DHCR Violated Law in Changing Electric Metering Rule
LVT Number: 13932
Facts: Landlord applied to the DHCR for permission to stop providing electric service to tenants and to convert to individual electric metering. The DHCR had changed its method of computing rent reductions when a landlord converts a building from mass metering to individual electric metering. The DHCR ruled for landlord and applied the new calculation method. Tenants appealed. They didn't object to the conversion of the metering, but claimed that the DHCR's new calculation method was illegal. The DHCR had changed from a three-step process for calculating tenant rent reductions to a one-step process based on a fixed schedule of rent reductions similar to one used by the Section 8 program. The DHCR's old calculation method resulted in larger rent decreases. Court: Tenants win. Under the State Administrative Procedure Act (SAPA), the DHCR must explain why it was changing a rule before it applied a new one. The DHCR didn't do so in this case, which violated SAPA and made the court unable to determine whether the DHCR's new method was arbitrary or reasonable. The case was sent back to the DHCR.
Car Barn Flats Residents' Assn. v. DHCR: NYLJ, 2/23/00, p. 28, col. 5 (Sup. Ct. NY; Madden, J)