Landlord groups RSA, CHIP plan federal lawsuit over new rent law

Case will argue that new laws are "unlawful taking of property"

Jun.June 25, 2019 08:35 AM
Community Housing Improvement Program director Jay Martin, Mayer Brown's Andrew Pincus and RSA president Joseph Strasburg (Credit: iStock)

Community Housing Improvement Program director Jay Martin, Mayer Brown’s Andrew Pincus and RSA president Joseph Strasburg (Credit: iStock)

Soon after making it through both houses of state legislature, the new rent laws signed by Gov. Cuomo this month may have to go through a federal court house as well.

Two landlord groups, the Rent Stabilization Association and the Community Housing Improvement Program, are planning to file a lawsuit against the regulations for rent stabilized housing by the middle of July, the New York Post reported, citing sources.

The groups have asked law firm Mayer Brown to represent them, and appellate specialist Andrew Pincus, who has extensive experience challenging government regulations, is expected to lead the legal team.

The case will likely be argued on the basis of the Fifth Amendment’s “Takings Clause” — “nor shall private property be taken for public use, without just compensation” — which is often cited by plaintiffs who claim to have been harmed by legislation. It is unclear whether Cuomo himself will be named as a defendant.

The RSA, headed by Joe Strasburg, represents 25,000 landlords in New York City and is known for its “aggressive” advocacy for small landlords. CHIP director Jay Martin, who represents 4,000 apartment building owners, recently told The Real Deal that the MCI and IAI programs had been so “gutted and neutered” that they might as well have been eliminated outright.

Sources told the Post that the Real Estate Board of New York will not take part in the lawsuit, preferring to “work behind the scenes” to limit the legislation’s impact.

A TRD analysis from last week shows that the combined effect of the new rent laws will be to seriously constrain landlords ability to raise rents on stabilized units. Landlords say this will make it impossible to pay for improvements and cause prices of non-stabilized apartments to rise even further. [NYP] — Kevin Sun

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