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RPBG’s Open Letter Re: Rent Control Legislation

Posted by Mike G on March 13, 2017

My friend and colleague from the Rogers Park Builders Group, Steve Cain, took it upon himself to write this statement in opposition to a proposal from State Representative Will Guzzardi, to eliminate state restrictions against municipalities imposing rent control.

Key members of the Rogers Park Builders Group quickly signed on to Steve’s letter.

According to Steve, numerous studies have shown that rent control fails to work on behalf of those people it was meant to assist.

Here is Steve’s convincing arguments in opposition:

Rogers Park Builders Group recently posted an open letter to Will Guzzardi, Representative of the 39th District in the Illinois General Assembly. The 39th District includes parts of Logan Square, Avondale, and other rapidly gentrifying neighborhoods on the city’s Northwest Side.

Representative Guzzardi has proposed a bill (HB2430) that would repeal the state’s ban on the adoption of local rent control laws. A recent article in Crain’s Chicago Business quotes Representative Guzzardi as saying, “Chicago needs something to protect renters against the egregious rent increases that some bad-actor landlords use to move people out of their homes and bring someone richer in.”

RPBG strongly opposes any government regulation of rents. In our letter to Representative Guzzardi, RPBG outlines three broad areas of concern that we have about rent control and its impacts. For the full text of the letter, please link to our rpbg.org website. A summary of these concerns is as follows:

First, rent control doesn’t work. There have been many studies on the impacts of rent control in cities where it has been tried. There is close to unanimous agreement that (1) rent control is an ineffective means of helping the low and moderate-income families it is intended to benefit; and (2) the unintended consequences of rent control include lower maintenance of rental properties, reduced production of new apartment units, and increased average housing costs in rent controlled jurisdictions. As Peter Navarro, Professor of Economics at the University of California-Irvine, states in his 1985 study of rent control in Cambridge, Massachusetts, “the economics profession has reached a rare consensus: Rent control creates many more problems than it solves.”

Second, rent control is not fair. RPBG has argued before that government does a disservice to its citizens when it imposes the cost of public goods on private citizens. The cost of solving the affordable housing crisis in Chicago is enormous. Any attempt to impose a substantial part of that cost on just one group of people – in this case, property owners – is extremely unfair. It is also a shameless abdication of government responsibility.

As Representative Guzzardi’s statement above suggests, one of the rationales for justifying rent control is the stereotype that all property owners are wealthy and unconcerned about the welfare of their tenants. Another frequently used excuse is that state and local governments are broke. Neither of these arguments is acceptable. Most landlords are hardworking business people who have a vested interest in the well-being of their tenants and their communities. And elected officials who cannot pass a budget have little credibility when contemplating the imposition of large costs on private citizens for public goods.

Finally, there are better ways government, private owners, non-profits and other community partners can work together to solve the problem of affordable housing. These alternatives may include expanding the Section 8 voucher program; adopting more permissive zoning standards and building codes; and promoting economic development across a wider geography of the city.

RPBG prides itself on the excellent relationships we have cultivated across the Rogers Park community. We stand ready to work with city and state leaders on issues that reach beyond our area of the city. We believe we can find common ground in a commitment to a healthy and balanced housing market that serves all Chicagoans, regardless of income. But we flatly reject the notion that rent control will help achieve this goal. In fact, we are convinced it will do just the reverse.

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About the Author

Mike G's photoMike Glasser

Mike has a long term relationship with Rogers Park, having lived here at various times in his life, most recently returning to the neighborhood in August, 2009. While living here as a third year law student, he remembers drunken nights at Biddy Mulligan’s and hosting a couple of memorable parties that he, hypocritically, now forbids his own tenants from having. Years later, after completing his stint as a lawyer, Mike started investing in apartment buildings in Rogers Park (and elsewhere), and soon after, did what many newly divorced real estate investors do: he moved into one of his buildings. In 1992 Mike was one of the founding members of the Rogers Park Builders Group, an organization that he eventually headed for six years, until yielding those reigns three years ago. Around a decade ago, on a whim, he reserved the web site “Rogerspark.com,” which he has been developing ever since, and which co-hosts RP BizArts networking events. Mike is the proud father of three wonderful children, Amy, Mitch and Ella.

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