Second Lawsuit Challenges Controversial Rent Rules Realty Group Claims Law Hobbles Landlords

Passed last summer, New York’s Housing Stability and Tenant Protection Act (HSTPA) is facing a second lawsuit, reports Real Estate Weekly. The New York State Home and Community Renewal Agency (HCR)/Division of Housing and Community Renewal (DHCR)—the agency behind the controversial law—has been sued in the U.S. District Court, Southern District in White Plains.

Brought by the Building and Realty Institute (BRI) of Westchester and Putnam Counties, the Apartment Owners Advisory Council (AOAC), and several multifamily property owners, the most recent suit echoes the allegations in the first lawsuit brought in July by the Rent Stabilization Association (RSA) and Community Home Improvement Program (CHIP), which claimed that the regulations are unconstitutional. 

According to the Weekly, the new lawsuit claims in part that “The HSTPA limits the landlords’ financial ability to improve and maintain multifamily housing in those 21 communities in Westchester that have adopted ETPA [(Emergency Tenant Protection Act of 1974)], thereby reducing the quality of affordable multifamily housing available for rent. Without this income, the rent regulated Westchester multifamily housing will deteriorate in the coming years, to the detriment of both tenants and landlords.” 

The Weekly goes on to say that the BRI suit also characterizes the HSTPA regulations as “an unlawful ‘taking’ without compensation” and “an arbitrary exercise of governmental power” over Westchester County’s more than 525,000 residences covered by the law. This is in addition to the allegation that HSTPA will hurt cooperatives by limiting their ability to vet prospective shareholders and collect late fees and other charges. 

Meanwhile, reports the Weekly, RSA is conducting a survey to quantify the costs of HSTPA in terms of dollars and jobs, as they are seeing a lot of layoffs and revenue loss in the contractor and building vendor industries after the enactment of HSTPA

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