Council Member Seeks to Change RGB Methodology
City Council Member Corey Johnson seeks to introduce new legislation that would change the methodology of the city’s Rent Guidelines Board (RGB) for determining rent guidelines for rent-stabilized apartments. At a rally in front of City Hall, he said that while owners’ operating expenditures have gone up slightly in the past few years, their incomes have risen much faster.
His plan entails discontinuing consideration of the Price Index of Operating Costs (PIOC) and instead mandating the RGB to place greater weight on owner income. He says this would result in decisions about annual rent adjustments that more accurately reflect the costs and revenues accrued by owners. The PIOC measures the price change in a market basket of goods and services used in the operation and maintenance of rent-stabilized apartment buildings in New York City.
Johnson claims that the PIOC doesn’t measure the income owners receive from their properties, even though the RGB receives actual numbers of owners’ income and expenses. He says that this income and expenses data proves the PIOC has overestimated operating costs by roughly one-third for the past several years.
Currently, owners of income-producing property are required to file their income annually with the Department of Finance if they own more than 10 units. The proposed legislation would lower the minimum to six units. Johnson stated he would like to see New York City’s RGB operate more like the boards in Westchester and Nassau County, which don’t use a price index and have frozen rents several times, compared to New York City, which has never seen a rent freeze.