Disagreement over what the City Council really meant when it framed parts of the District's new rent control legislation is delaying its implementation and threatening administrative chaos for the city and hardship for tenants and landlords, according to a city official and advocates for both groups.
Until the regulations take effect, tenants are unable to file complaints involving rent, and landlords cannot establish their new base rent levels, from which all increases are calculated.
For the city, the regulatory burden could become massive under the rules recently approved by the Rental Housing Commission and expected to take effect within the next two weeks. One regulation could result in as many as 5,000 hearings on rent challenges that should be resolved within six months, said Michael S. Blaher, a hearing examiner with the Rental Accommodations and Conversions Division. "We couldn't possibly hold that many hearings in a six-month period," he added.
To make matters more complex, the regulations are being promulgated as emergency rules, which will expire on July 16, when the permanent rent control law takes effect. New rent commissioners, whose appointment is mandated by the legislation, could decide to start over and write new regulations. Whether they rewrite the rules or stick with the present ones, however, the regulations cannot become permanent until after a 30-day period set aside for public comment.
"As an attorney, I have addressed many complex issues . . . and this is one of the messiest," Blaher said.
Rent administrator John Hampton believes "we need to do something quickly in order to deal with [tenants and property owners] in an equitable manner," according to Lucenia Dunn, Department of Consumer and Regulatory Affairs spokeswoman.
The new law was approved by the City Council on April 30, after months of controversy over provisions that eventually could exempt most, and perhaps all, of the city's rental housing stock from controls. A 90-day emergency version of the act took effect on April 30, when the old rent control law expired. At the same time, the permanent bill went to Congress for the review period required for all D.C. legislation. The review time is 30 days during which one house of Congress is in session.
Implementing regulations were drafted by the rental accommodations division in early May, revised by the three-member Rental Housing Commission, reviewed by the corporation counsel and will become law when they are published in the D.C. Register either next week or the following week, said Commission Chairwoman Jacqueline Moore. Only the housing commission has the authority to issue final regulations.
The housing commissioners rejected the rental accommodations division's interpretation of how new base rents are to be calculated and how appeals from individual tenants who oppose the new base rents are to be processed, Blaher said.
Everyone on the housing commission and in the rent administrator's office agrees the new law mandates "some kind of fresh start. The question is how much of a fresh start," Blaher said.
The new law specifies that the new base rent will be the amount a landlord was charging on Sept. 1, 1983. Rental accommodations officials interpreted the new law to mean that, even if the amount was illegal under the old law, it would become the foundation for the new base rent. All legal increases made by the landlord between September 1983 and April 30, 1985, would be added to reach the final base rent under the rule drafted by the rental office, according to Blaher.
The rental housing commissioners decided, however, that the base rent will be the legal ceiling on Sept. 1, 1983, as established under the 1980 rent control law, plus legal increases made after that date, he said.
The new law provides that tenants have six months after the landlord registers base rents in which to challenge the amount. Under the rental office's proposed rule, city workers would examine all documents submitted by tenants and on file with the city, and make a decision. If the landlord or the tenant objected to the decision, a hearing would be held, Blaher said.
The housing commissioners changed the regulation to require that a hearing be held on every tenant challenge.
"We are expecting about 5,000 challenges" under the new law, Blaher said. The figure compares with a total of about 3,000 petitions on which the rental accommodations staff held hearings during the past four years.
There is no deadline by which hearings must be held into rental challenges under the new law, "but to hold up these proceedings would hold up the whole rental housing industry," he said. Landlords probably would be unable to make rent increases allowed by the law while the base rent was under challenge. As a result, "The whole thing could get very cumbersome and cause many problems," he added.
During periods when rules are not in force, "a lot of things may be in legal limbo," said Lynn Cunningham, managing attorney for the law reform unit of the Neighborhood Legal Services Program. "If a tenant and a landlord agree, then everything's fine. If they don't agree and the law is unclear, there are lots of things to fight about. There are lots of things tenants need to do, such as file petitions" seeking rent relief, that they probably cannot do until regulations are promulgated.
Under the new legislation, all landlords are required to register their property with the rental accommodations office within 120 days after the date the permanent law takes effect. An amnesty provision allows property owners who have never registered their rental units to do so within that 120-day period without penalty. If they do not register their rental property within the required period and subsequently raise rents, they could be required to refund rents, roll back rents or to pay a fine of up to $5,000.
The rental accommodations office expects to get 60,000 forms when landlords register -- 20,000 registering base rents and another 40,000 asking for exemptions. Each form represents either an apartment building or a single-family house, an official said.
Many landlords are not reassured, said Donald R. Slatton, executive vice president of the Apartment and Office Building Association.
"What scares us is that regulations implementing the 1980 [rent control] act were not issued until 1983," he said. "We just continued doing what we were doing" under the previous law until new rules were in place. But because of major changes in the 1985 act, "No one wants to take a chance."