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

     APPEAL OF                              DOCKET NO.:BE 610111-RT
                                            RENT ADMINISTRATOR'S
        BERNICE RUTHERFORD                  DOCKET NO.: BCS 000239-OM
                           PETITIONER    : 


     On May 12, 1987, the above-named tenant filed a petition for administrative 
     review of an order issued on April 20, 1987 by a District Rent Administrator 
     concerning the housing accommodations known as 1295 Grand Concourse, Bronx, 
     New York, Various Apartments.

     The Administrator granted the owner's application for a rent increase based 
     on the installation of a major capital improvement, to wit: a boiler/burner.

     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 petition for review.

     In her petition for administrative review the tenant asserts, in substance, 
     that the subject premises have not been registered with the agency as 
     required, that there was no need to replace the boiler/burner as it had been 
     functioning properly and that she was not given the time to "petition" the 
     owner's MCI application before the rent increase went into effect.  Finally, 
     the tenant asserts that the current owner is attempting to collect the rent 
     increase based on the former owner's "status" and the tenant thereby 
     references an enclosed copy of the first page of the order appealed from, on 
     which appears typed in as owner: current owner c/o former owner.  The tenant 
     also encloses a letter dated April 29, 1987 from the current owner, 
     requesting remitter of those rent adjustments implemented with the approval 
     of the owner's MCI application and a letter dated October 31, 1986, from the 
     former owner, informing the tenant, among other things, that the building 
     had been sold on October 29, 1986 to the current owner.

     After careful consideration, the Commissioner is of the opinion that this 
     petition should be denied.

     At the outset the Commissioner notes that Division records reveal that the 
     subject premises are registered with the agency.

     Rent increases for major capital improvements are authorized by Section 
     2522.4 of the Rent Stabilization Law for rent stabilized apartments.  Under 
     rent stabilization, the improvement must generally be building-wide; 


          DOCKET NUMBER: BE 610111-RT
     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.  In either 
     case, the rent increase is computed based on an amortization of the cash 
     cost of the improvement over five years or sixty months.

     The record in the instant case include copies of invoices, cancelled checks, 
     management approvals and sign-offs, governing agency certificates of 
     operation, and contractor/vendor signatures for the installation of the 
     boiler/burner unit. It is further noted that current owner is not precluded 
     from applying for and collecting MCI rent increases installed by a previous 
     owner.   The Commissioner is therefore of the opinion that the Administrator 
     properly determined that the owner's boiler/burner installation qualifies as 
     an MCI and accordingly granted appropriate rent increases.

     The Commissioner notes that the petitioner raised no objections to the 
     quality or adequacy of the installation, nor did she raise the other issues 
     she now raises on appeal when this proceeding was before the Rent 
     Administrator although she was afforded ample opportunity to do so; as the 
     owner's MCI application was filed with the agency and served on all the 
     tenants almost two years before the issuance of the order herein appealed.  
     Accordingly, pursuant to Section 2529.6 of the Rent Stabilization Code, the 
     tenant's allegations may not be considered now when offered for the first 
     time on administrative appeal.

     THEREFORE, in accordance with the provisions of the Rent Stabilization Law 
     and Code, it is

     ORDERED, that this petition be, and the same hereby is, denied, and that the 
     order of the Rent Administrator be, and the same hereby is, affirmed.


                                          JOSEPH A. D'AGOSTA
                                      Acting Deputy Commissioner


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