Division of Housing and Community Renewal

Real Estate Weekly, June 7, 2000 by Lois Weiss

The October Problem: The Division of Housing and Community Renewal has proposed changes to the administrative code that could solve the current October renewal problem.

This change would shorten the period before the lease expiration before the owner has to send the renewal offer from 120 to 90 days. "The tremendous advantage is that it would solve the October renewal problem, because you have to send it on June 1st with the old renewal numbers, checking off a box that says it will change, and then the change has to be explained to the tenant. You never want to have an October renewal," says Dan Margulies, executive director for the Community Housing Improvement Program, a middle market owners group.

At a public hearing on May 25th tenants requested the changes not be made, but most of those, Margulies says, were the changes made due to the 1997 rent law.

A comment period may be extended to mid-July, and then the changes would probably be adopted in late summer and fall. "Most of the changes, contrary to news reports, merely formalize and codifies the code to incorporate court actions and the 1993 and 1997 legislation," says Margulies.

Items being incorporated include the four-year statute of limitations on overcharge complaints, luxury decontrol, and the de minimus policy so overcharges cannot be obtained for items like paint color. "What DHCR is doing is simply telling us what the rules are and brining us up to date," Margulies adds.

New proposals include two desired by owners. One would be the repeal of the so-called Golub notice. This is a provision in the code that says owners can only commence a non-primary residence action during the period for lease renewals.

This means the owner can send a lease renewal, the tenant signs and return it to the owner for signature. Margulies says even if you then send the signed lease back and get that returned by the post office because the forwarding order has expired, it is too late to begin the non-primary residence action.

Another proposed change by DHCR applauded by owner reps would prevent tenants from profiteering on their room mates by prohibiting tenants from charging a roon-imate more than their "proportionate share" of the rent; Penalties could subject the prime tenant to an overcharge complaint.