Landlord Can't Charge Rent-Stabilized Tenant for Water Usage

Rent-stabilized tenant complained of rent overcharge based on rent surcharges collected by landlord for water usage. The DRA ruled for tenant, finding that in NYC landlords aren't allowed to charge tenants for water usage. The DRA directed landlord to refund water usage charges paid by tenant in May and June 2021, and to stop billing thereafter for monthly water usage.

Landlord appealed and lost. Landlord argued that tenant signed a vacancy lease rider for water usage and that the apartment was submetered for water usage. Landlord pointed out that RSC Section 2522.10 permits owners to charge for utility services and that the RSC provision wasn't limited to electricity, gas, cable, and telecommunications. Under RSC Section 2520.6(r), hot and cold water is a required service to be provided by the landlord. Under RSC Section 2520.13, a tenant may not waive a benefit afforded under the rent stabilization laws. So charges for water usage, a required service, couldn't be passed on to tenant. There was no indication that landlord had applied to the DHCR to decrease services via submetering apartments for water usage or that the agency allowed this. And although RSC Section 2522.10 allowed submetering for electricity and other utilities, it didn't permit landlord to pass along charges for required services to tenant. To the extent that an unrelated 2011 PAR decision relied on by landlord was inconsistent with current law on submetering and required services, it would not be followed.

Sydney Leasing, LP: DHCR Adm. Rev. Docket No. MT110008RO (1/6/25)[2-pg. document]