Rent Relief, Taxes on Rich at Stake in Albany Budget Talks

Housing advocates have mounted a serious campaign in the last several months to pressure the state Legislature to raise taxes on the richest New Yorkers. Significant new revenues are needed to fund social programs, including rental assistance to tenants who lost income due to COVID-19, and to get homeless people off the streets and out of shelters into permanent housing.

Tenants have been relentlessly calling legislators and have held protests and marches directed at the legislative leaders, especially Assembly Speaker Carl Heastie, who has been less forthright than state Senate Majority Leader Andrea Stewart-Cousins.

As Tenant/Inquilino went to press, negotiations between Heastie, Stewart-Cousins, and Governor Andrew Cuomo were entering the last week before the April 1 deadline for adoption of the annual state budget. There was reason to hope for a reasonably successful outcome. The “one-house” budget bills passed by the Senate and Assembly, which represent their stance in negotiations, would both raise taxes on the rich in ways that would produce about $8 billion in new revenue. Another $12.56 billion will be coming from President Joseph Biden’s $1.9 trillion COVID stimulus package, including $2.3 billion in rent-relief money for the state. (Additional federal funds will go to cities and counties.)

Neither budget meets the tenant movement’s demand to cancel rent owed (#CancelRent on Twitter), but tenants were mobilizing to get the proposals changed so they would effectively clear rent arrears for all renters for the duration of the pandemic without onerous eligibility requirements or complex application procedures.

Gov. Cuomo has resisted calls to increase taxes on the rich for years, adhering to the tired argument that it would cause billionaires to decamp to other states. During his decade in office, he has presided over severe cuts to education, health care, and other social programs — including the cuts to Medicaid he imposed in last year’s budget just as the pandemic was beginning to overwhelm hospitals.

The governor has been weakened politically by the scandals swirling around him, as more women come forward with accusations that he sexually harassed them, and as the FBI investigates whether Cuomo and his staff provided false data about COVID-related deaths in nursing homes. But despite his weakened position, Cuomo still holds a structural advantage in the budget process, because of the state constitution and court decisions that limit the Legislature’s ability to make changes in the executive budget without the governor’s acquiescence. 

Both houses now have the ability to override a gubernatorial veto of budget legislation, however. Tenants were watching to see how strongly Majority Leader Stewart-Cousins and Speaker Heastie would insist on raising taxes on the rich.

Some people have argued the state doesn’t need to increase revenues, because the federal stimulus aid will close this year’s budget gap. But the federal funds are a one-shot infusion, so there will be a large deficit next year unless the state collects more in taxes, and Cuomo’s austerity budgets have exacerbated economic inequality for years, leaving growing numbers of people hungry and homeless.

Although the Senate and Assembly have moved toward breaking the austerity regime, many are unsatisfied with the $8 billion in new revenues the one-house budgets would produce. In a last-minute letter to Heastie, several new Assemblymembers who are members of Democratic Socialists of America urged him to double the new revenues to $14 billion. 

Others, including Housing Justice for All, the DSA, and New York Communities for Change, are advocating the Invest in Our New York Act, a six-bill package that includes higher income taxes on the rich, resurrecting the small state tax on stock transfers, and a constitutional amendment to tax increases in billionaires’ wealth. It would yield an estimated $50 billion in its first year and $30 billion annually after that. 

Here’s a status report on budget negotiations as of press time.

Rent Relief

Both one-house bills would use the $2.3 billion in federal rent relief to pay back rent owed by tenants with household incomes below 80 percent of Area Median Income (almost $82,000 for a family of three in New York City, and $55,000 in Rochester). For tenants whose incomes are above 80 percent of AMI, the Assembly budget includes an extra $100 million, and the Senate bill $400 million. It is estimated that 1.4 million households in the state are behind in their rent.

Landlords who accept these funds would be barred for one year from raising the rent or evicting the tenant without good cause. Housing Justice for All has called for a five-year protection from rent increases and evictions.

The Assembly bill includes a way to deny rent-relief funds to landlords who have dangerous code violations in their buildings. But it has no tenant protections, so this provision could put tenants at risk of eviction. It was also unclear if the legislation would cover all accrued back rent or if it would cover a few months’ future rent. Without such a clause, tenants who are out of work would soon find themselves in arrears again.

That is crucial because the almost-universal moratorium on evictions enacted in December will expire May 1. If the Legislature does not extend it, thousands of tenants will face losing their homes. It’s impossible to imagine that they would be able to clear all back rent they owe by May 1.

Housing Access Voucher Program

The tenant movement is also pushing a new Housing Access Voucher Program, which would provide rent-subsidy vouchers to homeless New Yorkers and those at risk of homelessness. Legislation sponsored by Senate Housing Committee chair Brian Kavanagh (D-Manhattan/Brooklyn) and Assembly Housing Committee chair Steven Cymbrowitz (D-Brooklyn) would allocate $500 million for HAVP, enough for about 50,000 vouchers. 

The Senate budget bill includes $200 million for HAVP, essentially a down payment. The Assembly budget does not. It includes some funding for homeless programs, but unlike the Senate version, it would not help low-wage households whose income comes from SSI or SSD disability programs and do not qualify for public assistance, nor households with undocumented immigrants. (Speaker Heastie posted on Twitter March 20 that “we support HAVP.”)

Once the budget is passed, the tenant movement will turn our attention to legislative goals. Foremost among these will be enacting a bill to prohibit arbitrary and retaliatory evictions, commonly referred to as requiring “good cause” for eviction. In addition, the legislature needs to tweak the rent-stabilization system to adapt it to upstate markets. The downstate rent-stabilization system is predicated on annual or biennial lease renewals, but most upstate tenants rent on a month-to-month basis and do not have leases. 

Esteban Girón is a member of the Crown Heights Tenants Union and a board member of Tenants Political Action Committee.