The City Council’s BIG LIE!
Commercial Rent Stabilization Bill
Will Save Small Businesses!
Lawmakers Side with Lobby’s
Rent Bill to Kill Tenants’ Right Bill
and their American Dream!
A new bill*, intro 93- Commercial Rent Stabilization (CRS) was introduced in the City Council. The CRS bill is being touted to save our small businesses by establishing annual guidelines to control commercial rent increases. After all, every business owner and most New Yorkers know that sky high rents were the main reason their favorite mom and pop businesses were forced to close when their leases expired.
CRS is being publicized as needed today for our virus battle weary businesses who are barely hanging on. This is the false narrative being hyped.
Do not be fooled!
The CRS bill is the greatest symbol of success of powerful lobbies controlling our Democratic leadership at City Hall. CRS is the most anti- immigrant and
anti- small business bill in the Council.
The CRS bill was written by the real estate lobby to benefit only landlords, by keeping the status quo. If this law is passed it will not save a single business owner or one job! In fact, the CRS will result in higher rents every year causing increased business closings and more jobs lost. If passed, this law will guarantee that landlords remain in full control of the future of every business owner when their leases expire.
Our city’s “empty store blight” clearly shows the outcome when tenants have no rights and landlords have exclusive control over the critical commercial lease renewal process. The CRS bill is a cleverly disguised Trojan Horse created by a lobby to protect only the landlord’s investment and windfall profits. The passage of CRS will signal the end of the American Dream for the majority of our business owners in NYC. Every successful small business owner will be in jeopardy of closing whenever their leases expire, as would be the case if CRS passes, then an economic calamity is certain in NYC’s near future.
Those Council Members who have not carefully read the CRS bill and instead have relied upon the integrity and good faith of the BIDS, SBS, Chambers, lobby created shill groups or lobby loyal lawmakers must be warned. Warned of the dire outcomes to their local businesses, workers, neighborhoods and citizens if they vote for this lobby bill (CRS). Warned that none of our city’s business organizations or Democratic leadership has ever made a priority for over a decade to stop the closings of our small businesses or to find a real solution to end their crisis. A vote for this lobby created CRS bill will be a betrayal: of democracy, their business owners and employees, their progressive values and to the greater good of society. A betrayal which Council Members will be held fully accountable for if they support this lobby created bill.
True Outcomes of CRS if passed!
Lawmakers’ sponsorship and support leading to the passage of CRS will mean the certain continued loss of more local businesses and jobs, higher inflation, higher local property taxes to make up for the loss of the huge revenue collected by our small businesses, higher local unemployment rates, the loss of the major pathway for the hard to employ, continued landlord abuses such as extortion of cash from mostly immigrant owners and cruel shorter term leases of sometimes month to month/one year and the end of any profitable future in business for the majority of our local business owners. Most importantly, the passage of the CRS bill will mean the end of the Jobs Survival Act. The tenants’ bill, that for over 3 decades was the unanimous choice of true business advocates as the only real lifeline giving rights to business owners needed to survive, make a reasonable profit, and have a future in NYC.
These are the shameful truths about the CRS bill that the pro real estate BIDS, Chambers, SBS, and lobby corrupted lawmakers will hide from true progressive Council Members.
The truth that the CRS was not created now to save our businesses once the virus crisis ends. The rigging and planning for CRS’s creation began after an Oct 2018 hearing on the Jobs Survival Act. A sham hearing in response to the city’s “empty store blight.” A hearing supposedly to address the decade long growing crisis destroying our small businesses. A hearing where no real solutions were offered by the BIDS, SBS, Chambers or business groups to stop the closings of our small businesses. Yet, a hearing where all the real estate friendly groups and lawmakers opposed the Jobs Survival Act or any legislation that would regulate commercial landlords. A hearing where the priority was to keep the status quo, destroying our small business owners. Today’s CRS bill is an outcome of what that disgraceful lobby orchestrated hearing looks like.
The CRS is the worst case of rigging in plain sight in the City Council.
After the 2018 hearing and much stalling by lobby loyal politicians promoting worthless bills, useless programs and fake studies, the CRS bill was first introduced in late 2019. Created in secret while Speaker Johnson’s office, lead by Erik Bottcher, was pretending to amend the Jobs Survival Act and move it to a promised vote. The CRS bill was lead by then CM Brad Lander and CM Stephen Levin who touted CRS as the solution to save our businesses. Both lawmakers were urging the public to sign petitions for CRS so that our businesses could be quickly saved. All the while during this lobby’s public relations disinformation stunt both lawmakers purposely ignored the very existence of the Jobs Survival Act. The only real lifeline sitting in Committee with 28 sponsors ready to be voted on. Both lawmakers knew their CRS bill could not be voted on while the Jobs Survival Act was in Committee. CMS Lander and Levin were willing pawns carrying out the real estate lobby’s long term playbook, which was to kill the Jobs Survival Act and replace it with a lobby created bill.
CM Lander and Levin’s CRS bill gives new meaning to Hypocrisy!
Even though both councilmen proclaimed their motive for writing the CRS bill was to save our small businesses, they refused to ever call for a hearing on their bill until months before all pending bills expired in Dec 2021. They refused to gain sponsorship for their bill until months before 35 Council members’ terms ended. Instead of advocating to move the CRS, both remained silent, even as the virus crisis was forcing thousands of businesses to close. The real reason for both lawmakers refusing to not call for a hearing and move their CRS bill to a vote was because the CRS bill could never begin to stand up to the Jobs Survival Act for saving small businesses and protecting owners when their leases expired. The CRS bill does not address tenant's needs or offer any solution to the unfair lease renewal process; the main cause of the closings across our city.
For over 30 years the Jobs Survival Act was the only legislation created and advocated for by the city’s real business owners. This bill was written to be fair, legal and the only bill giving rights to business owners which were so desperately needed to protect all business owners from being forced to close when their leases expired. It was legislation giving rights needed to negotiate fair lease terms that would allow a reasonable profit for all parties. The Democratic leadership was working with the lobbies to see that no business owner would ever receive those rights needed to survive.
The CRS was without debate the most ridiculous and bias bill ever proposed to address the unfair one sided commercial lease renewal process. CRS is the Status Quo bill for the landlords, nothing more.
The Jobs Survival Act was so obviously far superior to the CRS bill in every way that an honest hearing could never be called. Any honest debate comparing the two bills would have immediately called into question the real reasons why CM Lander and CM Levin needed to create their own CRS bill. The most obvious question is why create a new inferior bill claiming to save our small businesses when the Jobs Survival Act, selected unanimously by the Small Business Committee in 2009 as the best and only real solution to save our small businesses existed with 28 sponsors ready to vote for it? Why not just amend the bill like happens regularly with other legislation and pass it? Especially making a priority to quickly move legislation during a growing crisis. As former Speaker Johnson repeatedly stated he intended to do a dozen times at the 2018 hearing on the bill?
A message to all true progressive Council Members! Do not be tricked!
The CRS bill is nothing but trick legislation dependent upon uniformed lawmakers of the workings of the commercial lease renewal process. Also, dependent upon the collusion of BIDS, Chambers, and SBS to give disinformation on the true intent of the CRS. The trick being the focus solely upon a half truth that sounds good, “high rents forced long established businesses to close”, therefore if you control the commercial rent increases when a lease expires, the closings will stop. Maybe partly right 20 years ago but totally wrong today.
20 years to late!
In reality the rents have been artificially and grossly inflated due to the years of unchecked hyper real estate speculation at the same time as big banks and chains were bidding for prime locations on Main Street. The landlords want the starting point for commercial rent guidelines set at the highest insane and destructive market rent levels of a two decade long commercial rent bubble. Market levels that resulted in our very best and oldest businesses being forced to close in record numbers. Yes, that is insane economics! Under the CRS bill the injustice gets worse. The commission members who determines the annual rent increase adjustments will be picked by the heavily lobby campaign funded Mayor. Even worse is the city’s commercial rents will never go down but only increased from their already proven lofty destructive levels.
Understanding the Commercial Lease Renewal Process is the KEY to saving our small businesses.
This is what the lobby does not want Progressive lawmakers to know.
The lobby created sham bill is absurd in every manner and would not save a single small business owner or job. The biggest reason it would fail to stop the closings is because , unlike the Jobs Survival Act, the CRS bill DOES NOT GIVE THE TENANT THE RIGHT TO RENEW A COMMERCIAL LEASE!
Advocates of CRS falsely claim that their bill will act just like the residential rent guidelines. THIS IS BLATANTLY WRONG! NYC residential tenants have a right to renew their leases, while NYC commercial tenant do not. This is the key trick of the CRS bill. With business owners having no right to renew their leases they have no negotiation rights and therefore the rents do not matter. CRS keeps the status quo where a landlord calls all the shots and can give a 30 day notice for a business owner to vacate the premise when a lease has expired. What about the length of lease and its impact upon a businesses’ ability to grow and create jobs? Again, under CRS only the landlord determines the length of leases. A short term commercial lease is a growth and job killer for business owners. Which make the CRS bill the most anti-job bill possible.
The passage of CRS would guarantee shorter lengths of leases in NYC. Under this law the new rent charged would not exceed the annual rent adjusted at the time of the lease expiring and would remain that percentage adjustment until the end of the lease. Which means shorter leases for the tenants and annual rent increases every time a lease expires, which could be every year if the landlord decides.
From the bill 93
22-1304 Stabilization provisions. a. Upon renewal of a lease for commercial space, the rent charged for the first year of the new lease shall not exceed the initial legal regulated rent or legal regulated rent adjusted pursuant to section 22-1308 until the end of any lease.
Shamefully, the CRS bill would allow landlord abuses to continue unabated. Cruel abuses such as illegal extortion of cash demanded by unscrupulous landlords from mostly immigrant owners to remain in business. The CRS has fines for violations of the bill but without the tenant having the right to renew their leases these landlord penalties are useless. What business owner will report their landlord for abuses when they have no protections when their leases expire? NONE!
Wouldn’t the CRS guidelines be fair to all parties? The board members would be hand picked by the city’s lobbies and a review of their first guideline makes clear who they will favor.
The first guideline for determining rent increase speaks for itself of this boards bias:
1. The economic condition of the commercial real estate industry in the affected area, including such factors as:
(a) Commercial real estate taxes and sewer and water rates;
(b) Gross operating and maintenance costs (including insurance rates, governmental fees, fuel and labor costs);
(c) Costs and availability of financing (including effective rates of interest);
The new CRS bill with all its claims of saving businesses, in truth, gives the tenant no right to renew their commercial leases. Therefore, failing this vital right, nothing changes and the landlord still has total control over the future survival and profitability of every business owner. The tenant having no right to renewal a commercial lease should be a NON STARTER for any fair and effective legislation.
The only real lifeline for businesses is the Jobs Survival Act!
The Jobs Survival Act ends all landlord abuses because it gives the right to renewal long term minimum 10 year lease. Landlords under the JOBS ACT, cannot demand anything from their merchants because business owners would then have legal rights. Our lobby corrupted government has nothing to do with the negotiations between the landlord and tenant in the commercial lease renewal process! With the “right to renewal” the tenant can equally negotiate the new lease terms with their landlord. If they cannot reach a mutual agreement then the Jobs Survival Act provided an arbitration process to arrive at reasonable rents. This process is based solely upon a case by case situation. How absurd is it that the CRS bill has one rent increase adjustment for the entire 200K plus businesses located in 50 or more neighborhoods ranging from Wall Street to small main streets in the outer boroughs? Yes, ridiculous, totally unworkable, a product of despicable corruption of City Hall.
Progressive lawmakers, do not believe the BIG LIE that the CRS will save our businesses by preventing rent gouging. Under CRS just the opposite happens with rents rising.
Only the Jobs Survival Act will result in lower rents! Under the Jobs Survival Act the burden is on the landlord to justify the insane rent increases being demanded. Therefore, the long established businesses closing and the empty stores on every main street will produce a strong case that the rents are too high and must be reduced to allow a business to survive and make a reasonable profit. No experienced arbitrator would ever allow rent increases for a neighborhood filled with empty storefronts caused by the same rents being demands. Especially in those blocks with empty stores for sometimes years!
Do not take my word for these claims against the CRS bill. The CRS first prime sponsor was then CM Stephen Levin and he testified in September 2021 before the Small Business Committee about his bill, CRS. Hear for yourself from the bill’s prime sponsor, CM Levin, the truth of this fake lobby bill. https://legistar.council.nyc.gov/MeetingDetail.aspx?ID=890490&GUID=3FF7A7DE-5B34-40BE-95F7-60E74A88A168&Options=ID|Text|Attachments|&Search=1796
click link on Video icon of hearing (under Agenda ) scroll to CM Levin statement of what this bill does not do. 12:08 sec to 12:36 sec. The truth exposed, because what this bill (CRS) does not do is what every business owner needs to survive. CM Levin’s statement “that the CRC does not guarantee any business a right to a space” is code for, the landlord has total control of your business to maximize only the landlord’s profits. If at any time the landlord finds someone willing to pay more rent, the tenant is not going to stay past their lease expiring. The money, time and sacrifices to build a successful business does not matter to the landlords nor to the lobby loyal Council Members supporting CRS. Under CRS only the landlord’s profits matter. CM Levin’s own statements, the CRC bill gives “no right to renewal for the tenant and no reduction of rents, ever ,” that says it all. CRS WORTHLESS! The statement also confirms who actually wrote the CRS bill.
The CRS was created to kill the Jobs Survival Act!
The disgraceful truth was the CRS was created by the real estate lobby with only two goals. One was to stop a vote on the Jobs Survival Act. A vote promised by then Speaker Johnson at the Oct 2018 hearing where he repeatedly stated “the bill ( Jobs Survival Act) would be amended and moved to a vote.” The second goal of the real estate lobby was to create their own substitute bill that would keep the status quo and never regulate commercial landlords.
With the help of a real estate friendly City Hall, the lobby was successful in stalling any vote on the Jobs Survival Act (even with the virus crisis speeding up the business closing and 28 sponsors) in the Council. The lobby could never honestly debate which bill was a better solution to save our businesses and end their crisis. Therefore, they just hid quietly during the pandemic crisis and ran out the clock of the Jobs Survival Act, and would then substitute this landlord’s bill (CRS) for the Jobs Survival Act in the new Council. Which is exactly what Council Members Ayala and Rivera, did for the real estate lobby by carrying out their playbook by substituting their lobby's CRS bill for the tenants’ rights Jobs Survival Act.
For those true independent progressive lawmakers not controlled by the real estate lobby, who honestly seek only the best solution to save their small businesses and jobs there is a way to find the best lifeline. Learn the truth from their own merchants of which bill will save them or give them a fighting chance to survive.
Open the link that compares the two bills.* Also, first read the article on the fair review of the CRS bill done by the real small business advocates.*
Make a copy of the two comparisons and take it to your favorite local merchant owners to discuss and gain their opinions. Ask them what bill they would want their Council Member to support and why? Do not listen to the anti Jobs Survival Act organizations: Bids, Chambers, SBS or lobby shill created groups. All these pro real estate groups have never and will never support legislation that gives any rights to commercial tenants when their leases expire.
The stakes are too high and the suffering too great for the “willful ignorance” of lawmakers to play any role in selecting the best legislation to give our businesses a fighting chance to survive, protect their investment, and restore their American Dream.