DHCR Disallowed Engineer Services Claimed in Connection with Boiler/Burner Installation

Landlord applied to the DHCR for MCI rent hikes based on installation of a boiler/burner. The DRA ruled for landlord in part, granting the MCI rent increase but disallowing the costs for fluorescent light fixtures, professional engineer services, and filing fees.

Landlord appealed and lost. Landlord claimed that applying Rent Stabilization Law amendments enacted by the HSTPA on June 14, 2019, to its pending MCI application was an impermissible retroactive application of the amended law and violated landlord's constitutional right to due process. The DHCR disagreed, noting that there was no such impermissible retroactive effect. Since landlord was merely an applicant for a potential MCI rent increase when HSTPA changes to the law were enacted, it didn't have a right to any MCI rent increase at that time. And, since enactment of HSTPA Part K concerning MCI rent increases, courts have repeatedly ruled that there was no potentially problematic retroactive effect of the amended provisions. The DHCR also found that the 2 percent cap on annual MCI rent increases resulting from HSTPA amendments to the rent stabilization law wasn't unconstitutional. Professional engineer service fees also were properly disallowed in this case since the services weren't both necessary and customary to the accomplishment of the MCI installation involved here. There was no proof here that the boiler/burner installation was more complex than usual so as to require an engineer's services. 

Norfolk Associates LLC: DHCR Adm. Rev. Docket No. JW410008RO (9/30/24)[4-pg. document]