New York State
Division of Housing and Community Renewal
Rent Administration - Operational Bulletins
New York City Rent Stabilization Code
New York City Rent and Eviction Regulations
Operational Bulletin 96-1
Operational Bulletin 96-1 (July 31, 1996)
(Replaces Operational Bulletin 89-1)
Procedures Pursuant to the Rent Stabilization Code for the Filing of
an Owner's Application to Refuse to Renew Leases on the Grounds of
Demolition.
Implementing New York City Rent Stabilization Code
I. Introduction
This Operational Bulletin replaces Operational Bulletin 89-1, issued
June 15, 1989, and is issued pursuant to Sections 2524.5 (a) (2) and
2527.11 of the Rent Stabilization Code ("Code"). It reflects judicial
determinations subsequent to the issue date of the earlier Bulletin.
Section 2524.5 (a) (2) of the Code provides that an owner shall not
be required to offer renewal leases to tenants where DHCR has granted
such owner's application to demolish all of the apartments located in
the subject premises for the purpose of constructing a new building.
Below are the eligibility, notice, order, relocation and other
requirements relating to the demolition application process.
II. Eligibility & Application
The term "owner" is specifically defined in Code Section 2520.6 (i).
For the purpose of filing a demolition application, the proceeding
must be instituted in the name of the owner as defined in that Code
section.
The owner may file the application with DHCR personally or by mail.
At the time the owner files the application, the owner shall also
submit a sufficient number of copies of the application for each
tenant to receive a copy.
The owner must file the application on a form prescribed by DHCR.
The owner must state in the application that he seeks in "good faith"
to recover possession of the housing accommodations for the purpose
of demolishing them and constructing a new building. The phrase "good
faith" means that the owner actually intends to accomplish the
purpose stated in the application. To establish good faith, the owner
must file with DHCR the following:
1. Approved plans; or completed plans and evidence that the
completed plans have been filed with the New York City
Department of Buildings (DOB); or an executed contract with the
project architect calling for delivery of completed plans within
12 months of the date of the application and proof of payment of
no less than ten percent of the total contract price.
2. Evidence of financial ability to complete the project, which may
include at the applicant's option: a Letter of Intent from a
financial institution, or a Commitment Letter from a financial
institution, or post a bond, payable to DHCR to be sufficient to
offset the reasonable costs actually paid and documented by
tenants and DHCR, or a letter of credit naming DHCR as the
beneficiary, issued by a financial institution acceptable to
DHCR and in a form acceptable to DHCR in an amount sufficient to
offset the reasonable costs to be incurred by the tenant and
DHCR.
As promptly as practicable thereafter, DHCR shall serve each tenant
with the application, and afford the tenant twenty days to answer.
The word "tenant" as used throughout this Bulletin means all persons
named on the lease, treated as a single entity. DHCR will also mail
to each tenant a copy of the Operational Bulletin advising the
tenants of the owner's obligations concerning Termination Notice
requirements pursuant to Code Section 2524.2 (c) (3); the owner's
obligations pursuant to Code Section 2524.5 (c) to pay certain moving
expenses and relocation benefits and the owner's other obligations,
tenants' rights and procedural advisements contained herein.
III. Notice Provisions
Once an application has been filed, the owner may refuse to renew
tenants' leases until a determination of the owner's application is
made pursuant to Code Section 2524.2 (c) (3). The tenant may remain
in occupancy during such period and the owner may not increase the
rent. Should the application be denied or withdrawn, the owner must
again offer prospective renewal leases to the tenants as directed in
DHCR's order of denial or withdrawal.
Pursuant to Code Section 2524.2 (c) (3), after filing a demolition
application, the owner must serve each tenant with a Termination
Notice at least 120 and not more than 150 days prior to the
expiration of the tenant's lease term ("window period"), or in the
case of a hotel permanent tenant without a lease, at least 120 and
not more than 150 days prior to the commencement of a court
proceeding. Provided each tenant whose window period occurs prior to
issuance of the Order is served with a timely Termination Notice, the
Order granting the application may be issued. See exceptions below.
The Termination Notice may be served personally or by mail, or
certified mail. An affidavit by the person making the service or a
receipt indicating proof of certified mailing shall constitute
sufficient proof of service. When service is by registered mail, the
stamped post office receipt shall also constitute sufficient proof of
service. Once such proof of service has been submitted, the burden of
proving non-receipt shall be on the party denying receipt. (Code
Section 2527.9 [a]).
The Termination Notice shall state:
1. that the owner will not renew the tenant's lease because the
owner has filed an application pursuant to Code Section 2524.5
(a) (2) for permission to recover possession of all of the
housing accommodations in the building for the purpose of
demolishing them and constructing a new building for which plans
and financing have been obtained, or are in the process of being
obtained, as stated in the application;
2. that while the application is pending, the tenant may remain in
occupancy at no increase in rent;
3. that the tenant shall not be required to vacate until DHCR has
issued a final Order approving the application and setting forth
the time for vacating, stipends and other relocation conditions;
and
4. that the tenant must be offered a prospective renewal lease if
the application is withdrawn or denied.
Interested parties should be aware that DHCR does not order the
eviction of any tenant. Warrants of Eviction are obtained from courts
of competent jurisdiction. Additionally, it should be noted that
tenants that elect to vacate prior to the dates provided in the
order, will, if stipends are applicable, be eligible to receive an
enhanced stipend.
IV. Hearing
After submission of the application and proof of financial ability,
supporting documents including copies of the plans that have been
submitted to DOB, and completing an offering if applicable, of
comparable apartments in accordance with "Comparable Apartments and
Relocation" below, the owner shall request in writing that DHCR
schedule a hearing. DHCR will schedule the hearing with written
notice to all parties. However the request to DHCR must be within 12
months of service of the application on the tenant. A copy of all
plans, statements or other documentation, and any amendments thereto,
which have been submitted to DHCR, shall simultaneously be made
available for review by the tenants, either in the office of the
superintendent or such other area readily accessible to all tenants.
Notice of the location where such material may be reviewed shall be
provided to tenants, by the owner no less than 30 days before the
hearing. The owner is advised to make this material available at
least 30 days before the request to schedule a hearing is made so
that the hearing can be scheduled expeditiously.
Any harassment proceeding(s) pending against the owner with respect
to the subject premises shall be consolidated with the owner's
application and determined at the demolition application hearing. A
finding of harassment shall result in the denial of the application.
At the hearing, both the owner and tenants will be afforded an
opportunity to testify and submit proof on all relevant issues as may
be determined by the hearing officer, including, at the owner's
option, the comparable apartments available, at the same or lower
legal regulated rents; or proof of such other relocation plan as may
be authorized by the Code. The hearing officer will issue a report
recommending whether the application should be granted, contingent
upon approval by DOB of the plans and the owner securing the
necessary funding. If a recommendation is made that the application
should not be granted or be granted conditionally, such
recommendation shall clearly indicate the reasons, and specify what
additional measures need to be taken by the owner and the time frame
for completion if the subject application is to be granted.
V. Administrative Order
In the event that DHCR finds that the project meets all the
requirements of Law and is feasible, the plans are approved by the
Buildings Department and proof that necessary funding has been
secured has been established, DHCR will issue an Order granting
permission for demolition. No order approving the owner's application
will be issued until the building plans have been approved and the
owner has secured the necessary funds to complete the project
specified in such approved plans . DHCR may, at the discretion of the
Administrator, and upon 30 days written notice to the owner, dismiss
an application because of the owner's failure to proceed in a timely
fashion. Upon the issuance of an order denying the application, or if
the application is withdrawn by the owner, prospective renewal leases
must be offered to all affected tenants as directed in the order of
denial or withdrawal.
An Order granting the application shall also be conditioned upon the
compliance by the owner with such terms as shall be set by the
Administrator relating to stipends and moving expenses, and the
compliance by the owner with service of Termination Notices.
In the event that the owner does not serve each tenant whose window
period occurred prior to the issuance of the Administrator's Order
with a Termination Notice, but can establish before the Administrator
that such failure was not the result of a willful attempt to evade
this obligation, and if the owner can establish that he or she has
otherwise substantially complied with the obligation to serve every
such tenant, DHCR shall not be required to terminate the proceeding
and may issue the order. Nevertheless, any such tenant who is not
served with the Termination Notice will be entitled to remain in
occupancy at no increase in rent pursuant to a one-year "deemed
lease," commencing on the date following the expiration date of the
prior lease. Thereafter, during the pendency of the proceedings, no
additional renewal rights vest pursuant to the "deemed lease." The
Administrator's Order shall provide that alternatively, the owner
may, at his or her option, elect to pay a stipend based on an
additional period up to one year for any tenant remaining in
occupancy who was not served with a timely Notice of Termination and
who leaves on or before the vacate date indicated in the final order.
In no event may any tenant be required to move out of an apartment
before the expiration date of that tenant's lease, or the vacate date
indicated when the owner's application is finally determined,
whichever is later. Where DHCR determines that an owner's failure to
serve a timely Notice of Termination occurred but was not willful,
and where such owner does not pay an additional one-year stipend,
such affected tenant may remain in occupancy for the deemed one-year
lease term, if later than such periods.
VI. Stipends and Other Relocation Conditions
The word "tenant" means all persons named on the lease, treated as a
single entity.
Any Order granting an owner's application shall require the owner to
pay all reasonable moving expenses. The tenant shall also be afforded
a reasonable period of time within which to vacate the apartment. If
the tenant vacates the apartment on or before the date provided in
DHCR final Order which authorizes the owner to refuse to renew the
tenant's lease and obtain possession of the apartment, such tenant
shall be entitled to receive all stipend benefits pursuant to
subparagraphs (1), or (2), or (3) below. The owner may, at his or her
option, pay a stipend to the tenant larger than the stipend set forth
in the schedule recited herein only if the tenant vacates the
apartment prior to the vacate date provided in the administrator's
order. Under no circumstances shall the owner be required to pay a
stipend in excess of the stipend set forth in such schedule.
If the tenant vacates before such date, such tenant shall be eligible
for an additional stipend to be negotiated between the owner and the
tenant. If the tenant does not vacate the apartment on or before the
date upon which a final Order authorizes the owner to obtain
possession of the apartment, the stipend shall be reduced. The
reduction of the stipend shall be one-sixth of the total stipend for
each month the tenant remains in occupancy after the vacate date
indicated in the final Order.
The order granting the owner's application shall also provide that,
at the owner's option, the owner may:
1. Relocate the tenant to a suitable housing accommodation at the
same or lower regulated rent in a closely proximate area, or in
a new residential building if constructed on the site in which
case suitable interim housing is provided to the tenant at no
additional cost; plus, in addition to reasonable moving
expenses, payment of a $5000 stipend, provided the tenant
vacates on or before the vacate date in DHCR Order; or
2. Where an owner provides relocation of the tenant to a suitable
housing accommodation at a rent in excess of that for the
subject housing accommodation, in addition to the tenant's
reasonable moving expenses, the owner may be required to pay the
tenant a stipend equal to the difference in rent, at the
commencement of the occupancy by the tenant of a new housing
accommodation, between the subject housing accommodation and the
housing accommodation to which the tenant is relocated,
multiplied by 72 months (6 years), provided the tenant vacates
on or before the vacate date in the DHCR Order; or
3. Pay the tenant a stipend which shall be the difference between
the tenant's current rent and an amount to be calculated as
follows: $293* per room** per month multiplied by the actual
number of rooms in the tenant's current housing accommodation,
but no less than three rooms. This difference is to be
multiplied by 72 months (6 years).
Please consult the following Demolition Stipend Chart for sample
calculations of stipends:
Number Max. Monthly Allowance by Current Rent.
of Monthly If Rent Equals
Rooms Allowance
$200 $500 $1,000 $1,500
3 $879 $679 $379 $0 $0
4 1,172 972 672 172 0
5 1,465 1,265 965 465 0
6 1,758 1,558 1,258 758 258
7 2,051 1,851 1,551 1,051 551
8 2,344 2,144 1,844 1,344 844
9 2,637 2,437 2,137 1,637 1,137
10 2,930 2,730 2,430 1,930 1,430
Number Max. Total Stipend by Current Monthly Rent
of Monthly For Tenancies Based On A 6 Year
Rooms Allowance Length Of Tenure
$200 $500 $1,000 $1,500
3 $879 $48,888 $27,288 $0 $0
4 1,172 69,984 48,384 12,384 0
5 1,465 91,080 69,480 33,480 0
6 1,758 112,176 90,576 54,576 18,576
7 2,051 133,768 111,672 75,672 39,672
8 2,344 154,368 132,768 96,768 60,768
9 2,637 175,464 153,864 117,864 81,864
10 2,930 196,560 174,960 138,960 102,960
For orders issued during a period commencing October 1, 1996, and on
or after October 1st of each subsequent year, the $293 per month base
will be raised by the applicable guidelines increase available for a
one year renewal lease. The $293 per month base, plus annual
adjustments, shall remain in effect until the release of a new
Housing and Vacancy Survey for the City of New York, at which time
the base rent per room shall be adjusted to reflect the mean asking
rent per room for all vacant rental units in that next Survey.
The formula for determining the stipend is based on data derived from
the 1993 New York City Housing and Vacancy Survey. The stipend
compensates for a reasonably expected alternative rent ($293 per room
per month), multiplied by the typical length of tenure (72 months).
While the $293/month rent remains constant for the projected period
of time, it is deemed to be equivalent to taking the present value of
such rent with projected guidelines increases over time.
Wherever a stipend would result in any tenant losing a subsidy or
other governmental benefit which is income dependent, at the tenant's
option the tenant may elect to waive the stipend and have the owner
at his or her own expense, relocate the tenant to a suitable housing
accommodation at the same or lower regulated rent in a closely
proximate area.
In the event that the tenant dies prior to the issuance by DHCR of a
final order granting the owner's application, the owner shall not be
required to pay such stipend to the estate of the deceased tenant.
Where the Order of DHCR granting the owner's demolition application
is conditioned upon the owner's compliance with specified terms and
conditions, if such terms and conditions have not been complied with,
the Order may be modified or revoked.
The owner's noncompliance with any term or condition of the
Administrator's or Commissioner's Order granting the owner's
application shall be brought to the attention of DHCR's Compliance
Unit for appropriate action. DHCR shall retain jurisdiction for this
purpose until all moving expenses, stipends, and relocation
requirements have been met.
VII. Comparable Apartments and Relocation
In the event a comparable apartment is offered by the owner, a tenant
may file an objection with DHCR challenging the suitability of an
apartment offered by the owner for relocation, within ten (10) days
after the owner identifies the apartment and makes it available for
the tenant to inspect and consider the suitability thereof. The
apartment will then be inspected by the staff of DHCR within 30 days,
on notice to both sides, so that DHCR may determine whether the
offered apartment was suitable. DHCR will make such determination as
promptly as practicable thereafter. In the event DHCR determines that
the apartment is not suitable, the tenant shall be offered another
apartment, and shall have ten (10) days after it is made available by
the owner for the tenant's inspection to consider its suitability.
In the event DHCR determines that the apartment is suitable, the
tenant shall have fifteen (15) days thereafter within which to accept
the apartment. A tenant who refuses to accept relocation to any
apartment determined by DHCR to be suitable shall lose the right to
relocation by the owner, and to receive payment of moving expenses or
any stipend.
"Suitable housing accommodations" as used in this Operational
Bulletin shall mean apartments which are similar in size and features
to the respective apartments now occupied by the tenants. Such
apartments shall be freshly painted before the tenant takes occupancy
and shall be provided with substantially the same required services
and equipment tenants received in their prior apartments. The
building containing such accommodations shall be free from violations
of law recorded by the city agency having jurisdiction which
constitute fire hazards or conditions dangerous or detrimental to
life or health, or which affect the maintenance of required services.
DHCR will consider proposed apartments for relocation which are not
presently subject to rent regulation, provided the owner submits a
contractual agreement, between the tenant and the new owner, that
places the tenant in a substantially similar housing accommodation at
no additional rent for a period of six years, unless the tenant
requests voluntarily and in writing a shorter lease period.
VIII. Administrative Review
Any party aggrieved by the Administrator's determination may file a
Petition for Administrative Review (PAR) in accordance with Part 2529
of the Rent Stabilization Code.
The filing of a PAR shall stay such order until the final
determination of the PAR by the Commissioner. Upon a showing that
there are equitable grounds, the Commissioner may entertain requests
for expedited processing of the PAR.
NOTE:
* The 1993 New York City Housing Vacancy Survey calculated the
mean asking rent level at $279 per month. Since the actual
enumeration for the Survey occurred between January and May of 1993,
the rent level was increased by 3% (one year lease renewal guideline
for 1993-1994) and by 2% (one year lease renewal guideline for 1994-
1995) to a total rent of $293.
** As registered
Paul A. Roldan
Deputy Commissioner
for Rent Administration
Reissued 9/96
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Division of Housing and Community Renewal (DHCR) and update
agency administration of the rent laws.
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For more information or assistance. call the DHCR Rent Infoline
at (718) 739-6400, or visit your Borough Rent Office.
Queens Central Office
92-31 Union Hall St. 4th Fl.
Jamaica, NY 11433
(718) 739-6400
Bronx
One Fordham Plaza
Bronx, NY 10458
(718) 563-5678
Brooklyn
250 Schermerhorn St.
3rd Floor
Brooklyn, NY 11201
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9th Floor
NY, NY 10038
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South side of 110th St. and below
Upper Manhattan
163 W. 125th St.
5th Floor
NY, NY 10027
(212) 961-8930
North side of 110th St. and above
Staten Island
350 St. Mark's Place
Room 105
Staten island, NY 10301
(718) 816-0277
Nassau County District Rent Office
50 Clinton Street, 6th Floor
Hempstead, NY 11550
(516) 481-9494
Westchester County District Rent Office
55 Church Street, 3rd Floor
White Plains, NY 10601
(914) 948-4434
Rockland County District Rent Office
94-96 North Main St.
Spring Valley, NY 10977
(914) 425-6575
Albany Regional Office
119 Washington Avenue
Albany, NY 12210
(518) 432-0596
Buffalo Regional Office
Ellicot Square Building
295 Main St., Room 438
Buffalo, NY 14203
(716) 856-1382
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