Rent Reduction Order Resulted in Reduction of Vacancy and Guidelines Increases

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant. Based on a rent reduction order in effect on the base rent date, the base rent was reduced to $524 and landlord was ordered to refund $16,294. Landlord appealed and lost. Landlord claimed incorrect calculation of the legal base date rent. But the August 1997 rent reduction order reduced the legal regulated rent to the level in effect prior to the most recent guidelines increase for the tenant’s lease, which commenced before the June 1, 1997, effective date of the order. Since, at that time, the prior tenant was under a two-year vacancy lease on Feb. 1, 1997, the DRA properly reduced the base date rent by subtracting both the guideline increase and vacancy allowance above the prior rent, eliminating both a 7 percent guideline increase and 9 percent vacancy increase. Although, after Oct. 1, 1997, vacancy increases were no longer determined by the Rent Guidelines Board, landlord argued incorrectly that the DRA couldn’t reduce the vacancy increase because on Feb. 1, 1997, the Rent Guidelines Board still set the vacancy increase percentage.

910 Sheridan Avenue LLC: DHCR Adm. Rev. Docket No. DP610005RO (2/24/16) [3-pg. doc.]