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

      APPEAL OF                              DOCKET NO.: DL 410104-RT
        JEFFERY HEIMAN &                     RENT ADMINISTRATOR'S
        THOMAS DELANEY                       DOCKET NO.: ZBF 430020-OM
                            PETITIONER    : 


      On December 6, 1989 the above-named petitioner-tenants filed an 
      Administrative Appeal against an order issued on November 28, 1989 by the 
      Rent Administrator, Gertz Plaza, Jamaica, New York, concerning housing 
      accommodations known as 964 Amsterdam Avenue, New York, New York, Apartment 
      3A, wherein the Administrator granted the owner's application for a rent 
      increase based on the installation of an oil boiler and burner and a new  

      The Commissioner has reviewed all of the evidence in the record and has 
      carefully considered that portion of the record relevant to the issues 
      raised by this appeal.

      The issue in this appeal is whether the Rent Administrator's order was 

      The owner commenced this proceeding on June 4, 1987 by filing an 
      application for a rent increase based upon the installation of several 
      major capital improvements (MCI's): an oil boiler/burner, roof, mailboxes, 
      oil tank lining and a cold water line.  

      None of the tenants responded to owner's application.

      On November 28, 1989, the Rent Administrator partially granted the owner's 
      MCI application, approving a rent increase for the boiler/burner and heat 
      timer and roof, and denying a rent increase for the mailboxes, oil tank 
      liner and cold water riser.

      In this petition, the tenants of Apartment 3A seek modification of the Rent 
      Administrator's order to exclude the retroactive increase on the grounds 
      that the tenants were neither polled as stated in the Administrator's order 
      nor given notice that the improvements would subject them to a rent 
      increase.  The tenants also objected to the retroactive increase because 
      the improvements merely added value to the owner's property.

      In answer thereto, the owner states that the tenants should be subject to 
      the retroactive increase because the tenants began occupancy of their 
      apartment prior to the installation of the improvements.  The owner also 
      states that he will rely on the Division to verify that the tenants were 


          ADMIN. REVIEW DOCKET NO.: DL 410104-RT

      After a careful consideration of the entire evidence of record, the 
      Commissioner is of the opinion that this petition should be denied.

      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 notes that for applications filed prior to October 1, 
      1987, an owner was required to serve a copy of the MCI application, a copy 
      of Notice Form RA-79N and three copies of Answer Form RTP-3 to all rent 
      regulated tenants.  Upon completion of service, the owner was required to 
      certify on RA-79 Supplement IV (Certification of Service of Notice to 
      Tenants of Filing of Application for Rent Increase) that service of these 
      items was performed.  If none of the tenants responded, as the record 
      indicates in the instant case, the Division would randomly select a sample 
      of tenants and send them a Notice to Tenant of Opportunity to Respond to 
      Application along with a copy of the MCI application and answer form.  This 
      last step was known as polling.

      The record indicates that the owner substantiated his application in the 
      proceeding below by submitting to the Administrator documentation in 
      support of the application, including the contractor's certifications, 
      copies of contracts, invoices, cancelled checks, and the necessary 
      governmental approvals for the work in question.

      Moreover, the record discloses that on September 22, 1987, the former owner 
      certified that he served each tenant with a copy of the application and 
      placed a copy of the entire application, including all required supplements 
      and supporting documentation, with the resident superintendent of the 
      subject building.  On August 8, 1988, a random polling of tenants was made 
      by the Division, but none of the tenants responded to such polling.

      Based upon the foregoing, the Commissioner finds that the notice 
      requirements in existence at the time the application was filed were 
      followed, and that the tenants were given adequate notice of MCI 

      With regard to the tenant's contentions that the oil boiler/burner and roof 
      increased value of owner's property, the Commissioner notes that the work 
      in question meets the criteria for an MCI as stated in Section 2522.4(a)(2) 
      of the Rent Stabilization Code.


          ADMIN. REVIEW DOCKET NO.: DL 410104-RT

      THEREFORE, in accordance with the Rent Stabilization Law and Code, and New 
      York City Rent and Eviction Regulations, it is

      ORDERED, that this petition be, and the same hereby is denied and that the 
      Rent Administrator's order be, and the same hereby is, affirmed.


                                           JOSEPH A. D'AGOSTA
                                       Acting Deputy Commissioner



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