On August 22, 2024, the Appellate Division, Third Department granted the Hudson Valley Property Owners Association, Inc. (HVPOA) leave to pursue its appeal contesting rent stabilization coverage at New York’s highest court.
In 2022, the HVPOA and a coalition of Kingston, NY property owners, represented by BBG, challenged both the City of Kingston’s opt into the Emergency Tenant Protection Act of 1974 (ETPA) and the local rent guidelines board’s unprecedented rent roll-back.
Kingston had opted into the ETPA following the passage of the Housing Stability and Tenant Protection Act of 2019. Kingston justified imposing rent stabilization on local owners after conducting a deeply flawed vacancy survey that purported to show that the vacancy rate in Kingston was less than five percent. Such a vacancy rate is a precondition for entry into the ETPA. Thereafter, the Kingston Rent Guidelines Board approved an unprecedented and oppressive 15% rent roll-back.
Marshalling extensive evidence, HVPOA challenged both the validity of the vacancy survey as grossly inaccurate, and the rent roll-back as unlawful. The trial court judge ruled that while the vacancy survey was sufficient, the rent rollback was unlawful. The decision was appealed to the Appellate Division, Third Department, which determined that both the vacancy survey and the rent-roll-back were proper.
BBG sought leave to appeal to the Court of Appeals, which was granted by the Appellate Division. We expect the Court of Appeals will decide what constitutes a proper vacancy survey and whether a rent roll-back is lawful. As a number of municipalities have either since opted into the ETPA or are considering it, this guidance from the High Court is critical.
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If you have any questions or need further clarification regarding this recent development, please reach out to your BBG attorney of record.