DHCR Will Reconsider MCI Application Based on Backflow Prevention Device

Landlord applied to the DHCR in 2021 for MCI rent hikes based on installation of a Reduced Pressure Zone (RPZ) backflow prevention device that cost $9,556. The DRA ruled against landlord because landlord had failed to submit a waiver of the DHCR's Reasonable Cost Schedule with its MCI application.

Landlord appealed and won in part. Although landlord failed to comply with all MCI application requirements in effect when its application was filed, the DHCR considered the following mitigating factors. Landlord's MCI application was filed without the required cost schedule waiver for backflow prevention devices shortly after this requirement took effect. Also, an update to the DHCR's procedures allowing for such backflow preventor-related MCI applications to be granted without such waiver took effect shortly after landlord's application was denied by the DRA.

The DHCR therefore sent the case back to the DRA for further consideration of whether to grant an MCI increase that wouldn't exceed the 2022 Reasonable Cost Schedule limit of $7,945 per backflow prevention device. But landlord wouldn't be given a second chance to "waive" the limits of the applicable 2022 Reasonable Cost Schedule. 

2531 Olinville Avenue LLC: DHCR Adm. Rev. Docket No. JV610055RO (8/4/24)[4-pg. document]