A lawsuit was filed by Union City in New Jersey, which is just across the Hudson River from New York.
It identifies Imam Feisal Abdul Rauf as sole officer of building owner Sage Development.
One of its buildings has been vacant since a fire in 2008 and a second contains 16 flats.
The lawsuit says Imam Rauf has not addressed complaints by tenants, or orders from the city to correct building code violations.
Imam Rauf's lawyers, and possibly the cleric himself, are due to appear for a court hearing over the claims on Wednesday.
The issues involved include mouldy bathrooms, bed bugs, dirty hallways, lack of heat, and fire hazards, according to the Star-Ledger newspaper in New Jersey.
A spokesman for local mayor Brian Stack told the newspaper: "He's a terrible landlord who's unresponsive to the residents who live in his building.
"City officials and inspectors have reached out to him to express the urgency in correcting problems in his buildings, and it's unfortunate that it's gotten to this point.
"But it's our responsibility to ensure that residents receive the care that is needed."
According to the lawsuit Union City received around 30 complaints from tenants in the buildings between 1996 and 2010.
Imam Rauf's proposed Islamic Centre, containing a mosque, two blocks from the site of the 2001 terrorist attacks on the World Trade Centre, has become embroiled in controversy.
(telegraph.co.uk)
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