(a) Coverage.
(1) These rent guidelines apply to interim multiple dwelling ("IMD") units, as defined in § 281 of Article 7-C of the Multiple Dwelling Law ("MDL"), which (i) are subject to Article 7-C solely pursuant to MDL § 281(5); (ii) are registered with the Loft Board; and (iii) do not meet the safety and fire protection standards of Article 7-B of the MDL.
(b) Definitions. For the purposes of this section, the following definitions apply:
(1) "Lease or rental agreement" means:
(i) a written lease or rental agreement; or
(ii) an oral agreement for a rental period of one year or less, provided that:
(A) There was a change in the rent for the IMD unit, confirmed by rent checks tendered by the residential occupant and accepted by the landlord within the year prior to June 21, 2010; or
(B) There had been a substantial change in the level of services agreed to be provided within the year prior to June 21, 2010.
(2) "Escalators" are additional charges agreed upon by the occupant and landlord to be paid by the occupant provided in a lease or rental agreement, including but not limited to charges based on: real estate taxes; heating fuel; labor; water and sewer; insurance; vault tax; or any cost-of-living increase formulas.
(3) (i) "Use-Based Escalators" are escalators that: 1) are based on a verifiable calculation of the occupant's usage and the cost to the owner; and 2) were part of the last lease or rental agreement in effect on or before June 21, 2010. Use-based escalators may include charges related to gas, electricity and steam.
(ii) Garbage Escalators are escalators related to garbage collection services that were part of the last lease or rental agreement in effect on or before June 21, 2010. Garbage escalators will not include charges for services provided by the New York City Department of Sanitation or a succeeding government agency at no cost to the owner.
(4) "Total rent"
(i) Lease in effect on June 21, 2010. Except as provided in (iii), total rent is the rent, including escalators, specified in the lease or rental agreement in effect on June 21, 2010, paid by the tenant pursuant to said lease or rental agreement.
(ii) No lease in effect on June 21, 2010. Except as provided in (iii), where no lease or rental agreement was in effect on June 21, 2010, the total rent is the rent, including escalators, paid by the tenant to the landlord on or before June 21, 2010 pursuant to the last lease or rental agreement prior to June 21, 2010.
(iii) Total rent shall not include use-based escalators or garbage escalators.
(c) Rent Adjustments Pursuant to § 286(2)(i). For purposes of determining rent adjustments pursuant § 286(2)(i), there will be no increase permitted above the total rent as defined above for any unit subject to Article 7-C pursuant to MDL § 281(5).
(d) Permissible Rent Levels. An owner of a unit subject to Article 7-C pursuant to MDL § 281(5) may not charge a residential occupant more than:
(1) Total rent, as defined above; plus
(2) Any other rent adjustments authorized pursuant to Article 7-C and these Rules, including allowable rent adjustments authorized pursuant to 29 RCNY § 2-12; plus
(3) Use-based escalators, if any; plus
(4) Garbage escalators, if any.
(e) Overcharges and Penalties. Rent payments made prior to September 11, 2013, the effective date of this rule, in excess of the permissible rent levels as described above in subdivision (d) constitute an overcharge which may be paid, at the owner's option, either in a lump sum to the tenant or as a 20 percent reduction of the legal rent permitted under this rule as of September 11, 2013, the effective date of the rule, until payment of the full overcharge is completed. No treble damages may be imposed for a violation of this section.