OFFICE OF RENT ADMINISTRATION
                                     GERTZ PLAZA

                               92-31 UNION HALL STREET
                               JAMAICA, NEW YORK 11433

          ------------------------------------X   ADMINISTRATIVE REVIEW
          APPEAL OF
                     STEVEN E. SHAPIRO,

                                                  RENT ADMINISTRATOR'S
                               PETITIONER         DOCKET NO.: L000423OM 


          On February 19, 1988, the above-named petitioner-tenant timely re- 
          filed a petition for administrative review (PAR) of an order issued 
          on November 5, 1987, by the Rent Administrator, concerning the 
          housing accommodation known as 226 East 70th Street, New York, NY, 
          apartment 2G, wherein the Administrator granted the owner's 
          application for a rent increase which was based on the installation 
          of a major capital improvement (MCI), a boiler/burner. 

          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. 

          The owner commenced the instant proceeding by initially filing an 
          application for a rent increase predicated on the installation of 
          a boiler/burner at a total cost of $42,500.00.

          In Docket No. L000423OM, issued November 5, 1987, the Rent 
          Administrator issued the order here under review, approving the 
          owner's MCI application by authorizing a rent increase of $3.97 per 
          room, per month for all rent controlled and rent stabilized 
          apartments in the subject building.

          In this petition, the tenant contends, in substance, that the Rent
          Administrator's order should be reversed because his lease does not 
          contain a provision authorizing the collection of a rent increase 
          pursuant to a DHCR order.

          The owner did not file a response to the petition, although 
          afforded the opportunity to do so.

          After a careful consideration of the entire record, the 

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

          Rent increases for major capital improvements are authorized by 
          Section 2522.4 of the Rent Stabilization Code and are warranted 
          where the improvements are building-wide, depreciable under the 
          Internal Revenue Code, other than for ordinary repair, required for 
          the operation, preservation and maintenance of the structure and 
          replace an item whose useful life has expired.

          The record in the instant case indicates that the Administrator's 
          order was predicated upon a review of full supporting documentation 
          including contracts, contractor's certification and cancelled 

          According to the terms and conditions of the order, the increase 
          granted by the order is collectible during the term of the current 
          lease only if the lease contains a provision authorizing the 
          collection of an increase pursuant to a DHCR order, as provided by 
          Section 2522.5(d)(2) of the Rent Stabilization Code and Division 
          precedent.  In the absence of same and in accordance with Section 
          2522.4(a)(5) of the Code, said increase is not collectible until 
          the expiration of the lease term then in effect at the time of the 
          issuance of the MCI order, provided the renewal lease contains a 
          general authorization provision for adjustment of the rent reserved 
          by the DHCR order.  If the petitioner's lease does not contain such 
          a clause, he need not pay the increase and if the owner attempted 
          to collect the increase, the tenant's remedy is to file an 
          overcharge complaint. 

          Since the tenant did not challenge the propriety of the 
          Administrator's order, and only attacked the owner's right to 
          collect the rent increase, the tenant's petition is denied.  
          However, this order and opinion is issued without prejudice to the 
          tenant's right to file a rent overcharge complaint, if the facts so 

          Based on the entire evidence of record, the Commissioner finds that 
          the Administrator's order is correct and should be affirmed.

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

          ORDERED, that this petition be, and the same hereby is, denied; and 

          that the order of the Rent Administrator be and the same hereby is, 


                                                  LULA M. ANDERSON  
                                                  Deputy Commissioner


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