PSC Intervention Pays Off

Con Edison rates will be going up less this month than requested thanks, in part, to CHIP’s intervention in the State Public Service Commission rate setting proceeding. This was the first time CHIP took part in the process. Con Ed had sought an 8.2% gas rate increase and 4.5% electric increase. First year increases under the approved tariff will instead be 2.3% for gas and 1.6% for electricity. Con Ed will also be required to provide automatic upload of benchmarking data by the end of the year, without charge.

CHIP, this week, filed an appeal with the State Department of Labor to update the amount of rent that can be included in calculating compensation under the state’s new minimum wage laws. The law allows an owner to add a rental value for a super’s apartment into the total compensation reported for compliance with wage laws–but the rental value is set at the 1975 rent. We are prepared to litigate if the number isn’t changed.
We were also active in court this week, as oral arguments on motions were heard in Portofino vs. DHCR. CHIP is one of the plaintiffs challenging the January 2014 amendments to the Rent Stabilization Code that established the Tenant Protection Unit and changed the formula for certain rent calculations retroactively.

Because of the higher purchase prices for condos receiving 421-a benefits, condo buyers in Manhattan spend on average 53 cents to 61 cents for each $1 of tax savings, according to the City Independent Budget Office. Condo owners in the rest of the city spend on average 42 cents to 50 cents for each $1 of tax savings, the IBO said in a new report. Somehow, the IBO concluded that the difference between the tax savings and the premium was a “wasted” benefit instead of part of the incentive value for developers to risk building in the first place.

The IBO’s argument, however, meshes neatly with Mayor de Blasio’s argument against continuing 421-a benefits for condos and his call for a new “mansion tax” on apartment sales over $2 million to support affordable rental development.

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