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 89-9 SPONSOR REPRESENTATIONS, IN COOPERATIVE OR CONDOMINIUM OFFERINGS, TO BEAR COST OF MCIs: EFFECT ON ENTITLEMENT TO MCI INCREASES The Rent Stabilization Code Section 2522.4(a)(9) states that DHCR shall not grant a Major Capital Improvement (MCI) application, to the extent that, after a plan for the conversion of a building to a cooperative or condominium ownership is declared effective, such improvement is paid for out of the cash reserve fund of the cooperative conversion or condominium association. Nothing in this paragraph (9) 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. The DHCR has several MCI applications from sponsors of converted buildings in which the offering plan states that an improvement or improvements will be made at the sponsor's sole expense" or cost and expense". The agency has received correspondence from the State of New York Department of Law stating, This representation can only be interpreted to mean that no non-purchasing tenant would bear any responsibility" for the improvement. The Department of Law regards the owner who makes a statement such as this in an offering plan as ineligible to recover the cost of the subject improvement in an MCI increase After reviewing the applications along with the offering plans, the Division of Housing and Community Renewal concurs with the Department of Law's interpretation of the phrase sole cost and expense . Any MCI application for a cooperative or condominium converted building, where the offering plan includes this (or similar) language without additional exclusionary language relating to an MCI application, will be denied to the extent that the costs for the improvements mentioned are included in the application. August 28, 1989 Elliot G. Sander Deputy Commissioner ------------------------------------------------------------ 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 (718) 739-6400 Bronx One Fordham Plaza Bronx, NY 10458 (718) 563-5678 Brooklyn 250 Schermerhorn St. 3rd Floor Brooklyn, NY 11201 (718) 780-9246 Lower Manhattan 156 William Street 9th Floor NY, NY 10038 (212) 240-6011, 6012 South side of 110th St. and below Upper Manhattan 163 W. 125th St. 5th Floor NY, NY 10027 (212) 961-8930 North side of 110th St. and above Staten Island 350 St. Mark's Place Room 105 Staten island, NY 10301 (718) 816-0277 Nassau County District Rent Office 50 Clinton Street, 6th Floor Hempstead, NY 11550 (516) 481-9494 Westchester County District Rent Office 55 Church Street, 3rd Floor White Plains, NY 10601 (914) 948-4434 Rockland County District Rent Office 94-96 North Main St. Spring Valley, NY 10977 (914) 425-6575 Albany Regional Office 119 Washington Avenue Albany, NY 12210 (518) 432-0596 Buffalo Regional Office Ellicot Square Building 295 Main St., Room 438 Buffalo, NY 14203 (716) 856-1382 ------------------------------------------------------------