STATEMENT FROM THE LANDLORDS ASSOCIATION OF TOMPKINS COUNTY REGARDING THE COVID-19 ECONOMIC DOWNTURN
April 1, 2020 The Landlords Association of Tompkins County (LATC) expresses its support of our neighbors, friends and lawmakers as we work our way through the economic calamity caused by the COVID-19 outbreak. The LATC has been a member of the community since before many of our tenants were born. We are an organization of more than 500 members, most of whom are very small and who depend on our rental income to pay for our mortgages, our taxes, our utilities, our insurance, our groceries, and to educate our children. Any situation that hurts our tenants economically will, by extension, inevitably hurt us. By the same token, any situation that reduces the income upon which we rely will have a negative impact on the institutions that keep our community functional, including our schools, our banks, and our local governments. A recent article in the New York Times estimates that anywhere between 39% and 50% of tenants in the city will be unable to make their April 2020 payments. Since our finances are so closely tied to the educational institutions in Tompkins County, we have little question that our economic impact will meet or exceed those in New York City. We have been urging our membership to be flexible with our tenants’ payment schedules. We are urging our tenants to communicate with us candidly about their situations. Some of our members have been approaching institutional lenders. We are finding that some lenders are being flexible with their loan repayment terms, while others are not. We have yet to hear much information about what flexibility our local governments will be providing to us when our tax bills become due. In addressing the economic downturn, consideration to all affected parties is a necessary and important step. Any measure that fails to adequately consider all affected parties will have a devastating impact on the people and institutions who rely on us. We may be unable to make our mortgage payments. We may be unable to pay our tax bills that will become due in a few short months, and we have many other expenses including utility bills, insurance, and sidewalk fees. Our local governments will be impacted. We ask that our local governments defer to the state legislature; and that the state legislature forbear from enacting any legislation that does not consider the following issues:
1. Legislation relating to rent payments should focus narrowly on tenants who will have lost income as a result of the COVID-19 economic downturn.
2. What consideration has the legislature given to the inevitable economic effect on institutions downstream from tenants and property owners, including local governments, banks, and suppliers?
3. The public needs to be educated about what a "rent freeze" is, and what it is not. An across-the-board cessation of rent is not feasible (and we understand that proposed State Senate legislation, in its current form, does not propose rent cessation for all tenants). Some members of the public seem to think that “rent freeze” means “free rent.” It does not, or it should not. People forget that it is more than just a mortgage that property owners have to pay. If there is not a freeze on all of the property owners’ payments downstream, we cannot afford it. The biggest misconception at this time is that mortgage payments will be deferred for a certain period of time; and while that may be an option for some landlords it is not for all. Regardless, our expenses are not stopping so we cannot simply stop requiring people to pay rent across the board. Likewise, we reiterate that we need to be hearing from our local governments – now – about what they propose to do when many of us are unable to pay our taxes in full. Providing accurate and concise information is essential for any proposed measures.
4. Running residential real estate is as much of a “Main Street” business as any other. At this point – early into the crisis – we all must try to look to the longer term. If landlords lose income, they too have to lay off workers and consider bankruptcy. Such bankruptcies could well impact our local communities with poor maintenance at properties, tax foreclosures and bankruptcy sales which would lead, in a year or so, to sales of properties or foreclosures and lower assessed values and lower tax revenues. Landlords must – like all of us – bear some of the pain. Most landlords are willing to work through re-arranging payments and foregoing some income – but they are no more in a position to bear the brunt of this crisis than any other small business owner in our community. All of us are in this together. We stand by our tenants, our members and our governments to find equitable solutions as we work through this difficult time. All of us on the LATC Board welcome comments. The LATC’s officers are:
President- Brian McIlroy
Vice President- Brian Grout
Treasurer- Ron Schmitt
Secretary- Kayla Lane
Corresponding Secretary- Brian McIlroy
The LATC’s directors are: Carol Schmitt
Thank you to Ithaca attorneys Michael C. Perehinec, Jeffrey D. Walker, Liam G.B. Murphy, and Christina DuBouchet for their input -- Russ Maines, (607) 279-1775; firstname.lastname@example.org