What is legal basis for rent reduction policy?
The following letter was written by several East Side elected officials to Darryl C. Towns, commissioner and CEO of New York State Homes and Community Renewal on the housing agency’s policy towards rent reductions for losses of services like those experienced in Stuyvesant Town/Peter Cooper Village. (The letter, though addressed to the HCR, refers to it as DHCR, its predecessor agency.)
Dear Commissioner Towns:
We are writing to request clarification of the Division of Housing and Community Renewal’s (DHCR) rent reduction policy with respect to tenants who experience a diminution of services, and to highlight an imminent issue in Stuyvesant Town and Peter Cooper Village (ST-PCV).
We are concerned that the DHCR’s policy is incompatible with the Rent Stabilization Code (RSC), and runs the risk of denying tenants compensation to which they may be entitled. Specifically, we seek clarification about a serious discrepancy between the DHCR’s stated policy on rent reduction effective dates and the RSC as it pertains to applications for Rent Reductions for Decreased Services recently filed by hundreds of ST-PCV residents in approximately 110 buildings, who are represented by the ST-PCV Tenants Association.
As you know, these ST-PCV residents filed applications on February 26, 2013 for rent reductions due to loss of services during and after Hurricane Sandy. The lost amenities include loss of trunk storage service, security systems, laundry room services, bicycle and carriage room storage, elevator service and building intercom services.
Section 2523.4(a)(1) of the RSC provides that “the DHCR shall … reduce the rent for the period for which it is found that the owner has failed to maintain required services.” Of course, application of this provision is predicated on the DHCR finding that services in fact have not been maintained, but in the event of such a finding, it is clear that any rent reduction should be effective for the entire period for which the services have not been maintained.
However, it is apparently the DHCR’s practice, as stated in its Fact Sheet #14: Rent Reductions for Decreased Services, that “The effective date for rent stabilized tenants is retroactive back to the first day of the month following DHCR’s service of the complaint on the owner.”
We do not understand why the DHCR’s practice is inconsistent with the RSC. If tenants are denied contractually obligated services, neither logic nor the RSC supports limiting their remedy to the period after the DHCR has had time to serve notice on the owner.
We are particularly concerned with the rent reduction applications recently filed by ST-PCV residents and currently pending before the DHCR. We understand that the DHCR has indicated that it may take several weeks to process these applications, which could delay the start date of any approved reductions even further under the agency’s stated practice.
In light of these serious concerns, we must ask: (1) When do you expect to present ST-PCV management with the rent reduction claims? (2) What is the legal basis for the policy regarding effective dates found in the fact sheet?
Given the time sensitive nature of the ST-PCV applications, and the importance of this issue to the people we represent, we ask that you respond promptly to these questions. If you would like to discuss this matter, please feel free to contact any of us directly. If you would like to arrange a meeting or conference call, Anna Pycior in Assemblymember Kavanagh’s office is available to help arrange one. We hope to hear from you soon.
Brian Kavanagh, State Assembly Member
Daniel R. Garodnick, City Council Member
Carolyn B. Maloney, U.S. Representative
Scott M. Stringer, Manhattan Borough President