DHCR to Amend Rent Codes
by William Rowen

The state Division of Housing and Community Renewal, has announced its intent to rewrite the state’s Rent Stabilization Code as well as the other rent codes affecting rent-controlled tenants and tenants outside New York City. The current Rent Stabilization Code has been in effect without change since May 1987.

In its announcement, published in June, DHCR only listed the provisions that would be changed, not the actual language of the changes they intend to propose. The actual text of proposed amendments must be published later.

The Pataki administration’s decision to amend the 1987 code reflects both DHCR’s understandable difficulty in working with an outdated code and an opportunity to change it to favor landlords. Since Pataki became governor in 1995, he has appointed a string of landlord advocates to run the agency, and they have instituted scores of policy changes that have eviscerated tenant protections. Overt tenant supporters within the agency have been either removed or demoted.

It is generally agreed by landlord and tenant advocates that both the 1993 and 1997 rent laws, cobbled together in a few days by Albany leaders under great political pressure, contain language that is very poorly drafted and uncertain in its meaning. So the administrative codes are important because they determine how state agencies actually implement those laws. For the Pataki administration, rewriting the code means they can go further to curtail tenants’ rights.

A prime example of how the current code rewrite could implement anti-tenant policy is in the broad-stroke approach DHCR has taken with the change in the four-year statute of limitations on challenges to rent overcharges in the Rent Regulation Reform Act of 1997.

That law prohibited DHCR from looking back at rents from more than four years prior to the filing of a tenant’s overcharge complaint. Before the 1997 change, DHCR had to look at the rent registered by the landlord four years prior to the tenant’s filing. The 1997 law does not care if the four-year-old rent was registered or not.

Since 1997, DHCR has extended the new four-year rule to MCIs, individual apartment improve- ments, Fair Market Rent Appeals, and other areas. These “policy discretions” can be tied down by new code language which does not now exist.

The courts have sometimes rejected DHCR’s interpretations of the 1993 and 1997 laws. However, the courts could find less to disagree with if a new code removed old protective provisions and language, or added new restrictions against tenants. It is a rule of the courts in appeals taken against DHCR decisions that, absent irrationality, the courts will not substitute its opinion for DHCR’s.

Because code amendments, by law, are subject to public hearings, DHCR has historically—under both Pataki and previous Democratic governors—been reluctant to expose itself to hearings that would allow disgruntled tenants and landlords alike a forum to criticize the government’s handling of the rent laws.

But despite the political risks, Pataki and DHCR now seem willing and able, after years of success in whittling away at the rent laws, to brave the hazards of public hearings on code changes.