STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
-------------------------------------X ADMINISTRATIVE REVIEW
IN THE MATTER OF THE ADMINISTRATIVE DOCKET NO.: CD620190RT
DOCKET NO.: AF630103OM
ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
On April 5, 1988, the above-named petitioner-tenant timely filed a
petition for administrative review (PAR) against an order issued on
March 28, 1988, by a Rent Administrator, 92-31 Union Hall Street,
Jamaica, New York, concerning the housing accommodations known as
3750 Bronx Boulevard, Apt. 4D, Bronx, NY.
The owner commenced this proceeding on June 24, 1986, by filing a
major capital improvement (MCI) rent increase application
predicated on the installation of windows building-wide, roof
replacement and vestibule door with lock at a total claimed cost of
On March 28, 1988, the Rent Administrator issued the order here
under review, finding that the installations qualified as an MCI,
determining that the application complied with the relevant laws
and regulations based upon the supporting documentation submitted
by the owner, and authorizing rent increases for rent stabilized
and rent controlled apartments.
In this PAR, the tenant requests reversal of the Rent
Administrator's order and alleges, inter alia, that he is being
overcharged, and that he was not informed by the owner of the
pending MCI application at the time that he entered into a lease
agreement with the owner.
The Commissioner is of the opinion that this petition should be
ADMIN. REVIEW DOCKET NO. CD-620190-RT
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.
It is the established position of the Division that the work
performed herein meets the definitional requirements of an MCI for
which a rent increase may be warranted. The record shows that the
owner submitted copies of the contracts, contractors'
certifications and cancelled checks which indicate that the owner
correctly complied with the applicable procedures for an MCI rent
increase, and that the increase was properly computed based on the
proven cost of said installation.
However, the record further indicates that the petitioner is the
first rent stabilized tenant of the subject apartment (4D) and
commenced occupancy of the subject apartment one year after the
owner filed its MCI application.
Since the subject apartment was subject to Rent Control at the time
of the instant application was filed and which subsequently became
subject to Rent Stabilization Jurisdiction, the Commissioner notes
that since the free market rent charged the petitioner (first
stabilized tenant) included any and all services then being
provided, the rent increase provided for in the Administrator's
order is not collectible from the petitioner-tenant or any
subsequent tenant of apartment 4D.
This order and opinion is issued without prejudice to the tenant's
right to file an overcharge complaint with this Division, if the
facts so warrant.
THEREFORE, in accordance with the provisions of the Rent
Stabilization Law and Code, it is
ORDERED, that this administrative appeal be, and the same hereby is
granted; and that the Administrator's order be, and the same hereby
is, modified in accordance with this order and opinion.
Joseph A. D'Agosta
2 Deputy Commissioner