BOSTON — The Legislature is considering two separate, but similar, bills to give Lawrence and Salem the power to control rents at buildings constructed or bought with government money in exchange for keeping rents low.
Under the bills, the cities also would be able to steer the sale of those buildings to owners who would promise to keep the apartments affordable.
At issue are "expiring use" apartment buildings built or bought with low-interest loans given by the U.S. Department of Housing and Urban Development, HUD, or state agencies some three decades ago in exchange for keeping rents low. Many of those mortgages are being paid off now.
The Lawrence and Salem bills were passed by their city councils last year. City councils in Boston, Lowell, New Bedford and Quincy have sent state lawmakers similar petitions.
Michael Kane, executive director of the National Alliance of HUD Tenants, said the Lawrence bill would preserve 120 affordable apartments at Sycamore Village in Lawrence, which its owner is selling.
"(The bill) would give tools the city seeks in Lawrence to preserve and restore affordable housing," Kane told the Legislature's Housing Committee recently.
If passed, the Lawrence bill would let the city cap rents at buildings built with those low-interest federal or state loans. The rents would be capped at what they were as of April 2000 or six months before the low-rent agreement ended.
Voters banned rent control in a 1994 statewide referendum. Kane said the bill is not a return of rent control. He also noted that this targets large apartment buildings, those with 25 or more apartments.
"It's not general rent control," Kane said. "It's picking up where the feds left off."
The Salem bill would affect buildings with 10 or more apartments.
The Lawrence and Salem bills also would place high hurdles to converting those buildings to condominiums.
The cities also would be able to steer those buildings, when they're put up for sale, to nonprofit organizations and affordable housing preservation developers. They would get an opportunity to bid first on an expiring use building and agree to keep rents low and accept Section 8 and other rental vouchers.
Sen. Susan Tucker, an Andover Democrat and co-chairman of the Legislature's Housing Committee, wants to pass a statewide bill instead.
Tucker would include rent caps and incentives to sell to nonprofit organizations and affordable housing developers.
Both plans come as state lawmakers are moving to approve a $1 billion housing bond bill, which includes money to build affordable housing. It includes a $100 million subsidy for nonprofit organizations to sweeten their bids for expiring use buildings.
Tucker said lawmakers are working on the legislation but that control of rents has been historically opposed by landlords. But with less affordable housing being built and a rising foreclosure crisis, Tucker said it's worth the effort.
"It's cheaper to preserve units than it is to build new ones," Tucker said.