New Brunswick

'Mute' PC MLAs thwart attempts to close loopholes in rent-cap bill

Green Party Leader David Coon doesn't think the government has gone far enough to eliminate loopholes that allow landlords to get around the government's temporary cap on rent increases. 

Green Party leader says N.B. government isn't doing enough to stop landlords from getting around bill

Bill 96 proposes a temporary rent cap of 3.8 per cent, but only for 2022. (David Horemans/CBC)

Green Party Leader David Coon doesn't think the government has gone far enough to eliminate loopholes that allow landlords to get around the government's temporary cap on rent increases. 

Coon made three suggestions to the committee discussing Bill 96 in order to address the loopholes, but all three were defeated by the Progressive Conservative MLAs who are in the majority on the standing committee on economic reform. 

On Wednesday, Service New Brunswick Minister Mary Wilson presented Bill 96, which would amend the province's Residential Tenancies Act. Among other things, the proposed amendments would limit rent increases to 3.8 per cent — but only for 2022.

The proposed changes have derailed some apartment owners' plans to raise rents, especially those who recently bought buildings at inflated prices or renovated buildings on the expectation of being able to attract higher-paying tenants.

Since the announcement, some landlords have been trying to figure out ways around the temporary cap, including so-called renovictions, where tenants are forced to leave while renovations occur. Others are waiting until the cap expires at the end of the year.

Coon, who is a member of the committee, suggested making the cap permanent.

Green Party Leader David Coon made three recommendations to tighten loopholes - all were defeated by Conservative MLAs, who hold a majority number of seats on the Standing Committee on Economic Reform. (Ed Hunter/CBC)

"It didn't make any sense that the rent cap would expire at the end of this year," Coon told Information Morning Moncton on Thursday.

"The conditions that are leading to unreasonable rent increases and are forcing people to look elsewhere for accommodations for apartments haven't changed. And until they do, there shouldn't be any consideration of ending the rent cap."

Coon said he's heard from constituents who have already received notices of rent increases to take effect in January, after the rent cap expires. 

Coon also suggested that New Brunswick follow Nova Scotia's lead in putting the onus on landlords who want to evict their tenants in order to do extensive renovations. 

In New Brunswick, the Residential Tenancies Board only gets involved in these so-called renoviction cases if the tenant complains. 

In Nova Scotia, landlords first have to prove to the tribunal that eviction is necessary before proceeding with the work. They're required to provide copies of their work permits and approvals.

But that suggestion from Coon was also shot down by PCs.

Coon's three proposals voted down

The problem, Coon said, is that once the renovations are complete, landlords can then jack up the rent for new tenants. 

The committee also voted down Coon's third motion — to follow the lead of Prince Edward Island and impose a moratorium on renovictions. He had asked the committee to consider banning renovictions until the end of 2023 so that renters could get through the "current economic upheaval." 

Coon was disappointed that his motions were defeated and that none of the Progressive Conservative MLAs on the committee spoke during the four-hour hearing. 

"They were mute. We never heard … from our colleagues on the government side as to why they voted against these amendments," said Coon.

Wilson told the hearing she believed there are enough measures in Bill 96 to eliminate loopholes. 

Coon said he doesn't believe her. 

As a way to get around the rent cap, landlords are evicting tenants in order to do renovations and then renting to new tenants at higher rents - since the cap only protects existing residents. (Shutterstock / Slava Dumchev)

"I don't," Coon said Thursday. "Because the only way you can guarantee that is if the onus is reversed and put on the landlord to apply for the ability to evict tenants to the tribunal, and prove that they have to empty the building or empty the unit in order to perform the kind of renovations they want to do."

He also said he doesn't think the bill protects people from renovictions or from large rent increases once the rent cap expires at the end of the year. 

Coon said landlords will simply wait until January to hike rents beyond 3.8 per cent. 

The committee ran out of time on Wednesday, and no date has been set for members to continue discussing Bill 96. 

Coon fears "it's a done deal" unless the minister returns to the standing committee with an amendment, since the end date for the rent cap is specifically mentioned in the legislation. 

In response to questions from opposition members of the committee, Wilson outlined the sections of the bill that would eliminate renoviction loopholes. 

"The landlord must require vacant possession to complete the renovation," she said. "Therefore, the renovation must be very extensive. Examples of renovations that would require vacant possession are if, for an extended period, tenants would be without water, electricity, heat or safe livable housing, safety hazard or noise, and would not include minor innovations such as painting or replacing flooring."

She said if landlords are caught overstating their renovation in order to get tenants out — and are caught doing so — they would be fined and the tenant would be compensated. 

ABOUT THE AUTHOR

Mia Urquhart is a CBC reporter based in Saint John. She can be reached at mia.urquhart@cbc.ca.

With files from Information Morning Moncton

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