On Roosevelt Island

RIOC Caves, Aligns with Manhattan Park and Dumps Tenants in Sub Metering Dispute

Updated 1 year ago David Stone, Peter McCarthy
Who Got Thrown Under the Red Bus?
Who Got Thrown Under the Red Bus?
Photo Credit: Wikipedia / Creative Commons License

To get results in the sub metering dispute with Manhattan Park, partnering with RIOC made the most sense — until RIOC suddenly knuckled under. It was as if someone sneaked up and lifted out their collective spine.

Our partnership with RIOC ended badly. This story is a summary of how it went down, from first optimistic steps until a final washout.

A Helpful First Meeting

Cautiously, on June 17th, this year, I emailed Susan Rosenthal, RIOC’s Acting President/CEO, asking who in her organization was responsible for monitoring and enforcing their ground lease with Manhattan Park.

After a couple of clarifying follow ups, Rosenthal replied, “Tell me the problem/issue and let us take a look and then we can meet to discuss.”

As we arranged to meet on July 18th, she added, “We monitor the financial terms of our ground leases but on issues involving tenants, we rely on the tenants or other community stakeholders to bring issues to our attention.  It appears as if this issue (violations of sub metering provisions intended to protect tenants) has not been raised before. I’ve asked Arthur Eliav to review the legal issues you raise.”

Rosenthal is accessible and, in all my experience, consistently honest as well as transparent. Eliav, who joined us for our meeting, is a different personality, less outgoing, so oddly reluctant to reveal information you wonder what he’s not telling you.

I came armed with copies of email exchanges between several Manhattan Park tenants and management as well as electric bills from other nearby locations showing large, inexplicable differences in utility rate charges.

Eliav confirmed that, having scoured their files, no prior complaints about Manhattan Park were found. He was also unable to locate an approved grievance procedure, a requirement that must be met prior to billing tenants for sub metered electricity.

Declining to accept the files I prepared for the meeting, Rosenthal along with Eliav suggested a different approach.

Rather than tie up her limited staff approaching Manhattan Park, she recommended that I write them first, copying her, about our concerns.

Quicker, more direct and less likely to provoke a defensive reaction, this made sense, and I appreciated her guidance.

On July 20th, I sent Michael Kim, Manhattan Park’s property manager, a letter, asking for proof that his company had a) established an approved grievance procedure; b) not made any profit from sub metering and c) billed tenants strictly on utilities used only in their own, individual apartments.

We had — and still have — evidence suggesting violations of all three requirements.

It took two weeks and a push to get a response. While we waited, new information arrived.

The Story Takes a Turn

Roosevelt Island activist Frank Farance, who helped with research I might not have completed on my own, urged me to check in with Mark Lyon, an attorney now relocated to Washington, who while a resident of Manhattan Park fenced with management and the Public Service Commission on the same issues.

Lyon’s response was as generous as it was surprising, the documents he shared so extensive that multiple emails were necessary to keep from choking the system.

What Lyon supplied was invaluable, but it was deflating too.

RIOC, it was immediately clear, had been very much involved and informed of his efforts, only a couple of years earlier, contradicting Eliav’s statements. RIOC’s entire board had been approached, two members expressing some interest.

More troubling was the fact that, copied on much of his correspondence with RIOC was none other than Eliav himself. Clearly, he had not been truthful during our meeting with Rosenthal.

Neither RIOC’s board nor its staff did much of anything about apparent ground lease violations, Lyon reported.

Eager to keep going forward and encouraged by confidence I had in Rosenthal, I made my first mistake in letting my concerns about Eliav pass, assuming good faith errors and forgetfulness in a busy organization.

I should also note that I polled all of RIOC’s resident board members — David Kraut, Margie Smith, Howard Polivy, Kathy Grimm, Fay Christian and Michael Shinozaki — asking if any would like to comment on Lyon’s interactions with them.

Not one even acknowledged receiving the request.

Another Meeting with RIOC, Changed Perspectives 

Among the material Lyon sent me were two related documents. The first, from 1986, was a memo detailing a grievance procedure proposed by Manhattan Park that was rejected by the Public Service Commission because it did not include a third-party arbitrator to whom tenants could escalate unresolved complaints about sub metering.

The other, three years later, was a letter from RIOC approving a grievance procedure that finally met PSC’s demands by including binding arbitration of unsettled, escalated disputes.

The approval letter knocked me a little off balance because, since none of the tenants I was working with nor I had ever seen any grievance procedure nor had any of us been offered arbitration when disputes with Manhattan Park hit dead ends.

For us, discussions consistently ended with Manhattan Park refusing to budge and/or simply stopping communications. Never once had any grievance procedure’s steps or even its existence been mentioned

Rosenthal provided some useful perspective.

“The question now,” she said, concerning the grievance procedure, “is, did they ever put it in play?”

The ground lease requirement for a grievance procedure has a dependent pair of working parts. An approved procedure was mandatory, but it also must be “established,” that is, made available to tenants.

Still troubling was the realization that, although Lyon provided me with his many documents, most came from RIOC’s own files in response to Freedom of Information requests, files Eliav said a thorough search had not turned up.

I didn’t get hung up on it, but maybe I should have. I was dealing directly with Susan Rosenthal, after all, and I never expected Eliav would be allowed to take over. 

That was mistake number two.

Dancing With Manhattan Park Management

After a long delay, roughly two weeks, I received a written response from Brian Weisberg, a subordinate property manager at Manhattan Park, regarding my letter to Michael Kim.

Weisberg, who I’ve met and corresponded with on many occasions and who is most frequently responsible for rebuffing tenant sub metering complaints, went to the trouble of personally dropping off a package at our building’s front desk.

The gist of his correspondence, condescendingly offered, was that I just didn’t get it, that I had “misconceptions” about how things were done at Manhattan Park. I had only, after all, lived here for fifteen years.

First, Weisberg informed me, Manhattan Park used the grievance procedure approved in 1989 faithfully. In addition, he said he had personally distributed a HEFPA guide that let tenants know they could also complain to the Public Service Commission. (This statement turns out to be significant.)

Weisberg did not provide any of the proofs requested.

And his response to the question of profiting on billing was similar. It continued a peculiar tradition every subsequent response carries. Denials that they do not profit form sub metering are always emphasized, either underlined, bolded or both.

I keep thinking of Shakespeare’s “The lady doth protest too much.”

If we were playing poker, this would be a “tell,” an indication we should look for something fishy.

As for the discrete metering of apartments’ electric usage, Weisberg made an offer similar to one he made to Mark Lyon. He would have his business partner, Quadlogic, perform an accuracy test, remotely, to verify that my meter was working properly.

This did not answer the question because it told us nothing about the feeds coming into the meter.

We already knew, from real life experience, of an apartment where breakers controlled electricity used next door. We also had empirical evidence that there were discrepancies in several more.

About this, Weisberg was silent, as if the question was never asked.

But he cheerily announced, I was welcome to set up a meeting where my misconceptions could be clarified.

I instead asked for instructions on how to get going with the grievance procedure he claimed Manhattan Park honored for twenty-six years.

Armed with documented incidents going back almost to the first year of sub metering showing that Manhattan Park had not offered complaining tenants access to any grievance procedure, I was certain Weisberg and Michael Kim, to whom I directed my request, would wriggle out of it.

They did, but their tactic was brand new and a bit shocking. So was, ultimately, RIOC’s response.

Why a Grievance Procedure Matters

It occurred to me early while confronting Manhattan Park and RIOC about sub metering that the grievance procedure was the single most important element.

There are two reasons.

Like a child with bad-tasting medicine, Manhattan Park’s working so diligently to avoid it, even to the point of not letting their tenants know it existed, is a story in itself.

There is a reason, and its importance must be commensurate with efforts at evasion. That’s reason #1.

#2 is more obvious when you look at it. The grievance procedure is embedded in the lease first because it’s the key to everything else. Without it, a dissatisfied tenant has no instrument allowing her or him to get to the bottom of any violation.

Specifically, the paragraph requiring the landlord to offer binding arbitration by a disinterested third party opens the magic box of disclosure. Without it, you get only what the landlord choses to give you. I’m sure you understand that means nothing damaging will see the light of day.

Manhattan Park saw that threat as serious enough that they tried to turn reality inside out by claiming, twice, mind you, that Quadlogic, the operation that reads meters and manages billings on its behalf “is not, and never has been our business partner.”

Assuming the tactic was designed to position Quadlogic as the disinterested arbitrator, if push came to shove, I felt obliged to offer Michael Kim and whoever was behind his carefully worded letters and emails the textbook definition of “business partner:” 

A business partner is a commercial entity with which another commercial entity has some form of alliance. (Source: Wikipedia)

That tactic defeated and my request to access the RIOC approved grievance procedure still pending, Manhattan Park parried by stating that, now, the HEFPA Guidelines Brian Weisberg threw or had thrown in front of doorways in October of 2013 were no longer just an addition to the RIOC approved procedure, they replaced it.

It was funny in its own inept way.

The HEFPA Guidelines

The Home Energy Fair Practices Act establishes requirements for, among other things, landlords who bill tenants through sub metering. Notifying tenants of their rights under HEFPA is a minimum requirement.

Brian Weisberg was right in saying that this provides tenants protections in addition to the RIOC approved procedure, but he was wrong in implying that it was a magnanimous gesture on Manhattan Park’s part.

State law requires it, and since his carefree distribution of materials in front of doors was confirmed by him in an affidavit, notarized by Matthew Katz, it’s fair to assume some pressure for compliance had been placed on him by 2013.

As for the five page document itself, it mainly covers rights assigned to the utility provider, that is, Manhattan Park, when bills are unpaid. But there is a single section that nods at tenants.

In its notice, Manhattan Park installed a brief “Complaint procedure.” 

Tenants must first complain about sub metering directly to the property manager who then responds in writing. If a tenant is dissatisfied with the response, he or she may appeal to… Guess who… the property manager.

There is not another word about any steps from there, not so much as a requirement for the property manager to even reply. 

A paragraph later, the document tells tenants of their right to complain to the Public Service Commission at any time, including pertinent websites, telephone numbers and addresses.

This, according to Michael Kim — and, sadly, RIOC — fits the ground lease requirement for a grievance procedure approved and administered by the Public Service Commission.

Apart from the fact that there is no evidence that the “Complaint procedure” described by Manhattan Park as part of a tenant information requirement was ever approved by the PSC, we obtained additional information when we sought legal guidance.

What we learned is that what Manhattan Park did in setting up a half-baked internal process without direct linkage to escalation to the PSC was a standard landlord gambit. However…

(Landlords) must have their own internal grievance procedures for residential customers. When that does not suffice to resolve the issue to the satisfaction of the customer, the customer must be notified of the availability of the PSC complaint handling and determination procedures. HEFPA requirements cannot be waived. Just telling customers they can "contact" the PSC, as some landlords do in their explanations to tenants of the complaint process, simply is not enough to satisfy their duty to inform the customer of the availability of the complaint handling procedures required by HEFPA.”

Manhattan Park has, to our knowledge, never informed a single tenant who was dissatisfied that the next step in their grievance procedure is the PSC or how it works. 

Moreover, what PSC calls a “complaint procedure” under HEFPA is a daunting, time consuming, bureaucratic jumble of legalistic entanglement that will easily discourage most tenants from proceeding. It requires reading through some sixty pages of guidelines to get a grasp on what everyone’s responsibilities are before getting to the complaints section.

RIOC’s Arthur Eliav will later say that this — he calls it “a brochure” — is “user-friendly.” Here is a link to it: http://www.dps.ny.gov/HEFPA_Brochure_12-08.pdf.

You tell us if you find it user-friendly and that the average person can be expected to weed through it and come out knowing what their rights are and how to exercise them. 

Manhattan Park’s Last Stand and RIOC’s Capitulation

“In reference to the grievance procedure approved by RIOC on 3/29/1989, Management has followed the procedure as outlined and all resident complaints were investigated accordingly.  Due to confidentiality of all resident records, current and past, we are unable to disclose any information to you at this time,” wrote Michael Kim (or his handlers) in response to our request that Manhattan Park show proof that the procedure had ever been used.

Working with several former and current Manhattan Park tenants, we had already accumulated evidence showing multiple instances where the grievance procedure had not been honored and chose to give Kim a chance to demonstrate that we were wrong in our perceptions about the extensive noncompliance implied.

Redaction of names would have been simple, to protect confidentiality, but more tellingly, Kim simply ignored the second part of our request, which was that he supply a list of arbitrators Manhattan Park had used, thereby confirming enactment of the grievance procedure.

He added, “…we are required to follow a procedure approved by RIOC or set forth by the PSC.  The PSC requires us to follow HEFPA guidelines and that fulfills our obligation,” adding Manhattan Park’s new and unique interpretation of the ground lease.

It was no credit to Kim’s email that it reiterated, “Quadlogic has never been and is NOT a business partner of Manhattan Park,” which, of course, they are and have been for decades.

I contacted Rosenthal and Eliav at RIOC: “I’ve received a notice from Manhattan Park that claims they dropped the RIOC grievance procedure in 2013 in favor of the HEFPA process. If you did not agree to this, it’s a clear violation of the ground lease. Do you have any record of an approval by RIOC?”

Eliav asked me to bring in a copy, which I delivered at RIOC’s front desk on August 17th.

When I heard nothing from him for two weeks, I followed up.

That’s when the trouble started.

“We are not aware of any formal release of MP from a RIOC-approved grievance procedure,” Eliav wrote but ominously added wording from the ground lease, of which he knew I was already aware, that Manhattan Park was required to use the either a RIOC approved grievance procedure or one approved and administered by the PSC.

The word “either” was deliberately underlined by Eliav.

For the first time, I got a vision of a bobblehead being pulled along on a string, nodding absently. A harmonized tune was playing vaguely in the background.

“Are you suggesting that the lame two step ‘complaint procedure,’ with no option to appeal beyond Manhattan Park, was somehow approved and administered by PSC and supersedes the RIOC approved procedure?” I fired back. “I expected more rigor on your part.”

Eliav professed innocence: “I think you are reading way too much into what I wrote to you.”

I soon discovered that I wasn’t reading enough into it. I challenge him, but he again proclaimed innocence.

“RIOC is taking this issue very seriously,” he replied. “In fact, we will be meeting with Manhattan Park management tomorrow.”

What?

“Good,” I told him, tamping down the distrust welling in me. “I hope an improved commitment to transparency will encourage you to let me know the results of the meeting, which I had no idea of until this moment.”

Paranoia flared when Eliav did not communicate anything about the meeting with me for two days. I reluctantly had to ask him if there had been any constructive developments.

Although he’d seen no reason to inform me without my asking, he declared, “We believe that the meeting was very productive.  Manhattan Park’s management seemed very eager to cooperate. They have offered to have your meters tested by their contractor.  Furthermore, they even expressed a willingness to have you test the meter by your own expert, as long as their contractor is present (solely to ensure that there is no equipment tempering).”

Call up the bobblehead. Cue the music.

This parroted Manhattan Park’s story line, even to the point that there is no explanation about what would be tested, what disinterested third-party might be witness to it or that the results would be binding in any way.

Worse yet, I could hire my own consultant to look at my meter, at my expense, as long as Quadlogic got to hang around and observe. RIOC even went along with Manhattan Park’s suggestion that I might tamper with the meters.

And there was even worse.

In capitulating to Manhattan Park, RIOC decided to ignore everything else, the grievance procedure violations, the suspected profiting on sub metering or the likelihood of tenants being billed for usage other than their own.

I thought tough negotiations were possible, given that RIOC might feel a need to find balance between both sides. I did not expect a complete and total capitulation. 

Where Do We Go From Here?

I have already notified RIOC of my “extreme disappointment that RIOC has gotten cold feet and appears unwilling to confront Manhattan Park.”

A graver concern hovering in the background is that RIOC has, as part of knuckling under to Manhattan Park, exonerated themselves of their own incompetence in not bothering to monitor compliance with their own lease.

Shading this is what it implies for the future: permission for both RIOC and Manhattan Park to continue their practices unchanged.

Recall, if you will, that Eliav first claimed to have no evidence of complaints as his way of explaining the absence of any action on RIOC’s part. This was shown to be untruthful.

But in his follow up, Eliav lied twice more.

“You provided no real evidence of profiteering by MP,” he wrote. In fact, both he and Rosenthal declined to take copies of the “real evidence” I brought to our first meeting. Mark Lyon had also previously supplied RIOC with evidence.

The truth is that, evidence or not, RIOC wasn’t going to do anything about it.

Eliav also claimed to have “offered to assist in having your meters tested.” No such assistance had been offered. The exculpatory claim was for public consumption and completely untrue.

Eliav in alliance with Manhattan Park relayed permission that I could bring in and pay for my own consultant, no assistance from RIOC involved.

In assisting Manhattan Park, Eliav attempted to turn the tables, accusing me of not taking advantage of the so-called HEFPA grievance procedure, ignoring my and other tenants repeated denial of the one RIOC approved. Not exactly a lie, but not an accusation fully flavored with integrity either.

So, given RIOC’s entrenched position in support of Manhattan Park management in fending off years of tenant complaints, it’s clear that the state agency cannot be relied on for any kind of assistance to tenants.

Fine. Better to know now than waste more time trying to work with them in good faith. They are openly in Manhattan Park’s corner.

Elected representatives, especially State Assembly Member Rebecca Seawright, have expressed interest. Senator José Serrano and City Council Member Ben Kallos have allowed Seawright to carry the ball rather than duplicate efforts.

The question, to which we will soon have an answer, is whether the politicians are willing to go beyond words of support and take action on behalf of tenants. 

RIOC is out of the equation with us, and we are prepared to dig into a new strategy that, we hope, includes representatives elected to represent us equally with business interests. If necessary, we are also prepared to move forward outside the political framework, now that RIOC threw us under the easy to recognize red bus.