Payroll Expense Disallowed from Cost of IAIs Added to Rent

Rent-stabilized tenant complained of rent overcharge. The DRA ruled for tenant, disallowed part of a rent increase collected for individual apartment improvements (IAIs), and ordered landlord to refund $1,987. Landlord appealed and lost. Landlord claimed that a worker it used was an independent contractor. But landlord put that person on payroll to do the work, which made him an employee. The DRA correctly disallowed $1,500 paid to this contractor and included in the reported IAI cost.

Keystone Towers Association LLC: DHCR Adm. Rev. Docket No. FU210017RO (4/5/18) [2-pg. doc.]