Hoylman: J-51 tenants need info from HCR

State Senator Brad Hoylman (Photo courtesy of Brad Hoylman)

By Sabina Mollot

With the exception of residents of Stuyvesant Town and Peter Cooper Village, for most New Yorkers, the letter J followed by number 51 has no meaning whatsoever. And consequently, this could mean they are living in an illegally deregulated apartment without even knowing it.

However, State Senator Brad Hoylman said he wants to make sure New York’s renters know what their rights are if they’re living in buildings where the landlords have benefitted from the J-51 tax break.

In a letter, he called on the state housing agency, Homes and Community Renewal, to inform tenants living in deregulated buildings if their landlords have been enrolled in the tax benefit program. The letter, which was sent to the agency’s commissioner, RuthAnne Visnauskas on August 7, Hoylman noted that the HCR routinely reaches out to the owners of more than 4,000 buildings with information about reregulation. But renters, meanwhile, are left in the dark as to their buildings’ history and may not know if they’re being overcharged.

He called the practice of keeping landlords but not tenants in the loop “baffling.”

Hoylman added, “It’s tenants who don’t know what their rights are and should be informed that their building may have been illegally deregulated because the owners had received J-51. It’s fine to notify landlords so that they will be compliant but they should let the tenants know.”

The J-51 tax break was misused most famously in ST/PCV, where prior owners Met Life and then Tishman Speyer began converting units to market rate. Following the Roberts v. Tishman Speyer lawsuit, the state’s highest court ruled in 2009 that the complex should remain rent-stabilized until the expiration of the program. This was after the HCR issued an advisory opinion in 1996 that ultimately allowed landlords around the city to improperly deregulate 50,000 apartments.

As to how often landlords may be withholding information from their tenants about the J-51 program, Hoylman said he was only aware of two current, possible cases of illegal deregulation within his district. Those examples were brought to his attention by the Village Independent Democrats Club, which recently canvassed local buildings.

However, Erik Coler, president of VID, said he believes hundreds of rent regulated units over decades have been lost “at the hands of bad landlords who take J-51 tax credits with one hand and remove units from regulation with the other.”

While his group along with the Housing Rights Initiative have been fighting the problem by communicating with individual tenants and filing lawsuits against unscrupulous landlords, he said the HCR also needs to become more proactive in restoring apartments’ rent stabilized status.

A ProRepublica report in 2016 had found HCR was not directly contacting tenants living in illegally deregulated apartments. Meanwhile, Hoylman referred to a pledge made by Governor Cuomo last year to return apartments that have been illegally converted to market rate to their regulated status, arguing that in order to make that happen, tenants will need to be armed with information.

“The more notice, the better,” Hoylman said.

The J-51 program is offered to landlords who rehabilitate a property in exchange for placing the building and its units under rent regulation.

Town & Village reached out to the HCR, and a spokesperson, Charni Sochet, said tenants do get informed but only once landlords are found to be breaking the law and other steps are taken to intervene. Owners found to be in violation, said Sochet, are subject to different measures available to the state and city and tenants, including litigation and the revocation of the tax benefits. Once there is a process taking place, HCR would then notify the tenants that the building is in the J-51 program and their apartments, while unregistered would be rent stabilized. T&V asked if this process specifically meant litigation but that question didn’t get a response.

HCR recommends that rent-regulated tenants who suspect they’re being overcharged contact the HCR’s Office of Rent Administration at (718) 739-6400.

 

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