Fred Neil represents the 3rd District on Dover City Council.
By Councilman Fred Neil
Any tenant living in any house, apartment or in a leased-land community has a huge stake in the outcome of the Delaware state legislature election in November. The amount of annual rent increases taken from low- and middle-income families, seniors and retired military is astronomical.
In addition to the financial peril these excessive increases place on Delaware citizens who can ill afford it, that money is lost to the state business economy.
Any change to keep affordable housing affordable must be spurred by the tenants asking the incumbents seeking reelection and the challengers how they are going to fix the lack of affordable housing in Delaware. Housing is one of the cornerstones of our economy. Small landlords are not so much of the problem, but rental domiciles, apartments and leased-land residences owned by corporations are out of control.
As a Dover city councilman, I am representing “grassroots” constituents on a daily basis. Over 50% of Dover homes are investment properties. I hear the anguish from apartment dwellers. I see my senior leased-land-home neighbors moving in with grown children because they can’t afford the excessive annual rent increases. Those compounded rent increases can’t be spent in local businesses if the money is in corporate pockets.
More and more of those pockets are out of state. I have never been able to find one elected official who knows how much rent money is returned to Delaware in taxes. I have a library of media stories of the outrageous rent increases due to the lack of affordable housing across our nation. Do out-of-state, passive investors pay Delaware taxes? Of course not!
The public interest requires a totally different approach — create a Public Service Commission for Rent for the same reason we have one for utilities. I have sent a version of this document to every single 2022 candidate with an email address, asking, “If elected, will you pledge to request a Joint Resolution calling for a review of the Tenant-Landlord code to create a stakeholder PSC?” The purpose is to provide a profit for the corporate money, so it’s spent in operating and maintaining their rental property but not for compounding annual rent increases for doing nothing to the property.
The tenants will have to pay $50-$100 each year for the commission’s operation, less than the compounded annual rent increases they are paying now. This approach should discourage slumlords and encourage good landlords to maintain their properties. It may also discourage the price-bidding that drives up the sale of rental properties, which tenants pay in higher annual rent increases.
Opposition will come from the landlords, who proclaim their business is private (just as utilities are private). I admit to being an unabashed capitalist. Capitalism works with competition, but there is no competition for affordable housing. Ergo, the need for a Public Service Commission.
Even if we throw money at building new housing, it may help in five to 10 years from now. Unless we make a fundamental change, that affordable housing will disappear. Here is why: Freddie Mac and Fannie Mae are better at creating and sustaining millionaires than they are in creating and sustaining affordable housing: These chartered, federally authorized agencies loan discounted money for affordable housing. Once the developer decides to take the profit and run, the “affordability” is gone.
Since the only string attached by these agencies is to follow state law, why not add a state tag that requires that the sale of the property goes to a nonprofit corporation or a professional managed co-op?
Campaign contributions create smoke that obscures the desperate need for affordable housing for Delaware. A Rent Public Service Commission clears the air and will be another first for the First State!
As voters, you need to ask and drive the message home to candidates. The ball is in your court.
