Contractor's Administrative Costs Disallowed from MCI

Landlord applied for MCI rent hikes based on elevator upgrading. The DRA ruled for landlord in part but disallowed the cost of miscellaneous work that landlord claimed was done in connection with the MCI. Landlord appealed and lost. Landlord then filed an Article 78 court appeal, claiming that the DHCR's decision was unreasonable. The case was sent back to the DHCR for reconsideration. The DHCR again ruled against landlord. The contract for the work submitted to the DHCR didn't include a line-item breakdown. Landlord submitted additional information at the DHCR's request showing that the extra work included a survey, parts management, scheduling, and supervision totaling $112,000 for the three elevators involved. This was administrative work performed by the contractor. There was no showing that this work was necessary or customary for the completion of the MCI. And these weren't professional services provided by a project manager, architect, or engineer. 

96-02 57th Avenue: DHCR Adm. Rev. Docket No. CS110003RP (12/31/14) [2-pg. doc.]