Taping, Plastering, and Painting Costs Deducted from MCI Increase

Landlord applied for MCI rent hikes based on installation of a new roof and asbestos abatement. The DRA ruled for landlord but limited rent increases based on HSTPA amendments to the Rent Stabilization Law. The DRA also disallowed costs for taping, plastering, painting, and permit filing fees.

Landlord and tenant both appealed and lost. Tenant argued that there were outstanding "B" and "C" violations at the building that prevented an MCI rent increase. But landlord submitted an architect's affidavit with its application stating that these violations had all been corrected except for violations existing in two apartments where tenants had refused access for repairs.

In landlord's PAR, it argued that the taping, plastering, and painting costs should've been included in the MCI. But the DRA appropriately disallowed these costs because they constituted ordinary repairs and maintenance rather than improvements. Landlord also argued that the DRA improperly and retroactively applied HSTPA amendments to its pending MCI application. But a number of court decisions had already ruled for the DHCR on the same issue. MCI applications pending when HSTPA amendments went into effect didn't give landlords a vested right to any rent increases. 

325/93 Associates LLC/David: DHCR Admin. Rev. Docket No. JX410012RO, JX410026RT (2/15/24)[4-pg. document]