Section 8 Apartments Covered

Facts: Tenant moved into apartment in 1987 and received Section 8 rent subsidy benefits. Shortly thereafter tenant filed a rent overcharge complaint with the DHCR. Landlord claimed that tenant wasn't subject to the ETPA because he received Section 8 benefits. The DHCR ruled for tenant, finding that tenant was rent stabilized and had been overcharged. Landlord was directed to refund the overcharge to the Section 8 office. Landlord appealed and showed another order in which the DRA stated that the DHCR had no authority over Section 8 tenants. The court ruled against landlord, and landlord appealed again. Court: Landlord loses. Where a building is subject to HUD mortgage and landlord receives Section 8 assistance, HUD regulations can preempt rent stabilization in order to minimize mortgage defaults. But landlord didn't have a HUD mortgage. And neither Section 8 regulations nor the ETPA contain any specific preemption for Section 8 housing. Exemption of all Section 8 housing from rent stabilization would be contrary to the purpose of federal regulation, which was to set reasonable limits on rents. The other DRA order landlord pointed to wasn't binding because it dealt with another building and wasn't a PAR-level determination by the DHCR.

Mott v. DHCR: 628 NYS2d 712 (1995) (App. Div. 2 Dept.; Sullivan, JP, O'Brien, Ritter, Goldstein, JJ)