New York State
Division of Housing and Community Renewal
Office of Rent Administration
Gertz Plaza, 92-31 Union Hall St.
Jamaica, New York 11433
Public Information: (718)739-6400
POLICY STATEMENT 92-2
COLLECTIBILITY OF "421-A" RENT INCREASES
This Policy Statement is being issued to assure awareness of
DHCR's policy with respect to the collectibility of "421-a" rent
increases.
For buildings subject to the Partial Tax Exemption Program under
Section 421-a of the Real Property Tax Law to off-set the
declining real estate tax exemption, the Real Property Tax Law,
and Section 4.2 of New York City's Department of Housing
Preservation and Development's 421-a Program regulations provide
for "...an annual rent increase over the initial adjusted monthly
rental at a rate not to exceed 2.2 percent per annum on the
anniversary date of the first lease for the unit... .'
Section 2522.5(e)(2) of the Rent Stabilization Code permits an
owner to include in each tenant's vacancy and/or renewal lease a
clause providing for such increase.
On August 27, 1987, for the purposes of clarification, the New
York City Department of Housing Preservation and Development
("HPD") amended its regulations governing the 421-a program by
specifying that owners cannot collect more than nine annual 421-a
rent increases. Because the 2.2 percent increase was intended as
an offset against the declining real estate taxes DHCR had
interpreted HPD's regulations to require this limitation even
prior to the specific amendment.
An owner may charge the 421-a rent increase commencing with the
anniversary date of the first lease of the first tenant to take
occupancy of the unit after the building was constructed, and
once each year thereafter on such anniversary date, for a total
period of nine years. Each annual rent increase is equal to 2.2%
of the initial rent of the unit's first tenant. The total
maximum increase thus permitted is 19.8 percent above the unit's
initial monthly rental.
Orders of the New York City Rent Guidelines Board authorize
owners of "421.a" buildings to charge guidelines increases for
vacancy and renewal leases in addition to the 2.2% 1'421-a" rent
increase.
Section 2522.5(e)(4) of the Rent Stabilization Code provides that
any 2.2% increase which became effective on or after November l9,
1982 shall not become part of the legal regulated rent but is to
be charged the tenant as a separate charge, not included in the
"base rent" when calculating Rent Guidelines Board increases.
The maximum increase (19.8%) may continue to be charged in each
year following the expiration of the tax benefit period, but no
additional 2.2% increases may be added after the tax benefits
end.
421-a housing accommodations remain subject to Rent Stabilization
after the ten-year period of tax benefits expires, where (a) the
accommodation has not been vacated since the expiration of the
benefits; or (b) the accommodation first became subject to the
rent stabilization requirements of 421-a after July 3, 1984, and
the owner has failed to include a clause in at least twelve point
type that the apartment will be deregulated upon expiration of
the last lease entered into during the tax benefit period in all
of the leases of the tenant in occupancy when the benefits
expire. This clause must also state when the benefits expire.
Rent charged in excess of nine 2.2 percent per annum charges,
limited to nine years or a maximum increase of 19.8%, or which is
otherwise not in compliance with this statement constitute
overcharges.
Dated: May 21, 1992
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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DHCR Policy Statements are **promulgated** (i.e., officially
issued) by the New York State Division of Housing and Community
Renewal (DHCR) and represent **official** policy of the agency.
The agency is generally obligated to follow the policy contained
in these and other documents or provide a rational for deviation;
failure to follow the law, policy or practice may form the basis
for an appeal. Electronic versions of the documents on TenantNet
are for informational purposes only and there is no guarantee
they will be accepted by any court (or even DHCR) as true copies
of DHCR policy. The reader is advised to obtain true copies of
these documents from DHCR. Also see DHCR Advisory Opinions,
DHCR Operational Bulletins, the Rent Stabilization Code, the Rent
Stabilization Law and various Rent Control Statutes.
Every attempt has been made to conform to the original Policy
Statements as issued by DHCR; TenantNet makes no
representation the enclosed material is current or will be
applied as written. The reader is advised that DHCR often fails
to properly apply, interpret or enforce housing laws. Since
housing laws are complex and often contradictory, it is
recommended the reader obtain competent legal advice from a
tenant attorney or counseling from a tenant association or
community group. (rev. 3/13/96) DHCR documents
are public documents; the electronic version of such documents
have been developed by TenantNet and any added value, enhancements
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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
(718) 780-9246
Lower Manhattan
156 William Street
9th Floor
NY, NY 10038
(212) 240-6011, 6012
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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