to cohabit with another. She rented the home but made a good faith error in water billing. The cohabiting relationship failed, but the water billing error prevented her accessing her home for three years, despite the error having been made in good faith. Last we heard in October 2023, she was still homeless.

History shows the Rent Board alone would be empowered to define additional just causes. An owner would never be allowed to argue their own.

Real estate investors who did not wish to participate in rent control historically converted their buildings into condos and sold them off piecemeal. In an effort to Band-Aid this critical flaw of rent control, Boston must ask for additional condo restrictions. Note that condo conversion is already regulated in all 4+ unit buildings and has been since 1983.

Here again we see the likely extortionate “tenant relocation payment” set by the Rent Control Board.

This ought to raise a question as to how income, age and disability will be verified. During rent control in Boston and Cambridge, a very simple sounding policy framework resulted in hundreds of pages of regulation. This complexity already exists in other places, for instance, RAFT applications and reasonable accommodations, and should be expected to require substantial municipal budget.

Here the heavy developer influence becomes apparent. Developers in today’s market can only make money on a property if they can purchase the land at a distressed price. The Rent Control Board will then stop private landlord ability to renovate until the building becomes unstable and must be sold. This is exactly what happened in Boston in the 1980s, resulting in Mayor Flynn calling for the survey of boarded up properties.

Note that “demolish” is a legal term that includes removal of any wall, e.g., to conduct a basic plumbing repair. If the wall contains a substrate layer of lead paint (common), the tenant must be relocated. Does that count as requiring a tenant to move? The Rent Control Board will decide.

The City know this ordinance is hated by housing operators and will be mercilessly litigated against. Anticipating decades of public money spent defending against this, they have made it clear that when one piece eventually succumbs to justice, the rest may yet stand until the next court decision.

Housing operators in Boston have told MassLandlords they have raised rents quickly in anticipation, especially where rents had previously remained low. That is not what anyone wanted or planned to do and shows how seriously misguided and punitive this proposal looks to housing operators.

The City would have known all this if they had invited us to participate at the outset. They did not.

They refuse to disclose the reasons for the appointment of the RSAC members above. This remains in litigation, MassLandlords vs. City of Boston docket number 2384cv00483.