Landlord Can Collect MCI Increase from New Tenant After J-51 Offset Ends

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant and ordered landlord to refund $1,800, including interest. Among other things, the DRA disallowed an MCI increase for new tenant who wasn't advised that the increase would go into effect after a J-51 offset ended. Landlord appealed and won. There was no requirement that landlord give new tenant notice in her vacancy lease that a J-51 offset would expire and that tenant's rent would thereafter be subject to an MCI rent increase. Landlord's right to collect the offset upon expiration of the tax abatement is by operation of the MCI order itself. Landlord had filed notice of the J-51 expiration with the DHCR. And beginning collection of the offsets upon commencement of the first new lease after expiration of the J-51 benefits was reasonable and permissible.

Beach Haven Apts. Assoc. LLC: DHCR Adm. Rev. Docket No. BQ210015RO (7/23/14) [4-pg. doc.]