Project-Based Section 8 Building Not Subject to Rent Stabilization Law

In separate proceedings, tenant complained to the DHCR that landlord refused to renew her lease and that her initial rent exceeded a fair market rent. The DRA ruled against tenant and terminated both proceedings. The DRA found that tenant's building was project-based Section 8 housing under HUD regulation, and therefore wasn't subject to rent stabilization.

Tenant appealed and lost. In September 2019, the housing court had already decided the same question in an eviction proceeding against tenant. In court, landlord presented correspondence and its mortgage with HUD detailing its requirements for income and asset reporting, as well as the HPD regulatory agreement for the building. The housing court also had rejected tenant's claim that she was rent stabilized. There was no basis under either Mitchell-Lama law or the building's HAP contract to find that the building was considered rent-stabilized at any point in the past. Landlord didn't agree to create rent-stabilized tenancies in the building by obtaining funds from NYC, and HPD acknowledged that tenant's apartment was exempt from rent stabilization because of federal law preemption.

Hunt: DHCR Adm. Rev. Docket Nos. IN410020RT, IN410021RT (10/6/20) [3-pg. doc.]