The Long Arm of Washington

The Reagan Administration is quite right in thinking that rent control is generally counterproductive. It tends to discourage new investment in rental housing, and sometimes tends to lead to deterioration in the quality of rental housing.

But the proposal by the Office of Management and Budget to cut off federal funds to cities that have rent control is a striking violation of the principle of federalism that the Administration has so often and so piously espoused.

About 200 cities--including Los Angeles, Santa Monica, San Francisco, New York, Boston and Washington--have some form of rent control.

The budget office is proposing to cut, by executive order, them and all others out of the $200 million a year in federal funds distributed to cities and states for major repairs to rental housing to correct violations of local business codes. Since the program began in 1985, Los Angeles has received $18 million from it; another $3 million that the city is due for earthquake-safety repair would be eliminated by the proposal.

The action would be taken as a “symbolic step” to make the point that rent control is counterproductive.

There are three things wrong with this proposal.

First, it would skew these funds away from some cities that need them most toward cities that need them less.

Second, it would seek to achieve by executive order of the Administration a major policy change that should, and perhaps by law must, be decided by Congress.

Third, it would substitute the judgment of the federal government for that of the cities on whether rent control was proper public policy.

It is long established that the federal government may and indeed must override local ordinances to secure the constitutional rights of the citizens. It is always debatable, however, how long the arm of Washington may reach when it comes to local housing ordinances. And surely it should not stretch it out on an important housing issue without the consent of Congress.