{"data":{"id":"us-dc/d.c.-code-42-3502.12","jurisdiction":"us-dc","citation":"D.C. Code § 42-3502.12","heading":"Hardship petition.","body":"(a)\nWhere an election has been made under § 42-3502.06(c) to seek a rent adjustment through a hardship petition, the Rent Administrator shall, after review of the figures and computations set forth in the housing provider’s petition, allow additional increases in rent which would generate no more than a 12% rate of return computed according to subsection (b) of this section.\n\n(b)\nIn determining the rate of return for each housing accommodation, the following formula, computed over a base period of the 12 consecutive months within 15 months preceding the filing of a petition under this chapter, shall be used to:\n(1)\nObtain the net income by subtracting from the sum of maximum possible rental income which can be derived from a housing accommodation to which this section applies and the maximum amount of all other income which can be derived from the housing accommodation the following:\n(A)\nThe operating expenses, but the following items shall not be allowed as operating expenses:\n(i)\nMembership fees in organizations established to influence legislation and regulations;\n(ii)\nContributions to lobbying efforts;\n(iii)\nContributions for legal fees in the prosecution of class action cases;\n(iv)\nPolitical contributions to candidates for office;\n(v)\nMortgage principal payments;\n(vi)\nMaintenance expenses for which the housing provider has been reimbursed by any security deposit, insurance settlement, judgment for damages, agreed upon payments, or any other method;\n(vii)\nAttorney’s fees charged for services connected with counseling or litigation related to actions brought by the District government due to the housing provider’s repeated failure to comply with applicable housing regulations as evidenced by violation notices issued by the Department of Buildings; and\n(viii)\nAny expenses for which the tenant has lawfully paid directly;\n(B)\nThe management fee, where applicable, of not more than 6% of the maximum rental income of the housing accommodation unless an additional amount is approved by the Rent Administrator as follows:\n(i)\nThe housing provider shall first file with the Rent Administrator a petition which contains information the Rent Administrator may require, including, but not limited to, the name of the payee; and\n(ii)\nIf the Rent Administrator determines, based on the petition and other information the Rent Administrator may require, that the excess over 6% of maximum possible income or part of income is reasonable, the Rent Administrator may permit the same excess or so much of the excess as is reasonable;\n(C)\nProperty taxes;\n(D)\nDepreciation expenses to the extent reflected in decreased real property tax assessments;\n(E)\nVacancy losses for the housing accommodation of not more than 6% of the maximum rental housing income of the housing accommodation unless an additional amount is approved by the Rent Administrator;\n(F)\nUncollected rents; and\n(G)\nInterest payments;\n(2)\nThen, divide the net income by the housing provider’s equity in the housing accommodation to determine the rate of return.\n\n(c)\n(1)\nAt the housing provider's election, instead of any adjustment authorized by § 42-3502.06(b), the rent charged for an accommodation may be adjusted through a hardship petition under this section. The petition shall be clearly identified as an election instead of the general adjustments authorized by§ 42-3502.06(b). The Rent Administrator shall accord an expedited review process for these petitions and shall issue and publish a final decision within 90 days after the petition has been filed.\n(2)\n(A)\nIn the case of any petition filed under this subsection as to which a final decision has not been rendered by the Rent Administrator at the end of 90 days from the date of filing of the petition and as to which the housing provider is not in default in complying with any information request made under § 42-3502.16, the housing provider may conditionally implement an adjustment of the rent charged, at the end of the 90-day period, in accordance with this paragraph.\n(B)\n(i)\nThe conditional adjustment of the rent charged that shall be available to the housing provider for an affected unit shall be based upon the Rent Administrator's hardship petition form completed by the housing provider and returned to the Rent Administrator.\n(ii)\nIf the hardship petition form indicates that the net income of the housing provider for the affected units is negative, the conditional adjustment of the rent charged for the affected units shall not exceed 5% of the current rent charged.\n(iii)\nIf the hardship petition form indicates that the net income of the housing provider for the affected units is positive, the housing provider may not implement a conditional adjustment of the rent charged.\n(3)\nA conditional adjustment of the rent charged shall be subject to subsequent modification by the final decision of the Rent Administrator on the petition. If a hearing has been held on the petition, the Rent Administrator shall, by order served upon the parties at least 10 days before the expiration of the 90-day period commenced pursuant to paragraph (2) of this subsection, make a provisional finding as to the rent increase justified by the order, if any. Except to the extent modified pursuant to § 42-3502.06 or this section, the adjustment procedures of § 42-3502.16 shall apply to any adjustment.\n(4)\nIf the Rent Administrator denies the requested rent increase or approves a rent increase that is less than the amount of the conditional adjustment of the rent charged by the housing provider, the housing provider shall refund to the tenant within 21 days of the Rent Administrator's order any rent paid in excess of the amount approved by the Rent Administrator, except that the tenant may elect within 14 days of the Rent Administrator's order to apply any amount of the refund not yet refunded by the housing provider to the tenant, as a credit against future rental payments.","path":["Title 42. Real Property.","Chapter 35. Rental Housing Generally.","Subchapter II. Rent Stabilization Program."],"source_url":"https://code.dccouncil.gov/us/dc/council/code/sections/42-3502.12","current_through":"2026-08-20 (D.C. Law 26-175)","vintage":"","retrieved_at":"2026-08-29T05:44:07Z","sha256":"919afeabbc7f2951ed2077173fc119c0c11c05ed4e79354b39bb26df7dc3c23d","source_id":"us-dc","stale":false,"prev":"us-dc/d.c.-code-42-3502.11a","next":"us-dc/d.c.-code-42-3502.13"},"notice":"GroundRules: Original legal text. Not legal advice."}