This article was posted on Sunday, Aug 12, 2012

Actress Faye Dunaway, with a net worth estimated at $40 million, recently vacated her cheap Upper East Side Manhattan apartment, but only after the threat of an eviction lawsuit.
The owner argued that Dunaway’s permanent residence was, in fact, in California and that she was therefore not entitled to her rent-stabilized Manhattan lease.

Not an Isolated Case
As highlighted by the numerous examples below, Dunaway’s case is not an isolated one.  ‘s symptomatic of a much larger issue of particular concern to small rental property owners “ the widespread and completely legal abuse of the spirit of rent control by those who have absolutely no need for subsidies.  Why do they exploit the system?  Because they can.

In San Francisco, Santa Monica, New York and many other American cities, rent control ordinances force rental property owners to subsidize renters, many of whom have no need for subsidies.  Yet, tenant advocates continue to insist that rent control is designed for and in fact, overwhelmingly benefits the poor and low-wage earners.  However, as many San Francisco small property owners can attest to from personal experience, the only factor that distinguishes one renter paying fair market rent from another down the hall paying far less is the length of time he or she has resided in the unit.

Rent Control for the Rich and Famous?
U.S. Congressman Charles Rangel had four rent-stabilized apartments in the same building for which he paid a total of $3,894 per month.  He even used one of them as his campaign headquarters.
New York Governor David Paterson and his father Basil had four rent-stabilized units in the same building.  With a governor’s mansion as well as his own private home to live in, he paid only $1,250 for his rent-stabilized apartment in a luxury building.  When asked about the situation, Paterson said he saw no problem with what he was doing, that it was within the spirit of the law.
N.Y. City Mayor Ed Koch had the mayor’s mansion to live in, but he just couldn’t let go of his rent controlled Greenwich Village apartment for $300 a month.
Bianca Jagger refused to give up her rent-controlled apartment on ritzy Park Avenue until it was determined that it could not be her primary residence, as she had an apartment in London and only a tourist visa.
Pop-singer Cindi Lauper and her actor-husband, David Thornton, showed their True Colors when they managed to have their rent reduced from $3,750 to $989 a month in 1995.
Actress Mia Farrow lived in a rent-stabilized apartment paying only $2,900 per month for 11 rooms overlooking New York’s Central Park.

‘s About Fairness and Much More
SPOSFI is an organization made up of air-minded people who recognize the need for subsidizing the housing costs of those who truly need it.  Ensuring that everyone has a roof over their head is a good thing and benefits society as a whole.
However, we have always strenuously objected to achieving this worthy goal by means of rent control.  There are a host of reasons why, including:

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¢    First and foremost, rent control places the burden of subsidizing someone’s rent entirely on the property owner.  If indeed society deems subsidizing poor peoples’ rent worthwhile public policy, should the cost not be borne by all citizens, including other renters?
¢    In practice, rent control makes no distinction between an hourly worker barely making ends meet and an attorney earning $300,000 a year.  True believers in rent control reveal their real agenda by opposing all efforts to at least make rent control more equitable by adopting means testing as a way of disqualifying high-income earners who should not be beneficiaries of rent subsidies.
¢    Rent control ignores the fact that many small property owners, especially elderly owners on fixed incomes and dependent on their rental income in retirement, are in no position to subsidize their renters for life.
¢    Rent control is an illegal taking as defined by the U.S. Constitution, many leading legal minds argue.
¢    Economists across the political spectrum are virtually unanimous in concluding that rent controls are destructive, leading to housing shortages and diminution of housing quality, among many other ills.
¢    Rent control breeds animosity between renters in the same building who may occupy similar units but pay radically different rental amounts.
¢    Rent control has spawned a thriving industry of non-profits dedicated to perpetuating a system that is inherently unfair and encourages a lifelong renter-hood.  Undeniably, non-profits like the Tenderloin Housing Clinic and the Tenants Union, and the politicians who pander to them, have a strong, vested interest in maintaining their political power by enduring that renters remain renters.
¢    What here and in New York started as a temporary emergency measure to curb skyrocketing rents has become a permanent entitlement.  Rent control has been less corrosive than it would otherwise be only because it has been substantially relaxed over the years in New York, and in San Francisco only applies to pre-1979 buildings.

Reprinted with permission of the Small Property Owners of San Francisco Institute (SPOSFI) News.  For more information on becoming a member of SPOSFI or to send a tax-deductible donation, please visit their website at or call (415) 647-2419.

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