The D.C. rent control commission, in a major policy change, has decided to let landlords accumulate unused portions of allowable rent increases instead of losing them after a year.
The decision, which will take effect after regulations are published in about two weeks, will not result in large rent increases immediately, said Gregory R. McConnell, executive assistant to the three-member commission. But it does open the door for landlords to impose larger increases in the future than otherwise would be allowed in a single year.
Each year the city's Rental Accommodations Commission decides how much of a rent increase landlords may impose, based on increases in the consumer price index for this area. This year's allowable increase is 4.2 percent of current rent, but past levels have ranged as high as 10 percent.
The previous rent control commission ruled that a landlord must use the entire allowable increase each year or lose it.
To impose a higher increase than that set by the board in any year, landlords who are subject to the law--those who own four or more rental units--were required to demonstrate that the commission's increase would cause them a hardship by not allowing them to earn legally approved profits.
The current commission, which took office last year after a change in the law altered the commission's makeup, ruled in a July 28 opinion that "there is no provision in the rent control laws or regulations which provides that a landlord waives a right to an increase when he does not implement the increase."
The opinion adds that "we do not suggest that a landlord can retroactively charge rent that he previously was authorized to take," but McConnell said that in the future, after 30-day notice to tenants, landlords can impose rent increases that include unused portions of annual increases from this year forward.
The case that produced the policy change involved a building in the 2900 block of Alabama Avenue SE that is owned by Adolph J. Edwards, McConnell said. Tenants in the building filed a complaint against Edwards when he tried to increase the maximum rents he could charge by including amounts the former owner did not but could have taken.
A hearing examiner for the rent control office agreed with the tenants and ordered a rollback in the rents and refunds. But Edwards appealed the decision to the rent control commission and won, according to McConnell.
Edwards' attorney, Abraham Greenstein, said, "I think it the new policy will benefit landlords and tenants because if the landlord doesn't take it an increase now he doesn't lose it, and the landlord is not forced to raise rents."
Don Slatton, executive vice president of the Apartment and Office Building Association, a trade association representing landlords, said, "It just gives us what we were entitled too. It's fairer to the landlords."
Kerry Kincannon, a leader of the Southern Columbia Heights Tenants Union, said he was studying the opinion but added: "It seems to me it will be very confusing to the tenants. Sometime down the line tenants could be hit with a large increase, and they will not be prepared for it."
A landlord must inform tenants annually of the amount of the automatic increase and whether the entire amount will be put into effect that year, McConnell said.
In another decision, the commission said it will begin strictly enforcing its requirement that owners of less than four units register their property before they can claim an exemption from the city's rent control laws. In the past, these landlords have been granted exemptions regardless of whether they were registered, officials said.