In Vink v. DHCR, 285 A.D.2d 203, 729 N.Y.S.2d 697 [1st Dept. 2001]), the court noted that Rivercross had argued that DHCR lacks the authority to impose any particular surcharge schedule and that DHCR disagreed, maintaining that it has the power to direct Rivercross to do so (id at 208).

There was no need for the court to resolve the issue because the Rivercross Board had fixed the increases and DHCR had approved them.

In the Supreme Court, Justice Figueroa held that the actions of Rivercross and DHCR in increasing the surcharge schedule were consistent with the PHFL. He also noted that Rivercross and DHCR were intended by the Legislature to have "interlocking, rather than unilateral, capacities" (id at 209).

The Appellate Division held, however, that DHCR is "empowered" (id at 211) to vary rents and that "while retaining oversight authority on the matter of amending surcharge schedules, has in that case, eschewed any greater role in micro-managing these essentially financial issues." (id at 210).

Clearly, the Appellate Division was satisfied that DHCR possessed the authority to micro-manage the fiscal affairs of regulated Mitchell-Lama projects but had no occasion to exercise it in that case. Further, in rejecting an effort by some residents to require DHCR to order Rivercross to increase the surcharge schedule to the maximum provided for in the PHFL, the Appellate Division held that DHCR's powers in this area are "discretionary, rather that ministerial" (id at 211).

The Appellate Division having determined that DHCR has the discretion to amend the surcharge rates, petitioner's claim that DHCR exceeded its authority when it ordered amendment of the surcharge schedule over petitioner's objection must be rejected.