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

     APPEAL OF                              DOCKET NO.: BF 110006-RO
                                            DRO DOCKET NO.: ZAA 130240-0M
                           PETITIONER    : 


     On May 6, 1987 the above  named  petitioner-owner  filed  a  Petition  for
     Administrative Review against an order of the  Rent  Administrator,  Gertz
     Plaza, 92-31 Union Hall Street, Jamaica, New York issued May 4, 1987.  The 
     order concerned  housing  accommodations  located  at  40-39  48th  Street
     Sunnyside, New York.  The Administrator denied the owner's application for 
     a rent increase based on major capital improvements.

     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 administrative appeal.

     Petitioner commenced this proceeding by filing an application  on  January
     15, 1986 for a rent increase based on the installation of a major  capital
     improvement.  On April 14, 1986 the owner certified that the  tenants  had
     been served with a copy of Application Form RA-79, a copy of  Notice  Form
     RA-79N and three copies of Answer Form RTP-3.  The improvements claimed by 
     petitioner were: spot pointing, waterproofing  and  cleaning,  lintel  and
     parapet replacement all done  in  July  and  August  1985  at  a  cost  of

     The owner's application included a statement by the  contractor  that  all
     exposed sides of the building were examined, that only  the  front  needed
     spot pointing, that nine lintels needed replacement,  that  the  front  of
     the building needed cleaning,  that  all  remaining  sides  needed  to  be
     completely water proofed due to the poor condition of the mortar, and that 
     twelve square feet of the parapet needed replacement.  A  diagram  of  the
     building was included showing the areas repaired.

     Various tenants objected to  the  application  on  the  grounds  that  the
     improvements were, in fact, repairs.

     The Administrator denied the application, finding  that  the  installation
     did not qualify as a major capital improvement.  On appeal the  petitioner
     claims that the contractor examined the entire building and performed  all
     the required work.  The waterproofing was done to 80% of the exterior wall 


     DOCKET NUMBER: BF 110006-RO
     area and the parapet and lintel replacement, spot  pointing  and  cleaning
     were done on the front of the building.

     Various tenant again responded  and  requested  that  the  Administrator's
     order be affirmed.

     The Commissioner has carefully considered the evidence  contained  in  the
     record, and is of the opinion  that the proceeding should be  remanded  to
     the Administrator for further consideration.

     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  law  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  that  for  ordinary
     repairs; required for the operation, preservation, and maintenance of  the
     structure; and replace an item whose useful life has expired.  

     According  to  Division  policy,  and  prior   decisions,   pointing   and
     waterproofing as necessary on exposed sides of the building is defined  as
     a  major  capital  improvement.   On  remand,  the  Administrator   should
     reconsider the owner's application and supporting documentation, including 
     what was submitted with the petition, and  if  appropriate,  issue  a  new
     order granting a rent increase for pointing, water proofing, cleaning, and 
     lintel replacement as described in the owner's application.

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

     ORDERED, that this petition be, and hereby is, granted to  the  extent  of
     remanding this proceeding to the Administrator for further  processing  in
     accordance with this order and opinion.


                                            ELLIOT SANDER
                                          Deputy Commissioner


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