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Archive for the ‘Housing’ Category

The Last Words of Brother Chris

Slain community activist Chris Crowder was the final witness at a March 31 hearing of the D.C. Council Committee on Consumer and Regulatory Affairs.

Introduced by Ward 1 Councilmember Jim Graham only as “Brother Chris,” Crowder, in one of his final public statements, showed a glimpse of the spunk that once pissed off the likes of Bill Cosby but made him a memorable presence in neighborhood debates.

Spoke Brother Chris: “I’m gonna overlook that I heard there were threats to certain people if they organize in tenant groups, because I know we do have some tough guys in this city who can help some of you citizens if you are being threatened. So I’m not even gonna pretend I heard some of that tonight. I end saying thank you, thank you, and thank you.”

When is a Vacant Building Not Vacant?

In last week’s paper, we wrote about a loophole that has been allowing developers to convert buildings to condos while avoiding a hefty 5 percent conversion fee. They vacate a building, or at least claim it’s vacant, and then apply for a “vacancy exemption” from the Department of Consumer and Regulatory Affairs (DCRA). It may be, though, that this dodge is too clever by half. Declaring a property vacant, though, should mean the owner has to pay a special vacant-property tax rate, which is more than five times the standard fee.

Last week, Matthew Forman, federal real-estate attorney and vice president of the Kalorama Citizens Association, e-mailed Ward 1 Councilmember Jim Graham, alerting him of the contradiction. “Would you please investigate how, if the owner of 1342 Vermont is claiming the property to be vacant, they were not charged the $5/100 real property tax rate for vacant properties? The property isn’t paying the vacant tax rate and in fact is still receiving the homestead exemption, giving them a further, significant reduction in their property taxes.…In this case, it would appear that the property owner needs to be sent a bill for either the conversion fee or the back taxes - they can’t have it both ways,” he wrote. Besides the City Paper, he cc’ed Eric Goulet in Councilmember Jack Evans’ office and Thomas Branham, the District’s chief assessor.

Graham forwarded the e-mail back to Branham asking for an opinion.

“In the future,” Forman writes, “you need to make sure that the branch of DCRA that is accepting filings stating that properties are vacant is passing this information on to [the Office of Tax and Revenue] to make sure that the property is paying the full vacant tax rate.”

Forman says he has been working with the council trying to increase collection of the full vacancy tax rate, and the contradiction in the latest loophole jumped out at him. Either the property’s vacant, he says, or it’s not. “It’s just the total, perfect irony,” he says.

Condo Catch-22

The Department of Consumer and Regulatory Affairs (DCRA) has made a number of head-slappingly ludicrous decisions in the past—perhaps most famous among them the pronouncement that the sale of 95 percent of a building is not actually a sale. But for sheer Kafka flavor, a recent ruling in a tenant-purchase issue may have set a new bar.

Jeff Nelson and some fellow residents of 1815 19th St. NW thought their plans to purchase their Dupont Circle apartment building and convert it into condos were coasting along. Like scores of tenant groups before them, they formed a limited liability corporation (LLC) as part of the purchase. The next step in the condo-conversion process should have been a formality—an election whereby the tenants vote to proceed with the deal. “We played by all the rules,” Nelson says.

But Carl Bradford, a DCRA housing-regulation specialist, stopped the process cold. He ruled that the tenants could not vote in the election because they were “employees” of the LLC. The tenants initially thought that the ruling was a simple mistake that would be corrected by Bradford’s higher-ups.

At the end of last week, one higher-up declined to do so. In an 11-page decision, Acting Rent Administrator Keith Anderson argues that if he allows the tenants to vote, future landlords might create their own LLCs and have employees move into a building, pay rent, and then vote for conversion, thereby skirting tenants’ rights. Ward 1 Councilmember Jim Graham, who chairs the committee that oversees the DCRA, says he doesn’t understand the legal basis of the ruling. It “effectively jettisons [tenants'] ability to convert to condominiums,” he says, which is protected under District law.

Of course, this ruling is miles from lunacy for some in the D.C. housing market. If tenants can’t purchase a building and then vote to convert to condos—as is the obvious intent of the law—they have only one other choice: sell their right to purchase to a developer.

DCRA spokesperson Karyn-Siobhan Robinson did not comment, other than to say that the decision is “not final.”

Nelson et al.—encouraged by an IRS ruling that says “employees” actually have to be paid—plan to appeal the ruling in court, and Graham says he will formally request that Anderson reconsider his ruling. “It has an Alice in Wonderland quality,” he says. “I thought we were in a little bit of a different era.”

Landlords Try to Evict Graham

This afternoon, the D.C. Apartment and Office Building Association (AOBA), held a press briefing at its downtown offices on rent-control legislation currently making its way through the D.C. Council. Ward 1 Councilmember Jim Graham has been AOBA’s main adversary on the legislation—which would do such tenant-unfriendly things as abolish rent ceilings and penalties for landlords that do not file rent increase notices. Loose Lips wrote about the conflict this week.

Shortly before the briefing started, Vincent Mark Policy, an attorney with landlord-favorite law firm Greenstein Delorme & Luchs, spotted Graham inside the meeting. “You weren’t invited,” he told the councilmember.

“You’re asking me to leave?” Graham replied.

“Politely,” said Policy. “This is not a public event.”

“Let me have someone from AOBA ask me to leave. You’re from a law firm.”

Policy said OK and walked away. Asked if he’d ever been kicked out of an event before, Graham said, “Never. This will be a first….I didn’t even get a cookie.”

Policy returned and told Graham “you can stay if you don’t talk.” Said Graham: “I wouldn’t dream of saying a word. I have my car legally parked. I can go down and get in it.”

“You want some change for the meter?” Policy replied.

After the event ended an hour and a half later, Policy apologized to Graham.

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