CTRC Fact Sheet Index

TenantNet note: These Fact Sheets were published by CTRC in the mid-1990's. Some information will be out-of-date. As far as we know, there have been no updates to these fact sheets. While much of the information may still be valid, the reader should exercise caution.

CTRC Fact Sheets -- reproduced with permission.

The Community Training Resource Center (CTRC) is a city-wide not-
for-profit organization that champions the rights of modest and
low-income tenants and promotes the preservation, improvement,
and expansion of affordable housing. CTRC provides training and
technical assistance for neighborhood housing groups, community
based organizations, legislative staffs and social service

CTRC produces fact sheets on tenants' rights, develops and
publishes research reports, and provides a written guide to New
York City government processes. CTRC advocates on budget policies
that affect housing and related services in low-income
neighborhoods. CTRC has led the campaign for the improvement and
expansion of the city's Housing Maintenance Code inspection and
enforcement services.

CTRC Fact Sheet #106


In 1970, New York City Local Law 30 established the Maximum Base
Rent (MBR) System to set rents for apartments in buildings
subject to Rent Control. The system attempts to permit rent
increases that are fair to tenants and are also adequate for the
proper maintenance and upkeep of the subject buildings.

The New York State Division of Housing and Community Renewal
(DHCR) is charged with determining increases, if any, in the
Maximum Base Rent (MBR) for these apartments every two years. The
increases are based on a formula in the law that considers real
estate taxes, water and sewer charges, operating and maintenance
costs, and return on capital value.

There are several grounds for challenging building-wide MBR rent
increases and tenants should do some careful research before
filing an MBR challenge on DHCR Form RA-94MBR, entitled,
Challenge Re: Maximum Base Rent Order

Violation Certification (DHCR Form VC)

MBR rent increases are tied to the condition and upkeep of the
subject building. To qualify for an increase, a landlord must
submit a written certification six months prior to the effective
date of the increase, that he has cleared, corrected, or abated
all rent-impairing violations and at least 80 percent of all
other violations of record, as of January 1st of that year, at
the Office of Code Enforcement, NYC Dept. of Housing Preservation
and Development (HPD).

Historically, Code Enforcement (which determines the category and
number of violations in a building) would conduct an MBR
Inspection to verify the landlord's Violation Certification (VC)
and upon approval, an "Order of Eligibility" would be issued by
the DHCR (copy mailed to each affected tenant) authorizing the
MBR increase.

However, Orders of Eligibility are now issued on the strength of
certain certification criteria alone, without any physical
inspection. Supposedly, an inspection would be scheduled by the
DHCR if the affected tenants challenged the order. This, of
course, has shifted the burden of enforcement to the tenants.

Tenants should examine the Order of Eligibility when received, to
decide if there were, in fact, violations of record that the
landlord certified he had corrected. This can be determined by
checking the code in the lower left-hand corner of the order; a
"V" indicates that there were violations and a "NV" that there
were none. Tenants may call the DHCR at (718)739-6400 to get a
copy of the building's List of Pending Violations (LPV).

The following is language that can be used to challenge the

     The landlord has failed to clear the minimum
     number of violations of record to be eligible for
     the MBR that was granted him. We respectfully
     request an inspection to verify this.


     The landlord has collected the MBR increase before
     the end of the six-month period after
     certification of violation removal. He certified
     on (insert date) and collected rent increases on
     (insert date).

In some circumstances, both grounds may apply.

Deadline for challenge based on the above: Within 33 days of the
tenant's receipt of Form RN-26S or RN-26, Notice of Increase.
Form: RA-94MBR, page 2, section III.

Operation and Maintenance of Essential Services Certification

Failure of the landlord to have made payments and/or incurred
obligations to pay at least 90 percent of the expense allowance
for the operation and maintenance of the building as required in
this certification may also be the basis for challenging an MBR

The operating and maintenance (O&M) expense allowance is designed
to provide sufficient revenues to operate and maintain a building
properly. It is computed by a formula designed to cover the costs
of fuel and utilities, management, insurance, repairs, contract
services, parts and supplies, payroll expenses, janitorial,
garbage, and extermination services.

Tenants cannot substantiate such a challenge by themselves
because the records, are in the landlord's possession. A DHCR
audit is required.

Deadline for challenge based on the above: None, but may be filed
with other time-limited items. Form: RA-94MBR, page 2, sec. III,
or by letter.

Under the MBR system landlords must also certify that they are
maintaining all essential services, which include the following:
heat and hot water, cold water, janitorial services, entrance
door security, gas and electric utilities, etc. and "such other
services when failure to provide and/or maintain such would
constitute a danger to the life or safety of, or would be
detrimental to the health of the tenant or tenants". In addition,
landlords must state that they "have and will continue to
maintain essential services".

Prior to February 1990, any failure to maintain established
services in a rent controlled apartment whether "essential" or
not would result, upon complaint and confirmation, in a rent
reduction and freeze. Until an official restoration of services
form was filed with the DHCR, and corroborated by the tenant, all
increases, including the biennial MBR and MCR increases, were

However, the DHCR, as of the above date, no longer bars the
collectability of MBR increases if the service reduction is not
an "essential" service as defined above. In other words, a
specific dollar amount (i.e. $10.00 per month) rent reduction may
be imposed if there is a decrease in a "non-essential" service,
but not a total freeze on rent. Service decrease complaints that
were filed prior to the above date are not affected by this
change in policy.

Use DHCR Form RA-81, Individual Tenant Statement of Complaint of
Decrease in Services, or Form RA-84, Statement of Complaint of a
Decrease in Building-Wide Service(s). In the MBR challenge it is
perfectly appropriate to state:

     The MBR should be denied or revoked because the
     landlord is not providing the following essential

Deadline for challenge based on the above: None, but may be filed
with other time-limited items. Form: optionally RA-94MBR, page 2,
section III, or by letter to DHCR's MBR Unit.

Failure by the Landlord to Incur Cost Increases that Match the
Biennial MBR Increase Granted by DHCR

The rent control law requires DHCR to recalculate a MBR for an
individual building if tenants challenge the city-wide biennial
MBR increase as excessive. For many buildings, this might produce
an MBR adjustment well below the city-wide figure. The DHCR
should require the landlord to submit evidence of increases in
operating expenses and compare the building's actual increased
costs with the city-wide biennial increase (which is based on an
economic study of a sample of buildings). If DHCR finds the
landlord did not experience cost increases as high as the
biennial increase, the actual percentage may be substituted for
the city-wide figure.

Deadline for challenge based on the above: None, but may be filed
with other time-limited items. Form: optionally RA-94MBR, page 2,
sections I and II, or by letter to DHCR MBR Unit.

Filing And Follow-up With DHCR

1.   All documents in duplicate. An original and photocopy
     duplicate should be submitted.

2.   Copy of file. Copies of submitted documents should be
     retained; originals of vital documents are not to be
     submitted unless specifically requested.

3.   Certified mail or hand delivery. Certified or registered
     mail is safest. If by hand delivery, a file copy should be

4.   Type or print complaint.

5.   Content of complaint. Simple, detailed, and objective.

6.   A Reply to the landlord's answer to the complaint when sent
     by the DHCR is suggested. If the landlord does not file an
     answer, he defaults. A reply provides additional support to
     the substance of original tenant complaint.

7.   PAR. An administrative appeal against an unfavorable
     decision, may be filed with a PAR (Petition for
     Administrative Review) within 35 days of the issue date of
     the DHCR order. See CTRC's fact sheet, Petition for
     Administrative Review.

8.   Where to file: DHCR-Office of Rent Administration, Gertz
     Plaza, 92-31 Union Hall Street, Jamaica, New York 11433.


These article are Copyright 1995 and 1996 by Community Training Resource
Center (CTRC) and reproduced by TenantNet. They may be freely
redistributed in their entirety provided they are reproduced exactly
as in the originals, including this copyright notice, the opening and
closing informational banners and any references to either CTRC
or TenantNet must be included.

These article are provided as is without any express or implied
warranty. While any information in these article is believed to be
correct at the time of writing, these articles are for educational
purposes only and do not purport to provide legal advice. If
you require legal advice, you should consult with a legal
practitioner licensed to practice in your jurisdiction.

Community Training Resource Center                (212)964-7200
47 Ann Street
New York, NY 10038

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