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.:GB430306RO

             322 East 73rd Street Associates,
                                                  RENT ADMINISTRATOR'S
                                                  DOCKET NO.:FG430008B
                                   PETITIONER
          ----------------------------------X

                                          
            ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
                                       IN PART


          On February 25, 1992, that above-named petitioner-owner filed a 
          petition for administrative review of an order issued on January 
          17, 1992, by the Rent Administrator, and post marked January 21, 
          1992 concerning the housing accommodations known as 322 East 73rd 
          Street, New York, NY, various apartments, wherein the Administrator 
          determined that the rent for rent stabilized apartments should be 
          reduced to the level in effect prior to the last rent guideline 
          increase which commenced before the effective date of the order 
          based upon a diminution of services and further determined that the 
          maximum legal rent for rent controlled apartments should be reduced 
          by $8.00 per month based upon a diminution of services.  The Rent 
          Administrator's order was based upon inspections held on October 
          10, 1991 and December 17, 1991, which disclosed that although 
          several service items had been corrected, some had not.  The 
          inspection of December 17, 1991, revealed that paint and plaster on 
          the bulkhead and paint and plaster on the third floor stairs had 
          not been corrected.

          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 issue herein is whether the Rent Administrator properly reduced 
          the rents of various rent stabilized and rent controlled apartments 
          in the subject building.


                                         -1-












          GB430306RO


          This proceeding was commenced on July 2, 1991 when one rent stabi- 
          lized tenant filed a complaint alleging several building-wide 
          conditions requiring repair and ordering a rent reduction.

          On November 4, 1991, the owner filed an answer below alleging that 
          all necessary repairs had been made and that regular maintenance is 
          conducted at specifically designated intervals.

          An inspection on October 10, 1991 revealed that the public area 
          windows required cleaning, one window was nailed shut for safety 
          purposes and there was peeling paint and plaster on the walls and 
          ceilings between the third and fourth floors and on the bulkhead.

          The owner was notified of the results of the inspection on November 
          1, 1991 and afforded an opportunity to correct the conditions and 
          submit proof within 20 days.

          A second inspection on December 17, 1991 revealed that new windows 
          had been installed but that there was still peeling paint and 
          plaster between the third and fourth floors.

          The Administrator's order reduced the rent by a guideline for the 
          one rent stabilized tenant who signed the complaint and by $8.00 
          per month for all rent controlled tenants in the building.

          In the petition for administrative review, the owner asserts that 
          it did not have sufficient time to address the conditions 
          complained of, that the water seepage condition was caused by 
          defective windows, that new thermal windows were installed 
          throughout the building, that the installation was completed in 
          December 1991 and the leak damaged areas could not be repaired 
          until they had dried out, which takes about 2 months.  The petition 
          was served on the tenant on April 2, 1992.

          In answer to the petition, the tenant states that the leak was 
          never properly corrected and although the affected areas have been 
          repainted, the water continues to seep through.

          After careful consideration of the evidence of record, the Commis- 
          sioner is of the opinion that the petition should be granted in 
          part.

          Pursuant to Section 2523.4(a) of the Rent Stabilization Code, a 
          tenant may apply to the Division of Housing and Community Renewal 
          (DHCR) for a reduction of the legal regulated rent to the level in 
          effect prior to the most recent guidelines adjustment, and the DHCR 
          shall so reduce the rent for the period for which it is found that 
          the owner has failed to maintain required services.


                                          2






          GB430306RO


          Required services are defined in Section 2520.6(r) to include 
          repairs and maintenance.

          A review of the record before the Commissioner clearly shows that 
          the owner did not submit any evidence that the deficiencies noted 
          on the follow-up inspection of December 17, 1991 had been 
          corrected.

          The owner's claim on appeal that repairs were in progress is not 
          material insofar as it had ample opportunity to make all repairs in 
          a workmanlike manner during the several months that this proceeding 
          was pending, but had failed to do so before the issuance of the 
          Rent Administrator's order.

          The Commissioner finds that the Administrator properly based his 
          determination on the entire record, including the results of the  
          on-site physical inspections conducted on October 10, 1991 and 
          December 17, 1991 and that pursuant to Section 2523.4 (a) of the 
          Code the Administrator was mandated to reduce the rent for the one 
          rent stabilized tenant who signed the complaint, upon determining 
          that the owner had failed to maintain services.

          Although rent controlled tenants do not have to request a rent 
          reduction to be entitled to one, in this case since not one rent 
          controlled tenant joined in signing the complaint, the owner was 
          not on notice that the provisions of the Rent Control Law were 
          being invoked in this proceeding.  The rent reductions granted to 
          rent controlled tenants constitutes a denial of the owner's due 
          process rights and must be revoked.


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

          ORDERED, that the owner's petition be, and the same hereby is, 
          granted in part, and the Rent Administrator's order be, and the 
          same hereby is, affirmed, as modified to revoke the rent reduction 
          for rent controlled tenants.

          Upon a restoration of services the owner may separately apply for 
          a rent restoration.


          ISSUED:
                                                                             
                                                      JOSEPH A. D'AGOSTA
                                                      Deputy Commissioner


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