§ 26-405. General powers and duties of the city rent agency.
a. (1) At the time this chapter shall become effective, the
city rent agency shall establish maximum rents which,
subject to the provisions of subdivision b of this section,
shall be the maximum rents in effect on April thirtieth,
nineteen hundred sixty-two pursuant to the state rent act
and the regulations thereunder.
(2) (a) Notwithstanding the foregoing provision of
this subdivision, and except as provided in
subparagraph (b) of this paragraph two, effective
August first, nineteen hundred seventy, the
maximum rent in effect on July thirty-first,
nineteen hundred seventy shall be adjusted as
follows:
(i) for any individual housing accommodation for
which one or more but less than two full
fifteen per centum rent increases has been
granted since may first, nineteen hundred
fifty-three pursuant to former subparagraph
(d) of paragraph one of subdivision g of this
section the maximum rent shall be increased
by eight per centum.
(ii) For any individual housing accommodation for
which no full fifteen per centum rent
increase has been granted since may first,
nineteen hundred fifty-three pursuant to
former subparagraph (d) of paragraph one of
subdivision g of this section the maximum
rent shall be increased by fifteen per
centum, except that if there was no such
increase for any individual housing
accommodation for which a first rent was
established pursuant to former subdivision m
of this section after July thirty-first,
nineteen hundred sixty-five and before August
first nineteen hundred sixty-eight, the
maximum rent shall be increased by five per
centum, and except that if there was no such
increase for any individual housing
accommodation for which a first rent was
established pursuant to such subdivision on
or after August first, nineteen hundred sixty-
eight there shall be no increase in maximum
rent. On or after August first, nineteen
hundred sevens a landlord may file
application for labor cost rent adjustment
pursuant to subparagraph (l) of paragraph (1)
of subdivision g of this section. In lieu
of such labor cost rent adjustment, the
landlord of a building with twenty or fewer
housing accommodations shall have the option
of filing for a five per centum increase in
maximum rent for any individual housing
accommodation for which two or more full
fifteen per centum increases have been
granted since may first nineteen hundred
fifty-three pursuant to former subparagraph
(d) of paragraph one of subdivision g of this
section.
Nothing contained in this subparagraph (a)
however, shall have the effect of establishing the
maximum rent in an amount less than the maximum
rent in effect on July thirty-first, nineteen
hundred seventy nor of increasing by more than
fifteen per centum the maximum rent for any
housing accommodation.
(b) Where the maximum rent in effect on July thirty-
first, nineteen hundred seventy for any individual
housing accommodation is less than sixty dollars
per month such rent shall be increased effective
August first, nineteen hundred seventy by ten
dollars per month where the housing accommodation
is comprised of three rooms or less and by fifteen
dollars per month where the housing accommodation
is comprised of more than three rooms.
(c) Where a lease is in effect for any housing
accommodation on August first nineteen hundred
seventy, no adjustment of maximum rent for such
accommodation shall become effective until the
expiration of such lease. Where a h accommodation
becomes vacant on or after August first, nineteen
hundred seventy and before January first, nineteen
hundred seventy-two by voluntary surrender of
possession by the tenant the maximum rent shall be
increased by no more than fifteen per centum over
the maximum rent established for such
accommodation at the time the vacancy occurred,
provided that a report is filed with the city rent
agency as prescribed by its regulations. If the
city rent agency shall make a finding of
harassment in violation of subdivision d of
section 26-412 of this chapter for the purpose of
obtaining such a vacancy, in addition to all other
civil or criminal penalties, injunctive relief and
enforcement remedies authorized by section 26-413
of this chapter, no housing accommodation in the
building shall thereafter be entitled to the
benefit of a rental increase as a result of
becoming vacant between the aforesaid dates.
(d) The total of (i) the increase pursuant to
subparagraph (a) of this paragraph or (ii) any
increases granted between December thirty-first,
nineteen hundred sixty-nine and December thirty-
first; nineteen hundred seventy-one pursuant to
subparagraph (a), (b), or (c) of paragraph one of
subdivision g of this section and (iii) any
increase granted on or after the effective date of
this paragraph pursuant to subparagraph (1) of
paragraph one of subdivision g of this section
shall not exceed fifteen per centum of the "1970
base rent." For purposes of this subparagraph, the
"1970 base rent" is the maximum rent on July
thirty-first, nineteen hundred seventy minus the
amount of any increase granted between December
thirty-first, nineteen hundred sixty-nine and July
thirty-first, nineteen hundred seventy pursuant to
subparagraph (a), (b), or (c) of paragraph one of
subdivision g of this section. This subparagraph
shall not operate to decrease any maximum rent
existing on its effective date.
(e) The rent increases provided for in this paragraph
two shall be collectible upon the landlord's
filing a report with the city rent agency on forms
to be prescribed by such agency, including
simplified forms for landlords of buildings with
twelve or fewer housing accommodations, and giving
such notice to the tenant as such agency may
prescribe, subject to adjustment upon order of the
city rent agency. The report shall contain a
certified statement by the landlord that there is
no legally habitable rent controlled housing
accommodation in the building which has not been
rented for a period of six months or more on the
date of the filing of such report, or that if
there is such a housing accommodation, the reasons
it has not been rented is that it is being altered
pursuant to a permit issued by the department of
buildings no later than three months after the
vacancy commenced and that the alteration is of
such a nature that the accommodation must be kept
vacant while it is being made or for such other
cause found by the city rent agency not to be
inconsistent with the purpose of this chapter,
provided further that in the case of an alteration
It is commenced within sixty days from the
issuance of said permit. A copy of the permit and
the application therefor shall accompany the
report. No report shall be accepted for filing and
no rent increase provided for in this paragraph
two shall be collected in the absence of any such
certified statement by the landlord. Any excess
shall be credited to the tenants in full
commencing with the rental payment following the
receipt by the landlord of such order of
adjustment. If such report is filed on or before
October thirty-first, nineteen hundred seventy,
the increase shall take effect August first,
nineteen hundred seventy. If the report is filed
thereafter, such increase shall take effect with
the first rental payment following filing.
(f) The rent increases provided for in this paragraph
two shall not be collected for the period between
March thirty-first, nineteen hundred and seventy-
one and December thirty-first, nineteen hundred
seventy-one until the landlord shall have filed
with the city rent agency a certified statement
attesting that for every month for which he or she
has received a rent increase pursuant to
subparagraphs (a) and (b) of this paragraph two,
he or she has expended or incurred in the
operation, maintenance and improvements of the
housing accommodations from which increases were
collected an amount which equals the amount
expended per month for such purpose averaged over
the preceding five years, or such lesser period
that he or she has been landlord of such
properties, plus ninety per centum of all
increased rents so collected.
(3) The city rent agency shall establish maximum rents to
be effective January first, nineteen hundred seventy-
two by dividing the maximum gross building rental from
all housing accommodations in the property whether or
not subject to or exempt from control under this
chapter by the number of such accommodations, after
giving consideration to such factors as may be
prescribed by formula, such as size and location of
housing accommodations and number of rooms. Such
maximum gross building rental shall be computed on the
basis of real estate taxes, water rates and sewer
charges and an operation and maintenance expense
allowance, a vacancy allowance not in excess of two per
cent, and a collection loss allowance, both as
prescribed by such agency, and an eight and one-half
per centum return on capital value. The operating and
maintenance expense allowance shall include provision
for the cost of fuel, utilities, payroll, maintenance
repairs, replacement reserves and miscellaneous charges
attributed to the property, excluding mortgage interest
and amortization, and may be varied by the agency for
different types of properties depending upon such
factors as the year of construction, elevator or non-
elevator buildings, the average number of rooms per
individual housing accommodations in the building.
Capital value shall be equalized assessed valuation as
established pursuant to article twelve-a of the real
property tax law. Where the property receives income
from sources other than such housing accommodations,
the taxes, water and sewer charges and the capital
value attributed to the portion consisting of housing
accommodations shall be in the same ratio of the total
taxes, water and sewer charges (where not computed
separately) and the total capital value as the gross
income from such portion consisting of housing
accommodations bears to the total gross income from the
property, as prescribed by the agency.
The agency shall report to the council on or before
October fifteenth, nineteen hundred seventy-one as to
the status of preparation of the formulas necessary to
implement the rent adjustments to be effective January
first, nineteen hundred seventy-two.
(4) The city rent agency shall establish maximum rents
effective January first, nineteen hundred seventy-four
and biennially thereafter by adjusting the existing
maximum rent to reflect changes, if any, in the factors
which determine maximum gross building rental under
paragraph three of this subdivision except that
commencing January first, nineteen hundred eighty-two,
said maximum rent shall no longer recognize or reflect
the adjustment allocable to changes in heating costs
after April ninth, nineteen hundred seventy-nine.
Notwithstanding any other provisions in this paragraph
to the contrary, commencing January first, nineteen
hundred seventy-four, the city rent agency shall
require each owner to make available for examination
his or her books and all other financial records
relating to the operation of each building under his or
her ownership containing accommodations subject to this
chapter at least once every three years for the purpose
of determining whether the maximum formula rent is
appropriate for each building in light of actual
expenditures therefor and shall also alter such formula
rent to take into account significant variations
between the formula and actual cost experience. The
agency shall also establish maximum costs for the
factors under paragraph three of this subdivision which
determine maximum gross building rental to preclude
increases which would otherwise results from excessive
expenditures in the operation and maintenance of the
building. The return allowed on capital may be revised
from time to time by local law.
(5) Where a maximum rent established pursuant to this
chapter on or after January first, nineteen hundred
seventy-two, is higher than the previously existing
maximum rent, the landlord may not collect more than
seven and one-half percentum increase from a tenant in
occupancy on such date in any one year period, provided
however, that where the period for which the rent is
established exceeds one year, regardless of how the
collection thereof is averaged over such period, the
rent the landlord shall be entitled to receive during
the first twelve months shall not be increased by more
than seven and one-half percentum over the previous
rent and additional annual rents shall not exceed seven
and one-half percentum of the rent paid during the
previous year. Notwithstanding any of the foregoing
limitations in this paragraph five, maximum rent shall
be increased if ordered by the agency pursuant to
subparagraphs (d), (e), (f), (g), (h), (i), (k), (1),
(m) or (n) of paragraph one of subdivision g of this
section. Commencing January first, nineteen hundred
eighty, rent adjustments pursuant to subparagraph (n)
of paragraph one of subdivision g of this section shall
be excluded from the maximum rent when computing the
seven and one-half percentum increase authorized by
this paragraph five. Where a housing accommodation is
vacant on January first, nineteen hundred seventy-two,
or becomes vacant thereafter by voluntary surrender of
possession by the tenants, the maximum rent established
for such accommodations may be collected.
(6) Where a new maximum rent has been established pursuant
to former subdivision m of this section or, following
the repeal of such subdivision, pursuant to
subparagraph (m) of paragraph one of subdivision g of
this section, a new maximum rent shall not be
established pursuant to paragraph three of this
subdivision. Except with respect to a housing
accommodation to which the preceding sentence applies,
where the maximum rent on December thirty-first,
nineteen hundred seventy-one is higher than the maximum
rent established pursuant to paragraph three of this
subdivision, such prior maximum rent shall continue in
effect until the maximum rent under paragraph three, as
adjusted from time to time pursuant to the provisions
of this chapter, shall equal or exceed such prior
maximum rent, at which time the maximum rent for such
housing accommodations shall be as prescribed in this
chapter.
(7) Section eight housing assistance.
(a) Notwithstanding any provision of this chapter, if
during a rental period in which the landlord is
eligible for an adjustment or establishment of
rents pursuant to paragraph three or four of this
subdivision, housing assistance payments are being
made pursuant to section eight of the United
States Housing Act of nineteen hundred thirty-
seven, as amended, with respect to any housing
accommodation covered by this chapter, the maximum
rent collectible from the tenant in occupancy
shall be the lesser of:
(1) the maximum rent established pursuant to
paragraph three of this subdivision as
adjusted pursuant to this chapter, computed
without regard to the limitations of
paragraph five of this subdivision (provided
that in any case the rent paid by the tenant
pursuant to this chapter without regard to-
this paragraph is higher than such rent, the
rent paid shall be substituted for such
rent), or
(2) the contract or fair market rent approved for
the housing accommodation pursuant to federal
law or regulation.
(b) Prior to the collection of any increase in maximum
rent pursuant to this paragraph, the landlord
shall advise the city rent agency of his or her
intent to compute the maximum rent pursuant to
this paragraph.
(c) If a housing accommodation to which this
subdivision applies ceases for any reason to be
governed by this paragraph, the maximum rent
collectible from the tenant shall be computed as
if this paragraph had not applied and any
adjustments thereto which would have been
permitted pursuant to this chapter during the
period such rent was set by this paragraph shall
be proper rental adjustments.
(8) Notwithstanding the provisions of this chapter, upon
the sale in any manner authorized by law of a multiple
dwelling which was previously subject to the provisions
of such chapter and which was acquired by the city in a
tax foreclosure proceeding or pursuant to article
nineteen-a of the real property actions and proceedings
law, for a dwelling unit which was subject to this
chapter pursuant to the local emergency housing rent
control act at the time the city so acquired title, is
occupied by a tenant who was in occupancy at the time
of acquisition and remains in occupancy at the time of
sale, the maximum rent shall be the last rent charged
by the city, or on behalf of the city, for such
dwelling unit, which rent shall not exceed the rent
computed pursuant to paragraph three of this
subdivision, computed as of the time of such sale. This
paragraph shall not apply to redemptions from city
ownership pursuant to chapter four of title eleven of
the code.
(9) The city rent agency, prior to establishing biennially
maximum base rents pursuant to this chapter and before
establishing a maximum base rent which is different
from the previously existing maximum base rent for
dwellings covered by this law, shall hold a public
hearing or hearings for the purpose of collecting
information the city rent agency may consider in
establishing maximum base rents. Notice of the date,
time, location and summary of subject matter for the
public hearing or hearings shall be published in the
city record for a period of not less than fourteen
days, and at least once in one or more newspapers of
general circulation at least fourteen days immediately
preceding each hearing date, at the expense of the city
of New York, and the hearing shall be open for
testimony from any individual, group, association or
representative thereof who wants to testify.
b. Such agency, to effectuate the purposes of this chapter, and
in accordance with the standards set forth in paragraph two
of subdivision c of this section may set aside and correct
any maximum rent resulting from illegality, irregularity in
vital matters or fraud, occurring prior to or after may
first, nineteen hundred sixty-two.
c. (1) whenever such agency determines that such action
is necessary to effectuate the purposes of this
chapter, it may also establish maximum rents for
housing accommodations to which this chapter applies,
where no maximum rent with respect thereto was in
effect on April thirtieth, nineteen hundred sixty-two,
or where no registration statement had been filed with
respect thereto as required by the state rent act, or
where for any other reason the provisions of
subdivision a of this section are not susceptible to
application to any such housing accommodations.
(2) Such rents shall be established, having regard for the
maximum rents for comparable housing accommodations or
any other factors bearing on the equities involved,
consistent with the purposes of this chapter.
d. Where any housing accommodations, which are decontrolled
(including those decontrolled by order) or exempted from
control pursuant to the provisions of subparagraph (i) of
paragraph two of subdivision e of section 26-403 of this
chapter, are certified by any city agency having
jurisdiction to be a fire hazard or in a continued dangerous
condition or detrimental to life or health, the city rent
agency shall establish maximum rents for such housing
accommodations, having regard for the maximum rents for
comparable housing accommodations or any other factors
bearing on the equities involved consistent with the
purposes of this chapter.
e. Notwithstanding any other provision of this chapter, and
subject to the provisions of subdivision f of this section,
provision shall be made pursuant to regulations prescribed
by the city rent agency for the establishment, adjustment
and modification of maximum rents with respect to rooming
house and single room occupancy accommodations, which shall
include those housing accommodations subject to control
pursuant to the provisions of subparagraph (c) of paragraph
two of subdivision e of section 26-403 of this chapter
(other than those accommodations subject to control under
the last proviso of such subparagraph (c)), having regard
for any factors bearing on the equities involved, consistent
with the purposes of this chapter, to correct speculative,
abnormal and unwarranted increases in rent.
f. On or before June thirtieth, nineteen hundred sixty-two, the
city rent agency shall undertake a survey and investigation
of all factors affecting rents, rental conditions and rental
practices with respect to rooming houses and single room
occupancy accommodations within the city for the purpose of
determining whether the provisions of this chapter and the
regulations thereunder relating to the establishment and
adjustment of maximum rents for rooming house and single
room occupancy accommodations are reasonably designed to
prevent exaction of unreasonable and oppressive rents. Not
later than January fifteenth, nineteen hundred sixty-three,
such agency shall submit to tine' council a report setting
forth the results of such survey and investigation, together
with the findings and recommendations of such agency and any
amendments to this chapter and the regulations thereunder
which such agency may deem necessary or desirable for the
accomplishment of the purposes of this chapter in relation
to such accommodations. During the period between may first,
nineteen hundred sixty-two and the thirtieth day next
succeeding the date of the submission of such report to the
council (1) no application for an increase in any maximum
rent for any rooming house or single room occupancy
accommodations may be filed on any ground other than those
specified in subparagraphs (f) and (g) of paragraph one of
subdivision g of this section, and (2) no maximum rents for
any rooming house or single room occupancy accommodations
shall be increased on any grounds other than those specified
in such subparagraphs (f) and (g), provided that where the
maximum rents for any such accommodations were or are
decreased prior to or during such period because of the
landlord's reduction of living space, essential services,
furniture, furnishings or equipment, and such reduction has
been corrected, an application for restoration of the rent
decrease may be filed and such rents may be adjusted so as
to fix maximum rents which the city rent agency may
determine to be proper, pursuant to the provisions of
subdivision e of this section, but which shall not in any
event exceed the maximum rents for such accommodations in
effect immediately prior to such rent decrease.
g. (1) The city rent agency may from time to time adopt,
promulgate, amend or rescind such rules, regulations
and orders as it may deem necessary or proper to
effectuate the purposes of this chapter, including
practices relating to recovery of possession; provided
that such regulations can be put into effect without
general uncertainty, dislocation and hardship
inconsistent with the purposes of this chapter; and
provided further that such regulations shall be
designed to maintain a system of rent controls at
levels which, in the judgment of such agency, are
generally fair and equitable and which will provide for
an orderly transition from and termination of emergency
controls without undue dislocations, inflationary price
rises or disruption. Provision shall be made, pursuant
to regulations prescribed by such agency, for
individual adjustment of maximum rents where:
(a) The rental income from a property yields a net
annual return of less than six per centum of the
valuation of the property.
(1) Such valuation shall be the current assessed
valuation established by the city, which is
in effect at the time of the filing of the
application for an adjustment under this
subparagraph (a); provided that:
(i) The city rent agency may make a
determination that the valuation of the
property is an amount different from
such assessed valuation where there has
been a reduction in the assessed
valuation for the year next preceding
the effective date of the current
assessed valuation in effect at the time
of the filing of the application; and
(ii) Such agency may make a determination
that the value of the property is an
amount different from the assessed
valuation where there has been a bona
fide sale of the property within the
period February first, nineteen hundred
sixty-one, and the time of filing of the
application, as the result of a
transaction at arm's length, on normal
financing terms, at a readily
ascertainable price, and unaffected by
special circumstances such as but not
limited to a forced sale exchange of
property, package deal, wash sale or
sale to a cooperative, provided however,
that where an application was filed
under this subparagraph (a) on or before
the effective date of this subitem (ii),
the city rent agency may determine the
value of the property on the basis that
there has been a bona fide sale of the
property within the period between March
fifteenth, nineteen hundred fifty-eight,
and the time of the filing of the
application. In determining whether a
sale was on normal financing terms, such
agency shall give due consideration to
the following factors:
(a) the ratio of the cash payment
received by the seller to (1) the
sales price of the property and (2)
the annual gross income from the
property;
(b) the total amount of the outstanding
mortgages which are liens against
the property (including purchase
money mortgages) as compared with
the assessed valuation of the
property;
(c) the ratio of the sales price to the
annual gross income of the
property, with consideration given
to the total amount of rent
adjustments previously granted,
exclusive of rent adjustments
because of changes in dwelling
space, services, furniture,
furnishings or equipment, major
capital improvements, or
substantial rehabilitation;
(d) the presence of deferred
amortization in purchase money
mortgages, or the assignment of
such mortgage at a discount;
(e) Any other facts and circumstances
surrounding such sale which, in the
judgment of such agency, may have a
bearing upon the question of
financing; and
(iii) Where the assessed valuation of the
land exceeds four times the assessed
valuation of the buildings thereon,
the city rent agency may determine a
valuation of the property equal to
five times the assessed valuation of
the buildings, for the purposes of
this subparagraph (a).
(2) An application for an increase in any maximum
rent under this subparagraph (a) of this
paragraph one may not be filed with respect
to any property if, on the date when the
application is sought to be filed:
(i) Less than two years have elapsed since
the date of the filing of the last prior
application for an increase under this
subparagraph (a) of this paragraph one
with respect to such property, which
application resulted in the granting of
an increase; or
(ii) Less than two years have elapsed since
the last sale of the property, and the
application is based upon a sale price
in excess of the assessed valuation.
This subitem shall not apply, however,
where less than two years have elapsed
since the last sale of the property and
the application is based upon a sale
within such two-year period at a price
in excess of the assessed valuation, if
such price is less than the price in the
last sale which meets the criteria
heretofore specified in this
subparagraph (a) occurring prior to two
years before the application is sought
to be filed and since February first,
nineteen hundred sixty-one.
(3) No increase in maximum rents shall be granted
under this subparagraph (a) by the city rent
agency while there is pending without final
disposition any judicial proceeding to
correct the final determination of the tax
commission with respect to the assessed
valuation of such property, (a) for the city
fiscal year in which the landlord filed the
application for such increase or (b) for the
city fiscal year immediately preceding the
filing of the application for such increase.
(4) For the purposes of this subparagraph (a):
(i) Net annual return shall be the amount by
which the earned income exceeds the
operating expenses of the property,
excluding mortgage interest and
amortization, and excluding allowances
for obsolescence and reserves, but
including an allowance for depreciation
of two per centum of the value of the
buildings exclusive of the land, or the
amount shown for depreciation of the
buildings in the latest required federal
income tax return, whichever is lower;
provided, however, that no allowance for
depreciation of the buildings shall be
included where the buildings have been
fully depreciated for federal income tax
purposes or on the books of the owner;
and
(ii) Test year shall be the most recent full
calendar year or the landlord's most
recent fiscal year or any twelve
consecutive months ending not more than
ninety days prior to the filing of the
application for an increase;
(b) Where a building contains no more than nineteen
rental units and the landlord has not been fully
compensated by increases in rental income
sufficient to offset unavoidable increases in
property taxes, fuel, utilities, insurance and
repairs and maintenance, excluding mortgage
interest and amortization, and excluding allowance
for depreciation, obsolescence and reserves, which
have occurred since the federal date determining
the maximum rent; or
(c) The landlord operates a hotel or rooming house or
owns a cooperative apartment and has not been
fully compensated by increases in rental income
from the controlled housing accommodations
sufficient to offset such unavoidable increases in
property taxes and other costs as are allocable to
such controlled housing accommodations, including
costs of operation of such hotel or rooming house,
but excluding mortgage interest and amortization,
and excluding allowances for depreciation,
obsolescence and reserves, which have occurred
since the federal date determining the maximum
rent or the date the landlord commenced the
operation of the property, whichever is later; or
(d) The landlord and tenant in occupancy voluntarily
enter into a valid written lease in good faith
with respect to any housing accommodation, which
lease provides for an increase in the maximum rent
on the basis of specified increased services,
furniture, furnishings, or equipment, provided the
city rent agency determines that the specified
increased services, furniture, furnishings or
equipment have a market value commensurate with
the increased rent, the increase maximum rent is
not in excess of fifteen per centum and the lease
is for a term of not less than two years, provided
further that a report of lease is filed as
prescribed by regulations issued by the city rent
agency or has been otherwise accepted by such
agency, and provided further, that where the
entire structure, or any lesser portion thereof
was vacated by order of a city department having
jurisdiction, on or after November twenty-second,
nineteen hundred sixty-three and any tenants
therein were relocated by the department of
relocation, or such structure was boarded up by
the department of real estate, such lease
increases in subsequently executed leases shall
not become effective for any housing
accommodations in the structure until such
departments have been reimbursed for expenses
necessarily incurred in connection with the
foregoing; provided further, however, that the
landlord may obtain such lease increases without
making such reimbursement where the vacating was
caused by fire or accident not resulting from any
unlawful act or omission on the part of the
landlord; or
(e) The landlord and tenant by mutual voluntary
written agreement agree to a substantial increase
or decrease in dwelling space or a change in the
services, furniture, furnishings or equipment
provided in the housing accommodations. An
adjustment under this subparagraph shall be equal
to one-fortieth of the total cost incurred by the
landlord in providing such modification or
increase in dwelling space, services, furniture,
furnishings or equipment, including the cost of
installation, but excluding finance charges,
provided further than an owner who is entitled to
a rent increase pursuant to this subparagraph
shall not be entitled to a further rent increase
based upon the installation of similar equipment,
or new furniture or furnishings within the useful
life of such new equipment, or new furniture or
furnishings. The owner shall give written notice
to the city rent agency of any such adjustment
pursuant to this subparagraph.; or
(f) There has been since March first, nineteen hundred
fifty-nine, an increase in the rental value of the
housing accommodations as a result of a
substantial rehabilitation of the building or
housing accommodation therein which materially
adds to the value of the property or appreciably
prolongs its life, excluding ordinary repairs,
maintenance and replacements; or
(g) There has been since July first, nineteen hundred
seventy, a major capital improvement required for
the operation, preservation or maintenance of the
structure. An adjustment under this subparagraph
(g) shall be in an amount sufficient to amortize
the cost of the improvements pursuant to this
subparagraph (g) over a seven-year period; or
(h) There has been since March first, nineteen hundred
fifty-nine, in structures containing more than
four housing accommodations, other improvements
made with the express consent of the tenants in
occupancy of at least seventy-five per centum of
the housing accommodations; provided, however,
that whenever the city rent agency has determined
that the improvements proposed were part of a plan
designed for overall improvement of the structure
or increases in services, it may authorize
increases in maximum rents for all housing
accommodations affected upon the express consent
of the tenants in occupancy of at least fifty-one
per centum of the housing accommodations, and
provided further that no adjustment granted
hereunder shall exceed fifteen per centum unless
the tenants have agreed to a higher percentage of
increase, as herein provided; or
(i) There has been, since March first, nineteen
hundred fifty-nine, a subletting without written
consent from the landlord or an increase in the
number of adult occupants who are not members of
the immediate family of the tenant, and the
landlord has not been compensated therefor by
adjustment of the maximum rent by lease or order
of the city rent agency or pursuant to the state
rent act or the federal act; or
(j) The presence of unique or peculiar circumstances
materially affecting the maximum rent has resulted
in a maximum rent which is substantially lower
than the rents generally prevailing in the same
area for substantially similar housing
accommodations.
(k) The landlord has incurred, since January first,
nineteen hundred seventy, in connection with and
in addition to a concurrent major capital
improvement pursuant to subparagraph (g) of this
paragraph, other expenditures to improve, restore
or preserve the quality of the structure. An
adjustment under this subparagraph shall be
granted only if such improvements represent an
expenditure equal to at least ten per centum of
the total operating and maintenance expenses for
the preceding year. An adjustment under this
subparagraph shall be in addition to any
adjustment granted for the concurrent major
capital improvement and shall be in an amount
sufficient to amortize the cost of the
improvements pursuant to this subparagraph over a
seven-year period.
(l) (1) The actual labor expenses currently
incurred or to be incurred (pursuant to a
collective agreement or other obligation
actually entered into by the landlord) exceed
the provision for payroll expenses in the
current applicable operating and maintenance
expense allowance under subdivision a of this
section. No application pursuant to this
subparagraph may be granted within one year
from the granting of an adjustment in maximum
rent pursuant to this subparagraph (1), or
pursuant to subparagraph (a) of this
paragraph. Any rent increase the applicant
would be entitled to, or such portion
thereof, shall not exceed a total increase of
seven and one-half per centum per annum of
the maximum rent as provided in paragraph
five of subdivision a of this section.
(2) Any adjustment in the maximum rents pursuant
hereto shall be subject to:
(i) The adjustment in maximum rent for any
twelve-month period for any housing
accommodation shall not exceed four
percent of the maximum rent in effect on
December thirty-first, nineteen hundred
seventy-three.
(ii) Where the increase in labor costs
compensable herein is the result of an
industry-wide collective bargaining
agreement or a specific agreement in
anticipation of, or subsequent to, an
industry-wide collective bargaining
agreement the adjustment shall be in
such amount (subject to the above
limitation) that the increased rental
income from January first, nineteen
hundred seventy-four to December thirty-
first, nineteen hundred seventy-six
shall reflect the increased labor costs
for the period from April thirtieth,
nineteen hundred seventy-three to April
thirtieth, nineteen hundred seventy-six.
(3) For the purpose of this subparagraph (1) the
increase in labor costs shall be the amount
by which the labor costs (a) actually in
effect and paid, or (b) actually in effect
and paid or payable and fixed and determined
pursuant to agreement on the date of the
filing of the application and projected over
the period ending April thirtieth, nineteen
hundred seventy-six, exceed the labor costs
for the twelve calendar months immediately
preceding the last day of the month in which
the wage agreement became effective.
(4) Notwithstanding any other provision of this
chapter, the adjustment pursuant to this
subparagraph shall be collectible upon the
landlord's filing of a report with the city
rent agency, subject to the provisions of
subparagraph (e) of paragraph two of
subdivision a of this section.
(5) No increase in the maximum rent for any
housing accommodation may be granted under
this subparagraph (1) if on the date when the
application is sought to be filed, less than
the full term of such agreement has elapsed
since the date of the filing of the last
prior application for an increase with
respect to such property under this
subparagraph (1), which application resulted
in the granting of an increase. Where,
however, the landlord establishes the
existence of unique or peculiar circumstances
affecting an increase in labor costs for the
property, the agency may accept such
application where it determines that such
acceptance is not inconsistent with the
purposes of this local law.
(6) The increase authorized herein shall be
apportioned equitably among all the housing
accommodations in the property whether or not
subject to control under this chapter.
(m) Where the rehabilitation or improvement of
substandard or deteriorated housing accommodations
has been financed under a governmental program
providing assistance through loans, loan insurance
or tax abatement or has been undertaken under
another rehabilitation program not so financed but
approved by the commissioner.
(n) (1) The city rent agency shall hereafter
promulgate in January of each year
(i) findings regarding the price increase or
decrease, respectively, for all types of
heating fuel, including numbers two,
four and six home heating oils, utility
supplied steam, gas, electricity and
coal, together with the sales and excise
taxes thereon, on December thirty-first
as compared to the January first in any
year;
(ii) standards for consumption of heating
fuel, which shall be no more than two
hundred twenty-five gallons per year per
room commencing January first nineteen
hundred eighty-one, for buildings using
heating oils for heat with comparable
unit limitations to be established by
the city rent agency for utility
supplied steam, gas, electricity, coal
and any other types of heating systems,
provided that such consumption standards
for heating fuels shall be reduced by
five gallons per room per year for
heating oils and a comparable amount for
other heating fuels for the next
succeeding year and ten gallons per room
per year for heating oils and a
comparable amount for other heating
fuels for two succeeding years
thereafter.
Such findings and consumption standards shall
be published in the City Record.
(2) To obtain a rental adjustment pursuant to
this subparagraph (n), the landlord shall
file a report with the agency on forms
prescribed by the agency and shall:
(i) certify the amount of heating fuel
consumed in the calendar year
immediately prior to the filing of the
report;
(ii) state the type of fuel used and the
number of rooms in the building;
(iii) certify that (a) all essential
services required to be provided have
been and will continue to be
maintained and (b) there has been no
rent reduction order issued pursuant
to this chapter based on the
landlord's failure to provide heat or
hot water during the prior twelve
months;
(iv) certify on information and belief, in
order to qualify for an additional rent
increase pursuant to this subparagraph
(n), that for an individual housing
accommodation, if the maximum rent
collectible pursuant to paragraph five
of subdivision a of this section plus
actual rent adjustments pursuant to this
subparagraph (n) and such additional
rent increase, is equal to or exceeds
the maximum rent established pursuant to
paragraphs three and four of subdivision
a of this section plus the amount
calculated pursuant to subitem (i) of
item three and subitem (i) of item four
of this subparagraph (n), each to be
allocated to such housing accommodation
pursuant to subitem (ii) of item four of
this subparagraph (n), that the landlord
will not be earning an amount m excess
of the statutory return specified in
subparagraph (a) of paragraph one of
subdivision g of this section after
collection of a rent increase pursuant
to this subparagraph (n), with respect
to a building or buildings serviced by a
single heating plant;
(v) report any funds received with respect
to the housing accommodations from any
governmental grant program compensating
such landlord for fuel price increases
during the period for which an
adjustment is obtained pursuant to this
subparagraph (n);
(vi) provide such other information as the
agency may require.
(3) rent adjustments for controlled housing
accommodations for annual heating fuel cost
increases or decreases experienced after
December thirty-first, nineteen hundred
seventy-nine, shall be determined as follows:
(i) the increase or decrease in heating fuel
prices found by the agency for that year
shall be multiplied by the actual
consumption, not to exceed that year's
consumption standard established
pursuant to subitem (ii) of item one of
this subparagraph; and
(ii) seventy-five percentum of such amount
shall be allocated among all rental
space in the building, including
commercial, professional and similar
facilities, provided, for the purposes
of this subparagraph (n), that living
rooms, kitchens over fifty-nine square
feet in area and bedrooms shall be
considered rooms and that bathrooms,
foyers and kitchenettes shall not be
considered rooms.
(4) Rent adjustments for controlled housing
accommodations for heating fuel cost
increases or decreases experienced from April
ninth, nineteen hundred seventy-nine, through
and including December thirty-first, nineteen
hundred seventy-nine, shall be determined as
follows:
(i) the increase or decrease in heating fuel
prices found by the agency for that
period shall be multiplied by seventy-
five percentum of the actual heating
fuel consumption during the period from
January first, nineteen hundred seventy-
nine, through and including December
thirty-first, nineteen hundred seventy-
nine, which consumption shall not exceed
seventy-five percentum of that year's
consumption standard established by the
agency; and
(ii) such amount shall be allocated among all
rental space in the building, including
commercial, professional and similar
facilities, provided, for the purposes
of this subparagraph (n), that living
rooms, kitchens over fifty-nine square
feet in area and bedrooms shall be
considered rooms and that bathrooms
foyers and kitchenettes shall not be
considered rooms.
The city rent agency shall promulgate
findings for heating fuel price increases or
decreases and standards for consumption for
the periods set forth in this item four
thirty days after this local law is enacted.
The standard for consumption shall be no more
than seventy-five percentum of two hundred
thirty gallons per room for buildings using
heating oils for heat with comparable unit
limitations to be established by the city
rent agency for utility supplied steam, gas,
electricity, coal and any other types of
heating systems.
(5) A landlord who files a report pursuant to
this subparagraph and who falsely certifies
shall not be eligible to collect any rent
adjustment pursuant to this subparagraph for
two years following a determination of a
false certification and in addition, any
adjustments obtained pursuant to this
subparagraph for up to two years prior to
such determination shall not be collectible
for that same two year period. Such landlord
shall also be subject to any additional
penalties imposed by law.
(6) A landlord annually may file a report
pursuant to this subparagraph (n) after
promulgation by the agency of the findings
and consumption standards set forth in item
one of subparagraph (n). A rent adjustment
pursuant to such report shall be
prospectively collectible upon the landlord's
serving and filing the report, provided,
however, that if a landlord files such report
within sixty days of the promulgation of such
findings and consumption standards, such rent
adjustment shall be retroactive to and shall
be effective as of the January first of the
year in which the report is filed.
(7) A landlord demanding or collecting a rent
adjustment pursuant to this subparagraph (n)
shall at the time of either the demand or
collection issue to the tenant either a rent
bill or receipt separately setting forth the
amount of the adjustment pursuant to this
subparagraph (n) and the amount of the
maximum rent otherwise demanded or collected.
If the tenant has been issued a valid senior
citizen rent exemption order, the owner shall
also separately state the amount payable by
the senior citizen after the exemption.
(8) In the event that a rent reduction order is
issued by the city rent agency based upon the
landlord's failure to provide heat or hot
water to housing accommodations for which the
landlord is collecting a rent adjustment
pursuant to this subparagraph (n), the rent
adjustment shall not be collected during the
time such rent reduction order is in effect
and for twelve months following the date of
the restoration of the rent reduction. In
addition, the landlord shall not be eligible
to collect any subsequent rent adjustment
pursuant to this subparagraph (n) until
twelve months following the date of the
restoration of the rent reduction.
(9) In the event that the city rent agency
promulgates a finding of a price decrease, if
any landlord who has obtained a rent
adjustment pursuant to this subparagraph (n)
does not file a report for a rent adjustment
pursuant to this subparagraph (n) within
sixty days of the promulgation of such
findings, then all rent adjustments obtained
pursuant to this subparagraph (n) shall not
be collectible for a period of twelve months.
(10) Any rent adjustment obtained pursuant to this
subparagraph (n) shall not be included in the
maximum rent established pursuant to
paragraph four or five of subdivision (a) of
this section.
(11) The city rent agency shall have the power to
promulgate such regulations as it may
consider necessary or convenient to implement
and administer the provisions of this
subparagraph (n). The regulations shall also
require that any rent adjustment granted
pursuant to this subparagraph (n) be reduced
by an amount equal to any governmental grant
received by the landlord compensating the
landlord for any fuel price increases, but
not required by the city, the agency or any
granting government entity to be expended for
fuel related repairs or improvements.
(o) (1) There has been an increase in heating
and heating fuel expenditures in a property
resulting from a city-wide rise in heating
fuel costs such that the verifiable
expenditures for heating or heating fuel in a
property for nineteen hundred seventy-four
exceeds the verifiable expenditures for such
heating or heating fuel during nineteen
hundred seventy-three.
(2) To obtain a rental adjustment pursuant to
this subparagraph (o), the landlord must
certify that he or she is presently
maintaining all essential services required
to be furnished with respect to the housing
accommodations covered by such certification,
and that he or she will continue to so
maintain such essential services for the
period of any such adjustment.
(3) To obtain a rental adjustment pursuant to
this subparagraph (o), the landlord must
certify on information and belief that he or
she will not be earning an amount in excess
of the statutory return specified in
subparagraph (a) of paragraph one of
subdivision g of this section after
collection of such rental adjustment, with
respect to the building or buildings serviced
by a single heating plant, and where the
building, or buildings serviced by a single
heating plant, contains forty-nine or fewer
housing accommodations, the landlord must
certify that the amount expended directly for
heating or heating fuel in nineteen hundred
seventy-four equalled or exceeded ten per
cent of the total rental income which was
derived from the property during nineteen
hundred seventy-four; and, where the
building, or buildings serviced by a single
heating plant, contains fifty or more housing
accommodations the landlord must certify that
the amount expended directly for heating or
heating fuel in nineteen hundred seventy-four
equalled or exceeded seven and one-half
percentum of the total rental income which
was derived from the property during nineteen
hundred seventy-four.
(4) The total rental adjustments for a property
to be allocated or deemed allocated pursuant
to this subparagraph (o) shall not exceed one-
half of the gross amount by which the total
verifiable expenditures for heating or
heating fuel for nineteen hundred seventy-
four exceeds the total verifiable
expenditures for such heating or heating fuel
for nineteen hundred seventy-three.
(5) Such total rental adjustments shall be
allocated or deemed allocated pursuant to
this subparagraph (o) to all housing
accommodations subject to this chapter, to
all other housing accommodations, and to all
commercial, professional and similar
facilities in or associated with the property
in a manner to be determined by the agency.
In no event shall any adjustment in maximum
rent pursuant to this subparagraph (o) for
any housing accommodations subject to this
chapter exceed a monthly increase of two
dollars per room, as defined by item eight
below. In any apartment containing five or
more rooms, any increase shall not exceed the
total of nine dollars.
(6) Any adjustment pursuant to this subparagraph
(o) shall be effective for all or part of the
period July first, nineteen hundred seventy-
five through June thirtieth, nineteen hundred
seventy-six. Any adjustment pursuant to this
subparagraph shall automatically expire no
later than June thirtieth, nineteen hundred
seventy-six.
(7) The rental increases provided for herein
shall be effective and collectible upon the
landlord's filing a report with the agency on
forms prescribed by the agency and upon
giving such notice to the tenants as the
agency shall prescribe subject to adjustments
upon order of the agency.
(8) In determining the amount of an adjustment
allocation of an adjustment pursuant to this
subparagraph (o), only living rooms, kitchens
over fifty-nine square feet in area, dining
rooms and bedrooms shall be considered rooms
bathrooms, foyers, and kitchenettes shall not
be considered rooms.
(2) In any case where any housing accommodation was vacated
on or after the effective date of this paragraph two,
other than by voluntary surrender of possession or in
the manner provided in this chapter, the city rent
agency may by regulations having due regard for the
equities involved, bar adjustments pursuant to
subparagraphs (f) and (g) of paragraph one of this
subdivision g except for work which:
(a) is necessary in order to remove violations against
the property;
(b) is necessary to obtain a certificate of occupancy
if such certificate is required by law; or
(c) could have been performed with a tenant in
physical possession of the housing accommodation.
(3) Any adjustment pursuant to subparagraph (a), (b), or
(c) of paragraph one of this subdivision shall be
subject to the limitation set forth in paragraph five
of subdivision a of this section; provided:
(a) that in ordering an adjustment pursuant to such
subparagraph (a), the city rent agency may waive
such limitation where a greater increase is
necessary to make the earned income of the
property equal to its operating expenses; and
(b) that where due to such limitation the landlord
will not receive the full amount of the rent
increase to which he or she would otherwise be
entitled, the order of the city rent agency shall
increase the maximum rent by a further additional
amount during each succeeding twelve-month period,
not to exceed seven and a half percentum of the
maximum rent in effect on the date of the filing
of the application for an adjustment, under the
maximum rent shall reflect the full increase to
which the landlord is entitled.
(4) Any increase in maximum rent shall be apportioned
equitably among all the controlled housing
accommodations in the property. In making such
apportionment and in fixing the increases in maximum
rents, the city rent agency shall give due
consideration (a) to all previous adjustments or
increases in maximum rents by lease or otherwise; and
(b) to all other income derived from the property,
including income from space and accommodations not
controlled, or the rental value thereof if vacant or
occupied rent-free, so there is allocated to the
controlled housing accommodations therein only that
portion of the amount of increases necessary pursuant
to subparagraph (a), (b), (c) or (k) of paragraph one
of this subdivision g, as is properly attributable to
such controlled accommodations.
(5) The city rent agency shall compile and make available
for public inspection at reasonable hours at its
principal office and at each appropriate local office,
the manual of accounting procedures and advisory
bulletins applicable to applications under
subparagraphs (a), (b) and (c) of paragraph one of this
subdivision g, and all amendments to such manual and
bulletins.
(6) (a) No application for an increase in any maximum
rent may be filed under subparagraph (a), (b) or
(c) of paragraph one of this subdivision g with
respect to any property unless there is annexed to
such application:
(1) A report of search issued by the agency of
the city having jurisdiction stating either
that no violations against such property are
recorded or a receipt (or photocopy thereof)
issued by that agency attesting to the
payment of the fee for the report of search
or that all violations recorded against such
property have been cleared, corrected or
abated; and
(2) A certification by the landlord of such
property that he or she is maintaining all
essential services required to be furnished
and that he or she will continue to maintain
such services so long as an such increase in
the maximum rent continues in effect.
(b) Except as provided in subparagraph (c) of this
paragraph six and paragraph four of subdivision h
of this section, no landlord shall be entitled to
an increase in the maximum rent on any ground
unless he or she certifies that he or she is
maintaining all essential services furnished or
required to be furnished as of the date of the
issuance of the order adjusting the maximum rent
and that he or she will continue to maintain such
services so long as the increase in such maximum
rent continues in effect; nor shall any landlord
be entitled to any increase in the maximum rent on
any ground where an agency of the city having
jurisdiction certifies that the housing
accommodation is a fire hazard or is a continued
dangerous condition or detrimental to life or
health or is occupied in violation of law; nor
shall any landlord be entitled to any increase
where the landlord has not removed the violations
recorded against such property as shown in the
report of search required under subparagraph (a)
of this paragraph six.
(c) Where an application for an increase in any
maximum rent is filed under subparagraph (f)
and/or (g) of paragraph one of this subdivision g,
and the landlord is not entitled to any increase
by reason of the provisions of subparagraph (b) of
this paragraph six, the city rent agency may waive
such provisions and issue orders increasing the
maximum rent effective as of the date of the
issuance of the orders provided, however, that the
landlord agrees in writing to deposit the entire
amount of such increase in maximum rent into an
escrow account administered by the city rent
agency in accordance with rules and regulations to
be promulgated by such agency for the purpose of
obtaining compliance with such provisions and
further agrees to obtain and submit to the city
rent agency within one year from the date of
issuance of such orders; a report of search issued
by the agency of the city having jurisdiction
stating that the violations shown in the report of
search required under subparagraph (a) of this
paragraph six have been removed, cleared,
corrected or abated, and his or her own
certification that he or she is and will continue
to maintain all essential services in accordance
with the provisions of subparagraph (b) of this
paragraph six. In the event the landlord fails to
fully comply with such provisions within one year
from the date of the issuance of the order
increasing the maximum rent, the city agency may,
having due regard for the equities involved,
revoke such orders and direct full refund to the
tenants of the entire increase paid by the tenants
as a result of such orders. Any person serving as
escrow agent shall not be liable except for fraud
or misfeasance.
(d) No new maximum rent shall be established pursuant
to paragraph three or four of subdivision a of
this section unless not more than one hundred
fifty days nor less than ninety days prior to the
effective date thereof, the landlord has certified
that he or she is maintaining all essential
services required to be furnished with respect to
the housing accommodations covered by such
certification, and that he or she will continue to
maintain such services so long as such new maximum
rent is in effect. Each such certification filed
to obtain a new maximum rent pursuant to paragraph
four of subdivision a of this section shall be
accompanied by a certification by the landlord
that he or she has actually expended or incurred
ninety per centum of the total amount of the cost
index for operation and maintenance established
for his or her type of building.
(e) The city rent agency shall establish a counseling
service to provide assistance to tenants and to
landlords of buildings containing nineteen or
fewer housing accommodations, by way of
instruction in the management, maintenance and
upkeep of housing accommodations, their respective
responsibilities thereto, the programs and
enforcement remedies available in the agency and
from other city agencies, and assistance in the
preparation of applications and other forms.
(7) Before ordering any adjustment in maximum rents, the
city rent agency shall accord a reasonable opportunity
to be heard thereon to the tenant and the landlord.
h. (1) whenever in the judgment of the city rent agency
such action is necessary or proper in order to
effectuate the purposes of this chapter, such agency
may, by regulation or order, regulate or prohibit
speculative or manipulative practices or renting or
leasing practices, including practices relating to
recovery of possession, which in the judgment of such
agency are equivalent to or are likely to result in
rent increases inconsistent with the purposes of this
chapter.
(2) Whenever in the judgment of such agency such action is
necessary or proper in order to effectuate the purposes
of this chapter, such agency may provide regulations to
assure the maintenance of the same living space,
essential services, furniture, furnishings and
equipment as were provided on the date determining the
maximum rent, and such agency shall have power by
regulation or order to decrease the maximum rent or
take action as provided in paragraph four of this
subdivision h for any housing accommodation with
respect to which a maximum rent is in effect, pursuant
to this chapter, if it shall find that the living
space, essential services, furniture, furnishings or
equipment to which the tenant was entitled on such date
have been decreased.
(3) Whenever any agency of the city having jurisdiction
certifies that any housing accommodation is a fire
hazard or is in a continued dangerous condition or
detrimental to life or health, or is occupied in
violation of law, the city rent agency may issue an
order decreasing the maximum rent or take action as
provided in paragraph four of this subdivision h for
such housing accommodation in such amount as it deems
necessary or proper, until the agency issuing such
certification has certified that such housing
accommodation is no longer a fire or other hazard and
is not in a condition detrimental to life and health
and is not occupied in violation of law.
(4) (a) Whenever in the judgment of the city rent
agency such action is necessary or proper in order
to effectuate the purposes of this chapter, such
agency may, in lieu of decreasing the maximum
rents as provided in paragraphs two and three of
this subdivision h, enter into a contract wherein
the landlord agrees in writing to deposit all
income derived from the property, including income
from spaces and accommodations not controlled,
into an escrow or trust account for use in
maintaining or restoring essential services and
equipment, for removing violations against the
property or housing accommodations therein, making
such repairs as are necessary to remove a
certification from any city agency having
jurisdiction thereof that the housing
accommodation is a fire hazard or is in a
continued dangerous condition or detrimental to
life or health, or is occupied in violation of
law, and/or for such other uses as the city rent
agency deems necessary or proper for the
preservation, repair or maintenance of the
property. The city rent agency may adopt such
rules and regulations and orders as it may deem
necessary or proper to effectuate the purposes of
this paragraph, including but not limited to the
issuance of orders adjusting all controlled rents
to the appropriate maximum rent effective as of
the first day of the month following the execution
of the contract provided, however, that in the
event the city rent agency shall determine that
the landlord has breached such contract, such
agency may issue orders (1) decreasing the maximum
rents pursuant to such contract; (2) containing a
directive that rent collected by the landlord in
excess of the rent thus decreased be refunded to
the tenants; and (3) containing such other
determinations and directives as are necessary in
order to effectuate the purposes of this paragraph
four.
(b) Notwithstanding any provision of this chapter to
the contrary, whenever in the judgment of the city
rent agency action as provided in paragraph two or
three of this subdivision h is necessary or proper
in order to effectuate the purposes of this
chapter, such agency may in lieu of decreasing the
maximum rents thereof issue orders adjusting all
controlled rents and directing that rents be paid
into an escrow account for the uses stated in
subparagraph (a) of this paragraph four where:
(1) The landlord fails to take corrective action
after notice by the city rent agency of
proposed action to decrease the maximum rents
pursuant to paragraph two or three of this
subdivision h, and,
(2) The city rent agency has notified all
mortgagees who have filed with the city rent
agency a declaration of interest in such
property and in such proposed action, and,
(3) The landlord has failed for three consecutive
months to collect any controlled rents or to
commence court proceedings for their
collection or if such proceedings have been
commenced, the landlord has not diligently
prosecuted them or such proceedings have not
resulted in judgment in favor of such
landlord.
(c) The city rent agency shall promulgate rules and
regulations for the administration of escrow and
trust accounts set forth in this paragraph four.
Any person serving as escrow agent or trustee
shall not be liable except for fraud breach of
fiduciary duties or misfeasance.
(5) Whenever the essential services, furnishings, furniture
or equipment of any individual housing accommodation
are reduced, impaired, mutilated, or made unworkable as
the result of the neglect, failure to exercise due
care, or failure of the tenant to take practicable
precautions to prevent such condition, the landlord
shall restore such services, furniture, furnishings or
equipment and pursuant to regulations to be prescribed
by the city rent agency may make application for a
temporary increase in the maximum rent based upon the
cost of such restoration. In the event of the failure
of the tenant to make restitution within a reasonable
time, as determined by the city rent agency an order
shall be issued adjusting the maximum rent for such
tenant in an amount sufficient to recover the cost over
twelve monthly installments, or until the tenant
surrenders possession, whichever is sooner. The
provisions of this paragraph shall be in addition to
all other rights and remedies of the landlord.
(6) If at least six months before the effective date of any
adjustment or establishment of rents pursuant to
paragraph three or four of subdivision a of this
section, the landlord has not certified to the agency
having jurisdiction that (a) all rent impairing
violations (as defined by section three hundred two-a
of the multiple dwelling law), and (b) at least eighty
per centum of all other violations of the housing
maintenance code or other state or local laws that
impose requirements on property that were recorded
against the property one year prior to such effective
date have been cleared, corrected, or abated, no
increase pursuant to such paragraphs shall take effect
until he or she shall have entered into a written
agreement with the city rent agency to deposit all
income derived from the property into an escrow or
trust account pursuant to subparagraph (a) of paragraph
four of this subdivision, in addition to the procedures
set forth in this paragraph and all other applicable
penalties and procedures under this chapter, such
violation shall also be subject to repair or removal by
the city pursuant to the provisions of article five of
subchapter five of the housing maintenance code, the
landlord to be liable for the cost thereof.
i. Any regulation or order issued pursuant to this section may
be established in such form and manner, may contain such
classifications and differentiations, and may provide for
such adjustments including the establishment of new or
adjusted maximum rents in whole dollar amounts, and such
reasonable exceptions as in the judgment of the city rent
agency are necessary or proper in order to effectuate the
purposes of this chapter.
j. No increase or decrease in maximum rent shall be effective
prior to the date on which the order therefor is issued,
except as hereinafter provided. If an application for an
increase pursuant to subparagraph (a) of paragraph one of
subdivision g of this section submitted on or after August
first, nineteen hundred seventy is accompanied by a
certified statement of expenditures and no order is issued
thereon within four months of the filing of an application
based on assessed value or equalized assessed value, or
eight months of the filing of an application based on sale
price, with all required documentation the increased rent
requested shall thereafter be placed in an interest bearing
escrow account until a final determination is made upon such
application by the city rent agency. Upon initial
determination by the agency an order shall be issued
providing for the payment of the increased amount, if any,
due to the landlord from the date of first deposit of rent
in said escrow account with interest, and the excess amount,
if any, be paid the tenants entitled thereto, with an
appropriate amount of interest. The city rent agency shall
promulgate rules and regulations for the administration of
such escrow accounts. Any person serving as escrow agent
shall not be liable except for fraud or misfeasance.
k. Regulations, orders, and requirements under this chapter may
contain such provisions as the city rent agency deems
necessary to prevent the circumvention or evasion thereof.
l. The powers granted in this action shall not be used or made
to operate to compel changes in established rental
practices, except where such action is affirmatively found
by the city rent agency to be necessary to prevent
circumvention or evasion of any regulation, order, or
requirement under this chapter.
m. Findings. The council finds that there is an acute and
continuing housing shortage; that this shortage has and
continues to have an adverse effect on the population and
especially on inhabitants of the city who are sixty-two
years of age or older and of limited means, who cannot pay
enough rent to induce private enterprise to maintain decent
housing at rents they can afford to pay; that this condition
is and continues to be particularly acute in a time of
rising costs such as the present; that present rising costs
and the continuing increase in rents pursuant to amendments
to the New York City Rent and Rehabilitation Law may result
in such persons being unable to pay their rent, thus making
them subject to eviction, that such hardships fall with
particular severity upon older persons in the population
because of their particular inability to find alternative
accommodations within their means, because of the trauma
experienced by many older persons who have to relocate and
because they may endanger their health by paying additional
sums for shelter and thereby deprive themselves of other
necessities; that hardships imposed upon such people
adversely affect their health and welfare and the general
welfare of the inhabitants of the city. The council is aware
of the provisions set forth in chapter three hundred seventy-
two and chapter one thousand twelve of the laws of nineteen
hundred seventy-one. It is our considered opinion that this
legislation extending the rent exemption to cover the
resultant rent increases due to the maximum rents
established January first, nineteen hundred seventy-two, is
not more stringent or restrictive than those presently in
effect. It is, therefore, found and declared to be necessary
for the health, welfare and safety of such persons and of
inhabitants of the city that the city continue a system of
special rent adjustments for such persons as hereinafter
provided.
(1) No increase in maximum rent pursuant to paragraph two
or paragraph three, four or five of subdivision a of
this section, or subparagraph (a), (b), (c), (1) or (n)
of paragraph one of subdivision g of this section,
shall be collectible from a tenant to whom there has
been issued a currently valid rent exemption order
pursuant to this subdivision, except as provided in
such order.
(2) A tenant is eligible for a rent exemption order
pursuant to this subdivision if:
(i) the head of the household residing in the housing
accommodation is sixty-two years of age or older
and is entitled to the possession or to the use or
occupancy of a dwelling unit.
Nothing herein contained shall render ineligible
for benefits persons receiving supplemental
security income or additional state payments, or
both, under a program administered by the United
States department of health and human services or
by such department and the New York state
department of social services.
(ii) The aggregate disposable income (as defined by
regulation of the department of housing
preservation and development) of all members of
the household residing in the housing
accommodation does not exceed fifteen thousand
dollars per year, after deduction of federal,
state and city income and social security taxes.
For purposes of this subdivision, "aggregate
disposable income" shall not include increases in
benefits accorded pursuant to the social security
act which take effect after the date of
eligibility of a head of the household receiving
benefits under this subdivision whether received
by the head of the household or any other member
of the household; and
(iii) (a) in the case of a head of the household
who does not receive a monthly allowance for
shelter pursuant to the social services law,
the maximum rent for the housing
accommodations exceeds one-third of the
aggregate disposable income or if any
expected increase in the maximum rent
pursuant to paragraph two, three, four or
five of subdivision a of this section, or
subparagraph (a), (b), (c), (1) or (n) of
paragraph one of subdivision g of this
section would cause such maximum rent to
exceed one-third of the aggregate disposable
income; or
(b) in the case of a head of the household who
receives a monthly allowance for shelter
pursuant to the social services law, the
maximum rent for the housing accommodations
exceeds the maximum allowance for shelter
which the head of the household is entitled
to receive pursuant to the social services
law or if any expected increase in the
maximum rent pursuant to paragraph two,
three, four or five of subdivision a of this
section, or subparagraph (a), (b), (c), (1)
or (n) of paragraph one of subdivision g of
this section would cause such maximum rent to
exceed the maximum allowance for shelter
which the head of the household is entitled
to receive.
(3) (a) A rent exemption order pursuant to this
subdivision shall provide:
(i) in the case of a head of the household who
does not receive a monthly allowance for
shelter pursuant to the social law services
law, that the landlord may not collect from
the tenant to whom it is issued rent at a
rate in excess of one-third of the aggregate
disposable income, or the maximum collectible
rent in effect on December thirty-first of
the year preceding the effective date of the
order, whichever is greater; or
(ii) in the case of a head of the household who
receives a monthly allowance for shelter
pursuant to the social services law, that the
landlord may not collect from the tenant to
whom it is issued rent at a rate in excess of
either the maximum allowance for shelter
which the head of the household is entitled
to receive, or the maximum collectible rent
in effect on December thirty-first of the
year preceding the effective date of the
order, whichever is greater; except,
(iii) that the landlord may collect from the
tenants described in items (i) and (ii) of
this subparagraph increases in rent
pursuant to subparagraphs (d), (e), and (i)
of paragraph one of subdivision g of this
section.
(b) Each such order shall expire upon termination of
occupancy of the housing accommodation by the
tenant to whom it is issued. The landlord shall
notify the department of housing preservation and
development, on a form to be prescribed by such
department, within thirty days of each such
termination of occupancy.
(4) Any landlord who collects, or seeks to collect or
enforce, rent from a tenant in violation of the terms
of a rent exemption order shall, for the purposes of
all remedies, sanctions and penalties provided in this
chapter, be deemed to have collected or attempted to
collect or enforce, a rent in excess of the legal
maximum rent.
(5) A rent exemption order shall be issued to each tenant
who applies to the New York City department of housing
preservation and development in accordance with its
regulations and who is found to be eligible under this
subdivision. Such order shall take effect on the first
day of the first month after receipt of such
application, except that where the aggregate disposable
income of all members of the household residing in the
housing accommodation is greater than five thousand
dollars per year but does not exceed fifteen thousand
dollars per year pursuant to subparagraph (ii) of
paragraph two of this subdivision m of this section on
orders issued on applications received before July
first, nineteen hundred seventy-five, the effective
date of such order shall be the later of (1) June
thirty, nineteen hundred seventy-four or (2) the last
day of the month in which a person becomes an eligible
head of household in the housing accommodation in which
such person resides at the time of filing the most
recent application for a rent exemption order; and
further, except that where any other application has
been received within ninety days of the issuance of the
order increasing the tenant's maximum rent pursuant to
paragraph three, four or six of subdivision (a) of this
section, or subparagraph (a), (b), (c), or (1) of
paragraph (1) of subdivision (g) of this section or
pursuant to court order, whichever is later, the rent
exemption order shall without further order take effect
as of the effective date of said order increasing the
tenant's rent including any retroactive increments
collectible pursuant to such orders.
(6) A rent exemption order shall be valid for a period of
two years and may be renewed for further two year
periods upon application by the tenant provided, that
upon any such renewal application being made by the
tenant any rent exemption order then in effect with
respect to such tenant shall be deemed renewed until
such time as the department of housing preservation and
development shall have found such tenant to be either
eligible or ineligible for a rent exemption order but
in no event for more than six additional months. If
such tenant is found eligible, the order shall be
deemed to have taken effect upon expiration of the
exemption. In the event that any such tenant shall
subsequent to any such automatic renewal, not be
granted a rent exemption order, such tenant shall be
liable to his or her landlord for the difference
between the amounts he or she has paid under the
provisions of the automatically renewed order and the
amounts which he or she would have been required to pay
in the absence of such order. Any rent exemption order
issued pursuant to this subdivision shall include
provisions giving notice as to the contents of this
paragraph relating to automatic renewals of rent
exemption orders. Any application or renewal
application for a rent exemption order shall also
constitute an application for a tax abatement under
such section. The department of housing preservation
and development may, with respect to renewal
applications by tenants whom it has found eligible for
rent exemption orders, prescribe a simplified form
including a certification of the applicant's continued
eligibility in lieu of a detailed statement of income
and other qualifications.
(7) Notwithstanding the provisions of this chapter, a
tenant who resides in a housing accommodation which
becomes subject to this chapter upon the sale by the
city of New York of the building in which such housing
accommodation is situated may be issued a rent increase
exemption order for increases in rent which occurred
during ownership of such building by the city of New
York provided that such tenant would have been
otherwise eligible to receive a rent increase exemption
order at the time of such increase but for the fact
that such tenant occupied a housing accommodation owned
by the city of new York and was therefore not subject
to this chapter. Application for such rent increase
exemption orders shall be made within one year from the
date such building IS sold by the city of New York or
within one year of the effective date of this
provision, whichever is later.
(8) Notwithstanding the provisions of this chapter or
chapter four of this title when a dwelling unit is
subject to regulation under this chapter or chapter
four of this title is reclassified by a city rent
agency order subject to the other chapter the tenant,
who holds a senior citizen rent increase exemption
order at the time of the reclassification or is
otherwise eligible and entitled to an exemption order
from one or more rent increases but for the
reclassification of the dwelling unit, may be issued a
rent increase exemption order under the chapter to
which the unit is thereafter subject by virtue of the
reclassification continuing the previous exemption
notwithstanding the reclassification of the dwelling
unit or, where no previous rent increase exemption
order has been granted, issuing an initial order
exempting the tenant from paying the rent increase to
the extent for which he or she would have been eligible
and entitled to be exempted at the time of the increase
and reclassification but for the fact of
reclassification of the dwelling unit including
exemption from the rent increase granted pursuant to
subparagraph (m) of paragraph one of subdivision g of
this section to the extent that it is not predicated
upon any improvement or addition in a category as
provided for in subparagraph (d), (e), (f), (g), (h) or
(i) of paragraph one of subdivision g of this section.
Application for such rent increase exemption order
shall be made within ninety days from the date of
reclassification or within ninety days of the effective
date of this paragraph, whichever is later. The rent
increase exemption order shall take effect as of the
effective date of reclassification including any
retroactive increments pursuant to such rent increase.
(9) Notwithstanding any other provision of law to the
contrary, where a head of household holds a current,
valid rent exemption order and, after the effective
date of this paragraph, there is a permanent decrease
in aggregate disposable income in an amount which
exceeds twenty percent of such aggregate disposable
income as represented in such head of the household's
last approved application for a rent exemption order or
for renewal thereof, such head of the household may,
upon renewal or one year after the issuance or renewal
of such rent exemption order, apply for a
redetermination of the amount set forth therein. Upon
application, such amount shall be redetermined so as to
re-establish the ratio of adjusted rent to aggregate
disposable income which existed at the time of the
approval of such eligible head of the household's last
application for a rent exemption order or for renewal
thereof; provided, however, that in no event shall the
amount of the adjusted rent be redetermined to be (i)
in the case of a head of the household who does not
receive a monthly allowance for shelter pursuant to the
social services law, less than one-third of the
aggregate disposable income; or (ii) in the case of a
head of the household who receives a monthly allowance
for shelter pursuant to the social services law, less
than the maximum allowance for shelter which such head
of the household is entitled to receive pursuant to
such law. For purposes of this paragraph, a decrease in
aggregate disposable income shall not include any
decrease in such income resulting from the manner in
which such income is calculated pursuant to any
amendment to paragraph c of subdivision one of section
four hundred sixty-seven-b of the real property tax law
or any amendment to the regulations of the department
of housing preservation and development made on or
after April first, nineteen hundred eighty-seven. For
purposes of this paragraph, "adjusted rent" shall mean
maximum rent less the amount set forth in a rent
exemption order.
Added by Laws 1985, Ch. 907, § 1, eff. Sept. 1, 1986; amended by
Local L. 1985, No. 63, eff. Oct. 1, 1985, amended by Local L.
1985, No. 98, eff. Dec. 31, 1985; amended by Local L. 1986, No.
52; amended by Laws 1986, Ch. 737, § 2, eff. Sept. 1, 1986;
amended by Laws 1987, Ch. 584, § 7, eff. Aug. 3, 1987; amended by
Laws 1988, Ch. 366, § 2, eff. July 29 1988, amended by Laws 1988,
Ch. 651, §§ 3, 4, eff. Sept. 1, 1988; amended by Local L. 1988,
No. 67, §§ 2, 3, eff. Nov. 4, 1988; amended by Laws 1990, Ch.
749, §§ 1, 2, eff. July 22, 1990.