DHCR Had No Authority to Rule on Tenant's Lease Renewal Complaint

Rent-stabilized tenant complained to the DHCR that landlord failed to offer him a renewal lease on the same terms and conditions as his expiring lease. Tenant specified that the temporary lease rider for a preferential rent in the expiring lease should be permanent under HSTPA amendments to the Rent Stabilization Law. Tenant also claimed that landlord had taken away a utility credit that was part of his original lease term for his low-income apartment. The DRA ruled for tenant and ordered landlord to offer tenant a renewal lease.

Landlord appealed and won. Landlord pointed out that the DRA's decision contradicted several other DHCR orders issued for the building and other buildings in the apartment complex. Tenant's apartment was located in the Gotham West Apartments Project, a complex of four buildings containing mixed moderate, low-income, and other affordable housing units. The collectible and legal regulated rents for all apartments in the complex were set under a federal Regulatory Agreement between landlord and 45 Street HDFC, the NY State Housing Finance Agency, and HPD. The initial rent for the apartment was based on tenant's income and whether tenant qualified for a "utility allowance" was determined by HPD and revised annually, in accordance with federal agency guidelines. Therefore, the apartment's legal and collectible rent was governed by HPD under the federal Regulatory Agreement and wasn't under DHCR jurisdiction. The fact that landlord may have filed annual DHCR rent registrations and gave tenants rent-stabilized leases, as required by the Regulatory Agreement, didn't confer jurisdiction unto the DHCR. The DHCR had made the same ruling in six other PAR decisions involving apartments in the complex. And at least one appeals court made a similar ruling.

44th Street Development, LLC: DHCR Adm. Rev. Docket No. LS410004RO (8/8/23)[2-pg. document]