Over 50,000 apartments will soon return to their rent regulated status after an investigation by Governor Andrew Cuomo revealed that several landlords in the city who were renting out these apartments were violating rent regulation laws, the New York Post reports.
In the 1950s a number of rent regulated buildings in the city were suffering due to a lack of heating and hot water. Landlords however were hesitant to make improvements because it meant spending a lot of money, but not getting an equivalent return from tenants. As a result, the J-51 tax abatement program was established.
Through this program, landlords who made significant improvements on their buildings could recover 75 percent of their costs through the tax abatement program. However this prevented them from increasing rent in a certain way. Landlords carrying out renovations on rent regulated buildings are normally allowed to apply the luxury decontrol provisions towards the rent, and as a result make more money. But landlords who use the J-51 program are an exception as a result of the assistance they receive.
Cuomo's office however found out that several landlords in a total of 4,149 buildings throughout the city were flouting these laws. And now the Governor's office has issued notices to the erring landlords to restore them back to their rent regulated status. The J-51 tax abatement program was ended in 2011, but there are still thousands of apartments renovated before that time period that operate under that law.
Cuomo order would restore 50,000 rent-protection apartments [New York Post]
· J-51 and Gentrification [CHPC]
· What On Earth is a Tax Abatement? [Curbed]
· Rent Stabilization Archives [Curbed]