Rent Regulation Reform Act of 1997

Legislative Memo*

Six Year Extension

The bill would extend New York State's rent and eviction protection and coop/condo conversion laws until June 15, 2003.

Luxury Decontrol

The bill would lower the income level for high-rent, high-income decontrol from $250,000 to $l75,000 and maintain the existing $2,000 rent level. Currently, units renting for $2,000 or more a month and occupied by households earning more than $250,000 in two consecutive years are subject to high-rent, high-income decontrol.

Right Of First Refusal

The bill would provide occupants of units subject to high rent, high-income decontrol with a right of first refusal upon receipt of an order of decontrol. Under existing law, tenants do not have a right of first refusal upon receipt of an order of decontrol.

Vacancy Allowance

The bill would establish a statutory vacancy allowances for one and two year leases for units covered by the New York City Rent Stabilization Law and the Emergency Tenant Protection Act of 1974 (ETPA). The bill also establishes enhanced vacancy allowances for (1) units vacated after 8 or more years of continuous occupancy and (2) units renting for less than $500 a month. Currently, local rent guidelines boards establish vacancy allowances for regulated units within their jurisdictions.

Succession

The bill would codify current regulations governing the succession rights of family members in rent regulated units. However, the bill would diminish rights of succession by removing nieces, nephews, aunts and uncles from those family members authorized to succeed the prior tenant. In addition, the bill would subject the second generation of family members succeeding a tenant and each second subsequent succession to the statutory vacancy allowance and enhanced vacancy established by the bill. Vacancy allowances are currently not imposed when family members succeed the tenant of record.

New Penalties

The bill would enact new criminal penalties and significantly increase civil penalties for landlords who harass of tenants. The bill would amend the penal law to create the new class B felony of harassment of a rent regulated tenant punishable by up to four years in State prison.

Rent Registration Assessment

The bill would authorize municipalities to enforce the collection of rent registration assessments by treating them at liens on a property. Currently, owners of rent stabilized units who fail to pay annual registration assessments are precluded from applying for or collecting any rent increases until such assessments are paid.

Statute of Limitations on Rent Overcharges

The bill would codify a four-year statute of limitations for contesting rent overcharges. Existing case law is not definitive on whether tenants can bring rent overcharge complaints for overcharges that occurred four or more years ago.

Rent Escrow

The bill would, in summary proceedings to recover possession, require rent accruing from the date that the petition is served to be paid into escrow after two tenant requests for an adjournment or 30 days, whichever occurs sooner. Tenant requests for adjournment in order to secure counsul would count toward the two requests for adjournment. In buildings with 12 or fewer units, any undisputed amount of rent would be required to be paid by the tenant directly to the landlotd, with and the remaining undisputed amount would be paid into escrow. The amount of rent that public assistance recipients must deposit into escow is limited under the bill to no more than the amount of their shelter allowance payment. The amount of rent that SSI recipients must deposit into escrow under the bill would be limited to no more than one-third of their total monthly benefit. Currently, tenants must place all future rent into escrow upon a second request for adjournment by the tenant, except for good cause shown. Currently a tenant's request for adjournment to secure counsel does not count toward the two requests for adjournment.

Demolition

The bill would provide that in certain rent controlled buildings in New York City which are set to be demolished, the owner may relocate the tenants to comparable apartments for the same or lower rent. Current law has more stringent provisions.

Offsetting Damages

The bill would require the Division of Housing and Community Renewal to take into account court awarded damages for violations of the warranty of habitability for failure to maintain services before imposing damages for those same violations and vice versa. Currently, both tbe Division of Housing and Community Renewal and the courts can award damages without considering the actions of the other.

High Rent Vacancies

The bill would clarify that units with a maximum rent of $2,000 or more which are or become become vacant on or after the effective date of this legislation are not subject to regulation. In the City of New York, units must have a maximum rent of $2,000 or more upon vacancy in order to be no longer subject to rent regulation.

* Our source indicates this is the legislative memo, although it did not come directly from an official source.