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

          -------------------------------------X   ADMINISTRATIVE REVIEW
          APPEAL OF
                    PHILIP CASIMIR
                                                   RENT ADMINISTRATOR'S
                                                   DOCKET NO.:  AF630103OM



          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

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