Bleak House: Finding One
FINDING ONE
THREE YEARS AFTER ITS TAKEOVER OF THE RENT REGULATORY SYSTEM,
DHCR IS AN AGENCY IN CHAOS, UNABLE TO ANSWER ITS PHONES. RESPOND
TO MAIL. ENSURE THAT DOCUMENTS AND FILES SENT TO DHCR ARE NOT
LOST OR PROVIDE BASIC. ACCURATE FACTUAL INFORMATION TO ITS USER
COMMUNITY.
The vital services which tenants and landlords need from DHCR
depend upon efficient communication with the agency. Without such
communication, the administration of the rent regulatory system
is doomed to failure. Precisely such a failure has occurred at
DHCR.
The failure of DHCR to perform basic communications functions has
effectively denied important legal rights and protections to a
large-segment of the Division's user community and made dealing
with DHCR a Kafkaesque nightmare for both tenants and owners
alike.
Communications in Chaos
Testimony submitted by a wide variety of witnesses indicated that
DHCR's telephones are often either not answered or are constantly
busy. It took staff from the Assembly Oversight Committee, for
example, 75 rings to get through to the main DHCR information
number in Jamaica, Queens. DHCR rent examiner David Saphire
testified that in his office, where 25 rent examiners process
cases, all of the phones except one were recently removed. The
phone jacks were left in place, however, and tenants were never
informed that the numbers they had been given were no longer in
service. The result is that callers hear endless ringing on
disconnected phone jacks.
Testimony received by the committees documented the fact that
when tenants and owners are able to reach DHCR, they often are
given incorrect information. In a survey conducted by the
Assembly Oversight Committee in which staff attempted to call
each of DHCR's nine offices and ask, at different times, three
basic factual questions about tenants' rights, DHCR gave out
incorrect information or was simply not reachable by phone two-
thirds of the time. As Legal Services Attorney Russell Engler
testified:
"With respect to information by telephone, DHCR
supposedly has a public information number. The
success in using this number is revealed from the
notes of one of the paralegals in my office: 'Call
number one, it rang so often I gave up. Call
number two, I gave up. Call number three, I
started to count rings. It rang five times, then I
got a recorded message, then it rang forty-two
times before someone answered. I should add that
no useful information was provided once the
telephone was answered."
Efforts to communicate in writing with DHCR yield equally
unsatisfactory results. Testimony received at the hearing
supports the conclusion that DHCR simply ignores much of the
correspondence sent to the agency. A former DHCR employee told
staff of the Housing Committee that while working for DHCR he had
been given a box of two-year-old mail to answer.
Lost in the Shuffle
Many witnesses submitted testimony which indicated that DHCR
routinely loses important evidence and documents sent in by
tenants and owners and, in some cases, entire case files. The
Community Housing Improvement Program, a landlord trade group,
found that of one thousand complaints received from its members
about their dealings with DHCR, five hundred complaints
documented cases where the Division had lost documents or
evidence submitted by owners. Lost files are so commonplace at
DHCR that the agency has developed a widely-used form letter to
tenants and owners on the subject.
As Ken Fishel, the representative of a real estate company,
wrote:
"Since DHCR has taken over, the paperwork within
our office has tripled. When we file an answer to
a tenant's complaint, we must always refile the
same answer at least once. DHCR almost always
loses the original papers."
Some tenants and owners testified that mail sent to DHCR for
which they had proof of mailing or their entire case files had
been lost more than once by the agency. Tenant Louise Gubert
described what happened to an overcharge complaint she filed:
"I periodically would call the DHCR to see how my
claim was progressing. I also wrote letters to the
DHCR informing them of changes in my case, such as
when new landlords bought the building, et cetera.
(I have had three landlords.) A year ago I made
yet another pilgrimage to 10 Columbus Circle. At
that time I was told that my claim was lost and I
might consider dropping the claim or make copies
of my own files and resubmit the forms in order to
reconstruct my file, which I did."
Ms. Gubert resubmitted her claim and when she went to DHCR's
office six months later to check on its status:
"I was told not only could they not find my file
(the one I resubmitted), but that it was not in
the computer. To add to the confusion, one of my
neighbors in past requests to the DHCR when
inquiring about their claim, received a referenced
docket number which happened to have been my
docket number. Another time a tenant received a
notice from DHCR which included papers for a
tenant living on the East Side, it had nothing to
do with her claim. ... When I write I send
everything return receipt requested so I know my
correspondence is received but it is almost never
acknowledged. It seems whatever form of
communication used, whether it be the telephone,
letter or in person, it is ineffective to receive
information or help from the DHCR."
Rent examiner David Saphire testified that he often received
documents for the first time from tenants and landlords
accompanied by terse statements that the information enclosed had
already been sent to DHCR. DHCR officials could offer no
explanation for the pervasive cases of lost mail, documents and
files at the agency.
Testimony indicated that because DHCR has moved its rent
administration offices fourteen separate times over the last
three years, forms regularly are sent out with incorrect return
addresses reflecting prior DHCR locations.
As Barbara Craebel, the owner of two buildings in Manhattan,
summed up the situation:
"To obtain accurate information from the DHCR
files on any subject is all but impossible. I have
sought information by letter, telephone, never
honored, and even by personal visit to the DHCR
office in Queens, an all-day trip for me. Still
nothing happens. Documents that owners are
required to file disappear into the DHCR without a
trace. Months or years later, DHCR sends an
anonymous letter requesting information already
submitted or advises that information previously
filed doesn't exist. There appears to be no way to
resolve these problems except to file documents
over and over in the hope that DHCR will get it
straight someday."
Effects of DHCR Disarray
DHCR's failure to perform basic communications functions causes
more than frustration and inconvenience for its user community.
Tenants and owners who get incorrect information from DHCR and
then use that information in making decisions about their homes
and businesses suffer real-life consequences because of the
agency's errors. Tenants who are given wrong information about
their right to continue living in their apartment, for example,
may risk eviction by following the Division's advice. Conversely,
landlords who follow inaccurate DHCR information risk being held
liable, by DHCR or the courts, for violating the provisions of
the rent regulatory laws.
Lost letters, documents and files cause even more serious
problems for tenants and owners. The case processing system at
DHCR is essentially a paper flow where each party's contention in
a complaint is matched with an answer from the opposing party. If
a tenant or owner does not answer a DHCR request, or in some
cases several DHCR requests for a response to a contention made
by an opposing party, a case is closed using only the information
already in the file.
In theory, this is an equitable way to resolve cases. In
practice, however, where an owner may answer a complaint made by
a tenant one or two times and have each response lost by DHCR
(apparently a relatively common occurrence judging from the
testimony submitted to the committees), this method of closing
cases may result in gross unfairness and the denial of important
legal rights. Thus, if a tenant claims an overcharge has occurred
and the rent examiner has, after repeated requests, not received
any rebuttal from the landlord, the case will be decided in favor
of the tenant because of the landlord's failure to answer the
complaint. The landlord will be ordered to refund rent and may be
assessed treble damages.
If the response sent by the landlord is sitting in a different
DHCR office, or has been lost or is sitting in a box of unopened
mail, DHCR's attitude, as reflected by testimony received by the
committees, seems to be that persons who are victimized by
processing errors can always file an appeal assuming they have
the strength, after waiting sometimes for years to have their
original complaint resolved, to continue down the road of DHCR's
case-processing system.
Multiple Errors. Procedures Designed for Failure
Judging from the testimony and letters received by the
committees, it appears that many tenants and owners experience
more than one DHCR "inefficiency" in their case processing. Thus,
tenants may begin their DHCR experience with unanswered phone
calls, proceed to wrong information, then send letters that go
unanswered and finally have their entire case file lost.
The errors are compounded by routine practices which seem
designed to cause further problems. For example, the form which
allows tenants to challenge the information provided by an owner
in annual rent registrations contains no space for the tenant to
note the address of the owner. DHCR personnel, because of the
difficulties they experience in using DHCR's own rent
registration data base, often cannot determine the owner's
address themselves so they must send a new form to the tenant
asking the tenant to provide the owner's address. If a tenant
fails to respond to DHCR requests for an owner's address or DHCR
loses the tenant's response, the case may be closed on that
basis. This entire paper flow could be eliminated by simply
asking tenants to note the owner's address in the first place.
For those with sophistication, time and money, dealing with DHCR
can mean years of appeals and finally court actions to try to
correct the errors made by the Division. For those without such
resources, which includes many small owners and the vast majority
of tenants, the rights guaranteed by law are simply lost when
DHCR fails to properly administer them. As Jane Benedict of the
Metropolitan Council on Housing, a tenant advocacy organization,
testified:
"It is utterly hopeless for the poor, unless they
are organized through some organization even to
contemplate doing anything through the
administrative procedures and when the
administrative procedures are what we have seen
here today, then I assure you we're talking about
two different worlds. We're talking about a world
where people are totally disinherited."
The Multi-Year Wait For Case Resolution
Large numbers of tenants who filed overcharge cases have had to
wait years for a resolution. Rent examiner Elliot Vizansky
testified that he had recently been given cases to process for
the first time which tenants filed in 1981. The waiting time can
be particularly frustrating and may contribute to tenants and
owners being denied important legal rights for two reasons.
First, DHCR initiates no communication about a case to the
complaining party until case-processing is begun. Thus, tenants
and owners may typically receive a docket number upon filing
their case and then hear nothing more for a very long period of
time. The next communication, which may be years later, will
sometimes be a notice which informs parties in the case that
unless certain information is provided within 21 days, the case
will be closed using only the information already in the file. In
many cases, more than one notice will be sent before a case is
closed using only already existing information.
If the tenant or owner has moved or is on vacation, or if the
information request sent by DHCR or the response sent by the
owner or tenant is lost, the case may be closed without waiting
for additional information. In cases where a tenant or owner has
important evidence which would affect a case, the price for
failing to respond to such notices or having such responses lost
by DHCR can be very high.
Owners who have multiple overcharge claims filed against them may
have a particularly difficult time in quickly responding years
later to 21-day notices. (Until the spring of 1986, notices were
also sent out which allowed parties only ten days to answer. That
policy has subsequently been changed.)
A second source of tremendous difficulty in the multi-year
waiting period is that it is impossible for tenants or owners to
find out, either by phone or mail, the status of their pending
cases, other than whether the case is open or closed and whether
the case has been assigned to a rent examiner. From the
testimony, it appears that correspondence sent by tenants and
owners inquiring about case status is often simply not answered.
If an inquiry is answered, the response is likely to be that the
case has been "assigned to a rent examiner." Phone inquiries
produce no better results, even when made by public officials.
New York City Councilman Robert Dryfoos testified about one case
handled by his office:
"I would like to share with you the experience the
head of my constituent unit had when seeking
information on the status of a rent overcharge
case filed in March 1984, to which the tenant had
not received a determination and subsequently
turned to me for help in July 1986. Attempting to
gain information on the case in question, my staff
had 24 phone conversations with seven individuals
from three different offices over a period of
twelve days, at the end of which we knew no more
regarding the status of the case than we did when
we began."
Tenants and owners may be able to obtain more information by
personally examining their case files. But this usually involves
at least two trips to DHCR's Central Office in Jamaica, Queens.
On the first visit, the party is asked to fill out a form
requesting to see his case file. On the second trip, the files
sometimes will be made available. As one owner, Richard Albert.
testified:
"I found an engineering student on summer
vacation. I said hey, you're not working this
summer, go up to DHCR and here is a list of all
the outstanding rent reduction orders I have and
see if you can get information on them. He spent
weeks out of the summer. Here's the report he has,
it's signed by him. You want to know something? On
half of them they couldn't even find the file. The
other half where they found the file, it was
completely inaccurate information. At least they
found half."
Hundreds of Thousands of Cases -- Processed By Hand
Part of the reason for the tremendous disarray of the rent
regulation program is the fact that it is essentially a manual
system. Cases and orders are scattered in thousands of file
cabinets located everywhere from Jamaica, Queens to a storage
warehouse in East Brunswick, New Jersey. Boxes of mail sit in
various locations -- much of it doomed to be eventually lost in
the sprawling DHCR case-processing system. And tenants and owners
who must somehow make their way through the chaos to keep their
homes and businesses often find only frustration and despair.
An Internal DHCR Automation Study, completed in December of 1985,
one and a half years after the State's takeover of the rent
regulation program, concluded that:
"The Office of Rent Administration provides its
principals with few automated tools. A handful of
stand-alone personal computers, most of which are
underutilized, are scattered throughout the
organization. Existing word-processing equipment
is insufficient to meet the needs of the user
community. The creation, storage, retrieval, and
transmission of information is accomplished by
means of various manual procedures."
The study further noted that at the time it was done, DHCR had
only five word processors, ten personal computers and fourteen
3270 CRT terminals to do the processing work of the entire rent
administration program. The agency now is in the process of
installing the automation system recommended in its 1985 report.
DHCR developed a takeover plan in August of 1983, seven months
prior to the agency's assumption of the administration of rent
stabilization and rent control. The plan recommended, among other
things, that a comprehensive evaluation of the agency's
automation needs be conducted.
The transition plan developed by DHCR staff was never
implemented, however, with the result that no automation study
was conducted either prior to or in the first year of DHCR's
administration of the rent regulation system. Instead, DHCR
requested and was granted authorization to purchase $1 million of
computer equipment in March of 1985 without any comprehensive
analysis of the Division's automation needs.
During the spring of 1985, Commissioner William Eimicke's staff
and the Governor's office recommended that the new computer
system which had just been purchased not be utilized.*
According to the Legislative Commission on Expenditure Review
(LCER), which analyzed the Division's takeover of the rent system
in a 1986 memorandum report, the "verbal recommendation" of DHCR
and administration staff to not utilize the newly purchased
computer equipment "was accepted by the new DHCR Commissioner
without written documentation of specific problems with the
ordered computer system." The Office of General Services
attempted to halt delivery of the new equipment but was
unsuccessful and the vendor was paid $1,001,846 by the State in
August of 1985.
Three months later, DHCR sold about half the system to the State
Insurance Department. By the time of the completion of the LCER's
analysis in July of 1986, the other half of the system, valued at
more than half a million dollars, was still sitting in storage at
DHCR.
The Division today still does not have a fully functioning
computer network in place and the impact on the Division's
ability to efficiently process cases has been substantial. The
primary cause of DHCR's failure to automate, according to the
LCER, is that the Administration and the division never
implemented the detailed computer evaluation plan which had been
recommended by DHCR staff in 1983.
DHCR -- Where Are You?
Since assuming administration of the rent stabilization system,
as noted earlier, DHCR has moved its own offices 14 separate
times. Based upon the testimony submitted to the committees, it
is clear that these dislocations have contributed to the disarray
of the system and have made DHCR's troubled administration worse.
Unlike many other state agencies which have relocated, the
Division never undertook any effective campaigns to inform the
public of which offices moved, where tenants, owners or
legislators should go to obtain various services or get
information, or what plans were in the works for moves in the
future.
Case-processing is now largely centralized in Jamaica Queens, a
location which is extremely difficult to reach for most tenants
and owners and most present and potential employees. The case
backlog, however, continues to be processed at 10 Columbus Circle
in Manhattan. The Commissioner's and Deputy Commissioner's
offices are located at Fordham Plaza in the Bronx, physically
separated from the employees who do the case-processing work.
DHCR has satellite offices in each county where it administers
rent regulation laws. In the 1983 Omnibus Housing Act, the
legislature mandated the creation of these local District Rent
Administration Offices and intended that tenants and owners
receive the bulk of the services they needed from DHCR at
locations convenient to their homes and businesses. In practice,
however, these district offices supply only very limited public
information services and copies of forms. Tenants and owners must
travel from White Plains, Staten Island and every other location
in the New York metropolitan area to Jamaica, Queens to obtain
most services.
Maria Mottola, coordinator of Community Organizing Programs at
the Lenox Hill Neighborhood Association, a not-for-profit
settlement house in Manhattan, summed up some of the difficulties
her organization experienced in dealing with the Division's
moves:
"DHCR's organizational structure is a mystery. It
is difficult to learn which unit is responsible
for specific types of cases, ... or names of
supervisory personnel. We have been unable to keep
up with DHCR's whereabouts. DHCR has provided no
prior or timely notification of moves, changes of
address or telephone numbers, and we question why
the agency that is supposed to service tenants is
unable to let people know which offices are moving
and what function these offices will have.
The function of the District Rent Offices is
unclear. We are told that they are still
operational, and yet when inquiries are made to
the Manhattan office, we are told they will not
give information over the phone and that we must
call the general information number in Jamaica.
Trips to the District Rent Office by tenants also
prove futile. Tenants who need status reports on
their complaints are told that they must go to
Jamaica as that's where the files are."
DHCR claims, with some justification, that the problems caused by
their many office moves and the continuing difficulty that
tenants, owners and employees experience in traveling to the
Jamaica location is not entirely their fault. Much of the blame
in fact lies with the Administration, which was unable to
permanently locate DHCR for almost two years.
The seeming end to the Division's moves has not eliminated the
difficulties tenants and owners experience in finding personnel
at DHCR. As Oda Friedheim of the Association of Neighborhood
Housing Developers, a coalition of non-profit locally based
housing organizations, testified:
"Nobody knows who exactly does what at DHCR. Many
other agencies do have a departmental chart, at
least, to sort of indicate who's the head of what
unit, how many people are in a unit, etc. Even HPD
has that. Well, DHCR is a complete mystery, who
works where and who is responsible about what and
who is reporting to whom."
The Small Building Owners' Assistance Unit -- Fact or Fiction?
Among the most difficult offices to get in touch with at DHCR is
the unit charged with assisting small building owners.
The Omnibus Housing Act of 1983 required DHCR to establish a
Small Building Owners' Assistance Unit to help small owners
comply with the requirements of the rent stabilization and rent
control laws. The Legislature envisioned, and owner groups
understood, that the Small Building Owners' Unit would be a
separate entity within the Division whose sole function would be
to assist small landlords in dealing with the rent regulatory
system. In reality, as the Legislative Commission on Expenditure
Review noted:
"DHCR does not have a separate small building
owners' unit. Instead, this function is handled by
public information specialists at the six district
rent offices, at the Gertz building and through
the telephone hotline for owners. Information and
advice is available to owners and tenants alike."
The lack of this unit has caused difficulties for small building
owners and owner group representatives who feel the complexities
of the rent regulation system necessitate the services of
counselors who are trained to handle and deal exclusively with
small building owners. The absence of the unit has also caused
confusion among owners and legislators, most of whom have naively
assumed that DHCR complied with the Omnibus Housing Act's clear
mandate that a Small Building Owners' Unit be established. As one
owner testified:
"On many occasions, I have attempted to reach the
Small Building Owners' Assistance Unit. I have
never been able to find out where it is located or
reach it on the telephone. I would be very
interested in knowing where it is and what it
does."
In the course of the investigation, we did not come across a
single owner or owner representative who was aware of the
existence of a Small Building Owners' Assistance Unit. The
Division, however, steadfastly maintains that such a unit does in
fact exist, (although they say there is no one at DHCR who is in
charge of directing it), as in the following exchange between
Assemblyman Grannis and Commissioner Eimicke, testifying under
oath:
Assemblyman Grannis: The Omnibus Housing Act
required the Division to set up a Small Building
Owners' Assistance Unit. Does that unit exist in
the Division of Housing today?
Commissioner Eimicke: Indeed it does, and they
have handled over 300,000 complaints since the
system was put into place, approximately 100,000,
I believe, walk-in interviews as well.
Assemblyman Grannis: You're saying that there is a
separate unit within the Department. Commissioner,
your testimony in our budget hearings (was that)
an entire unit (was) separately established to
deal with the problems of small owners. Is that,
in fact, the case?
Commissioner Eimicke: Yes.
If a Small Building Owners' Assistance Unit has been established
but no one knows about it, does it exist? The resolution to that
riddle, at least in the minds of DHCR, is apparently yes.
Thousands of small owners do not believe this, however, and are
still searching for the answers to their questions.
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* Eimicke held the position of Deputy Secretary to the Governor
in charge of overseeing all of the operations of DHCR and other
state housing agencies until 1985. In June of that year, he was
given the formal position of "Director of Housing" and also
appointed DHCR Commissioner, replacing Yvonne Scruggs-Leftwich.