Pointing/Waterproofing Was Done Within Useful Life of Prior Work

Landlord applied for MCI rent hikes based on pointing and waterproofing, exterior restoration work, and a sidewalk shed installed while the work was being performed. The DRA ruled against landlord, finding that it had granted a prior MCI rent increase for the same work less than 25 years earlier. Therefore, the prior work's useful life hadn't been exhausted and no new MCI increase could be granted.

Landlord appealed and lost. Landlord claimed that it had filed a request with the DHCR for a waiver of the useful life requirement. Alternatively landlord sought an offset for some MCI items it claimed didn't exceed their useful life. But the DHCR found that a useful life waiver request generally must be filed prior to filing an MCI application. It can be filed at the time the MCI application is filed only if the work was done because of an emergency. In this case, landlord sought the useful life waiver at the time it filed its MCI application but no emergency was involved. So no useful life waiver could be granted. In addition, the pointing and waterproofing work wasn't performed as an independent MCI item but was included as an integral part of the exterior restoration work performed. So there was no shorter, separate useful life applicable to this work. The useful life for the exterior restoration project was 25 years. And since there was no valid useful life waiver request submitted, no partial MCI rent increase could be considered.

BSF Inwood Holding, LLC: DHCR Adm. Rev. Docket No. JU410004RO (9/15/23)[4-pg. document]