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 NO.: BK 430138-RT
THE TENANTS' ASSOCIATION OF 19 : BL 410180-RT
HAMILTON TERRACE, MARY HINES, AND CB 410056-RO
HAMILTON HEIGHTS ASSOCIATES,
PETITIONER : RENT ADMINISTRATOR'S
------------------------------------X DOCKET NO.: AD 510077-OM
ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW UNDER
DOCKET NUMBERS BK 430138-RT AND BL 410180-RT AND GRANTING IN PART
PETITION UNDER DOCKET NUMBER CB 410056-RO
The above-named tenants and owner filed petitions for administrative review
of an order issued on September 30, 1987 by a Rent Administrator concerning
the housing accommodations known as the housing accommodations known as 19
Hamilton Terrace, New York, New York, Various Apartments.
The Commissioner notes that with regard to the tenants' petitions under
Docket Number BK 430138-RT and BL 410180-RT, that they were not filed
within 35 days after the issuance date of the order appealed from as
required by the applicable Regulations and Operation Bulletin 84-1, which
provide that a petition for Administrative Review must be filed within 35
days after the date such order is issued. The Administrator's order was
issued on September 30, 1987; the tenants' petition (Apt. 5M) was received
by the Agency on November 5, 1987 and the tenants' Association petition was
received by the Agency on December 4, 1987.
There is no provision under the applicable Regulations permitting an
extension of time for the filing of a PAR. The Commissioner finds that the
tenant petitioners have failed to comply with the requirements set forth
above and that these PARs must be dismissed (Docket Numbers BK 430138-RT
and BL 410180-RT).
The owner commenced this proceeding by the filing of an application for a
rent increase based on the installation of several MCI's at a total cost of
$551,566.00.
By agency notice dated October 6, 1986 the owner was requested to submit
further evidence regarding more detailed contractor and/or vendor
information for several of the contractors' installations and to submit
proof the agency form on which the owner certificate service of notice to
the tenants of filing the application for a rent increase based on the MCI
installation, as well as complete copies of cancelled checks for the work
done by the contractors who had restored the walls and painted. On
December 8, 1986 the owner was again requested to submit proof of payment
for the work done by those contractors who had restored the walls and
painted.
ADMIN. REVIEW DOCKET NO.: BK 430138-RT
On November 18, December 1, and January 2, 1986 an agency inspector visited
the premises to inspect apartments 26, 3A and 6A. The report of agency
inspection for apartments 2G and 3A indicates that various MCI apartment
installations were completed in an unworkmanlike manner, had already begun
to deteriorate or the work had not been completed at all. Further the
refrigerator in apartment 3A was found to have been purchased by the
tenant.
Various tenants responded to the owner's application asserting, in
substance and pertinent part, that the installations were unworkmanlike or
had not been completed as stated on the owner's application.
On September 30, 1987 the Rent Administrator issued an order in which the
owner was granted an MCI rent increase for several of the installations.
However costs were not granted for several installations, as they did not
constitute MCI's to wit: painting and repairs in the amount of $49,750.00;
pointing and waterproofing where necessary, completed after the issuance of
Operational Bulletin 84-4, in the amount of $29,000.00; the installation of
shower bodies to existing pipes in the amount of $13,545.00; resurfacing of
bathtubs, in the amount of $17,160.00; wallpaper for public halls, in the
amount of $1,200.00; kitchen modernization (was not building-wide), in the
amount of $99,275.00. Further, it was found that several installation
costs had not been properly substantiated, to wit: refurbished elevator
cab) in the amount of $4,500.00; restoration of walls, in the amount of
$7,500.00; boiler and burner installation, in the amount of $3000.00; and
a mathematical error of $300.00 was noted.
In its petition the owner contends, in substance and pertinent part, that
new kitchens were installed in each apartment and therefore the kitchen
modernization was building-wide. It submits an affidavit from the
contractor in which the contractor asserts, in substance, that various
kitchen equipment was installed in all seventy-eight apartments on the
subject premises and a list, including costs of those items purportedly
purchased for the kitchen renovation. The owner further asserts that the
refurbished elevator cab costs were properly substantiated and qualify as
an MCI. The owner enclosed a copy of the cab refurbishing proposal per CAB
decision 24,642; that the boiler/burner installation costs qualify as an
MCI per CAB decisions 19,317; 22,478; 25,780; and that the pointing and
waterproofing qualifies as an MCI as it was completed as necessary on
exposed sides of the building, the owner encloses a letter signed by the
waterproofing company's president in which the president asserts, in
substance, that all pointing and waterproofing had been completed where
necessary; a diagram indicating which walls had been attended to, and an
affidavit from the man who supervised the pointing and waterproofing work
attesting to the fact that, based on his personal physical examination of
the work performed, all exposed sides of the building had been pointed and
waterproofed where necessary. Finally, the owner asserts that the painting
and plastering work, in the amount of $20,750.00 qualifies as an MCI as
this was work performed in conjunction with the adequate wiring (in the
amount of $9,750.00) and new windows (in the amount of $11,000.00).
ADMIN. REVIEW DOCKET NO.: BK 430138-RT
The owner also submits copies of several checks, one in the amount of
3,000.00 uncancelled, in proof of the fact that several of the
installations denied unsubstantial costs were paid for and asserts that
these copies were submitted when this proceeding was before the
Administrator below as well as affidavits from the contractor who painted
the hallways and "closed the apartment walls after the wiring
installation".
In response to the owner's petition several tenants assert, in substance
and pertinent part, that their bathrooms were not completely
rehabilitated/modernized, that their individual apartments had not been
painted and that the common areas were not painted building-wide; that
several of their apartments had malfunctioning electrical outlets or
contained exposed wiring; that the existing mail boxes had been reinstalled
in another area but not replaced. A few tenants complained of leaks in
their apartments and evidence of water seepage in the common area hallways.
After careful consideration, the Commissioner is of the opinion that this
petition 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 for ordinary repairs; required
for the operation, preservation, and maintenance of the structure; and
replace an item whose useful life has expired.
The Commissioner is of the opinion that the Administrator properly denied
to the owner those costs associated with the kitchen modernization as the
installations were not completed building-wide or in some instances were
not completed at all. This is corroborated by the report of agency
inspection, dated January 2, 1986, for apartment 2G, on which the inspector
notes that the kitchen stove has not been replaced and another report,
dated November 18, 1986, for apartment 3A, on which the inspector notes
that the areas around the newly installed kitchen cabinets and sink had not
been completed.
It is the established position of the Division that pointing and
waterproofing performed where necessary and also comprehensive in nature
constitutes an MCI for which a rent increase adjustment may be warranted,
provided the owner otherwise so qualifies. It is also the general rule
that administrative determinations shall be in accord with the law as of
the time of determination. Accordingly, the owner's pointing and
waterproofing installation, completed as necessary on the exposed sides of
the building is an installation for which an MCI rent increase is
warranted.
ADMIN. REVIEW DOCKET NO.: BK 430138-RT
In view of the foregoing the Commissioner finds that the owner's petition
should be granted in part and that the owner is entitled to a rent increase
for the pointing and waterproofing installation at a cost of $29,000.00.
To determine the dollar amount of the rent increase, the rent charged for
each apartment as submitted in the rent roll dated March 1986 must be
multiplied by 2.04 percent.
The tenants shall be permitted to pay any arrears to the owner in 36 equal
monthly installments retroactive to September 30, 1987, the date on which
the Administrator issued the order herein appealed.
With regard to the elevator refurbishing costs in the amount of $14,500.00.
The Commissioner notes that the copies of checks for their installation,
which are a part of the record below, failed to adequately substantiate
$4,500.00 in costs and the only new evidence that the owner submits with
its petition substantiates another $2,000.00 in costs. However, the
Commissioner will not accept evidence when submitted for the first time on
appeal. Accordingly, the Commissioner is of the opinion that the
Administrator correctly disallowed costs, in the amount of $4,500.00 for
elevator cab refurbishing.
With regard to the painting and plastering of the subject premises
apartments in the amount of $9,500.00, which the owner asserts was
necessitated by the rewiring installation, the Commissioner notes that the
record below contains an adequate rewiring contract to which is appended a
statement which appears to indicate that the restoration of walls for all
apartments "caused by electrical installing" rewiring would be at a cost of
$7,500.00; this "invoice" however, is not signed, nor are there any
cancelled checks in the record which would indicate that this amount was
ever expended. Furthermore, the report of agency inspection, dated
November 18, 1986, for apartment 3A, indicates that the Foyer area had been
plastered but not painted, accordingly had the apartment painting costs
been substantiated there would remain a question as to whether the work had
been completed. the Commissioner also notes that although the owner
asserts that costs of $9,750.00 in wall renovations are attributable to the
rewiring installation, attached to the rewiring contract is the
abovementioned statement by a general contractor which appears to indicate
that the restoration of walls (plastering and painting), due to the
electrical rewiring, was completed at a cost of $7,500.00, which costs
remain unsubstantiated despite two agency notices (dated October 20, 1986
and December 8, 1986) sent to the owner requesting that proof of payment
for this work be sent to the agency. Accordingly, the Commissioner is of
the opinion that the Administrator's order, denying the alleged $7,500.00
in costs for the restoration of walls is correct as is the determination
regarding the painting and repair costs and thus should be affirmed.
ADMIN. REVIEW DOCKET NO.: BK 430138-RT
Accordingly, the Commissioner is of the opinion that the costs of the
pointing and waterproofing should be granted but that in all other respects
the Administrator's order was correct when issued and should be affirmed.
THEREFORE, in accordance with the Rent Stabilization Law and Code, it is
ORDERED, that this petition under Docket Numbers BK 430138-RT and BL
410180-RT, be, and the same hereby are, denied, and that the petition under
Docket Number CB 4100056-RO be and the same hereby is granted in part, and
that the maximum collectible rents of the subject premises be increased in
the manner and to the extent hereinabove directed.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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