Feature

by Kim Boyd-Birmingham

Q. Are passthroughs still worth doing, and if so, who is doing them?

A. For most landlords, passthroughs are still an excellent option. Although every landlord must weigh the costs and benefits of each passthrough, most have decided that in their best interest they should file. The main reason is that if you do a passthrough, you get something rather than nothing. For this reason—following an initial drop-off after the capital improvement passthrough “compromise” (CIP) came into effect—our company, Rent Board Passthroughs, files several requests per month.

Q. What are the most important points I need to know about the new CIP laws?

A. There are three important changes in the laws that require you to take action before or at the time the work is being done.

Notices of Violation
Act on Notices of Violation immediately. Costs to correct a code violation with an unabated Notice of Violation for 90 days cannot be certified according to the new law. If you cannot complete the work within 90 days because of the nature of the work, or have delays that are out of your control, you may still be able to pass it through. However, carefully and diligently document your progress and the reasons for delays.

Estimator Fees
To avoid hefty estimator fees, get at least one competitive bid for each project before you decide on a contractor, and obtain back-up documentation from your contractors for both time and materials’ billings. When you file a petition that exceeds $25,000 in costs, you must have documentation of competitive bids (or backed-up time and materials’ billing). If you don’t have this, you will be charged an estimator fee based on the total cost of all projects without competitive bids (or T&M back-up).