Union County judge clears the way for ballot measure that would restore a decades-old limit on annual rent increases for rent-controlled apartments

A referendum to cap annual rent increases for rent-controlled apartments in Elizabeth at $20 a year will be on the ballot this November after a Union County Superior Court judge dismissed a lawsuit from landlords seeking to block the proposal before voters could weigh in.

The ballot initiative would restore a provision that was in place for more than three decades, capping annual rent increases at either $20 or 3%, whichever was less. The Elizabeth City Council eliminated the $20 cap but left the 3% limit in place in 2023 after landlords argued the law had become outdated.

“It was something that existed in Elizabeth for over 30 years,” Isaac Jimenez, an organizer with the North Jersey Democratic Socialists of America’s Freelizabeth campaign, told The Jersey Vindicator in an interview. “A lot of people cite Elizabeth as being pretty affordable, at least in the past few decades, but that’s starting to change now. We think the removal of the cap is just one of the ways that the city is caving to developers and to corporate landlords.”

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An analysis by the apartment search website RentCafe.com found that 74% of Elizabeth residents are renters. It’s unclear how many of those rental units are rent-controlled. Under municipal and state law, residential buildings with at least three units become subject to rent control 30 years after they are built.

Nearly 800 Elizabeth residents signed petitions to place the proposal on the ballot. In June 2025, organizers submitted the signatures, and a group of 13 landlords sued a month later to keep the question off the November ballot.

“This proposed dollar cap is inconsistent with every other rent control ordinance in the state,” attorneys for the landlords wrote in court filings.

The landlords argued that the proposed ordinance would restrict their ability to earn a reasonable return on their properties so severely that it would amount to an unconstitutional taking of private property under the Fifth Amendment.

Union County Superior Court Judge John M. Deitch rejected that argument. In his ruling, Deitch wrote that the landlords had not shown the proposed cap would deprive them of the “just and reasonable return” required under New Jersey law.

The New Jersey Supreme Court ruled in the 1970s that rent control is constitutional as long as it allows landlords a just and reasonable return on their investment and rationally serves the public interest. Deitch found the proposed ordinance could rationally serve the public interest by promoting affordable housing.

A coalition of 17 organizations, including the ACLU of New Jersey, Fair Share Housing Center, the Housing and Community Development Network of New Jersey, and the New Jersey Tenants Organization, filed a friend-of-the-court brief supporting the ballot measure.

Elizabeth voters will decide whether to restore the $20 cap in November. According to Make the Road New Jersey, an immigrant, tenant, and worker advocacy group that supported the ballot initiative in court, the ballot question will read:

QUESTION: Shall the City of Elizabeth amend its Chapter 5.70.60 Municipal Code on Increases in Base Rent to add a $20 annual rent cap so that no landlord shall request or receive any increase in base rent in excess of three percent or twenty dollars, whichever is less, over the base rent received for the twelve (12) months prior?

“If the landlords disagree with the policy and think they should be able to raise rents even more, they can make their case directly to voters,” said Renée Steinhagen, executive director of the New Jersey Appleseed Public Interest Law Center, who represented the residents who successfully petitioned to place the rent-control question on the ballot.

The attorneys representing the landlords did not respond to emails requesting comment.