## Facts

- Boulevard Gardens Housing Corp. operated a state-regulated limited-profit housing project under New York’s Private Housing Finance Law (Mitchell–Lama), with about 950 tenants.
- Boulevard Gardens Tenants Action Committee, Inc. was a tenants’ association comprising roughly 90% of the project’s tenants.
- About 486 tenants had air-conditioning units and paid a separate monthly air-conditioning charge.
- The supervising state housing agency (described as the New York Housing and Community Renewal Executive Department) approved an increase in the air-conditioning charge from $3 per unit per month to $6.50 per unit per month.
- The agency approved the increase without holding a public hearing.
- The tenants’ association, together with an individual tenant acting in a representative capacity for similarly situated tenants, filed a proceeding under CPLR Article 78 challenging the approval on the ground that a public hearing was required.
- The litigation also raised procedural questions about who could sue on behalf of the tenant group and whether notice to other tenants was needed.
- The court treated the pleadings flexibly, including converting the declaratory-judgment form into the proper special-proceeding posture and permitting representative participation.

## Issues

1. Whether the tenant association and/or an individual tenant could prosecute the challenge in a representative capacity for tenants affected by the air-conditioning charge increase.
2. Whether the air-conditioning charge increase constituted an increase in “rental” under the Private Housing Finance Law, triggering a statutory requirement for a public hearing before agency approval.
3. Whether the court could treat the matter as a special proceeding and reach the merits rather than dismissing based on form.

## Decision

- The court treated the case as an appropriate special proceeding (including conversion under CPLR 103(c)) and addressed the merits rather than dismissing for procedural form.
- The court permitted representative participation (including an intervening/representative tenant) and considered the tenants’ association’s role in bringing claims common to many tenants.
- The court upheld the agency’s approval of the increased air-conditioning charge, concluding that the charge was not “rental” within the meaning of the Private Housing Finance Law.
- Because the charge was an optional, separately billed service rather than part of base rent, the agency was not required to hold a public hearing before approving the increase.
- The tenants therefore were not entitled to Article 78 relief setting aside the agency action on the “no hearing” theory.

## Legal Principles

- Under the Private Housing Finance Law, statutory hearing protections tied to increases in “rental” apply to base rent (the core consideration for the tenancy), not automatically to every separate fee or amenity charge.
- A separately stated charge for an optional service—such as air conditioning for tenants who choose to have units—may be treated as distinct from “rental,” so an increase in that charge does not necessarily require a public hearing.
- Courts may use CPLR 103(c) to convert an action to the proper procedural form and proceed to the merits when the substance of the claims calls for special-proceeding treatment (including Article 78-type review).
- Tenant groups and individual tenants may be allowed to proceed in a representative manner when the challenged practice applies uniformly to many tenants, subject to the court’s management of notice and fairness concerns.

## Conclusion

In *Boulevard Gardens Tenants Action Committee v. Boulevard Gardens Housing Corp.*, the Supreme Court, Queens County, upheld a state housing agency’s approval of an increase in a Mitchell–Lama project’s air-conditioning surcharge from $3 to $6.50 per month, ruling that the surcharge was an optional, separately billed service and not “rental” under the Private Housing Finance Law; as a result, the agency’s failure to hold a public hearing did not invalidate the approval, and the tenants were not entitled to Article 78 relief.


Boulevard Gardens Tenants Action Committee v. Boulevard Gardens Housing Corp., 88 Misc. 2d 98, 388 N.Y.S.2d 215 (1976)