Frequently Asked Questions About Montclair’s Rent Control Ordinance
Montclair Township’s new rent control ordinance went into effect on May 9, 2022. Below are some answers to frequently asked questions about the new law (with accompanying citations). This fact sheet is not to be considered legal advice. Please refer to Chapter 257 for the entire text of the ordinance.
What structures ARE NOT included in the new rent control ordinance? See §257-2.
- Units in buildings in which the owner resides that contain 3 or fewer residential units.
- Units for which the amount of rent is determined as a function of household income by a government program.
- Motels, hotels, and similar type buildings intended for transient use, floor space used strictly for commercial purposes in any type building, including state-licensed rooming houses.
- Dwelling units rented for the first time after May 9, 2022, and the initial rent may be determined by the landlord, but all subsequent rents are subject to the provisions of the law.
- Dwelling units exempted by state or federal law. See N.J.S.A. 2A:42-84.1 through 84.6
- Single family homes, single condominiums, single co-operative units.
- Housing provided for students by a school, college, or similar institution which owns and/or controls housing.
What structures ARE included in Montclair’s new rent control ordinance?
- Rental units in buildings containing 2 or 3 units in which the owner does not reside.
- All units in buildings containing 4 units or more (except for exceptions listed above).
The new law references “base rent;” what is “base rent”? See §257-3.
- For any dwelling unit where the landlord collected an increase in rent from an existing tenant on or after May1, 2020, the base rent shall be the rent in effect as of May 1, 2020.
- For any dwelling where the landlord provided notice of a rent increase to an existing tenant, but did not collect or otherwise seek to collect such increase, on or after May 1, 2020, the base rent shall be the rent in effect as of May 1, 2020.
- For any dwelling unit that became vacant since May 1, 2020, the base rent shall be the rent in effect as of May 9, 2022.
What are the permitted increases in “base rent” under Montclair’s new rent control ordinance? See §257-9.
- A one-time 6% increase of the base rent is permitted for dwelling units covered under this law as long as no tenant living in the unit is 65 years or older AND as long as the landlord did not raise the base rent after May 1, 2020.
- With the exception of the one-time annual increase to the base rent as listed above, the maximum permissible annual rent increase on a dwelling unit covered under this law is 4% of the base rent which cannot be charged more than once in any 12-month period as long as no tenant living in the unit is 65 years or older.
- If there is at least one tenant living in the dwelling unit who is 65 years or older, the maximum annual increase is 2.5% of the base rent.
Is parking covered by the new rent control ordinance? See §257-11
- Yes. Specifically, any parking provided by the landlord, or anyone related to the landlord, rented in conjunction with the apartment rental to the tenant, whether or not billed separately, is covered by the rent control ordinance and any increases to parking must not exceed what is permitted under the ordinance.
Are there exceptions to the base rent increases for dwelling units covered by the new rent control ordinance? In other words, can these units’ landlords raise rents above the caps?
Yes, a landlord can raise rents beyond the rent control caps in tenant occupied units if: See §257-9
- The annual operating expenses for any one building exceed 65% of the total gross income. (Operating expenses shall include all reasonable expenses necessary to carry out the proper operation and maintenance of the property, including property taxes allocated to the year).
- There has been a major capital improvement to the property or major additional services added to the property.
- Major capital improvement means an addition to the dwelling or housing space units that inures to the benefit of the tenant, that was not previously provided or required to be provided by law or lease, that materially adds to the value of the dwelling or housing space and prolongs its life, and that must not be upkeep, maintenance, repairs, rehabilitation or replacement of items or services. See §257-3.
- Major additional services means an addition to the dwelling or housing space units that inures to the benefit of the tenant, that was not previously provided or required to be provided by law or lease, that materially adds to the value of the dwelling or housing space and prolongs its life, that includes substantial increase in services, furniture, furnishings or equipment provided to tenants since the date of the most recent rent increase and that must not be upkeep, maintenance, repairs, rehabilitation or replacement of items or services. See § 257-3.
A landlord can also raise rents beyond the rent control caps in vacant units if: See § 257-12
- The vacancy is due to a voluntary, uncoerced vacation of the property, and
- Such rental increase is done no more than once in a five-year period.
Are landlords able to increase their rents on May 9, 2022, the day the rent control ordinance went into effect?
It depends. If the unit is occupied and the tenant has a lease, the landlord is bound by the rental price contained in the lease and cannot raise the rent simply because the rent increase moratorium is no longer in effect. Once the lease expires, or if the tenant pays month to month, the landlord may raise the rent in accordance with the ordinance, provided the landlord abides by all notice and registration requirements.
How will the new rent control ordinance be overseen?
The law establishes the creation of a Rent Control Officer who will keep and maintain all relevant records and other data and information, supply information and assistance to landlords and tenants, bring landlords and tenants together in formal conferences and suggest resolutions of conflicts in compliance with the law, ensure adherence to the law by landlords and tenants, remedy violations of the law including bringing appropriate legal charges if necessary, accept, process, investigate and determine complaints with regard to vacancy decontrol, collect and maintain accurate Rent Registration Statements, and prepare forms for various processes outlined in this law. See § 257-5.
The law also establishes a Rent Control Board which shall consist of seven members who will be appointed by the Township Council. The Board will issue and promulgate rules and regulations, supply information and assistance to landlords and tenants, hold hearings and adjudicate various matters, approve and accept settlements, require landlords to produce financial and other records in order to adjudicate matters and more. See § 257-4.
What can I do if my question was not answered here?
Submit your question to [email protected].