Sixty-five senior citizens at the Parkside condominium complex in Bethesda are faced with the choice of finding new places to live or having their rents increased as much as $300 a month beginning in August.
The predicament arises because the individuals who bought the units as investments are not covered by laws designed to protect elderly tenants, because the conversion began before the laws took effect.
The situation has prompted Parkside tenants to picket the development's sales office, while more than 500 tenants, young and old, signed a petition to the developer calling the rent increases "totally unfair and unreasonable." The county government also has stepped in, trying to negotiate with the developers for a phase-in of the rent increases and an aggressive plan to help resettle the elderly tenants.
The Parkside developers have complied with the letter of the law. The controversy demonstrates how both the state and county laws governing condominium conversions--laws that require developers to set aside 20 percent of their units for the elderly--are not applicable to some of the county's largest conversion projects because they began before the 1981 laws took effect.
Attorney Roger Winston, representing the developers, said after a meeting Monday with county officials that an agreement was reached to phase in the rent increases. The rents showed such a dramatic increase because the developer held rents artificially low the past three years, giving the elderly residents time to move out. This year's increases also reflected rehabilitation costs of the complex, he said.
The case also illustrates Montgomery's acute shortage of low- and moderate-income housing in the lower county, as officials search for alternative homes for the displaced Parkside seniors. The county's own rent-subsidized apartment complexes have waiting lists of from one to three years.
Also, the Parkside case underscores the limited nature of Montgomery's voluntary rent-control guidelines. The Office of Landlord-Tenant Affairs recommended rent increases this year of no more than 8.5 percent. But for the elderly tenants at Parkside, rents will increase as much as 95 percent for some tenants, partly reflecting the escalating market values of rents in Bethesda as the area prepares for the opening of Metrorail. Even some of those who sympathize with the senior tenants concede that the higher rents probably represent the going rate for Bethesda apartments.
Millie P. Schafer, a spokeswoman for the tenants, said, "We're in one sorry little mess right now." Schafer, who owns her unit, organized a "Senior Citizens Committee," which conducted last weekend's picketing. Shafer said more protests are planned unless county officials and the developers can reach an agreement on phasing in the rent increases.
Also, Schafer said, the tenants are considering a rent strike for next month. "We have not ruled anything out," she said. "If they the developers are not responsible, we're going to keep the pressure on."
She said the protest found support among the younger tenants, whose rents were not protected since the conversion began, and whose most recent increase was 10 percent--more than the county's 8.5 percent guidelines. "They could have one heck of a tenants' rebellion on their hands," Schafer said.
About 40 of the 65 affected elderly tenants do not have enough money to pay the higher rents, according to Joe Giloley, program manager of the county's Office of Consumer Affairs. "Some can't leave. Some don't want to leave," he said.
The county administers an emergency aid fund for displaced tenants that is financed by the 4 percent transfer tax on condominium units. All 40 elderly tenants will likely qualify for $150 a month from the county, Giloley said, but that grant still will not cover the increases of tenants with the largest increases.