Big spenders: Real estate lobbying spiked for rent law

The year 2019 was a costly one for landlords — in more ways than one.

A new report by tenant advocacy groups shows that landlords splurged on lobbying that year, then dialed it way back.

Four industry groups spent more than $4.7 million on lobbying efforts in 2019, when the state overhauled rent stabilization in tenants’ favor. That was $1.7 million more than in 2018, 2020 and 2021 combined. Their spending plunged in 2020 and flattened out in 2021 at a little more than $1.1 million each year.

In 2019, the Rent Stabilization Association spent nearly $1.4 million on lobbying; the Real Estate Board of New York spent more than $650,000; and the Community Housing Improvement Program just over $210,000.

Lobbying expenditures by landlord lobbying organizations 2018-2021 (Via Housing Justice for All, NYS Joint Commission on Public Ethics)

The report, by Housing Justice for All and other tenant advocacy groups, argues that the industry’s past spending likely heralds a major effort this year, as landlords push to replace tax break 421a and to stop the passage of good cause eviction.

“These lobbying groups appear primed to unleash another deluge of influence spending — seeking to turn popular opinion and the opinions of lawmakers in their favor,” the report states.

REBNY, CHIP, RSA and other groups have launched a campaign, “Homeowners for an Affordable New York,” against good cause eviction, which would give tenants a defense against eviction in housing court if their rent went up by more than 3 percent or 1.5 times the regional inflation rate, whichever is higher. The campaign has a $1.4 million lobbying contract with Fontas Advisors.

A spokesperson for the campaign was dismissive of the tenant advocates’ findings.

“We don’t put much faith into a report hastily pieced together by a lobbying organization whose leadership doesn’t see that, if pushed through the legislature, good cause eviction will do real damage to New York’s already teetering economy,” the homeowners’ spokesperson, Ross Wallenstein, said in a statement.

He argued that the measure would discourage investment in rental housing statewide, hurting both owners and tenants.

The three groups, along with a political action committee tied to them, spent a total of $7.7 million on lobbying between 2018 and 2021. The PAC, Taxpayers for an Affordable New York, spent the most, nearly $3.5 million, followed by REBNY’s $2.6 million and RSA’s $1.9 million. CHIP spent $700,421.

Vocal-NY Revenue (IRS/990s)

Meanwhile, the budget of VOCAL-NY, a pro-tenant nonprofit that finances the Upstate-Downstate Housing Alliance, nearly tripled in the four years leading up to the 2019 rent law, from $1 million in 2014 to $2.8 million in 2018, according to the organization’s tax filings.

Its spending on lobbying between 2018 and 2021 was less than $200,000, according to state records. That does not represent the full extent of tenant-focused lobbying, though, and VOCAL-NY is active on other issues besides housing.

Similarly, REBNY advocates on numerous matters other than rent stabilization, which is a focus of the RSA and CHIP. But REBNY’s budget dwarfs theirs.

The changes to rent stabilization enacted in 2019 dramatically altered the economics of nearly 1 million New York City rental units and tens of thousands outside of the city, notably by severely limiting rent increases and deregulation. Good cause eviction would provide a lesser degree of protection to tenants in the rest of the state’s rental housing.

Lobbying is just one of many factors that influenced the outcome in 2019. The seeds of the rent law reform were planted in 2018, when voters swept Republicans out of power in the state Senate. Real estate interests had heavily supported Senate Republicans and had little sway with Senate Democrats, who had spent nearly all of the previous 40 years in the political wilderness.

A consensus emerged after the law passed that tenants’ advocates had outhustled and outprepared their landlord counterparts. Owners were unexpectedly abandoned at the 11th hour by then-Gov. Andrew Cuomo, despite having donated millions of dollars to his campaigns over the years.