OFFICE OF RENT ADMINISTRATION
                                    GERTZ PLAZA
                              92-31 UNION HALL STREET
                              JAMAICA, NEW YORK 11433

     APPEALS OF                             DOCKET NOS.:ART 13038-U
       GLADYS LEDDY AND THE TENANTS OF   :              BE 430434-RO
       707 WEST 171ST STREET                

                            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 

     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

     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

     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

     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.


                                          JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner


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