MCI Application Denied Due to Outstanding Building-Wide Rent Reduction Order

Westchester landlord applied to the DHCR in July 2021 for MCI rent hikes based on installation of a new boiler/burner. The DRA ruled against landlord on Feb. 4, 2022, because there was a building-wide service reduction order in effect under a separate DHCR docket number at the time the DRA ruled on landlord's application.

Landlord appealed and lost. Landlord pointed out that it had filed a PAR of the service reduction order. But tenants had filed the building services complaint in August 2018 and the DRA granted tenants' application on April 16, 2019, with an effective date of Sept. 1, 2018. Although landlord filed a PAR of the service reduction order, the DHCR had denied landlord's PAR of that order on July 9, 2020. Landlord then filed a rent restoration application in June 2021, which the DRA denied in Feb. 2022. Landlord then filed a PAR of the decision denying rent restoration, which was denied by DHCR on Dec. 16, 2022.  A second rent restoration application was denied on Sept. 5, 2023. On Oct. 30, 2023, landlord filed a third rent restoration application, which was pending at the time that the DHCR denied landlord's PAR of the MCI denial on Dec. 1, 2023.  The ETPA permits the DHCR to deny an MCI application if the landlord is not maintaining all required services, or if there are current hazardous or immediately hazardous violations outstanding against the building. The existence of a building-wide rent reduction ordered by the DHCR precludes the granting of an MCI rent increase. Landlord's initial rent restoration application was denied before the DRA issued its order denying the MCI application. This denial was proper.

Westchester Plaza Owner LLC: DHCR Adm. Rev. Docket No. KO910014RO (12/1/23)[3-pg. document]