The D.C. Rental Accomodations Commission has upheld an earlier ruling that Rep. James H. Scheuer (D-N.Y.) has been overcharging some of his tenants at a Southwest Washington apartment building and also that he can be fined for ignoring a subpoena for his rental records.
The commission said it agrees with a ruling by its administrative staff that Scheuer should be forced to roll back some rents at the 402-unit Capitol Parks Apartments at 800 4th St. SW. But the commission also ruled that rescinding the rent increases back to 1977, as the staff had ordered, was excessive.
Moreover, the nine-member commission said the $5,000 fine that the staff imposed was too high. The commission said the staff should hold further hearings on both issues before setting the amount of the rent roll-back and the fine.
Scheurer's laywer, J. Kirkwood White, contended that the commission's decision is a victory for the congressman because it ruled that the rent rollback was excessive and the fine too large. He predicted that eventually the administrative staff will rule against any rent rollback.
The nine-term congressman's dispute with the city's rent control officials centers on the amount he can charge for the apartments he rents to transients, not quite half of the building, according to White. Scheuer has wanted to convert the entire building, which he holds in trust for his children, into a hotel since 1979. He was in the process of doing so until the D.C. City Council passed a moratorium on such conversions in May 1980. Since then, Scheuer -- through White, friends and a paid lobbyist -- has been lobbying the council to lift the freeze on hotel conversions.
Over the last year, former city general counsel James Christian and Alma Rangel, public relations spokesperson for the apartment building and the wife of another New York Democratic congressman, Rep. Charles B. Rangel, have also lobbied on Schuerer's behalf.
However, the tenants of the building and some Southwest Washington residents have been actively campaigning against the conversion. The tenants are afraid they will be displaced if the building is turned into a hotel, and some neighbors fear that the presence of a large hotel in the area would change the character of their generally quiet residential neighborhood.
The rent case evolved from the issue of whether those units in Schuerer's building that had already been converted to hotel rooms should still be considered apartment units -- and thus subject to the city's strict rent control ceiling -- if more than 40 percent of the units in the building were still used as apartments.
Since less than 60 percent of the units in the building are being rented as hotel rooms, the commission essentially decided that the entire building should be classified as an apartment building and not a hotel, and was thus subject to rent control.
Currently, single rooms on the hotel side of the Captiol Parks building rent for $52 per night and $62 per night for double rooms. Over the course of one month, at those daily rates, the price of the rooms could significantly exceed the monthly ceiling -- different for each apartment -- that is allowed under rent control. Most apartment rents at the building range from $300 to $500 a month.
In February 1980, the staff at the Rental Accomodations Office ordered Schuerer's lawyers to turn over all of their hotel guest registrations and the tax receipts from the units being used as hotel rooms. One month later, the office fined Scheurer $5,000 for not complying with that subpoena, but the commission delayed imposition of the fine to give Scheurer's lawyers time to appeal.
White also said that the tenants have recently been offered an arrangement whereby the building could be essentially divided in half, with one half of the building used as apartments and an entirely separate half as a hotel. "Discussions will be proceeding" with the tenants, White said.