Governor Kathy Hochul and New York State Homes and Community Renewal Commissioner RuthAnne Visnauskas have announced a $3.1 million settlement with the Lefrak Organization after an investigation by the Tenant Protection Unit (TPU) found that tenants in 59 rent-regulated buildings across New York City were improperly charged for water use. The agreement ends these charges, provides full refunds with nine percent interest to nearly two thousand tenants, and requires independent monitoring to ensure compliance.
“We are committed to making the State more affordable and livable for all New Yorkers and will not allow illegal fees to drive up costs for millions of rent regulated tenants,” Governor Hochul said. “Today’s settlement will refund these prohibited charges back into the pockets of tenants and send a powerful message that our Tenant Protection Unit is working tirelessly to defend millions of New Yorkers by upholding our rent laws and preserving our rent regulated housing stock.”
The TPU began its investigation in 2024, engaging with Lefrak, which then agreed to stop charging tenants for water while awaiting a legal decision from the Office of Rent Administration (ORA). After ORA confirmed on appeal that Lefrak was improperly billing tenants, the organization agreed to drop any further appeals or related court proceedings and provide relief throughout its portfolio.
Key terms of the settlement include stopping all collection of water usage charges beyond monthly rent as of October 31, 2024; issuing credits to current tenants for all water charges paid since moving in; paying nine percent interest on refunds; and hiring an independent auditor at Lefrak’s expense to monitor ongoing compliance.
“This is a good day for tenants and for the LeFrak Organization, which chose to swiftly engage in resolving this regulatory dispute and ensure that relief extended well beyond the original complaining tenants. This is how government works best, delivering decisive successes for New Yorkers and safeguarding affordability. I commend the Tenant Protection Unit for recovering more than $3.1 million for nearly two thousand tenants, and their continued work protecting a million rent regulated households,” said Commissioner Visnauskas.
The TPU works to protect renters’ rights through audits, investigations, legal actions against landlord fraud or harassment, and by informing both tenants and owners about their rights under rent regulation. In previous cases this year, TPU reached settlements totaling hundreds of thousands of dollars against other landlords over similar violations.
Tenants who believe they are being overcharged or harassed can contact the Tenant Protection Unit at 212-872-0788 or via email.
