CI120207RO

                                  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

          ------------------------------------X 
          IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
          APPEAL OF                              DOCKET NO.CI120207RO
                                              :  DRO DOCKET NO.Q3120975RT
          RIDGE REALTY (MEADOW REALTY            TENANT: ANNE MURRAY
          MANAGEMENT)
                                PETITIONER    : 
          ------------------------------------X                             
             ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW


               On September 27, 1988, the above-named petitioner-owner filed 
          a Petition for Administrative Review against an order issued on 
          August 23, 1988, by the Rent Administrator, 10 Columbus Circle, New 
          York, New York, concerning the housing accommodations known as 144- 
          25 33 Avenue, Queens, New York, Apartment No. 3D, wherein the Rent 
          Administrator determined the fair market rent pursuant to the 
          special fair market rent guideline promulgated by the New York City 
          Rent Guidelines Board for use in calculating fair market rent 
          appeals.
               
               The Commissioner notes that this proceeding was filed prior to 
          April 1, 1984.  Sections 2526.1 (a) (4)  and 2521.1 (d) of the Rent 
          Stabilization Code (effective May 1, 1987) governing rent overcharge 
          and fair market rent proceedings provide that determination of these 
          matters be based upon the law or code provisions in effect on March 
          31, 1984.  Therefore, unless otherwise indicated, reference to 
          Sections of the Rent Stabilization Code (Code) contained herein are 
          to the Code in effect on April 30, 1987.

               The Administrative Appeal is being determined pursuant to the 
          provisions of Section 26-513 of the Rent Stabilization Code.

               The issue herein is whether the Rent Administrator's order was 
          warranted.

               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 originally commenced on March 30, 1984, by 
          the filing of a rent overcharge complaint and a fair market rent 
          adjustment application by the tenant.  In such complaint and 
          application, the tenant stated that she first moved to the subject 
          apartment on August 1, 1983 at a rental of $385.00 per month.  In 
          the fair market rent adjustment application, the tenant checked off 
          the box which stated that she believed that the initial legal 
          regulated rent for her apartment exceeded the fair market rent.

               Copies of the tenant's overcharge complaint and fair market 









          CI120207RO



          rent adjustment application were served on the prior owner and the 
          owner herein.  In addition the owner was afforded an opportunity to 
          prove that the tenant or a prior tenant was served with a copy of 
          the required Notice of Initial Legal Regulated Rent (hereafter DC-2 
          Notice).  In a response dated December 15, 1986, the owner herein 
          stated that it took over management of the subject building in 
          September 1985, and was not provided with copies of any DC-2 
          Notices.  Further, on March 16, 1988, the prior owner and the owner 
          herein were sent a letter (form RTP-22) directing the submission of 
          a complete rental history, stating that the tenant was challenging 
          the Initial Legal Regulated Rent and affording the owners the 
          opportunity to submit June 30, 1974, or post June 30, 1974 
          comparability data.  On March 16, 1988, the owner herein was sent a 
          Notice affording an opportunity to submit additional evidence and a 
          copy of the tenant's reply to the owner's answer was sent along with 
          this Notice.

               The owner submitted a response to the March 16, 1988 Notice, 
          but did not submit any comparability data.

               In Order Number CDR 33,918, the Rent Administrator adjusted the 
          initial legal regulated rent by establishing a fair market rent of 
          $180.79 effective November 1, 1977, the commencement date of the 
          initial rent stabilized lease.  Based on the failure to submit 
          comparability data, the Rent Administrator determined the fair 
          market rent using the special fair market rent guideline alone.  The 
          Rent Administrator also directed that the owner refund excess rent 
          of $8,912.30 to the tenant covering the period from August 1, 1983 
          to August 31, 1988.

               In this petition and a supplement to said petition, the owner 
          alleges in substance that the DHCR failed to give the owner proper 
          notice regarding the submission of comparability data and applied 
          incorrect statutory criteria;  that the tenant did not sufficiently 
          support her allegation regarding fair market rent; and that the 
          owner should not have been required to produce rent records prior to 
          April 1, 1980 in accordance with the decision in J.R.D. Management 
          Corp. v. Eimicke,148 A.D. 2d 610, 539 N.Y.S. 2d 667 (App. Div. 2d 
          Dept., 1989).

               The Commissioner is of the opinion that this petition should be 
          denied.

               Section 26-513 of the Rent Stabilization Law provides in 
          pertinent part that fair market rent adjustment applications are to 
          be determined by the use of special fair market rent guidelines 
          orders promulgated by the New York City Rent Guidelines Board and by 
          the rents generally prevailing in the same area for substantially 
          similar housing accommodations.  In order to determine rents 
          generally prevailing in the same area for substantially similar 
          housing accommodations, it is DHCR's procedure for fair market rent 







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          appeal cases filed prior to April 1, 1984 to allow owners to submit 
          June 30, 1974 fair market rent data for complete lines of 
          apartments, beginning with the subject line.  The average of such 
          comparable rentals will then be updated by annual guidelines 
          increases.  Alternatively, DHCR procedure allows owners to have 
          comparability determined on the basis of rents charged after June 
          30, 1974.  In order to use this method, owners were required prior 
          to November 1, 1984 to submit rental history data for all stabilized 
          apartments in the subject premises and subsequent to November 1, 
          1984 to submit such data for complete lines of apartments beginning 
          with the subject line.  Post June 30, 1974 rent data will be 
          utilized if the comparable apartment was rented to a first 
          stabilized tenant within one year of the renting of the subject 
          apartment and if the owner submits proof of service of a DC-2 Notice 
          or apartment registration form indicating that the rent is not 
          subject to challenge.

               In the instant case, the evidence of record discloses, contrary 
          to the owner's contention on appeal, that the owner was afforded an 
          opportunity to submit June 30, 1974 or post June 30, 1974 
          comparability data as outlined above.  Further, contrary to the 
          owner's contention on appeal, the tenant's fair market rent 
          adjustment application met statutory criteria in that the tenant 
          contended that the initial legal regulated rent exceeded the fair 
          market rent.  The tenant was not required to submit proof of this 
          contention.

               Finally, the Commissioner is of the opinion that the JRD case 
          is not applicable in this proceeding.  The change effected by 
          Section 14(g) of the Omnibus Housing Act and Section 26-516(g) of 
          the Rent Stabilization Law, as applied in the JRD case, only 
          involves rent overcharge proceedings, and does not apply to fair 
          market rent appeals.  Section 26-513 of the Rent Stabilization Law, 
          which deals with fair market rent appeals, continues to provide for 
          determination of the fair market rent from the date of the initial 
          stabilized tenancy.  Additionally, the owner was not required to 
          submit comparability data more than four years old, but had the 
          option to do so.

               The owner is directed to reflect the findings and 
          determinations made in this order on all future registration 
          statements, including those for the current year if not already 
          filed, citing this order as the basis for the change.  Registration 
          statements already on file, however, should not be amended to 
          reflect the findings and determinations made in this order.  The 
          owner is further directed to adjust subsequent rents to an amount no 
          greater than that determined by this order plus any lawful 
          increases.

               In the event the owner does not take appropriate action to 
          refund the excess rent of $8,912.30, as shown in the Rent 





          Administrator's order, within sixty days from the date of issuance 
          of this order, the tenant may credit the excess rent against the 







          CI120207RO

          next month(s) rent until fully offset.

               THEREFORE, in accordance with the provisions of the Rent 
          Stabilization Law and Code, it is

               ORDERED, that this petition for administrative review be, and 
          the same hereby is, denied, and, that the order of the Rent 
          Administrator be, and the same hereby is, affirmed.

          ISSUED



                                                                        
                                          JOSEPH A. D'AGOSTA
                                          Deputy Commissioner






                     































    

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