Topic No. 302: Capital Improvement Petitions - General Information

A landlord may petition the Rent Board to pass through to tenants the costs of certain renovations to the property, which are considered capital improvements. A capital improvement is one that materially adds to the value of the property, appreciably prolongs its useful life, or adapts it to new uses, and which may be amortized over the useful life of the improvement of the building. Examples of capital improvements include new windows, a roof replacement and exterior painting. Repair and maintenance work, such as replacing a broken window pane, patching a roof or clearing a clogged pipe, are not capital improvements.

The cost of capital improvement work that was required to correct a code violation for which a notice of violation was issued and remained unabated for 90 or more days will not be certified for passthrough to the tenants unless the landlord made timely good faith efforts to do the work within that 90-day period, but was unsuccessful due to the nature of the work or circumstances beyond the landlord's control.

The landlord must file a Capital Improvement Petition with the Rent Board before the landlord serves the tenant with a written notice of rent increase for the capital improvement passthrough. The passthrough does not become part of the tenant's base rent and should not be included in the base rent when calculating an annual or banked rent increase.

Capital Improvement Petitions must be filed within five years of the completion of the capital improvement work. A petition cannot be filed until the work is entirely completed. All petitions must be submitted on the forms provided by the Rent Board and must include supporting documentation. There are different forms and requirements for properties with 1-5 residential units and for properties with 6 or more residential units. There is also a special capital improvement petition form for seismic work required by law. Each form includes specific instructions for filing a Capital Improvement Petition. For more information, you can also read Fact Sheet 5, "Landlord Petitions and Passthroughs." To receive a copy of the applicable petition form and/or Fact Sheet 5, you can fax it to yourself through our Fax Back system by calling (415)252-4660 or visit our website at The forms and Fact Sheet 5 are also available at our office.

Please refer to the topics that follow for important information on specific requirements for Capital Improvement Petitions. Use the three-digit number to access the topic that you want.

For estimator fees, enter 303.
For allocation of capital improvement costs, enter 304.
For interest on capital improvement costs, enter 305.
For uncompensated labor rates, enter 306.
For special rules for properties with 1-5 residential units, enter 307.
For special rules for properties with 6 or more residential units, enter 308.
For special rules for seismic work and other improvements required by law, enter 309.
For special rules for energy conservation work, enter 310.
For notices to tenants of a capital improvement increase, enter 311.
For tenant objections to capital improvement petitions, enter 312.


January 2007