In Poor Brooklyn, More Than Just a Tree Grows
Rent Strike Against Millionaire Slumlord Catches Fire
As foreclosures continue to put historic pressure on the nation’s rental market, slumlords now have more opportunity than ever to prey on the most vulnerable of tenants, and people have timely reason to demand economic justice -- geonomics. This 2012 article is from AlterNet, Jly 6.
by Laura GottesdienerIn New York City, where average rent price increased more in the second quarter of 2012 than in any other city in the country, landlords went into a frenzy to evict old tenants -- especially those with stabilized rent -- and jack up the prices for newcomers. But despite a city that prefers pushing up site values to enforcing building codes, some tenants in Brooklyn are speaking out, occupying an assemblymen’s office, and launching a rent strike.
The rent strike now includes 80 families across three of the buildings that landlord Orazio Petito owns; protesters hope to spread the movement to his other properties as well.
Petito, who ranks 51 on city’s watch list of worst slumlords, owns approximately twenty buildings across the New York boroughs and dozens of small real estate corporations that flit in and out of existence and list PO boxes for addresses. He’s frequently fined and issued court dates, which he rarely shows up to, and he takes out million-dollar mortgages that he never repays. The only time his tenants see him is when he knocks on the door when rent is due.
An elderly resident who asked not to be named said, “He said he was going to evict me; he told me that he was going to call immigration on me.” As a newer resident, she was paying $1,600 a month for an apartment that rarely has heat, hot water, or electricity. Many of the building’s tenants lack residency papers, and Petito is more than willing to wave forged eviction notices in front of tenants who speak little English.
Like the historic rent strikes in Lower East Side before WWI or in Harlem during the 1960s, female tenants of color are leading the grassroots organizing at Petito’s buildings. Many from Occupy Sunset Park have joined in to support, tying this slumlord’s abuse to the broader context of housing injustice, one that includes the current foreclosure crisis but is, in truth, a constant reality in a country where private property is a right but a family’s need for shelter is considered a privilege.
Petito's building has had problems for years, but the conditions have worsened since the buildings fell into foreclosure. The building is home to mice, rats, roaches, bed bugs, and no exterminator to be found despite daily 311 calls. The mounds of garbage piled in the locked basement fester and stink when the temperature soars. With a broken boiler, the showers are freezing when the temperature plummets.
The city is well aware of the problems. A fire marshal even declared the building an imminent hazard and suggested that strike leaders call the Red Cross and to get all the tenants temporarily relocated. Yet the Department of Buildings has yet to send an inspector.
Residents invited television crews into the buildings and testified to Petito’s many abuses. Then dozens of tenants paraded through the blistering heat -- signs, canes, sun umbrellas and all -- to Assemblyman Felix Ortiz’s office, where they occupied the building. One resident’s sign read in Spanish, “In the winter we freeze and in the summer we roast." An hour later, the group departed, having scheduled a sit-down meeting with Ortiz for the next week.
The parade of women then shuffled the 10 blocks back to their sweltering apartments, hoping to sleep despite the heat, hoping their work would keep the apocalypse at bay.
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JJS: Part of the problem is that both landlords and tenants see the income from the building and the income from the land as belonging together. But those are two radically different payment streams. When a tenant (or buyer) pays for a building, they pay for a product of labor and capital, but when one pays for land, they pay for a gift of nature.
While none of us made land, all of us make locations valuable. The value of a location -- the three most important things in real estate -- is created by nature and society. People pay for good views, nearby parks, fertile fields, deep harbors, etc -- the aspects of nature -- and they pay for safe neighborhoods, nearby shops, functional infrastructure, job openings, etc -- the advantages of society.
No lone owner created any of the amenities that buyers and leasers pay for. Indeed, the factor that most closely correlates with the value of a site is population density, and no lone individual can claim responsibility for that!
What owners can fairly claim is the value of the structure that they built or bought and perhaps improved. Owners are entitled to income from the building, when either selling it or leasing it. But owners are obliged to pay over to their community the rental value of their land.
Society, for its part, is not entitled to any of the value of the building and should not tax it. Indeed, the tax on buildings, AKA the property tax, is enough of an added cost in low-income parts of a city that it eats up an owner’s profit margin. Hence those owners don’t do maintenance (sure, some might also be greedy), and hence the US Department of Housing and Urban Development blamed the property tax for slums.
It’s not just buildings that society should not tax or lay any claim on. What about our wages and purchases? Work is hard enough without government adding a tax on it. And raising the cost of doing business -- as does a sales tax -- does not stretch the consumer’s dollar either. Government does not do a thing to justify taking a slice out of one’s salary or business (unlike the value of a location); it should keep its hands off our efforts and de-tax earned income, de-tax sales, and de-tax buildings.
What should government do with the recovered value of sites and resources? Well, if it’s society who generates those values then it’s the members of society who could get back fair shares, a la Alaska’s oil dividend. Then, as the value of a location went up, the amount of the owner’s land tax or land dues would go up too, but so would the amount of one’s dividend. It’d be much easier to afford to stay put, or one could move to a more affordable location and maximize the difference between their land dues and their “rent” dividend. Thus it wouldn’t be landlords who’d be living off the “fat” of urban land but all residents equally would receive a share, an extra income, a safety-net.
Once people see those two income streams -- paying for the location and paying for the structure -- as separate, then society can get to the root solution of slumlordism, of price gouging, and of absentee ownership, as we learn to respect what belongs to others but share what belongs to us all.
Editor Jeffery J. Smith runs the Forum on Geonomics and helped prepare a course for the UN on geonomics. To take the “Land Rights” course, click here .
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