Lakewood Township has a Rent Control chapter (#14) which regulates when and how much landlords are permitted to increase rent. Certain increases are permitted on an annual basis, and certain increases such as hardships and unusual circumstances are permitted by application to the Township's Rent Control Board.

The basic annual increase section permits landlords who supply tenants with heat to raise rents annually 6.5% over the previous base rent, and landlords who do not supply tenants with heat to raise rents annually 5% over the previous base rent.

Landlords who do not increase this amount each year may at a later date, do an accumulative increase up to four years.

The chapter also grants a number of exceptions to the max increase - but with specific guidelines. The chapter grants an exemption of the max increase amount to landlords of "new construction" (i.e. for seven years from the date of the initial Certificate of Occupancy) or of rental units which are being placed on the market for the first time. However, this exception includes specific guidelines as follows:

"The landlord shall, during the exempt period, notify all prospective tenants in writing prior to commencement of any tenancy that:

1. The unit is exempt from rent control pursuant to this section.

2. The date upon which the exemption terminates."

Aside from the annual increase, which is permitted by-right, hardship increases (which is when a landlord finds that present rentals are insufficient to cover the cost of mortgage payments, taxes and maintenance) and increases for unusual expenses (which is where the unusual or unexpected cost of providing heat or utilities, or of making major capital expenditures or capital improvements may require a substantial investment or expenditure by the landlord to offset such expenses) are permitted only upon "special application to the Rent Control Board for good cause shown".

The Township also has an ordinance (2-49) which creates the Rent Control Board, regulates their membership, and lists the type of rent control disputes which the board can adjudicate, which includes the following:

To remedy violations of the Rent Control regulations by adjusting rentals, ordering rebates or taking any other authorized action to enforce compliance with the Rent Control regulations.

To accept complaints from tenants of illegal rental increases.

To accept applications from landlords who are seeking rental increase based on hardship, unusual expenses, tax surcharge or other circumstances under which said increase might be allowed after a hearing.

To reduce rents based on landlord's breach of covenants in lease or implied covenants, such as habitability.

To adjust rents based on landlord's subsequent change in position caused by law or economic conditions.

To review applications and investigate complaints if necessary prior to rendering final decisions in any case.

The Ordinance specifies that "landlords are entitled to fair and efficient administrative relief upon filing and application for a rental increase", and therefore, "the Rent Control Board shall, within 60 days following the proper filing of a completed application for a rental increase, render a decision on the application. If, due to no fault of the landlord, the Rent Control Board does not render a decision on a properly filed and completed application for a rental increase within 60 days of receipt of same, the landlord shall be entitled to have any rental increase granted on the application, applied retroactively to the first rental payment period 30 days after the filing of the application."

The Ordinance also includes an appeal clause in that "both landlords and tenants may appeal the decision of the Board to a court of competent jurisdiction according to law".

Back in 2016, while the Board was reviewing a complaint filed by a tenant alleging unfair practices by the Westgate rental management company, Deputy Mayor (and then-Mayor) Menashe Miller unilaterally decided to abolish this board in order to ensure that the Board would not vote against his Westgate friends. However, legally only the actual board was prohibited from meeting; the ordinances creating and regulating the board and their jurisdiction - and timeframe to respond to applications - is still in place on the books.

This quasi-abolishment has caused much turmoil, especially now with the property tax and utility bill increases which landlords and tenants have been dealing with:

1) This seems to preclude landlords from being able to apply to the Board for hardship and unusual circumstances increases - which is a very timely issue as many landlords are facing higher costs due to increased property taxes and utilities. At the same time, the Township Clerk is still authorized to accept Rent Control Board applications and therefore, it appears that a landlord can submit an application, wait the 60 day timeframe which the Ordinance permits that Board to wait before rendering a decision, and then "due to no fault of the landlord, the Rent Control Board does not render a decision on a properly filed and completed application for a rental increase within 60 days of receipt of same, the landlord shall be entitled to have any rental increase granted on the application, applied retroactively" - hence, any landlord can now submit any hardship application and it would be approved automatically.

2) The Ordinance clearly grants jurisdiction to the Rent Control Board to "enforce compliance with the Rent Control regulations". As Deputy Miller has abolished the Board, there is no one left to "enforce compliance with the Rent Control regulations" and perhaps, the entire Rent Control chapter which specifies how much a landlord can increase, and when exemptions are warranted, falls right out the window, and rent is now a free for all!

It's important to realize that the Ordinance specifies that the membership of the Board must be "two members from tenants residing in the Township; two members from landlords owning residential rented property within the Township", which makes clear that the purpose of the Board is to support both tenants and landlords, not just one.

3) FAA News has learned that the guidelines regarding the exemptions (which require the landlord to provide written notice to the tenant that the property is exempt) have caused numerous clashes between landlords and tenants in Lakewood as case law has shown that these guidelines are not legally sustainable. However, they are still "on the books" in Lakewood, causing tenants to believe they can rely on them.

4) The ordinance permits landlords - even without making an application to the Rent Control Board - to take a "tax surcharge" from a tenant because of an increase in Township property taxes. Lakewood Township property taxes go up each year for all property owners, so, this would appear that even property owners of new construction who fail to provide written notice to the tenant that the property is exempt, are eligible to take a tax surcharge (in addition to the point noted above that this exemption guideline has already been struck down in court).

How is your rent increase working out for you? Let us know in the comments section below!

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Anonymous said...

From what I hear, much of the Lakewood ordinance is pre-empted by state law, which is much more landlord friendly.

Rent control expert said...

Anon 8:39,

You’re totally wrong. Nothing in state law contravenes our municipal ordinance. In fact the statutes are essentially silent, as they relegate this matter up to home rule for each respective government jurisdiction.

Anonymous said...

The residents of Lakewood have adopted the rent control regulation decades ago. For Menashe The Abolisher and his cohorts to think he’s smarter than everyone else and discard a regulation so he can benefit his landlord friend is nothing less than an impeachable offense. He should be thrown out head first for leaving the tzibbur of bnei torah without proper protections. All of the grief which hundreds of families have experienced can be attributed to his reckless actions. He simply does not care for the majority of his constituents.

Anonymous said...

Yeah. Remember Menashe’s famous TLS press release where he promised to get RCB members who would attend the meetings. He was so full of it. There was an entire population to get members from, but of course he never did any sort of reaching out to recruit members. He was simply using his old political ploy to deflect deserved criticism from his egregious actions until people would forget about it. And once he removed the topic from the public discourse, he then moved to no longer designate a committee liaison to the RCB. So, in effect, he killed the board through refusing to reappoint the members who were already serving, plus he got rid of the liaison. Meanwhile he also left the residents high and dry and with no authority to turn for help. But that’s nothing new for him.

Anonymous said...

Aha. So now I understand why he’s always been referred to as Menashe The Abolisher. I guess he’s earned that title for life. It’s too bad the thousands of tenants in town don’t have a voice to represent their needs in our local government. After all, where’s the hakoras hatov for all those votes?

Menashe the Abolisher said...

I was the Mayor then at that time and I decided that it doesn't serve the interests of the community to have a rent control board. It's as simple as that. There's no reason to keep bringing up the issue again. Why can't people just forget about it already!

I can't believe I actually voted for Menashe said...

Which community were you representing at the time? Was it only your investor landlord friends? Because it certainly was not the thousands of bnei torah struggling to keep a roof over their children's heads! Have you no shame?!