The D.C. Council voted unanimously Sept. 22 to place a one-year moratorium on applications for certificates of assurance, signaling a desire to re-examine the issue of rent control in the District.
This obscure provision of the Rental Housing Act of 1985, used less than 50 times, poses a major barrier to increasing the number of rent-controlled residences in the District.
The certificates assure landlords that if their building is ever converted into rent-controlled housing, they will be compensated for the difference between the rent they receive under rent control and the rent they would have otherwise received annually, in perpetuity. The exact amount of this credit is up to the discretion of the landlord. But with a fair-market rent of $1,500 for a one-bedroom apartment in the District, converting even one multifamily building would place considerable financial strain on the government, effectively ruling out expanding rent control under the current law.
If rent control was expanded into just the 43 buildings whose landlords have applied for certificates, the change would cost the city over $40 million per year.
The District has no procedures for the implementation of these certificates and has not issued any in the 35 years since the initial act became law. However, the past year has seen an influx of applications, Johanna Shreve from the Office of the Tenant Advocate testified at a D.C. Council roundtable on Sept. 14. Shreve said addressing the issue would likely publicize the existence of the certificates to landlords and predicted an increase in applications in the coming weeks.
At the Sept. 14 roundtable, multiple speakers called on D.C. Council to address the issue of certificates of assurance so they could turn their attention to reforming rent control, which At-large Councilmember Anita Bonds hopes to do with a slate of bills introduced Sept. 24. The one-year moratorium passed on Sept. 22 is not a promise to end the practice of certificates of assurance, Bonds stressed. But it allows time for the council to consider the merits of the certificates and future action on rent control.
“[The certificates of assurance provision] stymies the ability of the council to even consider expansion because of the anticipated high-cost price tag on such a decision,” Bonds said in the hearing. “We want to try and get some sort of resolution today so we can move to having these broader discussions that will perhaps put in place something or permanence and certainly have an opportunity for more units perhaps under rent control.”