New York State
Division of Housing and Community Renewal
Office of Rent Administration
Gertz Plaza, 92-31 Union Hall St.
Jamaica, New York 11433
Public Information: (718)739-6400
POLICY STATEMENT 89-8
ASBESTOS REMOVAL AS A MAJOR
CAPITAL IMPROVEMENT - ELIGIBLE COSTS
This policy statement is being issued to clarify the rules of the
Major Capital Improvement (MCI) program as they relate to the
costs of asbestos removal.
According to section 2522.4(2)(i)(a)(b)(c) of the Rent
Stabilization Code, "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:
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; and
b) is for the operation, preservation, and maintenance
of the structure; and
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;"
According to a spokesman for the Internal Revenue Service,
asbestos removal is not regarded as depreciable under the IRS
code and is treated as an expense item. This rule is in the
process of being reviewed for possible amendment to make asbestos
removal depreciable. Under the rules of the New York City
Department of Environmental Protection, (DEP), asbestos must be
removed, a) when making an installation or rehabilitating a
building which may disturb the otherwise concealed asbestos or b)
any time it is exposed and poses a health danger.
Section 2522.4 of the RSC clearly defines the criteria which
asbestos removal has to meet in order to be considered as a MCI.
According to the IRS, asbestos removal is not considered
depreciable at the present time. DEP has also stated that the
only time asbestos has to be removed (with the exception of when
it already poses a health hazard) is when the asbestos is
disturbed by demolition or installation of new equipment in a
Therefore the costs of asbestos removal will be allowed as part
of a MCI only when it is connected with, and directly related to,
other improvements or replacements which are MCI eligible.
August 7, 1989
Elliot G. Sander
DHCR Policy Statements are **promulgated** (i.e., officially
issued) by the New York State Division of Housing and Community
Renewal (DHCR) and represent **official** policy of the agency.
The agency is generally obligated to follow the policy contained
in these and other documents or provide a rational for deviation;
failure to follow the law, policy or practice may form the basis
for an appeal. Electronic versions of the documents on TenantNet
are for informational purposes only and there is no guarantee
they will be accepted by any court (or even DHCR) as true copies
of DHCR policy. The reader is advised to obtain true copies of
these documents from DHCR. Also see DHCR Advisory Opinions,
DHCR Operational Bulletins, the Rent Stabilization Code, the Rent
Stabilization Law and various Rent Control Statutes.
Every attempt has been made to conform to the original Policy
Statements as issued by DHCR; TenantNet makes no
representation the enclosed material is current or will be
applied as written. The reader is advised that DHCR often fails
to properly apply, interpret or enforce housing laws. Since
housing laws are complex and often contradictory, it is
recommended the reader obtain competent legal advice from a
tenant attorney or counseling from a tenant association or
community group. (rev. 3/13/96) DHCR documents
are public documents; the electronic version of such documents
have been developed by TenantNet and any added value, enhancements
and/or proprietary features are copyright 1994, 1995 and 1996 by
TenantNet. These documents may be freely distributed provided they
remain intact as herein presented, including this and the top
informational banner referencing TenantNet as the original provider.
For more information or assistance. call the DHCR Rent Infoline
at (718) 739-6400, or visit your Borough Rent Office.
Queens Central Office
92-31 Union Hall St. 4th Fl.
Jamaica, NY 11433
One Fordham Plaza
Bronx, NY 10458
250 Schermerhorn St.
Brooklyn, NY 11201
156 William Street
NY, NY 10038
(212) 240-6011, 6012
South side of 110th St. and below
163 W. 125th St.
NY, NY 10027
North side of 110th St. and above
350 St. Mark's Place
Staten island, NY 10301
Nassau County District Rent Office
50 Clinton Street, 6th Floor
Hempstead, NY 11550
Westchester County District Rent Office
55 Church Street, 3rd Floor
White Plains, NY 10601
Rockland County District Rent Office
94-96 North Main St.
Spring Valley, NY 10977
Albany Regional Office
119 Washington Avenue
Albany, NY 12210
Buffalo Regional Office
Ellicot Square Building
295 Main St., Room 438
Buffalo, NY 14203