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 
      IN THE MATTER OF THE ADMINISTRATIVE :  ADMINISTRATIVE REVIEW
      APPEALS OF                             DOCKET NOS.: GF510047RT
                                          :               GF510317RT
      VARIOUS TENANTS OF 106 CONVENT                      GF510321RT
      AVENUE, NEW YORK, NY                                GF510336RT
                            PETITIONERS   :               GF510352RT
      ------------------------------------X                             
                                             RENT ADMINISTRATOR'S
                                             DOCKET NO.: EF530136OM

            ORDER AND OPINION DENYING PETITIONS FOR ADMINISTRATIVE REVIEW

      On various dates, five tenants timely filed petitions for administrative 
      review against an order issued on May 20, 1992, by a Rent Administrator 
      (Gertz Plaza) concerning the housing accommodations known as 106 Convent 
      Avenue, New York, New York, various apartments, wherein the Rent 
      Administrator determined that the owner was entitled to a rent increase 
      based on the installation of a major capital improvement (MCI).

      The Commissioner deems it appropriate to consolidate these petitions for a 
      uniform disposition since they pertain to the same order and involve common 
      issues of law and fact.

      The owner commenced this proceeding on June 25, 1990, by initially filing 
      an application for a rent increase based on the installation of apartment 
      windows at a cost of $47,600.00.

      Several tenants objected to the owner's application, alleging, in 
      substance, that the former windows were not properly maintained by the 
      owner, and as a result, had deteriorated beyond repair; the new windows 
      were fragile and unsafe; and the dimensions of the new windows were 
      different from the former windows, thus preventing the tenants from the use 
      of their storm windows, screens, gates and air conditioners.  The tenant of 
      apartment #26 contended, in substance, that the former windows were in such 
      a state of disrepair that he had to install storm windows, screens and 
      gates which were not replaced upon the installation of the new windows, but 
      were discarded by the owner; and that his air conditioner no longer fit due 
      to the changed dimensions of the new windows.

      On May 20, 1992, the Rent Administrator issued the order here under review, 
      finding that the installation qualified as an MCI, determining that the 
      application complied with the relevant laws and regulations based upon the 
      supporting documentation submitted by the owner, and allowing rent 
      increases for rent controlled and rent stabilized tenants.

      In these petitions, the tenants contend, in substance, that: (1) the former 
      windows had deteriorated beyond repair as the owner failed to do routine 
      building maintenance; (2) two apartments (15 and 26) had been burglarized; 
      (3) the windows improve the value of the property for the owner, therefore, 
      the tenants should not be burdened with a permanent rent increase; (4) the







          ADMIN. REVIEW DOCKET NO.: GF 510047-RT, et al.




      tenant of apartment 3 had to buy new blinds and a new air conditioner due 
      to the changed dimensions of the windows; (5) the tenant of apartment 8 
      signed the initial lease for a newly renovated apartment in June 1991 at a 
      monthly rental of $550.00 (the former tenant paid a monthly rent of 
      $193.00), and was told that the rent included the new windows which were 
      installed prior to his initial lease; (6) the tenant of apartment 6 states 
      that the new windows were installed prior to her renting the apartment in 
      September 1990, that there is no provision in her initial lease concerning 
      an MCI, and that she should not have to pay a retroactive increase; and (7) 
      the tenant of apartment 26 states that she had purchased storm windows 
      which were discarded by the owner when the new windows were installed, and 
      that she was not given an alternative to taking the new windows.

      In response to the tenants' petitions, the owner contends, in substance, 
      that it had no knowledge of any burglaries of the tenants' apartments,  
      that any window broken during a burglary attempt would be replaced by the 
      owner; that the tenant of apartment 8 was not told that the cost of the new 
      windows had been factored into the initial rent, rather this tenant's lease 
      agreement specifies that they (the tenants) were subject to the pending MCI 
      rental increase application for new windows under Docket No. EF530136OM; 
      that storm windows were never provided to the tenant of apartment 26; and 
      that several of the petitioner-tenants had not opposed the owner's MCI 
      application.

      After careful consideration of the entire record, the Commissioner is of 
      the opinion that these petitions 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.

      It is the well established position of the Division (as reflected in Policy 
      Statement 89-6), that the building-wide installation of all apartment 
      windows and/or public area or lot line windows to replace windows which are 
      25 or more years old (as is the case herein) constitute a major capital 
      improvement for which a rent increase may be warranted, provided the owner 
      otherwise so qualifies.  The fact that the work also benefits the owner 
      makes no difference as to whether the work qualifies as an MCI entitling 
      the owner to rent increases.  Additionally, tenant consent is not required 
      for an MCI rent increase.

      The record discloses that the owner substantiated its application in the 
      proceeding below by submitting to the Rent Administrator in support thereof 
      copies of the contract, contractor's certification and cancelled checks


          ADMIN. REVIEW DOCKET NO.: GF 510047-RT, et al.




      for the improvement in question.  The petitioners herein, on the other 
      hand, have failed to establish, either in the proceeding below or an 
      appeal, the alleged inadequacy of the work performed or that services were 
      not being maintained.  In this respect it is significant to note that the 
      records of the Division disclose that no rent reduction order had been 
      issued against the subject premises based on the owner's failure to 
      maintain services of a building-wide nature nor was any such complaint 
      pending at the time the order appealed herein was issued.  The tenants have 
      failed to establish that the Administrator's order should be revoked.

      In the event of a change of tenancy during an MCI proceeding, it is the 
      obligation of the owner to notify the new tenant of the pendency of such 
      proceeding, and to advise the Division of this change in tenancy.  While 
      not fatal to the owner's application, the owner runs the risk of the tenant 
      who was not so notified raising issues on appeal which could have been 
      raised in the proceeding below, thus jeopardizing the finality of the 
      Administrator's order.

      Where, as in the instant case, the tenant of apartment #6 took occupancy 
      pursuant to a vacancy lease commencing after the owner had filed its 
      application, the Commissioner notes that for the MCI increase granted by 
      the Administrator's order to be collectible during the term of the 
      petitioner's vacancy lease, such vacancy lease would have to contain a 
      specific clause advising the tenant of the docket number of the pending 
      proceeding and advising that the rent charged was subject to an additional 
      increase (during the current lease term in effect) as provided by Section 
      2522.4(a)(5) of the Rent Stabilization Code and established Division 
      precedent.  In the absence of same, said increase was not collectible until 
      the expiration of the lease term in effect at the time of issuance (May 20, 
      1992) of the MCI order, provided the renewal lease contains a general 
      authorization provision for adjustment of the rent reserved by a DHCR 
      order.

      As to any apartment which was subject to Rent Control at the time the 
      instant application was filed and which subsequently became subject to Rent 
      Stabilization jurisdiction (as is the case with apartment 8 herein), the 
      Commissioner notes that since the free market rent charged the first 
      stabilized tenant included any and all services then being provided, and in 
      the absence of a fair market rent appeal, the rent increase provided for in 
      this order is not collectible from the first stabilized tenant or any 
      subsequent tenant of such apartment.

      As to the tenants' contention pertaining to the permanent nature of the 
      increases granted, the New York Court of Appeals has concluded that the 
      Rent Stabilization Law authorizes this Division to grant permanent rent 
      increases for MCI's, and that the law does not limit the time during which 
      the increases can be imposed.  In the Matter of Ansonia Residents 
      Association, et al., v. DHCR et al., 75 N.Y. 2d 206, 551 N.Y.S. 2d 871 
      (1989).

      Finally, the Commissioner notes that an owner is required to maintain that 
      level of services which was provided or required to be provided on the  







          ADMIN. REVIEW DOCKET NO.: GF 510047-RT, et al.




      applicable "base date", and all additional services provided or required to
      be provided thereafter.  The courts have held that such services are not 
      confined to the services set forth in the lease in effect on the "base 
      date", but that it is the actual services, not the lease provisions, which 
      control the requisite level of services.  Consequently, it has been held 
      that where a tenant, with the owner's express or implied consent and with 
      or without a separate charge, installed an air conditioner, window guard, 
      storm windows or blinds in the apartment, the tenant's right to maintain 
      these items constitutes a service included in the rent which the owner is 
      not permitted to modify or discontinue.   Unless the owner did not consent 
      to these items being installed in a tenant's apartment, the owner must, at 
      his or her own expense, remove and reinstall said items when any exterior 
      work requires such removal and reinstallation.  However, the agency has 
      determined that the Rent Stabilization Law and Code do not require a major 
      capital improvement (such as the installation of new windows) to fit the 
      size of an individual tenant's air conditioners, nor do they require the 
      owner to buy the tenant's air conditioners that fit the new windows.

      The Commissioner notes that this order is issued without prejudice to the 
      tenants' filing complaints with this Division based on a rent overcharge 
      and/or a reduction in services, if the facts so warrant.

      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 Rent Stabilization Law and Code, and the 
      New York City Rent and Eviction Regulations, it is

      ORDERED, that these petitions be, and the same hereby are, denied; and that 
      the Administrator's order be, and the same hereby is, affirmed.


      ISSUED:







                                                                    
                                           JOSEPH A. D'AGOSTA
                                          Deputy Commissioner




                                                    
       
    

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