Administrative Delays Leave Tenants Behind
The New York State Division of Housing and Community Renewal (DHCR), the state agency responsible for overseeing rent regulated apartments, and its Office of Rent Administration (ORA), which processes rent overcharge complaints, are feeling the heat after State Assembly member Emily Gallagher publicly noted that there’s a significant backlog of rent-overcharge cases.
By way of background, rent increases for rent-stabilized apartments are restricted to a certain percentage (established, annually, by a local rent guidelines board). If a landlord wishes to increase rents beyond that amount, the owner must satisfy certain specified grounds (such as work done to the building or the apartments). When tenants suspect that they have been overcharged, (or that their apartments were wrongfully removed from rent stabilization), they can submit a claim to be reviewed by ORA.
However, it appears that the agency’s 27 employees who process these complaints may be a bit overwhelmed, as The Daily News recently reported that there are cases that have been languishing for as long as four years.
That significant backlog extends beyond mere inconvenience. For as the adage goes, “justice delayed is justice denied,” as tenants are often priced out of their homes before their overcharge disputes can be decided. While their claims are pending review, tenants remain responsible for paying the (higher) rent amount charged by their landlord (absent a stay from a court suspending the increase, or a finding by some tribunal that the increase was improper). While tenants who vacate their apartments would still be entitled to a refund and/or damages in the event their complaints were later found to be meritorious, that would be cold comfort if they have already been evicted (or otherwise forced to vacate) because they could not afford the improperly raised rents.
The Daily News spoke with a Brooklyn resident whose rent increased from $1,650 to $2,000, last year, and then up to $3,500, this year. That tenant, who filed an overcharge complaint some 6 months ago (and who has been informed that no one at ORA has yet been assigned to his case), lamented that the city’s rental market is “vicious,” and that he would have to leave the area entirely if he is priced out of his current home.
The News also interviewed a Harlem resident who has been awaiting a determination on a claim he filed back in 2019. That tenant said he filed complaints, in person, and messaged the agency’s commissioner on social media, to no avail. (Even though he ultimately vacated his apartment he appears to be pursuing his claim.) ORA would not confirm the extent of the backlog, but informed the Daily News that fewer cases are being processed after recent office closures and COVID-related delays.
Given that reality, many tenants are forced to turn to the courts. In fact, Newman Ferrara LLP recently filed a case, involving hundreds of tenants across 11 Harlem buildings who believe they have been overcharged. The owner of those Harlem buildings allegedly deregulated scores of units based upon (among other things) alleged improvements, but that landlord was unable to provide any evidence that such work had actually been performed. If successful, many tenants involved in that class-action litigation are likely to have their apartments revert back to rent stabilized status and/or will recover substantial overcharges.
Coordinated efforts, such as class actions, go a long way towards leveling the playing field between landlords (who tend to have deep pockets and vigorous representation) and tenants who, individually, may not have the means (or the stomach) to wage battle in the courts or before the DHCR. Further, courts (unlike administrative agencies) are empowered to grant injunctive relief suspending suspected improper rent increases, which can protect tenants from being priced out of their homes while the merits of their overcharge claims are being assessed.
It remains to be seen if any substantive political response will be implemented to address the lengthy administrative delays, but tenants who suspect they are being overcharged (or that their apartments were improperly removed from rent-stabilization) would do well to speak to an attorney to explore the merits of their claims and to review their options for redress.
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Should you wish to speak to someone about your claim, please feel free to call on one of our attorneys by dialing: 212-619-5400.
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