STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
GERTZ PLAZA
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
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IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEALS OF DOCKET NOS.:ART 13038-U
GLADYS LEDDY AND THE TENANTS OF : BE 430434-RO
707 WEST 171ST STREET
NEW YORK, NEW YORK, AND RENT ADMINISTRATOR'S
MIRLAN REALTY,OWNER PETITIONERS : DOCKET NO.: USC 00217-OM
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW UNDER
DOCKET NO. BE 430434-RO AND DENYING PETITION FOR ADMINISTRATIVE REVIEW
UNDER DOCKET NO. ART 13038-U
The above-named petitioners filed petitions for administrative review of
an order issued by a District Rent Administrator concerning the housing
accommodations known as 707 West 171st Street, New York, New York, various
apartments.
The Commissioner has reviewed all the evidence in the record and has
carefully considered that portion of the record relevant to the issues
raised by the petitions for review.
The owner commenced the proceeding before the District Rent Administrator
below by filing an application for a Major Capital Improvement (MCI) rent
increase with the Division claiming total costs of $120,205.00 for the
installation of replacement windows building-wide, a new roof,
boiler/burner and "adequate wiring".
In response to the owner's application the tenants, submitted
substantially identical answers in which they claimed, in substance, that
the installations were inadequate and had been completed in an
unworkmanlike manner. More specifically, the tenants asserted, in
substance, that the windows had been poorly installed and were likely to
"fall out of their frames"; that the electrical installation was minimal
and only involved work in the kitchen and the installation of one
"alternating current" outlet per apartment, which the tenants assert fail
to function properly; that the roof had only been patched and continued to
leak, and that the boiler breaks down on a weekly basis leaving the
tenants without heat or hot water.
On May 29, 1986 the District Rent Administrator issued the order here
under review granting in part the owner's MCI application and authorizing
an MCI rent increase for the installation of a new roof, boiler/burner and
adequate rewiring at a total recognized cost of $69,751.00. Disallowed by
the Administrator were the claimed costs for the installation of new
windows as well as claimed costs totalling $50,454.00 for the
boiler/burner and roof installations based on the owner's failure to
submit documentation to substantiate the cost of same.
DOCKET NUMBER: BE 430434-RO
In his petition the owner states "notice of modification of major capital
improvement application to submit additional proof of payment". The owner
encloses a list of various tenant's signatures and copies of certified
mailing receipts indicating that his petition had been mailed to the
agency.
In their petition for administrative review the tenants reiterate in
substance their prior allegations.
After careful consideration of the entire evidence of record, the
Commissioner is of the opinion that these petitions for review should be
denied.
Rent increases for major capital improvements are authorized by Section
2202.4 of the Rent and Eviction Regulations for rent controlled apartments
and Section 2522.4 of the Rent Stabilization Code for rent stabilized
apartments. Under rent control, an increase is warranted where there has
been since July 1, 1970 a major capital improvement required for the
operation, preservation, or maintenance of the structure. Under rent
stabilization, the improvement must generally be building-wide;
depreciable under the Internal Revenue Code, other than for ordinary
repairs; required for the operation, preservation, and maintenance of the
structure; and replace an item whose useful life has expired.
Division policy and precedent require that electrical rewiring include new
copper risers and feeders extending from the property box in the basement
to every housing accommodation in order to qualify as an MCI. The owner
must also establish that there has been a substantial improvement to the
kitchen and apartment wiring and that the wiring in the livingroom and
bedrooms is of sufficient capacity to accommodate the installation of air
conditioner circuits.
The record shows that to the extent recognized by the Administrator, the
owner substantiated its installations with the necessary governmental
approvals including a certificate of electrical inspection which is
stamped indicating that the installation had met the requirements of
Administrator's Interpretation #1 which included the addition in the
kitchen areas of a heavy duty outlet sufficient to support the operation
of an air conditioner unit a sufficient number of outlets in each room and
the upgrading of the risers and feeders. It is further noted that with
the issuance of the Administrator's order appealed herein the tenants
received a rider notice in which they were apprised of their right to
request the installation of electrical outlets of sufficient capacity to
support the operation of air conditioner units in the bedrooms and living
rooms of their apartments. The installations were to be completed no
later than three months from the date of issuance of the order and the
tenants were given the option of paying outright for the current cost of
installation or paying a monthly increase of 1/60th of the cost.
DOCKET NUMBER: BE 430434-RO
The Commissioner further notes that the tenants, in their answers to the
owner's MCI application, concede that all of the requisite installations
were made including the installation of one heavy duty "alternating
current" outlet.
With regard to the boiler/burner, and roof installations, the owner
submitted copies of proposals for the work performed, paid invoices and
cancelled checks (several copies are illegible) in substantiation of the
costs thereof and, where applicable, certificates of inspection from the
governmental agencies having jurisdiction. The Commissioner further notes
that the tenants do not deny that these installations were made, but
assert that they are inadequate.
The Commissioner notes that the records of the Division disclose that no
orders of rent reduction have been issued based on the owner's failure to
provide services of a building-wide nature nor have there been any
complaints based on the owner's failure to provide heat and/or hot water.
The tenants' unsupported allegations of the inadequacy of the installation
is insufficient to refute the documentation submitted by the owner.
Regarding the owner's petition in which he states "notice of modification
of major capital improvement application to submit additional proof of
payment" without enclosing any additional documentation, the Commissioner
notes that although the agency on March 26, 1992, sent the owner a request
for further information, the owner failed to respond. In fact, the record
reveals that when this proceeding was before the Rent Administrator below,
the owner, by rent agency notice dated July 12, 1985, was requested to
submit copies of contracts for the rewiring, new roof and boiler/burner
installations as well as all copies of paid checks for several previously
unaccounted for balances relating to the above installations and to state
the approximate age of those windows replaced. While noting that several
copies of checks which the owner had submitted with his original MCI
application were illegible. Accordingly, the Commissioner is of the
opinion that the Administrator properly denied in part the owner's MCI
application due to the owner's failure to adequately substantiate the
costs of the installations.
With reference to the tenants' petition regarding the windows, the
Commissioner notes that this installation was not a subject of the rent
increase appealed herein. Accordingly, the tenants are reminded that this
order is issued without prejudice to their rights to file services
complaints.
It is the established position of the Division that the various
improvements for which rent increase adjustments were authorized, under
Docket No. USC 000217-OM, including the installation, of a new
boiler/burner, adequate wiring and a new roof, qualify as major capital
improvements for which rent increases are warranted.
Accordingly the Commissioner is of the opinion that these petitions should
be denied.
THEREFORE, pursuant to the Rent Stabilization Law and Code and the Rent
and Eviction Regulations for New York City, it is
DOCKET NUMBER: BE 430434-RO
ORDERED, that the owner's petition, under Docket No. BE 430434-RO, be and
the same hereby is denied, and the tenants' petition, under Docket No.
ART 13038-U, be and the same hereby is denied, and that the District Rent
Administrator's order be, and the same hereby is, affirmed.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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