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. BF 430135-RT,
: BF 420250-RT
VARIOUS TENANTS OF 115 and
119 WASHINGTON PLACE, NEW YORK RENT ADMINISTRATOR'S
NEW YORK PETITIONERS : DOCKET NO.: AC 430062-OM
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ORDER AND OPINION GRANTING PETITIONS FOR ADMINISTRATIVE
REVIEW IN PART
On June 18, 1987, the above named petitioner tenants filed Petitions
for Administrative Review against an order issued on May 15, 1987 by a
Rent Administrator concerning housing accommodations known as various
apartments of 115 and 119 Washington Place, New York, New York, wherein
the District Rent Administrator determined that the owner was entitled
to a rent increase based on the installation of major capital
improvements.
The issue in these appeals is whether the District Rent Administrator's
order was warranted.
The applicable sections of the law are Section 2522.4 of the Rent
Stabilization Code and Section 2202.4 of the New York City Rent and
Eviction Regulations.
The Commissioner has reviewed all of the evidence in the record and has
carefully considered that portion of the record relevant to the issue
raised by the administrative appeals.
This proceeding was commenced on March 5, 1986 by the owner's filing of
an application for a rent increase based on the installation of major
capital improvements (MCI's) to wit: a new intercom system at a total
cost of $2,152.00; a new chimney at a total cost of $1,550.00; and
rewiring at a total cost of $40,320.00.
The owner certified that on May 31, 1986 he served each tenant with a
copy of the application and also placed a copy of the entire
application including all required supplements and supporting
documentation with the resident superintendent of 115 Washington Place.
Numerous tenants filed objections to the owner's application,
contending in substance that the owner was negligent in not maintaining
the chimney and should therefore bear the cost for replacing the
chimney; the old buzzer system was adequate and in good working order;
the new intercom system did not work in all of the apartments; the
rewiring was a maintenance and repair item rather than an improvement;
the rewiring was partial and mainly installed in the kitchens of the
DOCKET NUMBER: BF 430135-RT
the building; in most apartments no new plug sockets were added to any
rooms other than the kitchen; the rewiring was done in an unworkmanlike
manner with some cables exposed, some sockets coming out of the wall
and/or being inoperable; some light fixtures were becoming defective;
ceiling had holes and sloppy plastering; and many tenants had their own
220 line for air conditioning which they had paid for themselves.
The owner responded by claiming that one socket was hooked up to a
light switch in each room; that auxiliary air conditioning outlet was
installed in each apartment and that the workmen cleaned up the trash,
plaster, dirt and rubble before leaving the subject buildings.
In Docket No. ZAC 430062-OM dated May 15, 1987, the District Rent
Administrator determined that the rewiring and intercom systems
qualified as major capital improvements and accordingly authorized rent
increases of $4.02 per room for rent-controlled tenants and 2.97% for
rent stabilized tenants. The administrator further determined that the
chimney repairs did not constitute a major capital improvement.
In these petitions, the tenants contend in substance that the District
Rent Administrator's order is incorrect and should be reversed because
the rewiring was very minimal with only the kitchens being affected in
most apartments and with no additional wiring in the other rooms; most
tenants had to install their own air conditioning lines; and some of
the apartments have suffered a diminution of service as a result of the
rewiring with non-working sockets, light fixtures and exposed cables.
The tenants also reiterate their original answers to the owner's MCI
application.
On February 6, 1992, the Administrative Review Unit of the Division of
Housing and Community Renewal requested that the subject buildings be
inspected as to the adequacy and extent of the rewiring and intercom
installations. The subject premises was inspected on March 24 and 25,
1992 wherein the inspector noted that the intercom system was
functioning properly and that generally the apartments had been
adequately rewired with the exception that in several apartments there
were no wall switches, only pull chains, for livingroom, bathroom and
in some instances kitchen ceiling lights. The inspector further noted
that several apartments were lacking electrical outlets sufficient to
support the installation of air conditioners.
After careful consideration of the entire record, the Commissioner is
of the opinion that these petitions should be granted in part.
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
DOCKET NUMBER: BF 430135-RT
for ordinary repairs; required for the operation, preservation, and
maintenance of the structure; and replace an item whose useful life has
expired.
The Commissioner notes that for an electrical upgrading to qualify as
an MCI under current procedures, the job requires the installation of
new electric service (capacity), with new copper risers and feeders
extending from the property box in the basement to every housing
accommodation of the sufficient capacity to accommodate the
installation of air conditioner circuits as well as the installation of
a double duplex outlet in the kitchen to accommodate heavy duty
appliances (as performed in the case herein). In addition, the tenants
must be given the option of having air conditioning outlets installed
in the apartments at cost to the tenants.
The record herein discloses that the owner substantiated its MCI
application for the rewiring work in the proceeding below by submitting
to the Administrator copies of the contractor's certification, and
certificate of electrical inspection from the bureau of electrical
control for the work in question. However, it appears that, contrary
to the contract, as submitted by the owner, air conditioning outlets
were not installed on a building-wide basis nor were all the tenants
afforded an opportunity to have such outlets installed by the owner
and, in fact, several tenants have installed their own outlets.
Accordingly, the Commissioner is of the opinion and finds that the
Administrator's order should be modified in that so much of the MCI
rent increase attributable to the installation of air conditioner
outlets in each apartment should be revoked. Accordingly, the total
previously approved cost of $42,472.00 is reduced in the amount of
$1,920.00 which represents the claimed cost of the air conditioner
outlet installation. The above adjustment results in a reduced rent
increase of $3.84 per room per month for rent-controlled tenants and
2.84% of the August 1, 1986 rent for rent stabilized tenants, (computed
in accordance with the formula set forth in the Administrator's order).
The Commissioner is of the further opinion that the Administrator's
order should be further modified in the following manner. The tenants
may within 30 days of theissuance of this order advise the owner in
writing whether he/she wishes to have an air conditioner outlet
installed where there is none yet existing, which request shall be
limited to the living room and/or bedrooms. The owner is directed to
comply with such request within 90 days of the issuance of this order.
For the above-mentioned tenants, as well as those tenants for whom air
conditioner outlets may have been installed as part of the original
rewiring installation, the tenants shall be offered the option of
paying outright the cost of installing each air conditioning outlet
installed by the owner, in which event there shall be no monthly
increase in rent for each installation and such one-time charge shall
not be deemed a part of the monthly rent for the purposes lease
renewal. In the alternative, the tenant may elect a monthly increase
in the rent, in which event the rent may be increased by 1/60th of the
cost of the air conditioning outlets upon completion of the
installation without further order of the Rent Administrator. Any
questions arising in the course of complying with this order may be
brought to the attention of the Rent Administrator.
DOCKET NUMBER: BF 430135-RT
The Commissioner further notes that the agency inspection also revealed
that the intercom system, in those petitioners' apartments for which
access was gained and an inspection conducted, was functioning
properly.
THEREFORE, in accordance with the Rent and Eviction Regulations for New
York City and the Rent Stabilization Law and Code, it is
ORDERED, that this petition be, and the same hereby is granted; in part
and that the Administrator's order be, and the same hereby is modified
in the manner and to the extent indicated above including the
revocation of so much of the order as granted an MCI rent increase for
air conditioning outlets; and that as so modified said order be, and
the same hereby is affirmed; and it is further
ORDERED, that the owner refund to the tenants any excess rent collected
as a result of this order within 30 days from the issuance hereof.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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