BF 810227-RO
                                

                        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
APPEAL OF                               DOCKET NO.:
                                        BF 810227-RO
       PROSPECT REALTY COMPANY,         DISTRICT RENT
                                        ADMINISTRATOR'S DOCKET
                                        NO.:
                        PETITIONER      WNR 86-S-4-R
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  ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
                                
                                
On  June  22,  1987,  the  above-named petitioner-owner  filed  a
Petition for Administrative Review against an order issued on May
18,  1987  by  the Rent Administrator, (White Plains)  concerning
housing  accommodation known as Apartment 4-D, 1 Prospect Street,
New Rochelle, New York, wherein the Administrator determined that
the owner had overcharged the tenant.

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 appeal.

This  proceeding was commenced by the tenant filing an overcharge
complaint  with  the  Division, wherein  the  tenant  stated,  in
substance,  that  she  took occupancy of  the  subject  apartment
pursuant to a one year vacancy lease effective August 15, 1983 at
a  rental of $431.59 per month and that the current renewal lease
should  be effective on the expiration date, August 15, 1985,  of
her prior lease.

The  owner  who was served with a copy of the tenant's complaint,
responded by stating that on October 1, 1985 the tenant's  rental
charge  of $431.59 was increased to $431.92 based on an  increase
of  $.11  cents per room granted for a major capital  improvement
(MCI); and that said rent was further increased by a 6% guideline
increase  for  the  tenant's renewal lease effective  October  1,
1985.

On   May  18,  1987,  the  Rent  Administrator  issued  an  order
deter-mining that the owner was entitled to the guideline (0% for
a  one  year  lease) in effect when the tenant's  lease  expired,
August  15,  1985; that the lease effective on  October  1,  1985
should  be  based on the 0% guideline rate; and  that  the  legal
regulated rent is $431.92 per month as of October 1, 1985 through
September  30,  1986. The Administrator found  an  overcharge  of
$319.82,  including interest.  The owner was directed  to  refund
such overcharge to the tenant.

In  this  petition,  the owner contends, in substance,  that  the
tenant executed a one year vacancy lease effective June 15, 1983;
and  that the tenant's renewal lease should either be made effec-
tive  on July 1, 1985 with a 0% guideline increase, or on October
1, 1985; and that he is entitled to a 6% guideline increase since
the lease was made effective on October 1, 1985.

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

The  Commissioner notes that since the owner had failed to  offer
the  tenant a renewal lease at the expiration date of  the  prior
lease  term, the owner was not entitled to the guideline increase
in  effect  on  October 1, 1985.  Accordingly,  the  Commissioner
finds  that  the  Administrator properly  established  the  legal
regu-lated rent at $431.92 effective October 1, 1985 to August 1,
1986  and that the Administrator properly found an overcharge  of
$319.82,  including  interest and was correct  in  directing  the
owner to refund such overcharges to the tenant.

Because  this determination concerns lawful rents through  August
30, 1986, the owner is cautioned to adjust subsequent rents to an
amount  no  greater than that determined by this order  plus  any
lawful  increases, and to register any adjusted rents  with  this
order  and opinion being given as the explanation for the adjust-
ment.


THEREFORE,  in  accordance  with the Tenant  Protection  Act  and
Regu-lations, it is










ORDERED, that this petition be, and the same hereby is denied;
and that the Administrator's order be, and the same hereby is
affirmed.


ISSUED:




JOSEPH A. D'AGOSTA
                                         Deputy Commissioner
    

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