Reduced MCI Rent Hikes Mandated by HSTPA Were Correctly Applied to Landlord's Application

Landlord applied for MCI rent hikes in January 2019 based on elevator upgrading. The DRA ruled for landlord in October 2019. The DRA applied provisions concerning MCI rent hikes contained in HSTPA, which amended the rent regulatory laws effective June 14, 2019. This resulted in extension of the amortization period for the MCI increase, eliminating any retroactive rent increase, and reducing the amount of the collectible rent increase from 6 percent to 2 percent of the rents set forth in the application.

Landlord appealed and lost. Landlord argued that the law in effect when it filed its MCI application should've been applied. The DHCR pointed out that Section 18 of Part K of the HSTPA, concerning MCI amendments, stated that "this act shall take effect immediately." This was in contrast to other HSTPA provisions, such as those affecting leases and renewal leases, which specified that those amendments to the law applied to proceedings "commenced on or after such effective date" of HSTPA. The DHCR also denied that application of HSTPA's rent law amendments violated the Constitution. The DHCR pointed to several court decisions that supported its ruling in this case, including an October 2022 decision in Richmond Hill 108 LLC v. DHCR, Index No. 728474/2021 (Sup. Ct. Queens Co. 2022). 

386 Fort Washington Realty LLC: DHCR Adm. Rev. Docket No. HW410013RO (11/15/22)[3-pg. document]