A model rent control law will soon be available from the New Jersey Tenants Organization (NJTenantsOrg@excite.com).
Block v. Hirsh, 256 U.S.
135 41 S. Ct. 458.65 L.Ed. 865 (1921).
Early U.S. Supreme Court decision which required an emergency to exist as a legal basis for rent control.
Nebbia v. New York , 291
U.S. 502, 54 S. Ct. 505, 78 L. Ed. 940 (1934).
U.S. Supreme Court overturned Block stating that a "rational basis" was sufficient for regulatory legislation such as rent control.
Wagner v. Newark , 24
N.J. Super.467, 132,2d 794 (1957).
N.J. Supreme Court ruled that municipalities did not have the power to enact legislation on rent control which it construed as a statewide matter. Such power could only be granted by state enabling legislation.
Inganamort v. Fort Lee , 62
N.J. 521, 303 A.2d 298 (1973).
N.J. Supreme Court ruled that local municipalities had the police power to enact rent control ordinances in response to local housing conditions. Possible rationales could include exorbitant rents, prevalence of substandard housing, and housing shortages-low vacancy rates. This decision overturned Wagner. However, a number of other state legislatures still prohibit local rent control without enabling legislation.
Birkenfeld v. City of Berkeley , 17 Cal. 3d 129, 550 P. 2d 1001, 130 Cal. Rptr. 465 (1976).
California Supreme Court ruled Berkeley 's 1972 rent law unconstitutional.
Brunetti v. New Milford , 68 N.J. 576, 594, 350 A 2d 19,28 (1975).
Hutton Park Gardens v. West Orange, 68 N.J. 543, 564, 350 A.2d1, 12 (1975).
Troy Hills Village v. Parsippany,
68 N.J. 604 350 A 2d 34 (1975).
These three cases are known as "the rent control trilogy." The Court established three important principles in these cases which have had influence in the crafting of rent controls throughout the U.S. These decisions (1) placed the burden of proof on landlords to demonstrate that municipalities had no rational basis for rent control; (2) stated that a rent control law did not have to include all of a landlord's costs increases in the allowable annual rent increase as long as the law provided hardship appeals; and (3) in assessing hardship, landlords must be provided with a "just and reasonable" return on their investment.
Helmsley v. Fort Lee , N.J.
Sup. Ct. No.5 A 163-167 (1978).
N.J. Supreme Court affirmed that landlords are entitled to "prompt, fair, and efficacious administrative relief" when applying for hardship increases, and the court provided a conceptual definition of "fair return" and outlined constitutional methods for calculating it. Its recommended approach was the use of a "fair net operating income ratio" formula. It also found return on investment or equity formulas constitutional but found approaches based on market value unconstitutional.
Fisher v. City of Berkeley
, 475 U.S. 260 No. 84-1538. (1985).
Landlords challenged the City of Berkeley 's rent ordinance claiming it violated anti-trust law. This case worked its way up through the California courts and was ultimately appealed to the U.S. Supreme Court which ruled that Berkeley's (and by implication all local) rent control ordinance did not violate anti-trust law. This was the last major court decision on rent control.
NOTE: Not listed here are a number of state and federal cases which allow government agencies to preempt from rent control, properties that they own, manage, finance, or subsidize.
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Barr, K. (1983). "Guidelines for Drafting Rent Control Laws; Lessons of a Decade," Rutgers Law Review , 35 (4). Entire issue.
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Barr, K. and Keating, D. (1981). Fair Return Standards and Hardship Appeal Procedures: A Guide for New Jersey Rent Leveling Boards, Berkeley,CA. National Housing Law Project.
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Downs, A. (1988). Residential Rrent Controls: An Evaluation ,Washington, D.C.: The Urban Land Institute.
Dreier, P. (1979). "The Politics of Rent Control," Working Papers. 6, 55-63.
Eckert, J. (1977). "The Effects of Rent Controls on Assessment Policies, Differential Incidence of Taxation and Income Adjustment Mechanisms for Rental Housing in Brookline, Massachusetts," Ph.D. dissertation, Tufts University.
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Kahn. M. (1982). "Rent Control and the Failure of the Free Market. (March 29). The Bergen Record.
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Lett, M. (1976). Rent control: Concepts, Realities, and Mechanisms. New Brunswick, N.J.: Center for Urban Policy Research.
National Multi-Housing Council. (1996). "The High Cost of Rent Control," Washington , D.C. : NMHC. http;//www.nmhc.org/
Smith,P. (1981). Impact Study of the Effects of Rrent Control upon Community Tax Base, New Brunswick , N.J. , Apartment House Council of New Jersey.
Sternlieb, G. (1974). The Realities of Rent Control in the Greater Boston Area , New Brunswick , N.J. : Rutgers University Center for Urban Policy Research.
Sternlieb, G. (1975). Fort Lee Rent Control , New Brunswick , N.J. : Rutgers University Center for Urban Policy Research.
Tucker, W. (1997). "How Rent Control Drives Out Affordable Housing'" Case Policy Analysis No.274. Washington , D.C. : Cato Institute.
Vitaliano, D.F. (1983). The Economic Consequences of Rent Control; Some Evidence from New York State , Presented at Lincoln Land Institute's Colloquium on Rent Control, Cambridge , Mass.