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Referendum on Tenant Councils Planned in Berlin

Referenda concerning the housing market are becoming something of a tradition in Berlin. After the city's residents voted against the proposal to develop the periphery of the Tempelhof airport grounds last year, preparations for the next referendum are already under way: A tenant initiative now petitioning for a “rent referendum” (Mietenvolksentscheid e.V.) seeks to convert Berlin's six municipal housing associations (Gewobag, Gesobau, Howoge, Degewo, Wohnungsbaugesellschaft Mitte, Stadt und Land) into statutory corporations. The idea is not just to to grant policymakers a stronger influence on the housing associations, but also to give tenants a greater say. To this end, the draft bill proposes that so-called tenant councils be set up.

Tenants' Councils to be Granted Decision-Making Powers

It is the initiative's stated goal to mandate a socially compatible rental policy to the municipal housing associations and thereby to keep rents on a level affordable for average- and low-income groups on a long-term basis. At present, more than 300,000 of Berlin's total of 1.6 million rental flats are owned by the municipal housing companies. Berlin's Senate is planning to acquire additional units in order to bring their portfolios up to a total of 400,000 flats.

If the referendum was to win a majority, subsequent legislation would assign a key role to a so-called general tenants' council. Such a tenants' council would be formed for each housing association to represent the tenants' interests. It would have a say in all measures the municipal housing associations resolve to undertake, such as refurbishment and maintenance measures as well as intended sales and rent raises. Such measures would necessarily require the consent of the general tenants' council. In addition, local tenants' councils are to be formed in order to lend a voice to local tenant interests, e.g. by integrating them in the planning of modernisation investments, the development of outdoor areas or the drafting of house rules.

Affordable Rents at the Expense of the City Coffers

Berlin's body politic has mostly welcomed the initiative's plans. This is surprising insofar as implementation of the law would place a hefty financial burden on City Hall and thus on local taxpayers. That is not all: According to the draft bill, evictions on the grounds of rent arrears will no longer be permitted whenever the tenant at issue draws unemployment or other social benefits. It would also be unlawful to check a prospective tenant's credit rating. Finally, municipal housing associations are supposed to charge rents no higher than five euros per square meter. It remains to be seen if tenants are prepared to treat themselves to low rents at the city's expense.