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

     APPEALS OF                             DOCKET NOS. EH 130092-RT
                                         :              EH 130227-RT
        VARIOUS TENANTS OF 35-10            
        150TH STREET, FLUSHING,             DRO DOCKET NO. DC 130104-OM
        NEW YORK,          PETITIONERS   : 


     On August 8,  1990  the  above-named  petitioner-tenants  filed  duplicate
     Administrative Appeals (assigned the two docket numbers referenced  above)
     against  an  order  issued  on  July  9,  1990  by   the   District   Rent
     Administrator, 92-31 Union Hall Street, Jamaica, New York, concerning  the
     housing accommodations known as 35-10 150th Street,  Flushing,  New  York,
     Various Apartments.

     The Administrative Appeals are being determined pursuant to the provisions 
     of 9 NYCRR 2522.4 (a).

     The issue herein is  whether  the  District  Rent  Administrator  properly
     determined the owner's application for a rent increase based upon  claimed
     major capital improvements.

     The District Rent Administrator's order,  appealed  herein,  increase  the
     rents of the subject apartments by $7.36 per room per month based upon the 
     installation of replacement windows,  building-wide,  front  entrance  and
     vestibule doors, and pointing and waterproofing at a total  approved  cost
     of $162,609.00.  Of that total, the approved cost for the new  replacement
     windows alone was $107,253.00.

     On appeal, the petitioner-tenants allege, in substance,  that  the  second
     amendment of  the  offering  plan  to  convert  the  subject  premises  to
     cooperative ownership included a paragraph entitled "Partial Waiver of MCI 
     Rent Increases"  which provides that the sponsor will waive its  right  to
     all present and future MCI rent increases to  non-purchasing  tenants  for
     repairs and improvements to the building except that the sponsor  will  be
     entitled to an MCI rent  increase  not  to  exceed  3.5%  for  replacement
     windows; that the total number of rooms stated in the order is inaccurate; 
     that the arrears should cover an eleven  month  period,  rather  than  the
     thirteen month  period  stated  in  the  order;  that  subsequent  to  the
     issuance of the order, the  tenants  received  a  letter  from  the  owner
     stating that the MCI order was in error and  that  the  sponsor  was  only
     going to ask for a rent increase of 3 1/2% and only for the  new  windows;
     and that in August, 1990, the tenants were only  additionally  billed  for
     the new windows at 3 1/2% of the January, 1989 rent.


          DOCKET NUMBERS: EH 130092-RT, EH 130227-RT
     The owner responded to the tenants' administrative appeal by stating  that
     it agrees with the tenants that the  MCI  rent  increase  be  limited,  as
     agreed to by the second amendment, to the installation of new windows  and
     that the maximum rent increase be reduced from 6% to 3.5%; that the owner, 
     or sponsor,  by  the  tenants'  own  admission,  has  complied  with  this
     agreement; that the room count stated in the order is  correct;  that  the
     tenants did not raise any dispute over the room count  in  the  proceeding
     before the Administrator; and that the Division  properly  calculated  the
     number of months in arrears.

     After a careful  consideration  of  the  entire  evidence  of  record  the
     Commissioner is of the opinion that the administrative appeals  should  be
     granted, in part, as provided herein below.

     Pursuant  to  the  second  amendment  to  the  offering  plan,  which  the
     owner/sponsor has apparently already substantially implemented,  the  only
     MCI which may provide the basis for a rent adjustment is the  installation
     of replacement windows; and such increase may not exceed  3  1/2%  of  the
     rent.  In view of the foregoing, the Commissioner finds that the  District
     Rent Administrator's order should be modified to incorporate the terms  of
     said  second  amendment  by   reducing  the  previous  net  approved  cost
     (exclusive of  the  commercial  tenants'  share  of  the  MCI  cost)  from
     $159,812.13 to $105,408.25 so as  to  delete  the  costs  attributable  to
     doors, pointing and waterproofing and by reducing the rent  increase  from
     $7.36 to $4.85 per room, per month, subject to  the  limitation  that  the
     increase collectible thereunder shall not exceed more than 3 1/2%  of  the
     rent paid as of the March 1989 rent roll date.

     In addition thereto the amount of temporary arrears is reduced from $95.68 
     to $63.65 per room to cover the period between the effective date  of  the
     Administrator's order, July 1, 1989, and the collectibility date  thereof,
     August 1, 1990.

     With regard to the remaining allegations on appeal, the Commissioner finds 
     that the tenants failed to raise any dispute with the room  count  in  the
     proceeding before the District Rent Administrator and pursuant to 9  NCYRR
     2529.6, may not raise such issue for the first time on  appeal;  and  that
     the number of months of arrears was correctly determined by  the  District
     Rent  Administrator  based  upon  the  date  of  service  of  the  owner's
     application on the tenants, the effective date of the  increase,  and  the
     collectibility date of the increase.

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


          DOCKET NUMBERS: EH 130092-RT, EH 130227-RT
     ORDERED, that these administrative appeals be, and the  same  hereby  are,
     granted, in part, and that the order of the  District  Rent  Administrator
     be, and the same hereby is, modified, as provided herein above.


                                          JOSEPH A. D'AGOSTA
                                       Acting Deputy Commissioner


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