No Luxury Deregulation Permitted

Landlord applied for high-rent/high-income deregulation of tenant's rent-stabilized apartment in 2008. Tenant's rent was more than $2,000 per month, and landlord claimed that the annual household income was more than $175,000 in 2006 and 2007. Tenant claimed that he wasn't subject to luxury deregulation because the building was receiving J-51 tax benefits at the time landlord filed its application. Tenant also argued that his income was below the deregulation threshold. The DRA ruled for tenant based on a finding in a prior luxury deregulation proceeding that tenant's 2006 income was less than $175,000. The DRA didn't address the J-51 question. Landlord appealed and lost. Landlord argued that its appeal of the prior DHCR ruling was pending. In that case landlord claimed that the DHCR failed to consider the income of tenant's husband. But this didn't matter. Landlord acknowledged in an amendment to the building's condominium conversion plan that high-rent/high-income deregulation wasn't available while the building received J-51 benefits. Public records also confirmed that J-51 was in effect at the time of landlord's application.

Walsam 240 Owner LLC: DHCR Adm. Rev. Docket No. XK410029RO (1/11/12) [4-pg. doc.]