Mobilization Costs Added to Approved MCI Rent Hike

Landlord applied for MCI rent hikes based on exterior restoration work for the facade and roof with related architectural fees and scaffolding. The DRA ruled for landlord in part but disallowed the cost of removing and replacing heat pipes located on the roof, as well as costs of certain other specific items. The DRA also disallowed work shown on change orders because the change order forms contained no signatures. Landlord appealed and won, in part. But the DHCR found that many items were properly disallowed. It was long-standing DHCR policy that the cost of obtaining permits wasn't eligible and that scraping and painting was ordinary repair and maintenance work, even when done with an MCI. Landlord didn't prove that the excluded heat piping replacement was directly related to the MCI-qualifying exterior restoration project. The change orders weren't properly documented without signatures from landlord and its contractor. However, the cost of mobilization for the MCI should not have been excluded. DHCR policy includes mobilization costs for a qualifying MCI installation.

219 West 81st Residential Holdings LLC: DHCR Adm. Rev. Docket No. ZH430063RO (6/14/17) [3-pg. doc.]