New Montclair Rent Control Regulations Contested

MONTCLAIR, NJ—The implementation of rent control regulations in the Township of Montclair approved earlier this month is being contested in a five-count complaint filed in Essex County Superior Court.

On April 7, the Montclair Town Council voted 5-0 with two abstentions to approve rent control in the township. The new law limits annual rent increases to 4.25%. For apartments in which at least one tenant is 65 years of age or older, the maximum annual permissible rent increase is 2.5%.

According to the new rent control law, approximately 40% of the residents of the Township of Montclair live in rental housing units ranging from single-family homes to multiple dwellings of more than 100 units.

A committee of township residents, supported by Montclair Property Owners Association, is seeking to protect their right to engage in referendum activity and to enjoin the township from implementing the law until the COVID-19 state of emergency has eased so that petition signatures can be collected for referendum. The Montclair Property Owners Association was formed in response to the adoption of the rent control ordinance and includes the owners of more than 900 rental unites that would be subject to the ordinance.

Charles Gormally of Brach Eichler LLC and an attorney for the township residents committee, said, “Our shock over lack of transparency by not soliciting input from homeowners and property owners is only exceeded by our dismay over adopting this election-driven ordinance during a global pandemic. This lawsuit has been filed to protect the peoples’ right to protest government action through the referendum process.”

He says that government should not adopt legislation knowing that the peoples’ rights to engage in referendum “has been functionally eliminated due to the state of emergency.”

He added that the referendum process requires the committee to circulate a petition and obtain signatures in support within 20 days—activities that simply cannot be carried out during the social distancing emergency measures now in place due to the Coronavirus.

“The lawsuit will vindicate the substantive right of protest that Montclair residents have and provide a reasonable opportunity for the residents to exercise these rights when the public emergency has ended,” Gormally said.

He noted that the committee had attempted to negotiate with the township prior to filing the litigation and noted that the committee would continue those overtures, but to date has yet to receive a response from the township.

“When we learned of the ordinance, we proposed not increasing rents as a good faith gesture until the council could open a genuine dialogue about rent control in Montclair from which all property owners, including homeowners, were excluded,” says Ron Simoncini, executive director of the Association. “Instead of entertaining the offer, the council enacted a patently unenforceable and inequitable ordinance without even considering a single amendment, revealing their bias against property owners of all types.”

He added that recent discussions with several property owners, each had indicated that they do not plan on any rent increases for the next 90-days purely based on the sensitivity to the uncertainties related to the COVID-19 crisis.

“But the entire membership is determined to fight back on this until property owners are treated equally under the law,” Simoncini noted.

The new rent regulation states, “The rapid upsurge in the market and speculation in multiple dwellings with rental apartments has resulted in a substantial increase in the amount of rents over a short period of time, causing and threatening to cause the dislocation of tenants unable to adjust to the higher rents…”