Things Are Only Going to Get Worse for Developers

The landmark tenant protections won in New York last week are more than just good policy. They lay the basis for a statewide movement for universal rent control.

A countdown to the rent laws' expiration outside New York state senator Julia Salazar's office in Albany, NY on June 14, 2019. Julia Salazar / Flickr

Last week, New York State passed a sweeping package of rent reforms that dramatically strengthens tenants’ rights for millions of New Yorkers in rent regulated apartments. The new legislation also opens up an ambitious new front of struggle that could fuel the spread of tenant organizing, socialist political campaigns, and the expansion of rent control all across the state.

For decades, tenants have been fighting a war of attrition — trying to protect the state’s dwindling regulated housing stock against a sustained assault from the real estate industry and their allies in Albany. The rent law package passed last week took meaningful steps to reverse landlord influence over housing policy in New York — influence that has led to the deregulation of hundreds of thousands of apartments and a homelessness crisis of epic proportions.

The reaction of the industry and the business press tells us what we need to know about the significance of the legislation. One landlord who owns nine rent stabilized buildings told the Financial Times, “I feel like someone just dropped a nuclear bomb on my business and my family.” The stock prices for the banks that provide loans to speculators fell precipitously, and the titans of real estate were reduced to pitifully whining to their ally Governor Andrew Cuomo, to no effect.

While these historic changes will reduce the pressure on nearly two million rent stabilized tenants mostly in New York City, housing advocates’ signature policy demand did not pass. Democratic socialist Senator Julia Salazar’s “good cause eviction” bill would have prevented almost any tenant, anywhere in the state, whether their building was regulated or not, from facing a rent increase of more than 1.5x the rate of inflation. The ambitious good cause legislation — which would have guaranteed truly universal rent control — faced the most intense opposition from real estate and the business press. Despite substantial pressure from housing advocates, the Democratic Assembly and Senate were unwilling to include it in their deal.

The failure of good cause was a disappointment. But housing advocates still achieved one other major, though overlooked, victory: the expansion of the Emergency Tenant Protection Act to cover the entire state. Prior to last week the ETPA was in effect only in NYC and its suburban counties. With the new change, municipalities across the state can implement rent stabilization as long as they can demonstrate a housing vacancy rate below 5 percent through a local study. Many localities can meet that bar right now, as the state’s housing crisis continues worsen. The ETPA’s expansion provides an opportunity for the organized left to build on last week’s historic victory and bring class struggle politics to the local governments of communities across the state.

Political Context

This year’s major gains for tenants are due to a profoundly changed political landscape in New York that put the real estate industry on the defensive for the first time in decades. In recent years, Republican control of the State Senate has been empowered by a group of rogue “independent” Democrats financed by the real estate industry and tacitly supported by Governor Andrew Cuomo. Last year, six members of that ‘Independent Democratic Conference’ were unseated by progressive Democratic primary challengers. A successful general election gave the Democrats a seven-seat advantage in the State Senate (without their disloyal “independent” faction) and unified control of the state government.

The Democratic majority was absolutely essential to improving the rent laws. But without changing political dynamics within the Democratic Party, real estate donors might still have found a welcome ear from candidates whom they have been funding for years, and could likely have secured a much more modest set of reforms to the system.

Unfortunately for the real estate industry, last year marked the startling success of an explicitly class-conscious politics within the Democratic Party primaries. This politics focused on the dual issues of a housing crisis squeezing renters and a political system funded by landlords and developers. Political contributions by the real estate industry were an almost completely unquestioned feature of Democratic politics in New York until just a few years ago.

That started to change in a contested 2015 State Assembly race in Crown Heights, which evolved into a proxy battle between Brooklyn’s powerful political machine and Diana Richardson, a progressive backed by the Working Families Party. That election was reshaped when the Crown Heights Tenants Union called upon all the candidates to pledge not to take real estate money. Diana Richardson was the only candidate to take the pledge, and was able to turn an otherwise sleepy special election into a referendum on the role of real estate in a rapidly gentrifying neighborhood. She won decisively.

In 2018 Alexandria Ocasio Cortez’s congressional campaign beat one of the most powerful Democratic figures in the state, sending shockwaves through the establishment. That was quickly followed by another democratic socialist upset in the election of Julia Salazar over incumbent Democratic state senator Martin Dilan. Both Ocasio Cortez and Salazar also pledged to refuse donations from the real estate industry, as did Cynthia Nixon in her gubernatorial challenge to Governor Cuomo. This pledge has moved so quickly from the fringe to the mainstream that just a few months later Senator Mike Gianaris, the second most powerful Democrat in the State Senate, one of its most prolific fundraisers, and a key player in the rent reforms, felt pressured to publicly renounce real estate money as well.

It was in this new context — a unified Democratic majority in which a few democratic socialists with outsized influence were directly challenging real estate money in politics — that the Upstate/Downstate Housing Alliance (a coalition of over seventy housing organizations and community groups, including three chapters of Democratic Socialist of America) was able to push through historic reforms.

And with the expansion of ETPA statewide, the coalition’s working-class organizations have the opportunity to open a powerful new front in the fight against the real estate industry. While the assertion of one real estate industry leader that “the democratic socialist wing of the Democratic Party is in full control of the state government” is not yet true, this victory does give us the playbook to effect a political revolution across the state.

The New Playbook

Local politics is usually parochial, and municipal governments often operate, with very little public scrutiny, as an arm of local developers and the business community. When conflict around housing or development does break out it’s frequently between reactionary NIMBYs and developer-backed YIMBYs, a toxic struggle in which poor tenants lose either way.

But with the expansion of the ETPA statewide, transforming that dynamic just requires a little working-class initiative. Municipal governments now have a powerful tool to protect tenants, and tenants have an incredible opportunity to focus their demands into a potent political force.

If the seventy-plus independent organizations in the Upstate/Downstate alliance, the growing democratic socialist movement in New York State, and allies in progressive unions and the Working Families Party turned their attention locally, they could run dozens or even hundreds of candidates on a platform that explicitly highlights the irreconcilable interests of tenants who are just trying to live in their homes and the landlords who are trying to squeeze every drop of profit from them. It has the potential to embolden a working-class movement and win substantial, sometimes life-changing gains for working people.

It is fair to wonder whether an underfunded coalition of tenants and socialists, almost entirely unstaffed, can really run and win dozens of political campaigns in communities across the state, all while facing the opposition of both the local political establishments and the bottomless pockets of the real estate industry. The short answer is yes, we can. The dirty secret of New York’s Democratic political establishment is that its shaky foundation is a combination of a disengaged electorate and plentiful real estate money.

When real estate money is weaponized as a wedge issue by working class candidates, and voters are motivated by a clear message around a winnable reform that can change their lives, the vulnerability of the political establishment is quickly laid bare — just as it was in the Richardson, Ocasio Cortez, and Salazar races.

For example, Rochester, NY is the third largest city in the state. Its roughly two hundred thousand residents are majority people of color and it has one of the highest rates of extreme poverty in the nation. According to the American Community Survey, nearly two-thirds of the households are renters. The city has also been declared the “hottest housing market” in the United States, and rents continue to climb. There is no doubt that a compelling working class message with a little bit of organization behind it would find a welcome reception in Rochester.

Meanwhile, the current Rochester mayor won her Democratic primary (the only competitive election) in 2013 with fewer than nine thousand votes, and in 2017, as an incumbent, with only twelve thousand.  Mobilizing fifteen thousand working-class voters around rent control in a city with over 120,000 renters would be enough to completely transform local politics and potentially expand rent protections to tens of thousands of people.

Rochester’s tenant activists, united under the banner of the Rochester Housing Coalition (including the City-Wide Tenant Union of Rochester, the Rochester Homeless Union, and Citizen Action of New York) were able to move tenants to Albany week after week this year. They won an extraordinary victory in giving their city the power to initiate rent stabilization.  Now they have an opportunity to unequivocally demand local action and build the base of working-class voters who can turn that demand into reality.

The Rochester mayor is one of the largest municipal offices in the state, but this fight can be taken to county legislatures and city councils. In many places, a few dozen volunteers moving a few hundred or thousand voters can unseat even a well-funded local elected official. To get started, we don’t need much more than a compelling candidate and a small group of people — be it a community organization, a DSA chapter, or a group of tenants who are fed up and ready to organize. Campaign finance reports provide an easy map to which elected officials developers and landlords view as crucial to their political power — our top targets.

Knitting local campaigns together in city after city and county after county can be the basis for organizing tens of thousands of upstate tenants into a powerful new political bloc, comparable to the millions of rent stabilized voters in New York City. Organized and united on a truly statewide basis, renters could be a force to be reckoned with, perhaps powerful enough to pass Senator Salazar’s good cause bill and finally guarantee rent protections for all.

Recent socialist and progressive electoral victories laid the groundwork for the significant reforms we won last week, and those reforms now give us an opportunity to go on the offensive against landlords throughout upstate New York. Every county legislator and city councilor should be prepared to answer a simple question from tenants — which side are you on?