Articles

The Rent Stabilization Code and New York City Housing Court are anti-green.

In Uncategorized on June 2, 2011 by bleakhouses

The first blast of summer heat brought to mind this topic I have been thinking about  for some time.  I think that Mike Bloomberg, the “green” initiative Mayor, oversees a system that is anti-green and guilty of incentivizing the waste of massive amounts of electricity.

Is this controversial?  I don’t think so.  Tell me what you think.

In many rent stabilized apartments in New York tenant’s are entitled to install air-conditioners and the landlord is allowed to collect an additional fee per unit from the tenant.

The fee is set by the Division of Housing and Community Renewal on an annual basis and is disclosed to the public in a policy statement:

For rent controlled and rent stabilized apartments, where the rent includes the use of electricity, an owner may charge a tenant a surcharge for the use of electricity for each air conditioner that has been installed.

On October 1st of each year after the air conditioner has been installed the surcharge will be adjusted upward or downward for rent stabilized and rent controlled apartments with electricity included in the rent. Each annual adjustment of this electrical surcharge will be based on the increase or decrease in electrical cost stated in the Price Index of Operating Costs for Rent Stabilized Apartment Houses in New York City. The Price Index is prepared by the New York City Rent Guidelines Board, or an independent company chosen by the Board. This annual adjustment applies to air conditioners installed after October 1, 1985. If an owner collected a rent increase for the electricity consumed by an air conditioner installed in a rent stabilized apartment before October 1, 1985, that rent increase remains in effect and is not affected by this annual adjustment, because that rent increase is already part of the rent and subject to guidelines increases applicable to rent stabilized leases.

This passes an obligation to the owner to audit the building annually at the start of summer to ascertain which tenants to bill.  Recently, this issue has become frustrating as well because of the decreasing cost of portable non-window air conditioning units….which for the first time are considered in the policy statement and EXCLUDED from the charge!

The landlord may then bill the tenant, the monthly charge established by the DHCR, for the air conditioner.

It is at this point when things go anti-green.

If a tenant fails to pay for the air conditioning charge the Courts have determined that the landlord is not able to bring a non-payment proceeding to evict the tenant because the air conditioning charge is not rent.  The Court’s apply the rationale that the air conditioner charge is an additional charge similar to a late-fee or a legal-fee and thus cannot support an eviction proceeding.

This is despite the fact that the DHCR itself has determined that the charge is a “permissible charge” and not a fee.

The most recent DHCR policy statement can be viewed here:

http://www.dhcr.state.ny.us/Rent/OperationalBulletins/orao844_25.pdf

In practice I have observed this to result in great abuse by many tenants.  The Housing Court dismisses the claim for air conditioning permissible charges, or that part of an otherwise “proper” case, that seek air conditioning charges.  This puts the landlord in the unenviable economic position of having to commence a lawsuit in the more expensive and time consuming Civil Court, or small claims court (recently subject to massive budget cuts and already overburdened), for about $300.00.

Practicality usually dictates that the landlord wait a few years until it makes economic sense to prosecute the claim.

However, once this happens the DHCR has also determined (see the above link) that the landlord waives its right to collect the charge FOREVER!

Even those landlords that prosecute to judgment, in any Court, their claim for air conditioning charges find the collection of such judgments very frustrating.  This is made even more frustrating when the following year the air conditioners show back up in the windows of the judgment debtor and the bills go ignored again.

What results from all of this is the unrestrained consumption of electricity.  With nothing to disincentive the tenants from running the air conditioners all day and night they do just that.  Park your car this August in front of a building with rent stabilized apartments and just listen to the air conditioners run all day and night.  Can you imagine your electric bill if you did that!

Its hard to ignore this issue.   You can’t scapegoat the landlords on this one.  The excessive consumption of electricity hurts us all and The Housing Court, Rent Stabilization Code and DHCR promote it.  Even if you don’t worry about climate change, you have to agree that there is an economic to everyone.

Our “green” Mayor has done nothing about this our “green” City makes this happen every day.

Why?  I have my theories.  Drop me a line if you want to discuss this further.

 

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