...and a defeat for many people who are going to want to be able to find an affordable apartment in New York in the future. It's another example of the often insidious notion that receiving any apparent government "benefit" (and I fear all too often this is what pure anti-"vulgar libertarian" thinking can lead to--the idea that no market freedom is legitimate or to be cheered until all government intervention that might give a special benefit to some entity is ended) means that the government can call all the shots.
I'll let Joan Gralla at Reuters explain it:
Thousands of New York City apartment renters on Thursday won a major court victory that could help them keep lower rents but may drive landlords into foreclosure and crater city tax revenues. New York state's top court ruled that the owners of a huge Manhattan apartment complex, Stuyvesant Town and Peter Cooper Village, could not raise regulated rents to higher free market rates because the landlords are getting tax abatements.
The Court of Appeals gave thousands of Stuyvesant Town and Peter Cooper Village tenants -- and as many as 100,000 other renters around the city -- "the comfort that the rest of us enjoy...the right of renewal on the same terms and conditions of the previous lease," said Alexander Schmidt, the lawyer who sued on behalf of nine tenants in the East Side complex.
The consequences for the city's coffers, other apartment owners who also get tax abatements, banks and investors, could be grim under what lawyers said was the worst case scenario: a ruling that Thursday's court decision should be retroactive. New York's trial court will make that decision, the state's top court decided.
It's interesting, and of course to be expected, that Gralla frames the downside of this in terms of how it might hurt government coffers. The real bad part is the lack of freedom it gives to the building owners--and the lack of incentive to provide apartments for all future New Yorkers that will create widespread aggravation and shortages down the line.