PART 2522 -- RENT ADJUSTMENTS
-----------------------------
TABLE OF CONTENTS
Section 2522.1. Legal regulated rent adjustments.
2522.2. Effective date of adjustment of legal
regulated rents.
2522.3. Fair Market Rent Appeal.
2522.4. Adjustment of legal regulated rent.
2522.5. Lease agreements.
2522.6. Orders where the legal regulated rent or
other facts are in dispute, in doubt, or not
known, or where the legal regulated rent must
be fixed.
2522.7. Consideration of equities.
-----------------------------
Sec. 2522.1. LEGAL REGULATED RENT ADJUSTMENTS.
Legal regulated rents may be increased or decreased only as
hereinafter specified.
Sec. 2522.2. EFFECTIVE DATE OF ADJUSTMENT OF LEGAL REGULATED
RENTS.
The legal regulated rent shall be adjusted effective the first
rent payment date occurring 30 days after the filing of the
application, unless otherwise set forth in the order, or as set
forth in a Notice of Eligibility pursuant to section
2522.4(a)(3)(ii) of this Part, or on the effective date of a
lease or other rental agreement providing for the Rent Guidelines
Board annual rate of adjustments. No rent adjustment may take
place during a lease term unless a clause in the lease authorizes
such increase.
Sec. 2522.3. FAIR MARKET RENT APPEAL.
(a) Except as provided in section 2521.1(a)(2) of this Title, an
appeal of the initial legal registered rent on the ground
that it exceeds the fair market rent for the housing
accommodation may be filed with the DHCR by the tenant of a
housing accommodation which was subject to the City Rent Law
on December 31, 1973. If the housing accommodation was
registered in accordance with Part 2528 of this Title, this
right is limited to the first tenant taking occupancy on or
after April 1, 1984, except where such tenant had vacated
the housing accommodation prior to the service by the owner
of the Notice of initial Legal Registered Rent as required
by section 2523.1 of this Title. In such event, any
subsequent tenant in occupancy shall also have a right to
file a Fair Market Rent Appeal until the owner mails the
required notice and 90 days shall have elapsed without the
filing of an appeal by a tenant continuing in occupancy
during said 90-day period. Once a Fair Market Rent Appeal is
filed, no subsequent tenant may file such appeal.
Notwithstanding the above, where the first tenant taking
occupancy after December 31, 1973, of a housing
accommodation previously subject to the City Rent Law, was
served with the notice required by section 26 of the former
code of the Rent Stabilization Association of New York City,
Inc., the time within which such tenant may file a Fair
Market Rent Appeal is limited to 90 days after such notice
was mailed to the tenant by the owner by certified mail.
(b) The tenant need only allege in such appeal:
(1) that the initial legal registered rent is in excess of
the fair market rent; and
(2) such facts which, to the best of his or her information
and belief, support such allegation.
(c) Such appeal shall be dismissed where:
(1) the housing accommodation was subject to the City Rent
Law prior to July 1, 1971, and the initial legal
registered rent does not exceed the maximum rent as
calculated pursuant to the City Rent Law for the period
commencing January 1, 1974 and ending December 31,
1975, whether or not the housing accommodation was
subject to the City Rent Law on that date, plus the
appropriate guidelines allowance permissible for
renewal leases pursuant to Guidelines Board Order No. 6
issued June 28, 1974 and effective July 1, 1974, and
Order No. 6C issued February 7, 1975 and effective July
1, 1974, for any lease or other rental agreement
commencing on or after January 1, 1974; or
(2) the appeal is filed more than 90 days after the
certified mailing to the tenant of the initial
apartment registration, together with the notice
pursuant to section 2523.1 of this Title.
(d) The order shall direct the affected owner to make the refund
of any excess rent to the tenant in cash, check or money
order, and to the extent the present owner is liable for all
or any part of the refund, such present owner may credit
such refund against future rents over a period not in excess
of six months. If the refund exceeds the total rent due for
six months, the tenant at his or her option may continue to
abate his or her rent until the refund is fully credited, or
request the present owner to refund any balance outstanding
at the end of such six-month period.
(e) In determining Fair Market Rent Appeals, consideration shall
be given to the applicable guidelines promulgated for such
purposes by the Rent Guidelines Board and to rents generally
prevailing for substantially similar housing accommodations
in buildings located in the same area as the housing
accommodation involved. The rents for these comparable
housing accommodations may be considered where such rents
are:
(1) legal regulated rents, for which the time to file a
Fair Market Rent Appeal has expired and no Fair Market
Rent Appeal is then pending, or the Fair Market Rent
Appeal has been finally determined, charged pursuant to
a lease commencing within a four-year period prior to,
or a one-year period subsequent to, the commencement
date of the initial lease for the housing accommodation
involved; and
(2) at the owner's option, market rents in effect for other
comparable housing accommodations on the date of the
initial lease for the housing accommodation involved as
submitted by the owner.
(f) Where the rents of the comparable housing accommodations
being considered are legal regulated rents, for which the
time to file a Fair Market Rent Appeal has expired, and such
rents are charged pursuant to a lease ending more than one
year prior to the commencement date of the initial lease for
the subject housing accommodation, such rents shall be
updated by guidelines increases for one-year renewal leases,
commencing with the expiration of the initial lease for the
comparable housing accommodation to a date within 12 months
prior to the renting of the housing accommodation involved
Sec. 2522.4. ADJUSTMENT OF LEGAL REGULATED RENT.
(a) INCREASED SPACE AND SERVICES, NEW EQUIPMENT, NEW FURNITURE
OR FURNISHINGS; MAJOR CAPITAL IMPROVEMENTS; OTHER
ADJUSTMENTS.
(1) An owner is entitled to a rent increase where there has
been a substantial increase, other than an increase for
which an adjustment may be claimed pursuant to
paragraph (2) of this subdivision, of dwelling space or
an increase in the services, or installation of new
equipment or improvements, or new furniture or
furnishings, provided in or to the tenant's housing
accommodation, on written tenant consent to the rent
increase. In the case of vacant housing accommodations,
tenant consent shall not be required.
(2) An owner may file an application to increase the legal
regulated rents of the building or building complex on
forms prescribed by the DHCR, which the DHCR shall
serve upon all affected tenants, on one or more of the
following grounds:
(i) There has been a major capital improvement,
including an installation, which must meet all
of the following criteria:
(a) deemed depreciable under the Internal Revenue
Code, other than for ordinary repairs;
(b) is for the operation, preservation and
maintenance of the structure;
(c) is an improvement to the building or to the
building complex which inures directly or
indirectly to the benefit of all tenants, and
which includes the same work performed in all
similar components of the building or
building complex, unless the owner can
satisfactorily demonstrate to the DHCR that
certain of such similar components did not
require improvement; and
(d) the item being replaced meets the
requirements set forth in the useful life
schedule, except with DHCR approval of a
waiver. Pursuant to section 2527.11 of this
Title, the DHCR shall issue a useful life
schedule in accordance with manufacturing
industry standards, which shall also set
forth the conditions under which a useful
life requirement may be waived.
(ii) There has been other necessary work performed in
connection with, and directly related to a major
capital improvement, which may be included in
the computation of an increase in the legal
regulated rent only if such other necessary work
was completed within a reasonable time after the
completion of the major capital improvement to
which it relates. Such other necessary work
must:
(a) improve, restore or preserve the quality of
the structure; and
(b) have been completed subsequent to, or
contemporaneously with, the completion of the
work for the major capital improvement.
(iii) With approval by the DHCR, there has been an
increase in services or improvement, other than
repairs, on a building-wide basis, which the
owner can demonstrate are necessary in order to
comply with a specific requirement of law.
(iv) With approval by the DHCR, there have been other
improvements made or services provided to the
building or building complex, other than those
specified in subparagraphs (i)-(iii) of this
paragraph, with the express consent of the
tenants in occupancy of at least 75 percent of
the housing accommodations.
(3) An owner who files a complete application with the DHCR
for an increase authorized pursuant to subparagraph
(2)(i) of this subdivision which meets the requirements
of such subparagraph may begin to collect such increase
in the legal regulated rent prior to the issuance of an
order granting the increase, provided that:
(i) to be complete, such application must:
(a) contain an itemized list of the work
performed;
(b) contain a certification of the cost of such
work from the contractors, architect,
certified public accountant, engineer or
governmental agency; and that the item meets
the requirements set forth in the useful life
schedule, or a copy of a DHCR approval of a
waiver of such useful life requirement is
attached;
(c) contain proof of payment for such work the
cost of which is certified pursuant to clause
(b) of this subparagraph;
(d) contain the owner's sworn affidavit as to the
completion of the installation or improvement
in accordance with the itemization list and
the certified costs, that all applicable
governmental codes and regulations have been
complied with, the installation or
improvement has been properly performed in a
workmanlike manner, and the truthfulness of
all information submitted with the
application;
(e) contain copies of all necessary governmental
agency approvals or self-certification by a
duly licensed architect or engineer as may be
permitted by such governmental agency; and
(f) be for an improvement or installation of an
item which is included on the following
schedule, or such other improvement or
installation to the building or building
complex for the operation, preservation and
maintenance of the structure as may be deemed
necessary by the DHCR for the continued
viability of the building as specified in an
operational bulletin issued pursuant to
section 2527.11 of this Title.
-----------------------------
SCHEDULE OF MAJOR CAPITAL IMPROVEMENTS
1. Air conditioner--new central system; or individual units set
in sleeves in the exterior wall of every housing
accommodation; or, air conditioning circuits and outlets in
each living room and/or bedroom (see Rewiring).
2. Aluminum siding--installed in a uniform manner on all
exposed sides of the building (see Resurfacing).
3. Bathroom modernization--complete renovation, including new
sinks, toilets, bathtubs and/or showers and all required
trims in every housing accommodation.
4. Boiler and/or burner--new unit(s) including electrical work
and additional components needed for the installation.
5. Boiler room--new room where none existed before; or
enlargement of existing one to accommodate new boiler.
6. Catwalk--complete replacement.
7. Chimney--complete replacement, or new one where none existed
before, including additional components needed for the
installation.
8. Courtyard and walkways--concrete resurfacing of entire
original area within the property lines of the premises.
9. Doors--new lobby front entrance and/or vestibule doors; or
entrance to every housing accommodation, or fireproof doors
for public hallways, basement, boiler room and roof
bulkhead.
10. Elevator upgrading--including new controllers and selectors;
or new electronic dispatch overlay system; or new elevator
where none existed before, including additional components
needed for the installation.
11. Fire escapes--complete new replacement, including new
landings.
12. Gas heating units--new individual units with connecting
pipes to every housing accommodation.
13. Hot water heater--new unit for central heating system.
14. Incinerator upgrading--including a new scrubber.
15. Intercom system--new replacement; or one where one existed
before, with automatic door locks and push-button speaker
boxes and/or telephone communication, including security
locks on all entrances to the building.
16. Kitchen modernization--complete renovation, in eluding new
sinks, counter tops and cabinets in every housing
accommodation.
17. Mailboxes--new replacements and relocated from outer
vestibule to an area behind locked doors to increase
security.
18. Painting and waterproofing--as necessary on exposed sides of
the building.
19. Parapet--complete replacement.
20. Repiping--new hot and/or cold water risers, returns, and
branches to fixtures in every housing accommodation,
including shower bodies, and/or new hot and/or new cold
water overhead mains, with all necessary valves in basement.
21. Resurfacing of exterior walls--consisting of brick or
masonry facing on entire area of all exposed sides of the
building.
22. Rewiring--new copper risers and feeders extending from
property box in basement to every housing accommodation;
must be of sufficient capacity (220 volts) to accommodate
the installation of air conditioner circuits in living room
and/or bedroom.
23. Roof--complete replacement or roof cap on existing roof
installed after thorough scraping and leveling as necessary.
24. Solar heating system--new central system, including
additional components needed for the system.
25. Structural steel--complete new replacement of all beams
including footing and foundation.
26. Television system--new security monitoring system, including
additional components needed for the system.
27. Waste compactor--new installation(s) serving entire
building.
28. Waste compactor room--new room where none existed before.
29. Water tank--new installation(s) serving entire building.
30. Windows--new aluminum framed windows. Wood framed windows
allowed only for landmark buildings.
-----------------------------
(ii) The owner or his or her representative has
personally filed the completed application with
the DHCR, the DHCR has served such application
upon all affected tenants, the owner has
thereafter received a Notice of Eligibility from
the DHCR stating that the application is
complete, and the DHCR has served such Notice of
Eligibility upon such tenants. For the purposes
of an application filed pursuant to this
paragraph, the DHCR shall, within 90 days of
such filing, fully review such application to
insure completion pursuant to subparagraph (i)
of this paragraph and shall conduct inspections
where appropriate, and thereafter shall provide
an owner with a Notice of Eligibility stating
that the application is complete, and the
effective date of the notice for the purposes of
collecting the increase, or a notice of
deficiency determining that the application is
incomplete, and setting forth the grounds for
such determination. A Notice of Eligibility
shall be subject to a tenant challenge and
subsequent audit by the DHCR. A tenant may file
a challenge to the owner's eligibility to
collect the rent increase within 60 days after
the DHCR has served the tenant with a copy of
the Notice of Eligibility by setting forth the
grounds of his or her challenge in an answer
filed with the DHCR.
(iii) An owner, who on the effective date of this
Code, has an application pending before the DHCR
for an increase pursuant to subparagraph (2)(i)
of this subdivision, may begin to collect such
increase upon compliance with the procedure set
forth in subparagraphs (i) and (ii) of this
paragraph, provided that the retroactive
collectibility of the increase shall be no
earlier than the first rent payment date one
year prior to the filing of an application
completed pursuant to such subparagraphs (i) and
(ii), and shall not be collected until the DHCR
has issued an order granting the increase.
(iv) An owner who is found by the DHCR to have
knowingly filed a false affidavit pursuant to
clause (i)(d) of this paragraph shall not be
entitled to file any future application under
this paragraph, and shall be denied the increase
for which the owner submitted the application.
Any increased rent shall be returned to the
tenant and, in addition to any penalty contained
in any other provision of law, the DHCR may also
impose treble damages for the rent increase
collected pursuant to the Notice of Eligibility
described in subparagraph (ii) of this
paragraph.
(4) The increase in the monthly stabilization rent for the
affected housing accommodations when authorized
pursuant to paragraph (1) of the subdivision shall be
l/40th of the total cost, including installation but
excluding finance charges; and any increase pursuant to
paragraphs (2) and (3) shall be 1/60th of the total
cost, including installation but excluding finance
charges as allocated in accordance with paragraph (12)
of this subdivision. For increases pursuant to
subparagraphs (2)(iii) and (iv) of this subdivision, in
the discretion of the DHCR, an appropriate charge may
be imposed in lieu of an amortization charge when an
amortization charge is insignificant or inappropriate.
(5) Such increases shall not be collectible during the term
of a lease then in effect, unless a specific provision
in the tenant's lease authorizes an increase during its
term pursuant to an order issued by the DHCR, except
that increases pursuant to paragraph (1) of this
subdivision may be collected upon installation.
(6) The determination of the appropriate adjustment of a
legal regulated rent shall take into consideration all
factors bearing on the equities involved, subject to
the general limitation that the adjustment can be put
into effect without dislocation and hardship
inconsistent with the purposes of the RSL, and
including as a factor a return of the actual cost to
the owner, exclusive of interest or other carrying
charges, and the increase in the rental value of the
housing accommodations.
(7) Except for applications made pursuant to paragraph (3)
of this subdivision, an owner may apply for the DHCR's
advisory prior opinion pursuant to section 2527.11 of
this Title, as to whether the proposed work qualifies
for an increase in the legal regulated rent.
(8) No increase pursuant to paragraphs (2) and (3) of this
subdivision shall be granted by the DHCR, unless an
application is filed no later than two years after the
completion of the installation or improvement unless
the applicant can demonstrate that the application
could not be made within two years due to delay, beyond
the applicant's control, in obtaining required
governmental approvals for which the applicant has
applied within such two-year period. No increase
pursuant to paragraphs (2) and (3) of this subdivision
shall be granted within the useful life of an
improvement or installation for which an increase was
previously granted except with prior DHCR approval for
required improvements. In addition, an increase
pursuant to paragraphs (2) and (3) shall not be
collectible from a tenant to whom there has been issued
a currently valid senior citizen rent increase
exemption pursuant to section 26-509 of the
Administrative Code of the City of New York, to the
extent such increase causes the legal regulated rent of
the housing accommodation to exceed one third of the
aggregate disposable income of all members of the
household residing in the housing accommodation. The
collection of any increase in the legal regulated rent
for any housing accommodation pursuant to paragraphs
(2) and (3) shall not exceed six percent in any year
from the effective date of the Notice of Eligibility or
of the order granting the increase over the rent set
forth in the schedule of gross rents with
collectibility of any dollar excess above said sum to
be spread forward in similar increments and added to
the legal regulated rent as established or set in
future years. In no event shall more than one six-
percent increase in the legal regulated rent pursuant
to paragraphs (2) and (3) be collected in the same year
for the permanent, prospective rent increase, and no
more than an additional six-percent increase for the
temporary retroactive portion of such rent increase.
(9) An increase for an improvement made pursuant to
paragraphs (2) and (3) of this subdivision shall not be
granted by the DHCR to the extent that, after a plan
for the conversion of a building to cooperative or
condominium ownership is declared effective, such
improvement is paid for out of the cash reserve fund of
the cooperative corporation or condominium association.
Nothing in this paragraph shall prevent an owner from
applying for, and the DHCR from granting, an increase
for such improvement to the extent that the cost
thereof is otherwise paid for by an owner.
(10) The DHCR shall not grant an application pursuant to
this subdivision for an increase for any improvement
made pursuant to paragraphs (2) and (3) of this
subdivision to the extent that the cost of such
improvement is paid for by an owner with funds received
pursuant to a grant from any governmental agency or
entity. A low interest loan or subsidy shall not be
considered a grant for the purposes of this paragraph.
Nothing in this paragraph shall prevent an owner from
applying for, and the DHCR from granting, an increase
for such improvement to the extent that the cost
thereof is otherwise paid for by an owner.
(11) An owner who is entitled to a rent increase based upon
the installation of new equipment, or new furniture or
furnishings pursuant to paragraph (1) of this
subdivision 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.
(12) Rent adjustments pursuant to paragraphs (2) and (3) of
this subdivision and subdivisions (b) and (c) of this
section shall be allocated as follows: The DHCR shall
determine the dollar amount of the monthly rent
adjustment. Such dollar amount shall be divided by the
total number of rooms in the building. The amount so
derived shall then be added to the rent chargeable to
each housing accommodation in accordance with the
number of rooms contained in such housing
accommodation.
(13) The DHCR shall not grant an owner's application for a
rental adjustment pursuant to this subdivision, in
whole or in part, if it is determined by the DHCR prior
to the granting of approval to collect such adjustment
that the owner is not maintaining all required
services, or that there are current immediately
hazardous violations of any municipal, county, State or
Federal law which relate to the maintenance of such
services. However, as determined by the DHCR, such
application may be granted upon condition that such
services will be restored within a reasonable time, and
certain tenant-caused violations may be excepted.
(14) In the case of an improvement constituting a moderate
rehabilitation as defined in subdivision 2.1(6) of the
Rules and Regulations Governing Tax Exemption and Tax
Abatement pursuant to title 11 of the Administrative
Code of the City of New York, an owner may elect that
the total cost for such improvement be deemed to be the
amount certified by the Tax Abatement/Tax Exemption
Unit of HPD in the certificate of eligibility issued by
such office with respect to such improvement. Such
election shall be binding on the DHCR and shall waive
any claim for a rent increase by reason of any
difference between the total cash paid by the owner and
such lesser certified amount.
(b) COMPARATIVE HARDSHIP.
(1) An owner may file an application on forms prescribed by
the DHCR, and the DHCR shall grant, on the application
of an owner, appropriate rent adjustments as
hereinafter provided, where the gross rental income is
insufficient to yield to the owner an average annual
net income (which shall be computed without regard to
debt service, financing costs or management fees), for
the three-year period ending on or within six months of
the date of the filing of the owner's application,
equal to the annual average net income of the property
for:
(i) the period 1968-1970; or
(ii) the first three years of operation, if the
building was completed after 1 968; or
(iii) the first three fiscal years after a transfer of
title to a new owner who acquired title to the
building as a result of a bona fide sale of the
entire building, and who has been unable to
obtain requisite records for the fiscal years
between 1968 through 1970, despite diligent
efforts to obtain the same from predecessors in
title, provided that such new owner submits
financial data for not less than six years of
continuous and uninterrupted operation of the
property under his or her ownership.
(2) Notwithstanding anything to the contrary herein, no
increase granted pursuant to this subdivision shall,
when added to the annual gross rents as determined by
the DHCR, exceed the sum of:
(i) the annual operating expenses;
(ii) an allowance for management services as
determined by the DHCR;
(iii) actual annual mortgage debt service (interest
and amortization) on its indebtedness to a
lending institution, an insurance company, a
retirement fund or welfare fund under the
supervision of the banking or insurance laws of
the State of New York or the United States; and
(iv) 8 1/2 percent of that portion of the fair
market value of the property which exceeds the
unpaid principal amount of the mortgage
indebtedness referred to in subparagraph (iii)
of this paragraph. Fair market value for this
subparagraph shall be six times the annual gross
rent.
(3) Restrictions.
(i) The collection of any increase in the legal
regulated rent for any housing accommodation
pursuant to this subdivision shall not exceed
six percent in any year from the effective date
of the order granting the increase over the rent
set forth in the schedule of gross rents, with
collectibility of any dollar excess above said
sum to be spread forward in simila rents for similar or comparable housing
accommodations subject to this Code in the
building during the test year;
(vii) each owner who files an application for a
hardship rent increase shall be required to
maintain all records as submitted with the
subject application, and further be required to
retain same for a period of three years after
the effective date of the order;
(viii)each application under this subdivision shall be
certified by the owner or his or her duly
authorized agent as to its accuracy and
compliance with this subdivision, under the
penalty of perjury;
(ix) the annual gross rent income collectible for the
test year does not exceed the annual operating
expenses of such building by a sum equal to at
least five percent of such annual gross rental
income collectible;
(x) the owner or a related entity owned by the same
principals acquired the building at least 36
months prior to the date of application. A
cooperative corporation or the board of managers
of a condominium association shall not be
considered the owner of the building, nor are
individual shareholders or unit owners building
owners for the purpose of eligibility for the
alternative hardship, and as such are not
permitted to file alternative hardship
applications:
(xi) the owner's equity in the building exceeds five
percent of the sum of:
(a) the arm's-length purchase price of the
property;
(b) the cost of any capital improvements for
which the owner has not collected an increase
in rent pursuant to paragraph (a)(2) of this
section;
(c) any repayment of principal of any mortgage or
loan used to finance the purchase of the
property or any capital improvements for
which the owner has not obtained an
adjustment in rent pursuant to paragraph
(a)(2) of this section; and
(d) any increase in the equalized assessed value
of the property which occurred subsequent to
the first valuation of the property after
purchase by the owner; and
(xii) the maximum amount of hardship increase to which
an owner shall be entitled shall be the
difference between the threshold income and the
annual gross rent income collectible for the
test year.
(3) RIGHT OF TENANT TO CANCEL LEASE WHERE RENT INCREASE
BASED UPON HARDSHIP IS GRANTED. In the event that an
order is issued increasing the legal regulated rent
because of owner hardship, the tenant may within 30
days of his or her receipt of a copy of the DHCR order,
cancel his or her lease on 60 days' written notice to
the owner. Until such tenant vacates, he or she
continues in occupancy at the approved increase in
rent.
(d) An owner may file an application to decrease required
services for a reduction of the legal regulated rent on
forms prescribed by the DHCR on the grounds that:
(1) the owner and tenant, by mutual voluntary written
agreement, consent to a decrease in dwelling space, or
a decrease in the services, furniture, furnishings or
equipment provided in the housing accommodation; or
(2) such decrease is required for the operation of the
building in accordance with the specific requirements
of law; or
(3) such decrease is not inconsistent with the RSL or this
Code.
No such reduction in rent or decrease in services shall take
place prior to the approval by the DHCR of the owner's
application, except that a service decrease pursuant to
paragraph (2) of this subdivision may take place prior to
such approval.
(e) An owner may file an application to modify or substitute
required services, at no change in the legal regulated rent,
on forms prescribed by the DHCR on the grounds that:
(1) the owner and tenant, by mutual voluntary written
agreement, consent to a modification or substitution of
the required services provided in the housing
accommodation;
(2) such modification or substitution is required for the
operation of the building in accordance with the
specific requirements of law; or
(3) such modification or substitution is not inconsistent
with the RSL or this Code.
No such modification or substitution of required
services shall take place prior to the approval of the
owner's application by the DHCR, except that a service
modification or substitution pursuant to paragraph (2)
of this subdivision may take place prior to such
approval.
(f) Pursuant to section 452(7) of the PHFL, as an alternative to
the rental adjustments for which an owner may file an
application under subdivision (a) of this section, upon the
completion of the rehabilitation of a multiple dwelling
which is aided by a loan made pursuant to article VIII-A of
the PHFL, HPD may adjust the rent for each housing
accommodation within the multiple dwelling pursuant to such
law.
Any work required pursuant to or as a condition of an
article VIII-A loan for which a rent adjustment is granted
under section 452(7) of the PHFL is not eligible for an
increase pursuant to paragraph (a)(2) or (3) of this
section.
Sec. 2522.5. LEASE AGREEMENTS.
(a) VACANCY LEASE OR RENTAL.
(1) For housing accommodations other than hotels, upon the
renting of a vacant housing accommodation, the owner
shall provide to the tenant a copy of the fully
executed lease for a one- or two-year term, at the
tenant's option (except where a mortgage or mortgage
commitment existing as of April 1, 1969 prohibits the
granting of one-year lease terms), bearing the
signature of the owner and tenant and the beginning and
ending dates of the lease term, within 30 days from the
owner's receipt of the vacancy lease signed by the
tenant. Such lease shall conform to the intent of
section 5-702 of the General Obligations Law (plain
English). The rent provided therein may not exceed the
last legal regulated rent in addition to all increases
authorized by this Code. For a housing accommodation
subject to the City Rent Law which becomes vacant after
March 31, 1984, the owner may not increase the rent
charged in the initial lease or other rental agreement
pursuant to annual guidelines for a period of one year
or until the expiration date of the initial lease or
rental agreement, whichever is later.
(2) For housing accommodations in hotels rented to an
occupant who has never had a lease, such occupant may
at any time during his or her occupancy request a lease
and the owner must, within 15 days after such request,
grant a lease commencing on the date such request was
made at a rent which does not exceed the legal
regulated rent, for a term of at least six months. The
hotel occupant who requests such a lease becomes a
permanent tenant but the lease need not be renewed.
Notwithstanding the above, an owner shall not refuse to
grant a lease or to extend or continue a tenancy in
order to prevent the hotel occupant from becoming a
permanent tenant, except to the extent that the owner
may be permitted to do so by law pursuant to a warrant
of eviction, or other order of a court of competent
jurisdiction, or a governmental vacate order.
(3) In addition, where a hotel occupant has not requested a
lease, an owner shall not refuse to extend or continue
a tenancy solely in order to prevent the hotel occupant
from becoming a permanent tenant.
(b) RENEWAL LEASE
(1) For housing accommodations other than hotels, upon such
notice as is required by section 2523.5 of this Title,
the tenant shall have the right of selecting at his or
her option a renewal of his or her lease for a one- or
two-year term; except that where a mortgage or a
mortgage commitment existing as of April 1, 1969
prohibits the granting of one-year lease terms or the
tenant is the recipient of a Senior Citizen Rent
Increase Exemption pursuant to section 26-509 of the
Administrative Code of the City of New York, the tenant
may not select a one-year lease. The owner shall
furnish to the tenant signing a renewal lease form,
pursuant to section 2523.5 of this Title, a copy of the
fully executed renewal lease form, bearing the
signatures of the owner and tenant, and the beginning
and ending dates of the lease term, within 30 days from
the owner's receipt of the renewal lease form signed by
the tenant. Such renewal lease form shall conform to
the intent of section 5-702 of the General Obligations
Law.
(2) Upon complaint by the tenant that he or she was not
served with a copy of the fully executed vacancy lease
or renewal lease form pursuant to paragraph (1) of
subdivision (a) or paragraph (1) of this subdivision,
the DHCR shall order the owner to furnish the copy of
the vacancy lease or renewal lease form. In addition to
any other penalties provided under this Code,
noncompliance by the owner within 20 days of such order
shall result in the denial of any rent guideline
increases for vacancy or renewal leases until the fully
executed copy of the vacancy lease or renewal lease
form is furnished by the owner to the tenant.
(c) LEASE RIDER AND NOTICE OF RIGHTS.
(1) For housing accommodations subject to this Code, an
owner shall furnish to each tenant signing a vacancy or
renewal lease, a rider in a form promulgated or
approved by the DHCR, in larger type than the lease,
describing the rights and duties of owners and tenants
as provided for under the RSL. Such rider shall conform
to the plain English requirements of section 5-702 of
the General Obligations Law, shall also be available in
Spanish, and shall be attached as an addendum to the
lease. Upon the face of each lease, in bold print,
shall appear the following: "ATTACHED RIDER SETS FORTH
RIGHTS AND OBLIGATIONS OF TENANTS AND LANDLORDS UNDER
THE RENT STABILIZATION LAW." ("LOS DERECHOS Y
RESPONSABILIDADES DE INQUILINOS Y CASEROS ESTAN
DISPONIBLE EN ESPANOL").
(i) For vacancy leases, such rider shall in addition
also include a notice of the prior legal regulated
rent, if any, which was in effect immediately
prior to the vacancy, an explanation of how the
rental amount provided for in the vacancy lease
has been computed above the amount shown in the
most recent annual registration statement, and a
statement that any increase above the amount set
forth in such registration statement is in
accordance with the adjustments permitted by the
Rent Guidelines Board and this Code.
(ii) For renewal leases, such rider shall be attached
to the form sent to the tenant pursuant to section
2523.5 of this Title.
(2) For housing accommodations in hotels, each owner shall
furnish to each person, at the time of registration, a
Notice of Rights in a form promulgated or approved by
the DHCR, describing the rights and duties of hotel
owners, occupants and tenants as provided for under the
RSL and this Code and a hotel occupant's right to
become a permanent tenant at a legal regulated rent by
requesting a lease for a term of at least six months at
any time during his or her occupancy. Such notice,
which shall conform to the "plain English" requirements
of section 5-702 of the General Obligations Law, shall
also be available in Spanish. Such notice shall be
provided to each hotel occupant in residence on the
effective date of this Code no later than 90 days from
such effective date. An owner who violates the RSL and
this Code by failing to furnish this Notice of Rights,
and/or by engaging in any conduct which compels a
person to rent as a hotel occupant, prevents a hotel
occupant from becoming a permanent tenant, or results
in a hotel occupant vacating a housing accommodation,
shall be subject to a loss of a guidelines adjustment
pursuant to paragraph (3) of this subdivision as well
as penalties pursuant to section 2526.2(b) and (c)(1)
of this Title, and may be subject to a penalty pursuant
to section 2526.2(c)(2) of this Title, in an amount no
less than $1,000.
(3) Upon complaint by the tenant, permanent tenant or hotel
occupant that he or she was not furnished with a copy
of the lease rider pursuant to paragraph (1) or the
notice pursuant to paragraph (2) of this subdivision,
the DHCR shall order the owner to furnish the rider or
notice. In addition to such other penalties provided
for pursuant to section 2526.2 of this Title, if the
owner fails to comply within 20 days of such order, the
owner shall not be entitled to collect any guidelines
lease adjustment authorized for any current lease from
the commencement date of such lease. The furnishing of
the rider or notice by the owner to the tenant or hotel
occupant shall result in the elimination,
prospectively, of such penalty. With respect to housing
accommodations in hotels, noncompliance by the owner
shall not prevent the hotel occupant from becoming a
permanent tenant.
(d) LIMITATIONS.
No provision may be made in any vacancy or renewal lease for
adjustment of the legal regulated rent reserved in the lease
except as follows:
(1) if the applicable rent guidelines rate has not been
fixed by the execution date of the vacancy lease or the
renewal offer, the lease may make provision for the
rent increase, if any, pursuant to the said rate when
filed, to become effective as of the commencement date
of the lease term, unless the Rent Guidelines Board
shall have fixed a later effective date for the said
rate, in which event the adjustment may only be
effective as of the later date;
(2) where such lease provides that the rental reserved
therein may be increased pursuant to an order issued by
the DHCR; or
(3) where such lease provides that a rent increase shall be
in the amount, if any, authorized by the DHCR in the
rents for similar or comparable housing
accommodations subject to this Code in the
building during the test year;
(vii) each owner who files an application for a
hardship rent increase shall be required to
maintain all records as submitted with the
subject application, and further be required to
retain same for a period of three years after
the effective date of the order;
(viii)each application under this subdivision shall be
certified by the owner or his or her duly
authorized agent as to its accuracy and
compliance with this subdivision, under the
penalty of perjury;
(ix) the annual gross rent income collectible for the
test year does not exceed the annual operating
expenses of such building by a sum equal to at
least five percent of such annual gross rental
income collectible;
(x) the owner or a related entity owned by the same
principals acquired the building at least 36
months prior to the date of application. A
cooperative corporation or the board of managers
of a condominium association shall not be
considered the owner of the building, nor are
individual shareholders or unit owners building
owners for the purpose of eligibility for the
alternative hardship, and as such are not
permitted to file alternative hardship
applications:
(xi) the owner's equity in the building exceeds five
percent of the sum of:
(a) the arm's-length purchase price of the
property;
(b) the cost of any capital improvements for
which the owner has not collected an increase
in rent pursuant to paragraph (a)(2) of this
section;
(c) any repayment of principal of any mortgage or
loan used to finance the purchase of the
property or any capital improvements for
which the owner has not obtained an
adjustment in rent pursuant to paragraph
(a)(2) of this section; and
(d) any increase in the equalized assessed value
of the property which occurred subsequent to
the first valuation of the property after
purchase by the owner; and
(xii) the maximum amount of hardship increase to which
an owner shall be entitled shall be the
difference between the threshold income and the
annual gross rent income collectible for the
test year.
(3) RIGHT OF TENANT TO CANCEL LEASE WHERE RENT INCREASE
BASED UPON HARDSHIP IS GRANTED. In the event that an
order is issued increasing the legal regulated rent
because of owner hardship, the tenant may within 30
days of his or her receipt of a copy of the DHCR order,
cancel his or her lease on 60 days' written notice to
the owner. Until such tenant vacates, he or she
continues in occupancy at the approved increase in
rent.
(d) An owner may file an application to decrease required
services for a reduction of the legal regulated rent on
forms prescribed by the DHCR on the grounds that:
(1) the owner and tenant, by mutual voluntary written
agreement, consent to a decrease in dwelling space, or
a decrease in the services, furniture, furnishings or
equipment provided in the housing accommodation; or
(2) such decrease is required for the operation of the
building in accordance with the specific requirements
of law; or
(3) such decrease is not inconsistent with the RSL or this
Code.
No such reduction in rent or decrease in services shall take
place prior to the approval by the DHCR of the owner's
application, except that a service decrease pursuant to
paragraph (2) of this subdivision may take place prior to
such approval.
(e) An owner may file an application to modify or substitute
required services, at no change in the legal regulated rent,
on forms prescribed by the DHCR on the grounds that:
(1) the owner and tenant, by mutual voluntary written
agreement, consent to a modification or substitution of
the required services provided in the housing
accommodation;
(2) such modification or substitution is required for the
operation of the building in accordance with the
specific requirements of law; or
(3) such modification or substitution is not inconsistent
with the RSL or this Code.
No such modification or substitution of required
services shall take place prior to the approval of the
owner's application by the DHCR, except that a service
modification or substitution pursuant to paragraph (2)
of this subdivision may take place prior to such
approval.
(f) Pursuant to section 452(7) of the PHFL, as an alternative to
the rental adjustments for which an owner may file an
application under subdivision (a) of this section, upon the
completion of the rehabilitation of a multiple dwelling
which is aided by a loan made pursuant to article VIII-A of
the PHFL, HPD may adjust the rent for each housing
accommodation within the multiple dwelling pursuant to such
law.
Any work required pursuant to or as a condition of an
article VIII-A loan for which a rent adjustment is granted
under section 452(7) of the PHFL is not eligible for an
increase pursuant to paragraph (a)(2) or (3) of this
section.
Sec. 2522.5. LEASE AGREEMENTS.
(a) VACANCY LEASE OR RENTAL.
(1) For housing accommodations other than hotels, upon the
renting of a vacant housing accommodation, the owner
shall provide to the tenant a copy of the fully
executed lease for a one- or two-year term, at the
tenant's option (except where a mortgage or mortgage
commitment existing as of April 1, 1969 prohibits the
granting of one-year lease terms), bearing the
signature of the owner and tenant and the beginning and
ending dates of the lease term, within 30 days from the
owner's receipt of the vacancy lease signed by the
tenant. Such lease shall conform to the intent of
section 5-702 of the General Obligations Law (plain
English). The rent provided therein may not exceed the
last legal regulated rent in addition to all increases
authorized by this Code. For a housing accommodation
subject to the City Rent Law which becomes vacant after
March 31, 1984, the owner may not increase the rent
charged in the initial lease or other rental agreement
pursuant to annual guidelines for a period of one year
or until the expiration date of the initial lease or
rental agreement, whichever is later.
(2) For housing accommodations in hotels rented to an
occupant who has never had a lease, such occupant may
at any time during his or her occupancy request a lease
and the owner must, within 15 days after such request,
grant a lease commencing on the date such request was
made at a rent which does not exceed the legal
regulated rent, for a term of at least six months. The
hotel occupant who requests such a lease becomes a
permanent tenant but the lease need not be renewed.
Notwithstanding the above, an owner shall not refuse to
grant a lease or to extend or continue a tenancy in
order to prevent the hotel occupant from becoming a
permanent tenant, except to the extent that the owner
may be permitted to do so by law pursuant to a warrant
of eviction, or other order of a court of competent
jurisdiction, or a governmental vacate order.
(3) In addition, where a hotel occupant has not requested a
lease, an owner shall not refuse to extend or continue
a tenancy solely in order to prevent the hotel occupant
from becoming a permanent tenant.
(b) RENEWAL LEASE
(1) For housing accommodations other than hotels, upon such
notice as is required by section 2523.5 of this Title,
the tenant shall have the right of selecting at his or
her option a renewal of his or her lease for a one- or
two-year term; except that where a mortgage or a
mortgage commitment existing as of April 1, 1969
prohibits the granting of one-year lease terms or the
tenant is the recipient of a Senior Citizen Rent
Increase Exemption pursuant to section 26-509 of the
Administrative Code of the City of New York, the tenant
may not select a one-year lease. The owner shall
furnish to the tenant signing a renewal lease form,
pursuant to section 2523.5 of this Title, a copy of the
fully executed renewal lease form, bearing the
signatures of the owner and tenant, and the beginning
and ending dates of the lease term, within 30 days from
the owner's receipt of the renewal lease form signed by
the tenant. Such renewal lease form shall conform to
the intent of section 5-702 of the General Obligations
Law.
(2) Upon complaint by the tenant that he or she was not
served with a copy of the fully executed vacancy lease
or renewal lease form pursuant to paragraph (1) of
subdivision (a) or paragraph (1) of this subdivision,
the DHCR shall order the owner to furnish the copy of
the vacancy lease or renewal lease form. In addition to
any other penalties provided under this Code,
noncompliance by the owner within 20 days of such order
shall result in the denial of any rent guideline
increases for vacancy or renewal leases until the fully
executed copy of the vacancy lease or renewal lease
form is furnished by the owner to the tenant.
(c) LEASE RIDER AND NOTICE OF RIGHTS.
(1) For housing accommodations subject to this Code, an
owner shall furnish to each tenant signing a vacancy or
renewal lease, a rider in a form promulgated or
approved by the DHCR, in larger type than the lease,
describing the rights and duties of owners and tenants
as provided for under the RSL. Such rider shall conform
to the plain English requirements of section 5-702 of
the General Obligations Law, shall also be available in
Spanish, and shall be attached as an addendum to the
lease. Upon the face of each lease, in bold print,
shall appear the following: "ATTACHED RIDER SETS FORTH
RIGHTS AND OBLIGATIONS OF TENANTS AND LANDLORDS UNDER
THE RENT STABILIZATION LAW." ("LOS DERECHOS Y
RESPONSABILIDADES DE INQUILINOS Y CASEROS ESTAN
DISPONIBLE EN ESPANOL").
(i) For vacancy leases, such rider shall in addition
also include a notice of the prior legal regulated
rent, if any, which was in effect immediately
prior to the vacancy, an explanation of how the
rental amount provided for in the vacancy lease
has been computed above the amount shown in the
most recent annual registration statement, and a
statement that any increase above the amount set
forth in such registration statement is in
accordance with the adjustments permitted by the
Rent Guidelines Board and this Code.
(ii) For renewal leases, such rider shall be attached
to the form sent to the tenant pursuant to section
2523.5 of this Title.
(2) For housing accommodations in hotels, each owner shall
furnish to each person, at the time of registration, a
Notice of Rights in a form promulgated or approved by
the DHCR, describing the rights and duties of hotel
owners, occupants and tenants as provided for under the
RSL and this Code and a hotel occupant's right to
become a permanent tenant at a legal regulated rent by
requesting a lease for a term of at least six months at
any time during his or her occupancy. Such notice,
which shall conform to the "plain English" requirements
of section 5-702 of the General Obligations Law, shall
also be available in Spanish. Such notice shall be
provided to each hotel occupant in residence on the
effective date of this Code no later than 90 days from
such effective date. An owner who violates the RSL and
this Code by failing to furnish this Notice of Rights,
and/or by engaging in any conduct which compels a
person to rent as a hotel occupant, prevents a hotel
occupant from becoming a permanent tenant, or results
in a hotel occupant vacating a housing accommodation,
shall be subject to a loss of a guidelines adjustment
pursuant to paragraph (3) of this subdivision as well
as penalties pursuant to section 2526.2(b) and (c)(1)
of this Title, and may be subject to a penalty pursuant
to section 2526.2(c)(2) of this Title, in an amount no
less than $1,000.
(3) Upon complaint by the tenant, permanent tenant or hotel
occupant that he or she was not furnished with a copy
of the lease rider pursuant to paragraph (1) or the
notice pursuant to paragraph (2) of this subdivision,
the DHCR shall order the owner to furnish the rider or
notice. In addition to such other penalties provided
for pursuant to section 2526.2 of this Title, if the
owner fails to comply within 20 days of such order, the
owner shall not be entitled to collect any guidelines
lease adjustment authorized for any current lease from
the commencement date of such lease. The furnishing of
the rider or notice by the owner to the tenant or hotel
occupant shall result in the elimination,
prospectively, of such penalty. With respect to housing
accommodations in hotels, noncompliance by the owner
shall not prevent the hotel occupant from becoming a
permanent tenant.
(d) LIMITATIONS.
No provision may be made in any vacancy or renewal lease for
adjustment of the legal regulated rent reserved in the lease
except as follows:
(1) if the applicable rent guidelines rate has not been
fixed by the execution date of the vacancy lease or the
renewal offer, the lease may make provision for the
rent increase, if any, pursuant to the said rate when
filed, to become effective as of the commencement date
of the lease term, unless the Rent Guidelines Board
shall have fixed a later effective date for the said
rate, in which event the adjustment may only be
effective as of the later date;
(2) where such lease provides that the rental reserved
therein may be increased pursuant to an order issued by
the DHCR; or
(3) where such lease provides that a rent increase shall be
in the amount, if any, authorized by the DHCR in the
event an application is filed to establish a hardship
pursuant to section 2522.4(b) or (c) of this Part; and
(4) in the case of a vacancy lease, where an application
for a rent adjustment pursuant to section 2522.4(a)(2)
or (3), (b) or (c) of this Part is pending before the
DHCR, such lease also recites that such application is
pending before the DHCR and the basis for the
adjustment, and that the increase which is the subject
of such application, if granted, may be effective
during the term of the lease.
(e) ESCALATOR CLAUSES.
(1) Regardless of whether an escalator clause was contained
in the last effective lease or other rental agreement
prior to April 1, 1984, no renewal lease or vacancy
lease commencing on or after April 1, 1984 shall
provide for any escalator clause, except that nothing
herein shall prohibit the use of escalator clauses
otherwise required by any other statute or regulation
affecting the housing accommodation.
(2) For buildings receiving benefits pursuant to section
421-a of the Real Property Tax Law and the regulations
promulgated pursuant thereto, such clauses may provide
for an annual or other periodic rent increase over the
initial rent at an average rate of not more than 2.2
percent of the amount of such initial rent per annum
not to exceed the maximum cumulative amount, if any,
permitted under the 421-a program rules and
regulations. After the tax benefits end, such
additional 2.2 percent charges shall no longer be added
but the owner may continue to collect the cumulative
2.2 percent increases charged prior to the termination
of said tax benefits. Any lease containing the
aforementioned provision shall also include a rider
with an endorsement signed by the tenant acknowledging
the owner's right to include such provision and to
collect such rent increase for the tax benefit period.
Such rider shall state the approximate date of the
expiration of such tax benefits.
(3) Nothing in paragraph (2) of this subdivision shall
prohibit the inclusion of a lease provision for an
annual or other periodic rent increase over the legal
regulated rent at such rate of rental increase as is
provided for and authorized by section 423 of the Real
Property Tax Law. Such additional charges pursuant to
such section 423 shall no longer be added after the tax
benefits end. Any lease containing the aforementioned
provision shall also include a rider with an
endorsement signed by the tenant acknowledging the
owner's right to include such provision and to collect
such rent increase for the tax benefit period. Such
rider shall state the approximate date of the
expiration of such tax benefits.
(4) No additional charge which became effective on or after
November 19, 1982, pursuant to paragraph (2) of this
subdivision, shall become part of the legal regulated
rent.
(f) VACANCY PRIOR TO EXPIRATION OF LEASE TERM.
Where the tenant vacates prior to the expiration of the term of
the lease, and the housing accommodation is rented to a new
tenant pursuant to a lease commencing during the same guidelines
period as the prior lease, the rental provided in the new lease
shall:
(1) be in accordance with and at the guidelines rate of
rent adjustment applicable to the new lease;
(2) shall be computed upon the legal regulated rent charged
and paid on the last day of the immediately preceding
guidelines year; and
(3) may include such other rent increases as are authorized
pursuant to section 2522.4 of this Part.
(g) SAME TERMS AND CONDITIONS.
The lease provided to the tenant by the owner pursuant to
subdivision (b) of this section shall be on the same terms and
conditions as the expired lease, except where the owner can
demonstrate that the change is necessary in order to comply with
a specific requirement of law or regulation applicable to the
building or to leases for housing accommodations subject to the
RSL, or with the approval of the DHCR. Nothing herein may limit
the inclusion of authorized clauses otherwise permitted by this
Code or by order of the DHCR not contained in the expiring lease.
Notwithstanding the foregoing, the tenant shall have the right to
have his or her spouse, whether husband or wife, added to the
lease or any renewal thereof as an additional tenant where said
spouse resides in the housing accommodation as his or her primary
residence.
(h) LEASES FOR HOUSING ACCOMMODATIONS IN COOPERATIVE - OR
CONDOMINIUM-OWNED BUILDINGS, OR IN A BUILDING FOR WHICH THE
ATTORNEY GENERAL HAS ACCEPTED FOR FILING A PLAN TO CONVERT
THE BUILDING TO COOPERATIVE OR CONDOMINIUM OWNERSHIP.
(1) An owner of one or more housing accommodations subject
to this Code may evict the tenant of such housing
accommodation and/or refuse to renew a lease therefor,
if such housing accommodation is in a building, group
of buildings or development which is the subject of an
Eviction Plan for conversion to cooperative or
condominium ownership under General Business Law,
section 352-eeee (hereinafter "section 352-eeee"),
provided:
(i) the Attorney General has accepted for filing a
plan to convert the building, group of buildings
or development to cooperative or condominium
ownership and an amendment declaring the plan
effective as an Eviction Plan has been accepted
for filing and a closing has been held thereunder;
and
(ii) three years have elapsed from the date on which
the Attorney General has accepted for filing an
amendment declaring the plan effective as an
Eviction Plan, and at such time or thereafter the
tenant's lease has expired or has been canceled
pursuant to paragraph (2) of this subdivision.
(2) Until the conditions set forth in paragraph (1) of this
subdivision have been met, a tenant in occupancy of a
housing accommodation subject to this Code shall have
the right to a renewal lease or in the case of a
permanent tenant, to continue his or her tenancy on the
terms and conditions and at the rent and adjustments
thereto as otherwise provided for in this Code.
Notwithstanding the foregoing, any vacancy or renewal
lease, entered into after the plan is accepted for
filing by the Attorney General and such plan has been
presented to the tenants in occupancy, may contain a
provision authorizing the owner to cancel the lease as
of a date not less than three years after the date an
Eviction Plan has been declared effective (providing
that title has passed to the cooperative corporation or
condominium unit owners) on 90 days' notice to the
tenant. In order to cancel a lease pursuant to such
provision, the owner must give the tenant written
notice of such election by certified mail no less than
90 days prior to the date upon which the cancellation
is to become effective.
(3) For the purposes of this section, "filing date" shall
mean the date on which a letter was issued by the
Attorney General accepting a plan for filing.
(4) After the filing date, and prior to the plan being
declared effective, if a housing accommodation subject
to this Code is vacated, such housing accommodation may
only be rented at a rent and upon such terms and
conditions as are authorized under this Code for a
vacancy lease. Notwithstanding the foregoing, if a
vacancy lease herein called an interim lease for such
housing accommodation is executed in connection with an
agreement to purchase such housing accommodation or the
shares allocated thereto, pursuant to any Eviction Plan
or Non- Eviction Plan, as defined by section 352-eeee,
such interim lease:
(i) may provide that once the plan has been declared
effective, if the tenant fails to purchase his or
her housing accommodation or the shares allocated
thereto on the terms set forth in the subscription
or purchase agreement, or otherwise terminates or
defaults on the subscription or purchase
agreement, such tenant may be evicted; and
(ii) may provide for a rental below the legal regulated
rent which may, upon the abandonment or withdrawal
of the plan, be increased to the legal regulated
rent, provided the interim lease or other
agreement clearly notifies the tenant of what that
higher rental will be; If the plan is abandoned or
withdrawn, such
(5) If a housing accommodation which was subject to this
Code is vacated or is rented to a new tenant after any
plan which affects such housing accommodation has been
declared effective, and a closing thereunder has
occurred, such housing accommodation shall not be
subject to this Code.
(6) If a building, group of buildings or development
containing units to which this Code applies is
converted to cooperative or condominium ownership,
whether or not such conversion is pursuant to an
Eviction Plan or a Non- Eviction Plan as defined by
section 352-eeee, the services which shall be required
to be maintained under this Code with respect to
housing accommodations which remain subject to this
Code shall not be diminished or modified without the
approval of the DHCR as provided for in section
2522.4(d) or (e) of this Part.
(7) The provisions of paragraph (h)(1) of this section, and
the right to include a cancellation clause as provided
by paragraph (h)(2), shall not apply to a housing
accommodation of which the tenant is a senior citizen
or disabled person on the filing date. Until such time
as the appropriate agency determines that such tenant
is not eligible for such status, such tenant shall
continue to be subject to the provisions of this Code.
Sec. 2522.6. ORDERS WHERE THE LEGAL REGULATED RENT OR OTHER FACTS
ARE IN DISPUTE, IN DOUBT, OR NOT KNOWN, OR WHERE THE
LEGAL REGULATED RENT MUST BE FIXED.
(a) Where the legal regulated rent or any fact necessary to the
determination of the legal regulated rent, or the dwelling
space, required services or equipment required to be
provided with the housing accommodation is in dispute
between the owner and the tenant, or is in doubt, or is not
known, the DHCR at any time upon written request of either
party, or on its own initiative, may issue an order in
accordance with the applicable provisions of this Code
determining the facts, including the legal regulated rent,
the dwelling space, required services, and equipment
required to be provided with the housing accommodations.
(b) Such order shall determine such facts or establish the legal
regulated rent in accordance with section 2521.2 of this
Title. Where such order establishes the legal regulated
rent, it shall contain a directive that all rent collected
by the owner in excess of the legal regulated rent
established under this section for such period as is
provided in section 2526.1(a) of this Title, or the date of
the commencement of the tenancy, if later, either be
refunded to the tenant, or be enforced in the same manner as
prescribed in section 2526.1(e) and (f) of this Title.
Orders issued pursuant to this section shall be based upon
the law and Code provisions in effect on March 31, 1984, if
the complaint was filed prior to April 1, 1984. However, in
the absence of collusion or any relationship between an
owner and any prior owner, where such owner purchases the
housing accommodations upon a judicial sale and no records
sufficient to establish the legal regulated rent were made
available to such purchaser, such orders shall establish the
legal regulated rent with due consideration of equities
pursuant to section 2522.7 of this Part.
Sec. 2522.7. CONSIDERATION OF EQUITIES.
In issuing any order adjusting or establishing any legal
regulated rent, or in determining any applications by tenants
pursuant to section 2523.5(f) of this Title, or in determining
when a higher or lower legal regulated rent shall be charged
pursuant to an agreement between the DHCR and governmental
agencies or public benefit corporations, the DHCR shall take into
consideration all factors bearing upon the equities involved,
subject to the general limitation that such adjustment,
establishment or determination can be put into effect with due
regard for protecting tenants and the public interest against
unreasonably high rent increases inconsistent with the purposes
of the RSL, for preventing imposition upon the industry of any
industry-wide schedule of rents or minimum rents, and for
preserving the regulated rental housing stock.