MCI Application Denied Based on Missing Annual Rent Registrations

Landlord applied to the DHCR for rent increases based on installation of major capital improvements (MCIs) consisting of new flooring, boiler/burner, lobby doors and intercom. The DRA ruled against landlord because landlord failed to register the building with the DHCR for the years 2019 and 2020, and failed to submit a waiver of the Reasonable Cost Schedule for the flooring installation, despite the DRA's request for those records while the MCI application was pending.

Landlord appealed and lost. Landlord claimed that the DRA failed to inform him that annual registrations and a Reasonable Cost Schedule waiver were required and it didn't have the opportunity to submit the requested records. But DHCR records showed that requests for the missing information had been mailed to landlord. Annual rent registration was a well-established DHCR policy since 1984. While the MCI application was pending, the DRA sent landlord a Request for Additional Information seeking proof of rent registration for 2019 and 2020, and warned landlord that failure to comply with the registration requirement could result in dismissal of its MCI application. Also, while landlord's application was pending, no flooring installation cost limits appeared in the DHCR's Reasonable Cost Schedule under Operational Bulletin 2021-1. Landlord therefore was required to file documentation showing that the flooring installation's claimed cost was accurate and reasonable. The DRA sent landlord a request for this information while the MCI application was pending but received no response.

Park Slope United LLC: DHCR Adm. Rev. Docket No. JX210023RO (12/10/24)[3-pg. doc.]