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HPD inspections jump from $135 to $300.

Multi-family housing owners are protesting New York City's decision to raise the fee for an on-site inspection from $135 to $300.

These inspections are usually requested by owners to clear previous violations and are needed for many housing court cases, for Maximum Base Rent (MBR) and Major Capital Improvement (MCI) applications and for loans or sales of buildings.

"Apart from the fact that an increase of more than 100 percent is outrageous even for the City of New York," said Dan Margulies, executive director of the Community Housing Improvement Program (CHIP), "and considering they told us the $135 was set to cover expenses in full just two years ago - if in fact their costs have more than doubled, that tells us all to run from the city."

The new Dismissal Request Program cost of $300 is based on the actual cost to Housing Preservation & Development (HPD) providing this service, as was determined after an analysis, said spokesperson, Roz Post. Under this program, an inspector comes within 45 days.

The price increase, signed by Housing Preservation & Development Commissioner Felice L. Michetti on Sept. 22, goes into effect Nov. 9 said Post. HPD is in charge of administering code violations. Post said according to an attorney in their legal department, if a request comes in for an inspection before Nov. 9, the cost will be $135.

"I urge anyone who knows they need a reinspection for refinancing or another reason in the next few months to get it done right away," said Margulies.

John J. Gilbert III, president of the Rent Stabilization Association said, "It's indicative of the way New York City government looks at property owners - and that is they act as if property owners will be there forever no matter what onerous or burdensome regulations are put on."

Margulies explained it will now cost an owner a month's rent to establish that previous violations have been cured.

"They have gutted this program for smaller owners and have made it cost prohibitive," Margulies said.

Gilbert calls the fee rise a "prescription for disaster" because it ignores the 270 percent increase in rem actions over the last four years.

"This is not the only way to get violations removed," Post insisted. When violations are placed, they are supposed to be certify within a certain period of time, for which extensions are available. "If they certify on time and the city is unable to reinspect, in the computer it will indicate |deem complied'," Post said.

That system has only been in place for the last three years, however, and, Margulies said there are still literally hundreds of thousands of violations in the computer for conditions corrected years ago because for a long time, owners' certifications were ignored.

There is still a large number that remain uncertified, Margulies said, including new violations that for multiple reasons, cannot be certified in a timely manner.

Margulies expects a sharp cutoff in the number of requests. "They are going to have half as many jobs and that will prolong the use of bad data." he added.

I. Scott Edelstein, a partner with the Bronx-based law firm of Novick Edelstein Lubell Reisman Wasserman & Leventhal, P.C., believes the cost will not reduce the number of inspections.

"You need it for a comprehensive case to show that the violations have been removed," he said, "and when applying for a loan or refinancing you don't want the violations. They are going to be forced to swallow the costs.

Owners are entitled to inspections without the fee, Edelstein noted. If an owner files the certifications that indicate the repairs were made, the fee was initially to be charged to speed up the process to obtain an inspector. What has happened is that now inspections are not made without the fee unless a tenant calls or the court orders one.

"It was supposed to be a nominal cost and this is now unfair that the landlords are burdened with this," Edelstein said. "The tenants are not charged for an inspector to come out when they call about a violation," he added.

If there is a dispute in court over conditions, owners may also ask for a court ordered inspections. Margulies urged owners to have the court demand a new inspection when HPD brings them into court.

For most court purposes, owners usually do not require the inspections, said Eugene S. Reisman, Edelstein' partner. "The court orders the inspection if there is an issue between HPD or a particular tenant, " he explained.

An inspection is needed, Reisman said, when an owner must clear his violations to obtain an MBR for rent controlled units or an MCI increase or for a variety of administrative agency-type problems.

"You might be entitled to an increase of 7.5 percent on $200 rent and it will cost you $300 to get the paperwork," Margulies said.

Gilbert said it makes no sense for a code enforcement system to have violations removed and then have owners pay to have the property inspected to remove the violations from the records.

"And the city puts more violations on while they are there getting rid of the others,' Gilbert noted.

Gilbert points to the large increase in false fire alarms."Everyone is up in arms about false fire alarms, but what are we doing about the people who call false heat complaints?' he asked.
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Title Annotation:Housing Preservation and Development building inspection price increase effective November 9, 1992
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:Oct 28, 1992
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