HPD Clarifies Documentation Required for Underlying Conditions Program

Local Law 6 of 2013 gives HPD the authority to issue an order to a building owner to correct any underlying condition existing in that building that has caused or is causing a violation of the Housing Maintenance Code, the NYS Multiple Dwelling Law, or any other state or local law that imposes requirements on dwellings. This authority is known as the Underlying Conditions Program. Each year, HPD selects approximately 50 to 100 buildings for participation in the program based on the number of apartments affected and the number and severity of the violations.

Recently, HPD adopted amended rules relating to the repair of underlying conditions. HPD had previously issued rules that set criteria for the selection of buildings into the program and circumstances under which HPD may rescind or void an underlying conditions order. The recent amendments to the program rules inform owners of the documents necessary to complete their certification of correction.

We’ll go over the basics of HPD’s Underlying Conditions Program and highlight the documents needed dismiss an underlying conditions order.

How HPD Selects Buildings for the Program

HPD’s Underlying Conditions Program allows the agency to issue an administrative order to residential building owners to correct underlying conditions that have caused, or are causing, a violation of the Housing Maintenance Code. A building may be selected for the program if it has a Class “B” or “C” violation on record related to the existence of mold or water leaks that was issued by HPD within the prior year preceding the issuance of the order that has not been properly certified as corrected by the owner, or that was corrected by HPD, and if the building:

• Contains three to five dwelling units and at least 50 percent of the units have one violation;
• Contains six to nine dwelling units and at least 25 percent of the units have one violation; or
• Contains 10 dwelling units or more and at least 15 percent of the units have one violation.

HPD will first select buildings with conditions that may contribute to asthma outcomes and other relevant health indicators as determined by the Department of Health and Mental Hygiene, followed by those buildings with the highest total number of Class C and Class B violations relating to the existence of mold or water leaks.

HPD may exclude the building if it otherwise meets the criteria above but is:

• A one- or two-family building;
• Already subject to an Alternative Enforcement Program (AEP) Order to Correct, or to the appointment of a 7A Administrator;
• Subject to comprehensive litigation action by HPD;
• Conveyed to a new owner after an in rem judgment of foreclosure in favor of the city in the Third Party Transfer (TPT) Program within the past five years; or
• The subject of a preservation loan made by HPD or the NYC Housing Development Corporation within the past two years.

What to Do If Your Building Is Selected

Owners are required to investigate the cause of a leak or mold condition affecting multiple apartments in a building and to address the conditions and related violations within four months, or with HPD’s approval, within an additional two months.

To request a two-month extension, an owner must submit the following documentation to HPD within two months of the issuance of the order:

• An affidavit from a NYS-licensed professional engineer or registered architect in a form approved by HPD, identifying the underlying condition that’s the source of the mold or water leak; and
• An affidavit from the owner in a form approved by HPD stating that the underlying condition and related violations will be corrected, describing the work that will be performed to correct the underlying condition and violations, and stating that the work will be completed within the extended time period.

How to Get Removed from the Program

Under certain circumstances, HPD will grant a rescission if an owner submits the following documentation.

Absence of underlying conditions. If there are no underlying conditions, an owner must submit:

• An affidavit from a NYS-licensed professional engineer or registered architect in a form approved by HPD, stating that there are no underlying conditions causing the mold or water leak violations;
• A completed Request for Rescission form; and
• Evidence that the building is in compliance with the indoor allergen hazards law annual inspection requirement.

The last requirement was recently added by HPD, and its effective date is Sept. 15, 2023. To show compliance, an owner may elect to use the Control of Pests and Other Asthma Allergen Triggers – Sample Investigation Form available at www.nyc.gov/assets/hpd/downloads/pdfs/services/indoor-allergen-hazards-sample-investigative-report.pdf to document the inspection and any remedial actions taken.

Underlying conditions have been repaired. If the underlying conditions and related violations have been repaired, an owner must submit three items. First, the owner must submit an affidavit from a NYS-licensed professional engineer or registered architect in a form approved by HPD. The affidavit must identify the underlying condition that was the source of the mold or water leak violations. It must state that the underlying condition and related violations were properly repaired, and identify who repaired the underlying condition and related violations. And, as a result of the recent rule adoption, the licensed professional’s affidavit must also state that such work to correct mold violations was performed pursuant to the safe work practices in §27-2017.9 of Local Law 55 and 28 Rules of the City of New York §54-04. These practices include:

• Removing any standing water and fixing leaks or moisture conditions.
• Isolating the work area with plastic sheeting and covering egress pathways.
• Limiting the spread of dust. Use methods such as sealing off openings (such as doorways and ventilation ducts) and gently misting the molding area with soap and water before cleaning.
• Cleaning mold with soap or detergent and water. Dry the cleaned area completely.
• Removing and discarding materials that can’t be cleaned properly.
• Throwing away all cleaning-related waste in heavy-duty plastic bags.
• Cleaning any visible dust from the work area with wet mops or HEPA vacuums.
• Leaving the work area dry and visibly free from mold, dust, and debris.

Along with the affidavit, as the result of the recent rule amendment, the owner must submit evidence that the building is in compliance with the owner’s responsibility to notify tenant occupants and to investigate complaints, pursuant to the indoor allergen hazards law. Once again, an owner may elect to use the Control of Pests and Other Asthma Allergen Triggers – Sample Investigation Form to document the inspection and any remedial actions taken.

Last, if the underlying conditions have been repaired, the owner must submit a completed Request for Rescission form, and HPD inspectors must find that at least 80 percent of the mold and water leak violations have been repaired.

Penalties

HPD may sue noncompliant owners in housing court. The civil penalty is $1,000 for each dwelling unit, with a minimum of $5,000. If the owner fails to comply with the order to correct, HPD may hire a contractor to make the repairs at the owner’s expense. HPD is subject to laws that may make such work significantly more expensive than if the owner contracted directly for the work. Failure to pay the bill may result in a tax lien being placed against the property, which can be sold or foreclosed if not paid in a timely manner.