4105 EXCLUSIONS FROM COVERAGE BY THE ACT

4105.1 A rental unit shall be excluded from coverage by the Act and this chapter at the election of the housing provider under the following circumstances:- (a) If the rental unit is operated by a foreign government as a residence for diplomatic personnel under § 205(e)(1) of the Act;

- (b) If the rental unit is operated by a hospital, convalescent, nursing or personal care home, or other entity which has as its primary purpose providing diagnostic care and treatment of disease, and the rental unit is occupied or intended for occupancy by a recipient of the diagnostic care or treatment of disease; or

- (c) If the rental unit is part of a dormitory as defined in § 103(11) of the Act, and the rental unit is occupied or intended for occupancy by a matriculating student.4105.2 A rental unit which is used or intended for use as long-term temporary housing under § 205(e)(4) of the Act may be excluded from coverage by the Act by order of the Rent Administrator issued pursuant to § 4105.3.4105.3 A housing provider who proposes to operate a rental unit under § 205(e)(4) of the Act shall petition the Rent Administrator for an order of exclusion on a form approved by the Rent Administrator (a non-profit charitable petition).4105.4 A non-profit charitable petition shall be filed in duplicate and shall include the following:- (a) The name and address of the applicant housing provider, and documentation of the applicants exemption from federal income tax under § 501(c)(3) of the Internal Revenue Code and exemption from the D.C. franchise tax;

- (b) A schedule identifying each rental unit covered by the petition, whether the rental unit is vacant or occupied and, if occupied, the name of the tenant and the rent and the rent ceiling for the rental unit, if any;

- (c) The plan of comprehensive social services to be offered by the applicant housing provider to the tenant, listing in detail the services to be provided and the obligations to be assumed by the tenant and the applicant housing provider, and the criteria for qualification to be a tenant of a rental unit excluded from coverage under the Act;

- (d) A schedule of proposed rents for each rental unit under the petition including the proposed rent and rent ceiling for each rental unit for which exclusion may be denied under § 4105.8(b).4105.5 Upon receipt of a properly executed and filed non-profit charitable petition, the Rent Administrator shall promptly notify each tenant of an occupied rental unit covered by the petition of the following:- (a) The pendency of the petition;

- (b) The tenant's right to participate voluntarily in the proposed plan of comprehensive social services in which case the tenants rental unit may be excluded from coverage by the Act, or to decline to participate in the proposed plan in which case the tenant's rental unit shall be covered by the Act; provided, that no tenant may elect to participate in the proposed plan if the tenant does not meet the income requirements of § 4105.9(b); and

(c) The tenant's right to oppose or contest the non-profit charitable petition by filing written exceptions and objections with the Rent Administrator.

4105.6 The notice required by § 4105.5 shall be in a form approved by the Rent Administrator, and shall:

1. (a) Explain the plan and the effect of the proposed exemption in sufficient detail to permit the tenant to make an informed choice; and give each affected tenant not less than thirty (30) days in which to make the election to participate in the plan or not and to file written exceptions and objections, if any;
2. (b) State clearly that an affirmative election to participate in the plan is irrevocable for the duration of the tenancy;
3. (c) Provide a space for the tenant to indicate his or her irrevocable election to participate or not in the proposed comprehensive plan, or to decline to participate and state his or her exceptions and objections, if any, to the plan; and
4. (d) Be returnable to the Rent Administrator over the tenant's signature;

4105.7 Upon consideration of properly filed exceptions and objections, the Rent Administrator may grant or deny the non-profit charitable petition or shall convene a hearing under § 216 of the Act to consider any issues of fact which may be raised by exceptions and objections to the petition.

4105.8 Subject to § 4105.9, the Rent Administrator shall do the following:

1. (a) Approve a non-profit charitable petition for each vacant rental unit and each rental unit occupied by a tenant who elects to participate in the applicant's proposed plan of comprehensive social services; and
2. (b) Dismiss a non-profit charitable petition for each rental unit occupied by a tenant who elects not to participate in the applicant's proposed plan or who fails to make an election within the time provided; provided, that the Rent Administrator shall grant exclusion to a covered, occupied rental unit at any time if the eligible tenants under § 4105.9(b) elect to participate in the plan.

4105.9 The Rent Administrator shall approve a non-profit charitable petition and issue an order of exclusion only if the Rent Administrator finds the following:

1. (a) The rental unit shall be operated under the proposed plan of comprehensive social services;
2. (b) The rental unit shall be occupied by two (2) or more tenants or families of two (2) or more members who have incomes less than fifty percent (50%) of the median income in the District of Columbia; or who previously indicated agreement to participate in the housing provider's plan under the Act or prior rent control law and met the income requirements at the time of the previous election;
3. (c) The rental unit is occupied as long-term temporary housing;
4. (d) The rent for the rental unit is less than the operating costs including debt service paid or projected to be paid by the applicant housing provider for the rental unit; and
5. (e) The applicant housing provider is recognized as a non-profit charitable corporation by the District of Columbia and federal governments.

4105.10 The rent ceiling for a rental unit denied exclusion from coverage by the Act under §§ 4105.7 or 4105.8(b) shall be, at the housing provider's election, either of the following:

(a) The rent ceiling for the rental unit on the date of filing of the non-profit charitable petition; or

(b) An amount equal to seventy-five percent (75%) of rent levels established by § 303(b) of the Act; provided, that a housing provider's election under this subsection (b) shall constitute an irrevocable waiver of the right to petition for, or be granted, a rent ceiling increase for the rental unit under § 212 of the Act and § 4209.

SOURCE: Notice of Final Rulemaking published at 33 DCR 1336, 1378 (March 7, 1986); as amended by Notice of Final Rulemaking published at 33 DCR 2656, 2660 (May 2, 1986).