[1979 Code § 18-1; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1; Ord. No. 46-2 § 1; Ord. No. 52-23 § 1; amended 11-21-2023 by Ord. No.
67-71]
As used in this chapter:
Shall mean fit for habitation as defined in the Statutes,
Codes and Ordinances in full force and effect in the State of New
Jersey, County of Union and City of Linden, and occupied or unoccupied
and offered for rent.
Shall mean rent exclusive of capital improvement, temporary
hardship increase, real property tax and sewer charges and other adjustments
allowed by this chapter and prior rent control ordinances.
Shall mean "All Urban Consumers (CPI-U): All items in New
York-Newark-Jersey City, NY-NJ-PA, all urban consumers, not seasonally
adjusted," which is published periodically by the Bureau of Labor
Statistics, United States Department of Labor, copies of which shall
be available for public inspection at the City Clerk's office.
[Added 11-21-2023 by Ord. No. 67-71]
Shall mean and include any building or structure rented or
offered for rent to one (1) or more tenants or family units. Motels,
hotels, rooming houses, similar type buildings, buildings in which
one-third (1/3) or more of the occupied floor space is commercial,
and housing units of three (3) units or less are exempt from the provisions
of this chapter. Newly constructed multiple dwellings are exempt from
the provisions of this chapter to the extent permitted by N.J.S.A.
2A:42-84.1 et seq.
Shall mean and include that portion of a dwelling rented
or offered for rent for living and dwelling purposes to one (1) individual
or family unit together with all privileges, services, furnishings,
furniture, equipment, facilities and improvements connected with the
use or occupancy of such portion of the property.
Shall mean the owner, manager or operator of a residential
rental facility who is responsible and authorized to enter into leases,
to maintain and operate the rental property and to impose and collect
rents for the use of the property.
[Added 11-21-2023 by Ord. No. 67-71]
Shall mean the all Urban Consumers Price Index for the New
York, North-Eastern New Jersey region (all items), which is published
periodically by the Bureau of Labor Statistics, United States Department
of Labor, copies of which shall be available for public inspection
at the City Clerk's office.
Shall mean the body created by this chapter, hereinafter
called the "board."
Shall mean and include the cost of improvements which equals
or exceeds the cost of building improvements which, at fair market
value, equals or exceeds forty (40%) percent of the current assessed
value of the unit or building being rehabilitated, and which are in
compliance with all applicable laws and building codes of the State
of New Jersey, County of Union and City of Linden. Provided, however,
that all work done on the structure or unit must have been completed
with appropriate local approval as may be evidenced by permits, inspections,
and final approval certifications. Normal maintenance of the structure
or unit and facilities shall not be considered rehabilitation of a
substantial nature.
Shall mean such person or persons who have the right to occupy
a residential rental unit with the obligation to pay rent for such
right.
[Added 11-21-2023 by Ord. No. 67-71]
[1979 Code § 18-2.1; Ord. No. 26-11 § 1]
There is hereby created a Rent Leveling Board within the City.
Such Board shall consist of seven (7) members.
[1979 Code § 18-2.2; Ord. No. 26-11 § 1]
The members of the Board shall be appointed by the City Council
and their terms of office shall be for a period of one (1) year each,
and until their successors shall have been appointed and shall have
qualified. All members shall serve without compensation.
[1979 Code § 18-2.3; Ord. No. 26-11 § 1; Ord. No. 52-23 § 1]
The Board shall consist of two (2) landlords owning property
in the City consisting of four (4) or more units, or their managing
agents, or other designated representatives approved by City Council,
two (2) tenants, and three (3) residents of the City who are not classified
as landlords or tenants under the provisions of this chapter.
[1979 Code § 18-2.4; Ord. No. 26-11 § 1; Ord. No. 52-23 § 1]
There are hereby appointed two (2) alternates to the Rent Leveling
Board who shall be residents in the City under the provisions of this
chapter. They shall be designated as alternate number one (1) and
alternate number two (2).
[1979 Code § 18-2.5; Ord. No. 26-11 § 1; Ord. No. 32-34 § 1]
At its first meeting of each calendar year, the Board shall
select, by majority vote, one of its members to serve as chairperson
for a one (1) year term, and may also select a vice chairperson to
fulfill the duties of chairperson in the former's absence. The chairperson
and vice chairperson shall serve for any number of consecutive terms
in such capacity, at the pleasure of the Board.
[1979 Code § 18-2.6; Ord. No. 26-11 § 1]
Board members shall reveal to the City Clerk and Board Secretary
all financial interests they have in real property located within
the City as a precondition to sitting on the Board.
No member shall be permitted to act on any matter in which he
has either directly or indirectly any personal or financial interest.
[Former Subsection 11-2.7, Residency Requirement, was repealed 11-21-2023 by Ord. No.
67-71. Prior history includes 1979 Code § 18-2.7; Ord. No. 26-11 § 1]
[1979 Code § 18-3.1; Ord. No. 26-11 § 1]
The Rent Leveling Board is hereby granted, and shall have and
exercise, in addition to other powers herein granted, all the powers
necessary and appropriate to carry out and execute the purposes of
this chapter, including, but not limited to, the following:
a.
To issue and promulgate such rules and regulations as it deems necessary
to implement the purposes of this chapter, which rules and regulations
shall have the force of law until revised, repealed or amended by
the Board in exercise of its discretion.
b.
To supply information and assistance to landlords and tenants to
help them comply with the provisions of this chapter.
c.
To hold hearings and make determinations on applications from landlords
for additional rent as hereinafter provided and to adjust base rent
in accordance with the provisions of this chapter and to determine
whether any increases granted are temporary or are permanent.
d.
To hold hearings and make determinations on applications from tenants
for reduced rental as hereinafter provided.
e.
The Board shall have investigative power to ascertain validity of
complaints covered by this chapter.
[Added 11-21-2023 by Ord. No. 67-71]
a.
There
is hereby created the office of Rent Control Board Attorney. The Rent
Leveling Board may annually appoint, fix the compensation of or agree
upon the rate of compensation of the Rent Leveling Board Attorney,
who shall be an attorney other than the municipal or assistant municipal
attorneys. Such compensation shall not exceed the amount appropriated
by the City Council for its use.
b.
The Rent
Control Board may also employ or contract for the services of experts
and other staff (secretary) and services as it may deem necessary.
The Board shall not, however, in any case, exceed, the amount appropriated
by the City Council for its use.
[1979 Code § 18-4; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1]
a.
All hearings conducted under the authority of this chapter by the
Board shall be held and determination shall be made not later than
one hundred twenty (120) days from the receipt of a completed application
by the Board unless otherwise provided herein. However, by agreement
between the applicant and the Board, this time period may be extended.
b.
Any party appearing before the Board may, at his or her own expense,
be represented by an attorney or non-attorney of his or her choosing.
c.
The Board shall give both landlord and tenant reasonable opportunity
to be heard before making any determination.
d.
Upon receiving notification from the Board of a hearing date, the
landlord shall provide all tenants in the affected dwelling with copies
of all documents being submitted by the landlord in support of his/her
application. All information required herein shall be provided to
the tenants not less than ten (10) days prior to the hearing date.
[Ord. No. 50-64 § 1]
Any party aggrieved by a decision of the Board may appeal such
decision to the Superior Court of New Jersey in accordance with applicable
law and Court Rules. No such appeal shall be cognizable by the Governing
Body of the City of Linden.
[1979 Code § 18-6; Ord. No. 26-11 § 1; Ord. No. 34-44; Ord. No. 53-40 § 1]
a.
Establishment of Rents; Periodic Tenants. Establishment of rents
between a landlord and tenant to whom this chapter is applicable shall
hereafter be determined by the provisions of this chapter. At the
expiration of a lease or at the termination of the lease of a periodic
tenant, no landlord may request or receive a percentage increase in
rent which is greater than the percentage difference between the consumer
price index ninety (90) days prior to the expiration or termination
of the lease and the consumer price index ninety (90) days prior to
the date the lease was entered into with such tenant, or of five (5%)
percent during any twelve (12) month period, whichever is the lesser.
An increase of less than zero (0%) percent is not permitted.
b.
A landlord who has not applied for a rent increase during the previous
year shall be entitled to apply for and receive, to the extent permitted
by this chapter, an increase for the year in which no rent increase
was applied for.
c.
No landlord may request or receive more than one (1) increase in
base rent for any twelve (12) month period. Any such increase, or
increase in excess of that authorized by the provisions of this chapter
is null and void, except as otherwise provided in this chapter.
d.
A landlord may, in addition to the rent increase provided for in
paragraph a., supra, request or receive reimbursement for annual sewerage
charges for the same period in which a rental increase is sought.
[Added 11-21-2023 by Ord. No. 67-71]
a.
Purpose.
This section is intended to establish the limits on the amount by
which residential rents may be increased.
b.
Timing
of increases. A Landlord is hereby permitted to increase the rent
once for each forthcoming twelve month period. The time for such increase
shall be at the end of a lease term to be applicable for the forthcoming
twelve month period. If a Landlord and Tenant enter into a lease for
more than a twelve month period, the Landlord shall be permitted to
increase the rent at the end of each twelve month period within the
lease term, with the increase to be applicable to the next twelve
month period.
c.
In calculating
the maximum amount of rent increase permitted, the Landlord shall
determine the applicable increase in the CPI by the following method:
1.
Starting
with the date on which the current lease term will end, the Landlord
shall select the most recent month which ended not less than 90 days
prior to the end of the current lease term. For example, if a lease
is scheduled to end on October 31, the Landlord would select the month
of July, which ended exactly 92 days earlier than October 31.
2.
The Landlord
would then select the CPI for July (“Current CPI”) and
the CPI for July for the immediately prior year (“Prior CPI”).
As an example, the Current CPI for July of 2023 is 322.496 and the
Prior CPI for July of 2022 is 312.615.
d.
The permitted
increase for the forthcoming twelve month period shall be the lesser
of the CPI Increase or 5%, but not less than 0%. That increase can
only be applied to the rent for the twelve month period starting on
the day after the prior lease period ended. In the example provided,
the rent could be increased by 3.16% starting on November 1, 2023
for the following twelve months.
e.
A Landlord
shall not be permitted to increase the rent for any residential tenancy
except as provided for in this ordinance. Any increase in rent at
any time by any method other than as described in this ordinance shall
not be permitted and any amounts collected pursuant to such unauthorized
increases shall be due and payable to the Tenant, with interest calculated
at the annual rate of 8% from the time such amounts were collected
until such time as they are reimbursed. Tenants who believe that such
an unauthorized increase has been imposed shall have the right to
seek reimbursement in a court of competent jurisdiction over such
matters.
[1979 Code § 18-7; Ord. No. 26-11 § 1]
a.
Any landlord seeking an increase in rent shall notify the tenant
by certified mail, return receipt requested, of the calculations involved
in computing the increase, including the consumer price index ninety
(90) days prior to the entry of the lease, the consumer price index
ninety (90) days before the expiration of the lease, and the allowable
percentage increase and the allowable rental increase as expressed
in dollars.
b.
Any tenant seeking review for any increases requested by the landlord
must file an application for review with the Rent Leveling Board within
one (1) year after the effective date of the increase.
[1979 Code § 18-8; Ord. No. 26-11 § 1]
Notwithstanding any provisions of this chapter, a landlord may
raise the rent of an individual apartment when the preceding tenant
has voluntarily vacated the apartment or has been legally evicted
at a rate not to exceed twenty-five (25%) percent of the last rental
received. After such a rent increase, the dwelling shall be subject
to all the requirements of this chapter.
[1979 Code § 18-9.1; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1; Ord. No. 52-23 § 1]
a.
A landlord may seek a tax surcharge from a tenant because of an increase
in municipal property taxes or sewer tax. The tax surcharge shall
not exceed that amount authorized by the provisions herein. The landlord
shall divide the increase in the present property tax and sewer tax
over the property tax and sewer tax of the previous year by the number
of rooms in each apartment, exclusive of bathrooms.
b.
Any reduction in municipal property taxes or sewer tax due to the
budgetary action of any governmental agency shall be distributed in
accordance with the following formula:
One-half (1/2) the reduction shall be allowed to the landlord
and one-half (1/2) shall be divided amongst the tenants affected by
the reduction. The reduction due to the tenants shall be based on
the number of rooms in apartments, exclusive of bathrooms.
[1979 Code § 18-9.2; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1]
Any landlord entitled to surcharge or obligation to give a reduction
shall notify the tenant by certified mail, return receipt requested,
not less than thirty (30) days prior to its proposed effective date,
of the proposed surcharge or reduction, of the calculations involved,
including the present property tax for the dwelling, the property
tax for the dwelling for the previous year, the number of rooms occupied
by the tenant and the total number of rooms in the building.
[1979 Code § 18-9.3; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1]
The tax surcharge for which each tenant is liable shall be paid
in twelve (12) monthly installments, commencing within ninety (90)
days of landlord's receipt of his tax bill for the dwelling, and provided
the landlord gives proper notice of the tax surcharge to all affected
tenants.
[1979 Code § 18-9.4; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1]
The tax surcharge provisions of this section shall be available
to a landlord of a dwelling containing six (6) housing units or less.
Any allowable tax surcharge shall become a part of the tenant's base
rent, unless the dwelling unit experiences a tax reduction.
[1979 Code § 18-10.1; Ord. No.
26-11 § 1]
A landlord or owner is entitled to earn a fair return on his
equity investment. Upon application to the Board on board-prescribed
forms, the Board shall grant a hearing, at which time the landlord
shall be entitled to present his proofs which must be submitted to
the Board in writing no less than fifteen (15) days prior to the hearing,
using evidence, standards, and criteria which he deems necessary to
support his position.
The Board shall promulgate rules and regulations setting forth
the minimum documentation that the Board requires. But the failure
of the applicant to produce such documentation shall not be the sole
basis for denial of the application. The Board, however, shall consider
and give appropriate weight to all evidence before it. The Board may
consider the following factors:
a.
Taxes;
b.
Cost of maintenance and operation of the property;
c.
The kind, quality and quantity of the services being furnished or
withheld by the landlord;
d.
The number and frequency of prior hardship or capital improvement
increases for the multiple dwelling;
e.
Landlord's original and current equity investment;
f.
The dates, amount, terms and interest rates of all past and current
mortgages;
g.
The amount of current professional and management fees and the relation,
if any, between the landlord and the recipients of such fees;
h.
The age of the dwelling as well as its original and current appraisal
value;
i.
The present and past rates of vacancy;
j.
Cash flow history;
k.
Other factors which the Board, through its experience, shall determine
to affect the rate of return.
[1979 Code § 18-10.2; Ord. No.
26-11 § 1; Ord. No. 34-44]
The landlord shall be entitled to a hardship increase if he
qualifies for same pursuant to one (1) or more of the following formulas
and demonstrates that the application of the particular formula is
appropriate for his particular building. The formulas which the Board
shall consider are as follows:
a.
In the event that a landlord's annual residential operating expenses,
as hereinafter defined, exceeds sixty (60%) percent of his gross annual
residential income, as hereinafter defined, then the landlord shall
qualify for a hardship rental increase in an amount sufficient to
reduce his operating expenses to income ratio to sixty (60%) percent.
1.
For purposes of this chapter, the term "gross annual residential
income" is defined as all annual income derived directly or indirectly
from the operation of the landlord's property, including, but not
limited to, all residential rents received, all earnings from commissions
from vending machines, laundry equipment and supplies, deductions
from security deposits, late fees, parking fees, garage fees, key
charges, finders' fees, income from rebates, capital improvement surcharges
and hardship surcharges. The Board may request that the landlord shall
supply documentation supporting the gross annual income as stated
in the landlord's application. In any case, where rental units are
occupied in whole or in part rent free, the full rental value shall
be considered the legal rent therefor for the purpose of setting forth
gross annual residential income.
2.
For purposes of this section, the term "annual residential operating
expenses" is defined as all reasonable, necessary and valid annual
expenses (as determined by the Board) incurred and paid by the landlord
for the rental property for which a hardship increase is requested,
excluding therefrom, however, depreciation, mortgage interest and
amortization, and including but not limited to expenses for supplies,
administrative costs, management fees limited to five (5%) percent
of the gross rental, heating fuel, electricity, water supply, garbage
disposal, gas, building services, security, grounds maintenance, repairs
(other than reimbursed repairs), painting and decorating, real estate
taxes, other taxes, permit fees, attorney and accountant fees, insurance,
wages and recreational amenities. However, pursuant to the provisions
of P.L. 1981, c. 226, increased costs which are solely the result
of a conversion, as defined within the meaning of P.L. 1981, c. 226,
including but not limited to any increase in financing in carrying
costs, and which do not add services or amenities as previously provided
shall not be used as a basis for an increase in the hardship hearing
before the board or in any appeal from such determination.
3.
Where nonresidential income is received in connection with the property,
the landlord shall, in addition to the above, furnish to the Board
the income and expenses related to the nonresidential uses for the
purposes of determining the effect thereof on the hardship application
of the landlord.
b.
Fair Return on Investment. The landlord shall be entitled to a fair
return, meaning the percentage of return on equity in real property
investment. The amount of return shall be measured by the net income
before depreciation. The Board shall consider a fair rate of return
in an efficiently run multiple dwelling to be six (6%) percent above
the maximum passbook demand deposit savings account interest rate
available in the municipality. Six (6%) percent is provided to reflect
the higher risk three (3%) percent and lesser liquidity three (3%)
percent of the real property investment in comparison to savings account
investments. The Board shall consider, for purposes of this section,
annual residential operating expenses and gross annual residential
income in determining a fair rate of return. In the event that the
applicant's rent roll is less than what is calculated to give the
applicant a fair rate of return, then he shall be entitled to an increase
in an amount sufficient to achieve the rental which would grant him
a fair rate of return.
c.
Maintenance of Net Operating Income (NOI). A landlord is entitled
to an increase if the landlord has suffered a decline in NOI from
the base period. The base period is defined as the average NOI for
a period of three (3) years prior to the year in which the application
is presented. NOI equals gross annual residential income minus annual
residential operating expenses. The landlord shall be entitled to
an increase which will raise the dollar net operating income to the
base period level.
For example:
|
Maintenance of Net Operating Income
| ||
|
Base Year
| ||
|
Gross annual residential income
|
$50,000.00
| |
|
Annual residential operating expenses
|
- 25,000.00
| |
|
_________
| ||
|
Net operating income =
|
$25,000.00
| |
|
Current Year
| ||
|
Gross annual residential income
|
$55,000.00
| |
|
Annual residential operating expenses
|
- 32,000.00
| |
|
_________
| ||
|
Net operating income =
|
$23,000.00
| |
|
Hardship increase permitted: $2,000.00
| ||
d.
The Board, in making its findings of fact on each application, shall
make findings of fact which shall determine which of the above formulas
for hardship is best particularly suited for each application. The
Board shall use its expertise and the evidence presented before it
to make such determinations. The Board shall make the final determination
as to which hardship formula shall apply to the particular application.
e.
At the request of the Board, the landlord shall supply testimony
under oath and documentation supporting all or any of the items listed
in the application.
f.
A public hearing on the application shall be held no later than sixty
(60) days after the date of receipt of a completed application, at
which time the Board and landlord and tenants or their respective
agents or representatives shall be given an opportunity to be heard.
The Board shall render a decision on each application within sixty
(60) days of the completed hearing on the application. If a rent increase
is granted, it shall take effect after the tenant has received a thirty
(30) day notice of rental increase.
g.
The landlord shall notify each tenant of the subject property by
certified mail, return receipt requested, of the date, time and place
of the public hearing and of the substance of the landlord's application
at least fifteen (15) days prior to the public hearing and shall provide
proof of service to the Board.
h.
If a landlord has been in violation of the ordinance, then the tenants
shall have a remedy to receive a refund for any overcharge retroactive
to one (1) year from the date of complaint.
[1979 Code § 18-11; Ord. No. 26-11 § 1]
A landlord seeking a capital improvement increase shall apply
for the increase to the Board, which shall determine if the improvement
is a capital improvement and, if so, shall permit such increase to
take place in equal installments over the term of the life expectancy
for which the capital improvement was granted. A list of life expectancies
of capital improvements, as established by the Board, shall be maintained
and available for inspection in the City Clerk's office. If the increase
is granted, it shall not be considered rental and calculated in base
rent. The landlord must notify each tenant of the capital improvement
application by certified mail, return receipt requested, no less than
fifteen (15) days prior to the date set for hearing before the Board.
The landlord's application under this section shall include total
costs of the completed capital improvement claimed by the landlord
for purposes of depreciation for income tax purposes, the average
cost of improvement and the capital improvement increase being sought.
[1979 Code § 18-12; Ord. No. 26-11 § 1]
All payments by the tenant provided for in this chapter over
and above the base rent shall be paid in twelve (12) equal monthly
payments, or as provided by the Board.
[1979 Code § 18-13; Ord. No. 26-11 § 1]
During the term of this chapter, the landlord shall maintain
the same standards of service, maintenance, furniture, furnishings
and equipment in and about the housing space and dwelling as he or
she provided or was required to do by law at the commencement of the
lease.
[1979 Code § 18-14; Ord. No. 26-11 § 1; Ord. No. 27-23 § 1; Ord. No. 46-2 § 1]
a.
Initial Rentals. The owner of housing space or a dwelling being rented
for the first time shall not be restricted in the initial rent he
charges.
b.
If a dwelling or housing unit has been substantially rehabilitated,
the Board, in its discretion and for good cause shown, may allow the
landlord to negotiate with the affected tenant a rental that is mutually
acceptable to the parties.
c.
Once a tenant's rent has been established pursuant to paragraph a
or b of this section, any subsequent rental shall be subject to the
provisions of this chapter, unless otherwise exempt from its provisions
by Federal or State laws.
d.
The method by which a landlord may apply for consideration of a determination
by the Board that the unit or building has been "substantially rehabilitated"
as set forth in paragraph b above, shall be as follows:
1.
Vacant Buildings.
(a)
The landlord shall first present a plan to the Rent Leveling
Board of the planned renovation of the unit or the building, together
with the estimated costs, evaluations and assessed value thereof,
as assessed by the City of Linden.
(b)
The landlord shall be required to obtain Board approval of the
City Rent Leveling Board and all construction code permits as applicable
and submit them to the Rent Leveling Board prior to proceeding.
(c)
The landlord shall complete all work, and in the process shall
secure all necessary construction code permits and approvals therefor.
(d)
Upon completion the landlord shall apply for temporary rent
decontrol, and each unit shall be subject to rent control once that
unit is rented thereafter for the first time.
2.
Occupied Buildings.
(a)
In order to qualify for substantial rehabilitation, at least
one (1) unit must be vacant or scheduled to be vacant in the near
future. The unit scheduled to be vacant must actually become vacant
as scheduled or proposed.
(b)
The landlord shall present the total plan for renovation for
the entire building to the Board for approval prior to undertaking
the renovations.
(c)
The landlord shall complete all work on the unit to be temporarily
decontrolled and shall secure all necessary construction code permits
and approvals and present them to the Board prior to proceeding.
(d)
The landlord shall apply for temporary decontrol for each rehabilitated
unit upon which all work has been completed, as each unit is completed.
(e)
The landlord shall repeat the steps contained in paragraphs
(c) and (d) for each rehabilitated unit, as the unit becomes vacant,
until all the units in the building are completely renovated.
[1979 Code § 18-18; Ord. No. 26-11 § 1]
Any landlord, landlord's agent or tenant who, by threat, reprisal
or threat of reprisal, shall attempt to deter any person from seeking
his or its rights under this chapter shall be in violation of this
chapter.
[1979 Code § 18-19; Ord. No. 26-11 § 1]
A willful violation of any provision of this chapter, including, but not limited to, the willful filing with the Rent Leveling Board of any material misstatement of fact, shall, upon conviction, be liable to the penalty stated in Chapter 1, Section 1-5. A violation affecting more than one (1) leasehold shall be considered a separate violation as to each leasehold.
[Ord. No. 38-12; Ord. No. 40-20; Ord. No.
41-43; Ord. No. 43-34; Ord. No. 45-12; Ord. No. 47-1; Ord. No. 48-35; Ord. No. 49-16; Ord. No. 50-20; Ord. No.
51-17; Ord. No. 52-15; Ord. No. 53-17; Ord. No. 54-21; Ord. No. 55-15; Ord. No. 57-26; Ord. No. 58-29; Ord. No.
60-34; amended 3-16-2021 by Ord. No. 65-7; 4-19-2022 by Ord. No. 66-24]
Rent control shall continue in the City of Linden with no interruption
from April 19, 2019.
