and gentlemen good evening anybody take a seat I'd like to read the sunshine Laur to oh I'm gonna give Bridget as much time as she needs sorry Bridget okay take your time yeah for for for you I yeah it's horrible I don't know where Dan is coming in from yeah I didn't want you guys to worry sorry I'm having a little techical here you knew that was kind of over here pal six for okay good evening ladies and gentlemen welcome to the uh rent leveling Board of Jersey City and I'm going to read the sunshine low to the record haven't been properly advertised in accordance with the sunlight shine laws state of New Jersey and being today March the 20th meeting of the Jersey City rental living board is hereby coming to order at looks like almost 6:30 I need a roll call please present here cor established thank you okay so what I'd like to do is I'd like to first of all thank everybody for attending tonight's meeting and uh please speak only when recognize me as the chair to speak address the board and night your adversary please uh keep your presentation issues in question the board will listen to all sides of the complaint or application come to a decision all parties will receive a written decision within three weeks you will then have 45 days to appeal the decision to the superior court if you do not like our decision tonight please be civil and appeal it uh you will receive it in writing I hope to count on your cooperation I thank you um also this is a reorganization meeting so what I would like to um since everybody's not here like to make a motion somebody make a motion if they would like to reappoint uh everybody that's in place now and then if not then we'll just can move on from there so somebody make a motion motion to reappoint okay second second second all in favor I any object motion's been carried the the board is now um reappointed as chair and then Vice chair um the legal section the the adoption of the annual schedule do we have that and to reopt the board's rules do we have that up is microphone just just speak up like I'm talk no problem okay everybodys to my apologies I don't have the uh proposed schedule I can send it around and we can formally adopt it next oh no that's no good we can't do that no but I I don't think it's an issue the clerk's office has it and we haven't had an issue with no I'm fine that that that's fine John no no problem okay and the is there any changes to the board rules before we go any further there has okay so we're we're good on that on that okay very good all right so I'm going to call the first case which is a vacancy Capital Improvement appeal um 129 Magnolia Avenue units 202 306 and 519 and this is VI CI 2023 d47 48 and 49 in this case if there's no objection I'm going to merge all three into one case okay no objection counselor you have the floor good evening my name is Yoli ring and I represent Magnolia apartment's 129 LLC regarding the three vacancy Capital Improvement appeals as you just stated uh first I just want to address that my client complied with all of the procedural requirements in these applications um the approximate expenses that were inquired were 74,000 for unit 20 2 96,000 for unit 306 and 96,000 for unit 519 along with these applications there was an application for unit B3 and there was approximately $133,000 worth of work to that unit however hold on councel okay so she's trying to enter another unit into tonight's meeting am I did I have so that unit was used to they took that unit the square foot the cost per square foot and use that for the rest of the unit so that's not up for appeal tonight but it is part of the exhibits um that I submitted does that make sense yeah I'm I'm a little confused you're going to have to elaborate I'm sorry all right so unit B3 they were all submitted there were four applications submitted together when the inspector did his memo he took B3 and he said the cost per square foot for all of the units is based on unit B3 so unit B3 was acceptable to our client and we're not appealing that but that was used to base for the cost of the other three applications M okay and that in our opinion is not accurate at all okay so uh when the inspector subsequently us this uniform rate per square foot for unit B3 they approved cost for the three units 25,000 for Unit 202 60,000 for unit 306 and 61,000 for unit 519 which was much lower than the actual cost of the improvements and what was submitted in the application okay um Eric you guys you are okay with this with with the explanation given for unit B3 and and the other three that are here we we're okay okay okay okay you can you could proceed all right so this approach disregarded the clear documentation that was provided by my client in all of the applications um there was a blanket per square foot rate that was applied without actually looking into the expenses in incured by my client um so even if they want to do this blanket per square foot and group all these units together by just choosing the one unit it's very inaccurate if you take all of the units and do that blanket per square foot calculation it actually comes out to about $168 per square foot as opposed to the $126 per square foot that was applied based on unit b3s improvements okay so in conclusion this decision to have this blanket per square foot was an arbitrary calculation of what was done to all these units um it's at a great detriment to my client who spent a lot of time money and effort to make these Renovations and to submit all these applications and it's not a good representation of the work that was actually completed okay Tom do you have anything to add to this please you swear or affirm the testimony you're about to give in this proceeding will be the truth the whole truth and nothing about the truth I do okay first of all uh the documentation that the applicant provided was there but I want to start by reading a section of the rent Control Ordinance 26-5 the board in Computing the amount spent for special capital impr for I'm sorry for Capital Improvements may consider the reasonable value of Construction Services performed by the owner in the actual Capital improvement work which this is here before you because they're appealing it many many times in our vacancy Capital Improvements we deduct money from the client and they just don't OB to it so this is a routine procedure for us evaluating VY and when we look at these these came in four together and I did approve the larger unit which was 1,50 square feet but then looking at the two specifically the 480 and the 490 they're basically over two3 of the price of that one and construction goes by square footage basically everything in construction goes by square footage whether it's install in tile flooring sheet rock everything is done by square footage so I use that dollar amount and transferred it to the other three units which there is a mistake Unit 202 says 25536 actually should have been 44,47 it was just a calculation error there should have been more money attributed to Unit 202 so that's where I came up with those preunit prices it was based on the footage now to again I said everything is done on square footage we go by a it's called the 2023 National Home Improvement estimator um to go through item by item what things should be costing some applicants actually do a line item where they'll indicate how much tile is how much flooring is how much sheep offs this applicant didn't they basically have like had like eight or nine um invoices one's for the plumber one's for the electrician um one is for the appliances one is for uh the general contractor which was the largest portion of that and what we did and I provided this to the board is we went through the general contractor's invoice and basically went line item by line item and documented what each thing should cost ACC to National Home Improvement estimator and that's what I provided the board and you'll see I did a vinyl floor breakdown entrance door windows painting uh sheet rock framing fire stopping tile and backsplash and the number that I came with with and I just outright accepted their prices for electric plumbing Appliances kitchen cabinets and the architect so these numbers 2540 88640 for Plumbing yes those are these these are all okay individual invoices from their subcontractors that I just accepted out thank you okay when you line item everything for the rest of the apartment I come up with 49527 52 and then there's modifiers because New Jersey is more expensive to do construction GE and the modifier for New Jersey is 11% that puts me at what I estimate the whole job should have cost, 974 9754 which is very close to what the square footage price of the original calculation which I gave them 66816 okay um you know it's the documentation was there not saying that they didn't pay what they paid it's just the issue of uh you know if I spent 200,000 on an department does that mean I should be able to pass that cost through to the next prospective tenant right okay you know again if there wasn't such a difference in the price per square foot for the different units they probably if they were much closer in price they may not have been flagged and we may not have gone through the effort of basically taking one apartment I only did the one apartment where we itemized every single thing that was done to the apartment and that's basically where we came up with the calculation okay Commissioners any questions of Tom in this case do what go I have a question just because I mean I understand the square footage formula um but when you break down a are appliances included in that square foot because no the in the overall number yes they are but I just accepted their number outright as as the legitimate number I didn't question any of that any of their subcontractors I basically took what the general contractor did and gave a line item amount for all of his work and came up with a substantially the fridge is pretty much a fridge you know and you you could buy cheap ones and you could buy expensive ones and basically just accepted their all of their subcontract subcontractors itemized Sullivan my my question because when I was going through the material um and I can appreciate where exactly where you're coming from Tom but I'm trying to find out where you made aware of how this these these determinations were being made because I was trying to find the correspond respondence to made aware of how his no I was not yeah that that wasn't in the discovery materials at all okay yeah because I think that perhaps if that information had been exchanged there may be more agreement amongst everybody as to yeah yeah okay anybody else any questions of the attorney or of Tom no I don't okay Tom is there anything else you want to add to this or you no you're okay okay well I can I would have one one another question then given what you've just heard does that seem to hold solidly with you so I brought my client with me who can speak more to the specifics of the work and I kind of want to give her the floor to talk a little bit about that because I think she'll be able to respond that's fine yeah can you swear swearing please do you swear or affirm the testimony your BS given is proceeding will be the truth the whole truth and nothing but the truth yes I do and state and spell your full name please uh Regina U uh r e g i n a y u thank you and address like my home address uh 937 Boulevard East uh wehawken New Jersey okay 070 you may proceed okay thank you um can use the mic yeah you can use the mic you're good um so while I understand that a lot of construction costs are um based on a per square foot basis um the building the 129 magnoli building that we are doing improvements in is a very old building um a lot of things change when you open up the walls um B3 for example is a ground floor unit um it was slab on grade um the other units were not uh obviously they're on elevated floors um and a few of them for example when you take the flooring off you find that the floor isn't level um so you have to level the floor that costs material that costs labor it costs time so a lot of the increase and variation from the general contractor is due to a lot of these field conditions um some units um I know we opened up the walls we had to replace all the insulation other units the insulation was fine um it's it's these these small different changes field field conditions um that resulted in um all of the different What's the total amount of units in this building uh I'm sorry I don't know off the top of my head okay that's um but I know the building is weird shaped and all of the units are kind of shaped differently the exterior units are weirdly size the interior units are mostly like in a line um the the building in general uh it's a masonry building um it's got a steel frame in it it's got wood wood like wood stud in it it's all sorts of wacky um I spent seven years in the aec um construction industry so um there's a lot of weird stuff that comes up when you're trying to move interior walls and stuff like that okay you you could proceed that's fine yeah I I think that's you're done okay councelor anything you want to add yeah I mean as my client said I think taking the B3 unit was not a good representation of all the work that was done on the other three units I think something that might be more in the middle as my alternative suggestion of taking the the average of all the units work um however I think they honestly should be looked at as individual applications and I think the work should be looked at through the itemized receipts that were provided I I think our requires that where the benefit of the capital Improvement is exclusive to a are required to treat that that Capital Improvement separately I think one thing that from my perspective as the board probably knows by now I'm always looking at what's the risk on on appeal for for the board here the one thing that is maybe being filled in by testimony but isn't in the documents um a Mr Colleen's methodology in terms of um what where he where he's getting the costs that he's using for the multipliers and then also of perhaps the uniqueness of the property itself which is not also not in the landlord's uh invoices from the contractors not that we would normally expect it to be but without those two bits of information I'm not sure we had a complete picture before tonight um I don't know if that takes toward providing an opportunity for either a supplemental inspection or supplemental submissions bys please sorry um my question is basically if there are nuances in the building that are different and I live in a building just like that um other exceptions made by the law to heere and understand what those expectations are if there are exceptions um are they even allowed or is the basically the guide what the guide is and it doesn't matter if you've you know want to do improvements in something that's 10 years old or 150 years old just I want to just ask that question I answer from laws perspective obvious have to Def substance I don't have anyer at all in that area but the ordinance doesn't specifically say that you must use one formula or one guide or or anything like that it does effectively because the landlord is required to prove the Capital Improvements there's a level of discretion for the bureau over reasonable cost is for for a job they have to be able to say this this math doesn't add up so to speak but the discretion then lies with mren to make that call and then justify those are two things we have to do so he has the ability to look at it based on his expertise but then we also have to be able to show how that work would that be an option to do another inspection on the build just sort of see or than just more formal write up on where the num came that's kind of my concern yeah I was gonna that that's that's where I was going with that yeah because I I I I have confidence in what Tom has in terms of what the inspector has put together but the fact that that information wasn't shared with Council kind of you know and then the documentation that we had to review right hearing some of the other uh that wasn't present in terms of the paperwork that I was initially looking over um I wish they I can't hear you I'm sorry yeah that's that's where my concern is that some of the documentation as I was telling us you know wasn't included with the paperwork so that we understand exactly how the calculations were so what you're saying is maybe we need another inspection I don't know if it's another in are you talking I'm sorry if you are I need to be able to yeah okay I have a question sure like how long have you own the building I want to say about five years right about five years I'm just curious like tenant moves out moves in these numbers are a square foot it do seem a little high how bad was this shoot I mean see the pictures uh we had a unit where it was like a skate park when we walked in it and the floor was just so divided we I mean it depends on the unit right um but the building itself is quite old some units are nicer than others um but really leveling the floors is actually quite a large expense because you have to up everything and then you have to install new joist next to it then you have to get the material in the building the reason I'm asking is like I don't want to like do you just let a unit go how bad do you let it to go to get these cost to elevate the rent that's where well a lot of the units uh we renovate as they move out so a lot of the times the tenant hasn't moved out at all so like since we have have had it basically right so I mean if they move out then we're going to renovate it but we acquired the property 5 years ago and a lot of the tenants just they they stay there for however long and then I mean it's not you don't we renovate it before you're I have a question following up what you just said and that is um if the unit is in that kind of shape we're talking about here is that actually a capital Improvement was is that a necessary repair because now we're in a different territory if it floors a slope this badly so there's there's a there's a deflection limit governed by the um IBC um technically you're under the the limit but I mean a lot of it's not like to the point where it would be an improvement that is um require I don't sorry I'm not of sure of the phrasing detrimental to living um it's it's more of like you know your tenant doesn't want to walk in their room and like go down a little bit so we we we decided that you know for example the floors is is something that um you know would be important for that's I I understand that part but I'm saying if you for example is there's famic in there you don't want to fik a new tenant you put Gran it should the new tenant be forced to pay the increased rent because you chose to upgrade upgrade upgrade like that's kind of from for it's say granted yeah right I mean that that's where the number seem a little increased that's my like I mean yep for 400 square foot or you know three like to do a kitchen a bathroom like his numbers seem pretty reasonable that's wrong and I agree too that's where I'm at I think his numbers are yeah 350 fo I think that that's yeah I agree money about the building yeah that's lot yeah put in the height of the market do have a question Tom what was the was that a an ordinance or was that part of the Jersey City Municipal Code you had mentioned something that's that's part of the rank Control Ordinance yes which one was it because I know I looked at 260 is that is that 260 is that is that okay sorry brid yeah yeah by that um and just as a side note I think they've owned the building less than five years because I don't I just want to remind the board this was the building that put in a capital Improvement of 1 something million uh for the entire building they did the roof they took down all the uh the top of the defitely prop but that was I think about three somewhere between three and four years ago four years ago that we did approve majority of the capital Improvement for that that was the one with Joe pinski if I remember uh Tom right okay yes I do I do remember yeah yes I remember so they just got it that's why M just spent millions and all of a sudden this seems a little yeah pgy backing on all right so um I think at this point I think we're going to take five minutes um so bridg we're going to be off for five minutes okay we're we're going to discuss this discuss thee has to be on the okay you guys have anything else to ask you okay I do want to clarify inspector mentioned there was a mistake in Unit 202 is that correct yes okay and what is calculation should have been and it's just a math error the calculation should have been for that one 4,247 not 25 okay okay I just wanted to clarify that okay thank you m thank you okay commission is in any uh any recommendations or I don't see so then will you want to make a motion to uphold the uh determination at this point then yeah okay just one question I will one quick first off I had a little trouble hearing secondly um if inspector colen is looking to alter the determination slightly of his own ACC we can do that sure thank you all right so so motion to uphold and to give insor the opportunity if' like to alter okay that's the motion on the floor second second okay seconded and uh need a roll call please I I hi hi you have it the motion passes motion passes thank you okay have a great evening thank you okay thank you and before we adjourn the meeting is there anything else Tom that we need to discuss or we're okay in that case I'll make a motion to conclude the meeting second all in favor I we're done thank you okay good at 265 yeah yeah I mean I was