The tenant advocacy group that’s made a name for itself taking landlords to court is rounding out 2021 with another win for tenants — and a message for the governor.
The Housing Rights Initiative this week celebrated its investigation into J-51 rent overcharges that secured a $1 million settlement for a group of Bronx renters. The tenants of 3045 Godwin Terrace in 2018 brought a class-action suit against landlord Richard Albert after HRI revealed the managing member of Godwin Realty had signed tenants on for market-rate lease while reaping the benefits of the J-51 tax break. The program requires buildings to keep units stabilized while receiving the benefit.
The tenants are set to receive up to $100,0000 in refunds and current residents can bank on a rent reduction of 20 to 30 percent and see their units returned to stabilization.
HRI founder Aaron Carr seized on the agreement as an opportunity to turn Gov. Kathy Hochul’s head.
In a tweet thread posted Sunday night, Carr called on the governor and state legislature to “overhaul NYS’s housing enforcement agency and put our nonprofit out of business.”
BIG NEWS: One of our ~80 class action lawsuits against tax cheating real estate companies settled for $1 million.
We call on Governor @KathyHochul and the State Legislature to overhaul NYS’s housing enforcement agency + put our non-profit out of business.https://t.co/vLLQQcFHn1
— Aaron Carr (@aaronAcarr) December 6, 2021
“People may celebrate our organization for combating real estate fraud, but the truth of the matter is our existence is a tragedy,” Carr said in a statement. “Our state housing enforcement agency should do its job.”
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A spokesperson for New York State Homes and Community Renewal, which oversees and regulates housing, rent regulations and the protection of rent-regulated tenants, responded by detailing the agency’s efforts to ensure tenants get their due under J-51. The agency noted that the city’s Department of Housing Preservation and Development and Department of Finance have a role in administering the program.
HCR said its Office of Rent Administration has conducted “hundreds of investigations, returned more than 89,000 units to regulation and recovered over $6 million in overcharges for tenants.”
Additionally, the agency said it is involved in “an extensive outreach effort to compel landlords receiving the J-51 benefit to appropriately register their apartments” and that the names of owners who failed to register stabilized units are listed on the HCR website.
Despite HCR’s efforts, HRI in recent years has found cause to launch a slew of investigations into J-51 fraud, as well as voucher-based discrimination.
The group helped serve big-name brokers Compass and Corcoran for Section 8 discrimination and forced developers Blackstone and Kushner Companies to settle for $1 million and $88,000, respectively. Last month, a judge ruled in a case against Urban American that the landlord had illegally deregulated units while receiving the J-51 tax break.
“If we keep heading in this direction,” Carr said in a tweet referencing the group’s ongoing cases, “we will be able to get back up to a half a billion dollars for the tenants and taxpayers of New York City.” But some of the lawsuits stemming from Carr’s investigations have been dismissed.
If we keep heading in this direction, we project that we will be able to get back up to a half a billion dollars for the tenants and taxpayers of New York City (and that estimate only accounts for our current case load, not any future cases we generate).
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— Aaron Carr (@aaronAcarr) December 6, 2021