Incorrect IAI Rent Increase Calculation Wasn't a Willful Overcharge

The DHCR's Tenant Protection Unit (TPU) referred a rent overcharge complaint to the DRA after an audit investigation determined that the legal rent registered for an apartment wasn't fully substantiated. The DRA ruled for tenant and ordered landlord to refund $25,681, including triple damages. Landlord appealed and won in part. The DHCR agreed with landlord that the overcharge wasn't willful. Landlord collected a rent increase for individual apartment improvements (IAIs). The overcharge was caused solely by landlord's errors in the percentage calculation of the IAIs. Landlord charged an IAI increase equal to 1/40th of its cost, instead of 1/60th of the IAI cost. Triple damages therefore were eliminated, and the total overcharge was reduced to $13,441.

Schulmann Properties International LLC: DHCR Adm. Rev. Docket No. JV410034RO (11/30/21)[3-pg. document]