Cure Violations for Upcoming 2018-2019 MBR Cycle for Rent-Controlled Apartments

It’s not too soon for owners of buildings that contain rent-controlled units to begin preparing for the upcoming 2018-2019 maximum base rent (MBR) cycle. The Division of Housing and Community Renewal (DHCR) has recently released the 2018-2019 MBR forms. The forms that need to be filed include the Violation Certification and the Operation and Maintenance and Essential Service Certification.

File Violation Certification Form by June 30

The effective date of your MBR Order depends on when you file these certification forms, provided that your certifications prove to be correct. The timing is prescribed in the law. Therefore, the later these certifications are filed, the later the effective date of the MBR Order. For an MBR Order effective Jan. 1, 2018:

1. Violation Certification (VC), if required, must be filed no later than June 30, 2017; and
2. Operation and Maintenance and Essential Services Certification (OMESC) must be filed no later than Oct. 3, 2017. This form requires you to certify that you are maintaining and will continue to maintain all essential services, and have made payments toward at least 90 percent of the operation and maintenance expense allowance for the building. To expedite your application, it is advisable to file the OMESC form with the VC form by June 30, 2017.

The DHCR won’t let you increase the rent of your rent-controlled apartments if there are serious code violations at your building. At this point in the application process, it is the VC form that’s critical for owners with rent-controlled apartments to have their maximum base rent applications granted and an Order of Eligibility issued by DHCR.

The VC form requires an owner to certify either that:

• The owner has cleared, corrected, or abated all rent-impairing and 80 percent of all other New York City Department of Housing Preservation and Development, Division of Code Enforcement (NYC HPD DCE) violations that were on record as of Jan. 1, 2017, if the form is filed by June 30, 2017, or six months prior to the owner’s certification if the form is filed later than June 30, 2017; or
• Within 30 days of the date of filing, the owner will clear, correct, or abate all rent-impairing and 80 percent of all other NYC HPD DCE violations that were on record as of Jan. 1, 2017.

Editor’s Note: If no violations were on record for your premises on Jan. 1, 2017, you are not required to file a VC form for an MBR Order effective Jan. 1, 2018, provided the OMESC form is filed on time. If you fail to file the OMESC form by Oct. 3, 2017, a VC form is required even if there were no violations pending as of Jan. 1, 2017.

Document All Work Done to Clear Violations

The DHCR pays close attention to the VC forms. Therefore, owners should be prepared to submit specific documentation in support of the removal of those violations on record. Specifically, owners must establish that they meet the DHCR criteria for violation removal for those violations on record as of Jan. 1, 2017.

The DHCR may require that owners produce contracts for labor and invoices for materials utilized for the removal of the violations that are on record. If the work was done by a building employee, the owner should be prepared to submit its work logs or an affidavit outlining the work that the employee performed, and most important, the dates when the repairs were completed. Owners must demonstrate that the work was performed prior to Jan. 1, 2017, or six months before the filing of the VC form, if the VC form is being filed late. The DHCR will accept late filings, but owners will be penalized by a later effective date of the Order of Eligibility.