DHCR Decisions
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
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IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.: EC-130402-RO
:
DISTRICT RENT ADMINISTRATOR'S
BIRCHWOOD ASSOCIATES, DOCKET NO.: ZDB 130038-OM
PETITIONER :
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
The above-named petitioner-owner timely filed an administrative appeal
against an order issued on February 15, 1990 by the District Rent
Administrator (Gertz Plaza, Jamaica, New York), concerning the housing
accommodations known as 37-31 73rd Street, Jackson Heights, New York,
various apartments, wherein the Administrator denied the owner's
application for major capital improvement (MCI) rent increases for the
controlled and stabilized apartments in the subject premises based on the
installation of a new roof, parapet repairs, waterproofing, insulation,
new light fixtures in the hall, new hallway and stairwell fixtures, and
the painting of terraces and halls.
The landlord commenced the proceeding below by filing its MCI application
in February of 1989. In response to the application, various tenants
filed answers stating, among other things, that (I) The work done herein
did not constitute improvements but necessary repairs; and (II) The
landlord undertook to do the work herein at its own expense as part of the
cooperative conversion of the subject premises. In support of their
contentions, the tenants submitted a copy of a portion of the Fourth
Amendment to the Cooperative Conversion Plan for the premises.
The District Rent Administrator's order, appealed herein, stated that the
improvements claimed in the owner's application were those set forth in
the Cooperative Conversion Offering Plan whereby it was represented that
the costs would be paid by the sponsor at its expense. The District Rent
Administrator determined, therefore, that these costs cannot be passed on
to the tenants. In addition, the order stated that the installation of
new light fixtures in the hall, new hallway and stairwell fixtures, and
the painting of terraces and hallways did not constitute MCI's but are
considered to be repairs and maintenance.
On appeal, the petitioner-owner states, in substance, that (A) The new
roof, parapet repairs, waterproofing, and insulation have always been
considered as qualifying for an MCI; (B) The new hallway light fixtures
improved appearance, security, and energy conservation and should also be
considered as qualifying for an MCI; (C) The owner relied upon the policy
of the DHCR that existed at the time of the repairs and installations
herein; and (D) Any policy change pertaining to a building undergoing
cooperative conversion should not be imposed retroactively as it would be
a deprivation of the landlord's property without due process.
DOCKET NUMBER: EC 130402-RO
In response to the owner's petition, various tenants filed answers
stating, in substance, that (1) The work done by the landlord constituted
necessary repairs; and (2) The Fourth Amendment to the Cooperative
Conversion Plan stipulates that the work herein was to be done in the
building as a condition of going co-op.
After careful consideration of the entire evidence of record the
Commissioner is of the opinion that the administrative appeal should be
denied.
The Fourth Amendment to the Cooperative Conversion Plan for the subject
premises submitted by the tenants (dated March 3, 1987) states, in
pertinent part, that the "Sponsor agrees to make, at its cost, certain
additional improvements to the building including repair and pointing of
parapets as needed, and installation of a new roof. Sponsor will paint
and/or wallpaper and install new lighting fixtures in the lobby and all
residential corridors in the building. The lobby will be refurnished and
refurbished. New carpet will be installed in the residential corridors.
Sponsor will use best efforts to complete the said improvements and
repairs prior to the closing."
DHCR Policy Statement 89-9 covers the situation where the offering plan
states that improvements will be made at the sponsor's "sole expense".
The Policy Statement provides (in relevant part) as follows: "Any MCI
application for a cooperative or condominium converted building, where the
offering plan includes this (or similar) language without additional
exclusionary language relating to an MCI application, will be denied to
the extent that the costs for the improvements mentioned are included in
the application."
In this connection the Commissioner notes that Policy Statement 89-9,
dated August 28, 1989, does not reflect a change in policy but rather
reflects a line of administrative rulings (AE 730001-RT; ART 13,197-9-L
and BL 420122-4-RT) rendered prior to the issuance of this policy
statement which precluded major capital improvement rent increases where
the sponsor undertook to perform the improvement at no expense to the
tenants or at the sponsor's sole cost and expense.
In addition, despite the petitioner's non-specific contention of a change
in policy, no contrary policy of DHCR existed at the time the work herein
was done, and thus no showing has been made that the petitioner relied on
any contrary policy.
On the basis of the entire evidence of record, it is found 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, the Rent and Eviction Regulations for the City
of New York, and Operational Bulletin 84-1, it is
DOCKET NUMBER: EC 130402-RO
ORDERED, that the administrative appeal be, and the same hereby is denied;
and that the Administrator's order be, and the same hereby is affirmed.
ISSUED:
JOSEPH A. D'AGOSTA
Acting Deputy Commissioner
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