It’s no secret that the Incompatible Use provisions of the 2010 Loft Law, originally intended to protect manufacturing, are sometimes used by building owners who want to keep their buildings residential but don’t want to grant their tenants Loft Law protections. Just contesting an application on the basis of Incompatible Use puts up a huge roadblock, and sometimes drives tenants out even though there is no actual danger.

One unfair and strange consequence of the way the rule was implemented in 2011 is that the burden of proof is put on tenants to prove that there is not a dangerous condition. Aside from the difficulty of proving a negative, this also puts a tremendous expense on the tenant – often reaching into tens of thousands of dollars in legal and engineering costs – just to counter a problem the owner claims but hasn’t proved. 

We know of a number of buildings where tenants are unsure about applying because they suspect the cost of fighting an Incompatible Use claim may be too much for them. If an owner wants to disqualify a building, they should be compelled to show that there is an Incompatible Use, not the other way around.

Another way we have found the implementation of this law has unduly burdened tenants is in two phrases of 2-08(k): “has or should have … an environmental rating of ‘A’ or ‘B’”, and, “is or should be classified as a High-Hazard Group H occupancy” [emphasis added]. What should matter is if the actual activities and substances in the building are dangerous, not whether the business or building owner acquired permits for something they are not actually doing.

To take some examples we have seen: a factory has a Certificate of Occupancy for box manufacture, which could be incompatible, but now only assembles them: compatible. A garage has FDNY permits to keep large oil drums on the premises but actually stores them across the street. It is not what the business filed for permission to do, either in the past or in planning for the future, but what it is doing, that endangers residential tenants.

Or in other words, what matters is not if a certificate for process equipment “has” an environmental rating of “A” or “B”, but whether it “should have” that rating. It is not whether an occupancy “is” classified as High-Hazard Group H, it is whether it “should be”.

A building should not be deemed incompatible just because the Certificate of Occupancy or permits were over-filed or misfiled.

Thank you,
NYCLT

No one knows loft buildings better than the tenants who live there. Often tenants did most of the work to convert an empty warehouse or factory into living rooms, bedrooms, and kitchens. So when it comes time to make the building safe, it’s essential to have the tenants’ input. 

That’s a large part of why the Narrative Statement Process was created. Rule 2-01 is very well thought out and fair. However, many loft landlords are flouting the process and trying to escape the tenant oversight that is at the heart of the rule. Don’t let them!

One way landlords are doing this is through abuse of the Narrative Statement Waiver. The intent of the waiver under 2-01(f) is to save time and effort for landlord and tenant when they already agree on what work should be done, not to remove the tenant’s vital understanding from the process. Yet NYCLT is hearing many reports about landlords getting tenants to sign waivers with claims like “it’s so that we don’t have to change your unit” and other nonsense. Some have even pressured tenants to sign waivers without showing them a narrative statement, or without even having filed an alteration application!

NYCLT thanks the Loft Board for adding language to the rule mandating that the waiver must “identify the relevant plan and narrative statement by date”, and also for allowing conferences with tenants who didn’t understand what they were signing away.

However, the waiver form is clearly inadequate:

• It makes no attempt to explain the Narrative Statement Process, even briefly.

• It does not assert that the tenant has reviewed the plans and statement, nor does it assert that they understand that their unit and building will be legalized accordingly.

• It does not ask the tenant to acknowledge that they are waiving any further input into the plans and narrative in their present form.

• It also does not state that any further changes will be subjected to an amended Narrative Statement Process.

Given that the only way most tenants learn about the Narrative Statement Process is if they contact a volunteer tenant group or speak with a lawyer, it is no wonder that tenants sign their rights away. And when a group like NYCLT tells tenants one thing, and landlords say another thing, the tenants don’t know who to believe. Reading the summaries on the Loft Board website might give them a start, but the website doesn’t even say what the waiver is for.

We ask that the waiver form make tenants aware of how the process works, ensure they have have had a chance to review the statement and plans, and state what rights they are signing away.

Another way landlords try to manipulate the Narrative Statement Process is by giving tenants Narrative Statements that that are vague and dishonest, often without even having filed an alteration application or having plans available. For instance, the statement might quote building code correctly, to make it look intelligent, but then not specify which partitions will have to be changed in a unit, or what plumbing or wiring needs to be replaced. We acknowledge this is partly remedied through tenant education, but we ask the Board to continue being vigilant about the quality of statements and the completeness of service. 

Because of landlord disregard for the process, the notice of the Narrative Statement Conference may be the first time tenants even hear about the process at all. So please continue to be diligent about getting the notice to tenants on time.

Given how essential tenant participation is to building safety, we beseech the Loft Board to keep tenants involved and not tolerate attempts to short-circuit the process.

Thank you,
NYCLT

Last summer NYC Loft Tenants participated in the hearing on Rule 2-12 to ask that the Loft Board make milestone rent increases transparent. This way tenants would know when a rent increase is legal and wouldn’t be at risk of retroactive increases. This remains a serious issue and we urge the Loft Board to consider our renewed request. 

NYCLT offers a biweekly free and public Housing Clinic to help educate and empower tenants during the application and legalization process. We are frequently asked to help tenants understand what their legal rent is and where their building is in the process. We continually hear stories about landlords, under the new law, asking for rent increases which may or may not be based on milestones achieved. It is generally not easy to determine a building’s milestone by looking on BIS, because most buildings under the new law have had numerous earlier attempts at legalization and it is not clear which permits are valid. We are also seeing an increasing number of landlords under the old law suing their tenants for 10 to 15 years of retroactive rent increases which the landlord somehow forgot to ask for previously.

We’re here today with a simple solution: require landlords to notify their tenants about milestone increases and provide proof that the milestone was reached. As it happens, in Rule 2-01 the landlord is already required to provide proof of each milestone to the Loft Board; we simply ask that the landlord be required to deliver a copy of this proof to the tenants as well.

The first milestone is when a landlord has filed an alteration application. They are supposed to deliver the Narrative Statement to tenants within 15 days, and then deliver the proofs of service and a copy of the application to the the Loft Board. Why not have them include a copy of the alteration application with the Narrative Statement?  This would also eliminate the frequent problem of landlords delivering Narrative Statements to tenants without having completed plans or an alteration application.

The second milestone is when the DOB issues a building permit to the owner: the owner is required to file a copy of the permit with the Loft Board. Why not also have them deliver copies of the permit to tenants as well?

The final milestone is when the landlord has achieved 7B certification or a Temporary Certificate of Occupancy. Again, the landlord is obligated to deliver the certificate to the Loft Board; why not have them also deliver copies to the tenants? There is currently no way to find out if this milestone has been reached except by calling the Loft Board.

By these simple means, tenants would not be surprised by an increase, and can be sure it is legitimate. It means less stress for tenants, many less confused calls to the Loft Board and greater legal clarity.

Thank you,
NYCLT

Last Monday, the Loft Board published six rules for public comment. The hearing will be 1pm May 16th at 22 Reade St. 

You can read the changes to the rules on the Loft Board site. (Scroll down to “Recent News”.)

Are you concerned about how you’ll know whether your building is in compliance, Incompatible Use, or how increases get applied?

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