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  SJR NO. 5831 
          IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
          APPEAL OF                              DOCKET NO. EA 630404 RO
                                              :  DRO DOCKET NO.ZCD-630233-OM
               SHERIDAN ONE COMPANY                     

                                PETITIONER    : 
          ------------------------------------X                             
                   ORDER AND OPINION REMANDING PROCEEDING ON APPEAL


               On January 22, 1990, the above-named petitioner-owner timely 
          refiled a Petition for Administrative Review against an order issued 
          on November 13, 1989, by the Rent Administrator, Gertz Plaza, 
          Queens, New York, concerning the housing accommodations known as 930 
          Sheridan  Avenue, Bronx, New York, Various Apartments, wherein the 
          Rent Administrator determined that the 
          owner was not entitled to a rent increase based on a major capital 
          improvement (hereafter MCI).  Subsequent thereto, the petitioner 
          filed a petition in the Supreme Court pursuant to Article 78 of 
          the Civil Practice Law and Rules requesting that the "deemed 
          denial" of the petitioner's administrative appeal be annulled.  
          This proceeding was then remitted to the DHCR for a determination 
          of the petitioner's appeal. 

          The Administrative Appeal is being determined pursuant to the 
          provisions of Section 2522.4 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.  

          The owner commenced this proceeding on April 22, 1988 by 
          filing an application for a rent increase based on the following 
          MCI's: a bell, buzzer and intercom system at a total cost of 
          $4,814.00 and new interior and exterior lighting fixtures at a 
          total cost of $3,157.41.

          In response to the owner's application, several tenants 
          stated in substance that the intercom system was not working 
          properly.  On October 6, 1989, the owner was afforded an 
          opportunity to answer the tenants' reponses concerning the 
          intercom system.  Unfortunately, the owner's response was not 
          received by the Rent Administrator.

          On October 26 and October 27, 1989, inspections were 










          EA 630404 RO
          conducted at the subject premises.  Such inspections disclosed 
          that the intercom system was working in apartments 5F, 5K, and 3K, 
          but was not working in apartments 2H and 1N.

          On November 13, 1989, the Rent Administrator issued the order 
          here under review denying the owner's application based on a 
          finding that the bell, buzzer and intercom system was not working 
          properly as evidenced by the physical inspections and that the 
          owner failed to correct the condition and that installation of 
          interior and exterior lighting fixtures does not constitute a 
          MCI.

          In this petition, the owner alleges in substance that the 
          Rent Administrator failed to consider the owner's October 28, 1989 
          answer in response to a October 6, 1989 request by the Rent 
          Administrator, that the intercom system was in working order and 
          had been repaired on a number of occasions due to vandalism and 
          that at most the MCI increase should only have been denied for 
          those few tenants who had trouble with the intercom (there are 83 
          apartments in the subject premises).  In addition the owner 
          alleges that the installation of the interior and exterior 
          lighting should have been considered a MCI since it is energy 
          efficient fluorescent lighting (interior) and sodium vapor 
          lighting (exterior) and replaced outmoded energy consuming 
          incandescent lighting (both interior and exterior).  Moreover, the 
          high intensity exterior lighting acts as a deterrent to vandals or 
          muggers according to the owner.

          The Commissioner is of the opinion that this proceeding 
          should be remanded to the Rent Administrator.

          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 record in the instant case indicates that the owner's 
          answer in the proceeding before the Rent Administrator was not 
          received by the Rent Administrator.  In addition due to the fact 
          that only 5 of the 83 apartments in the subject premises were 
          actually inspected concerning the condition of the intercom 
          system, the Commissioner caused other physical inspections to be 
          conducted at the subject premises on December 11 and December 13, 
          1991.  During the course of such inspections, 19 apartments were 



          inspected including the apartments of all complaining tenants 
          except one tenant who failed to keep an appointment with the 
          inspector.  In all 19 apartments inspected, the bell, buzzer and 
          intercom system was found to be working properly.  Accordingly, 
          the Commissioner finds that the owner was entitled to a MCI rent 


          EA 630404 RO
          increase for this item and this proceeding is being remanded to 
          the Rent Administrator to determine the amount of the rent 
          increase per apartment for the installation of the bell, buzzer, 
          and intercom system effective May 1, 1988, the first rent payment 
          date following the filing of the owner's application.  In 
          addition, the tenants should be afforded an opportunity to pay off 
          any arrears in rent due to this MCI rent increase in 12 equal 
          monthly installments.

          With regard to the interior and exterior lighting fixtures, 
          the Commissioner is of the opinion that such items are not 
          structural in nature and are not required for the operation, 
          preservation and maintenance of the building and therefore do not 
          qualify as a MCI but are considered in the nature of ordinary 
          repairs for which no rent increase is warranted.  Accordingly, 
          that portion of the Rent Administrator's order finding that the 
          interior and exterior lighting fixtures do not constitute a MCI is 
          hereby upheld.

          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, granted to the extent of remanding this 
          proceeding to the Rent Administrator for further consideration in 
          accordance with this order and opinion.  The order of the Rent 
          Administrator remains in full force and effect until a new order 
          is issued on remand. 

          ISSUED



                                                                        
                                          ELLIOT SANDER
                                          Deputy Commissioner




                     

























          EA 630404 RO