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
------------------------------------X ADMINISTRATIVE REVIEW
IN THE MATTER OF THE ADMINISTRATIVE DOCKET NO.: GA210013RT
APPEAL OF
LAVENUS BROWN
RENT ADMINISTRATOR'S
PETITIONER DOCKET NO.: DH230189OM
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ORDER AND OPINION REMANDING PROCEEDING ON APPEAL
On January 3, 1992 the above-named petitioner-tenant timely filed
a Petition for Administrative Review (PAR) against an order issued
on December 6, 1991 by a Rent Administrator (Gertz Plaza)
concerning the housing accommodations known as 1517 Park Place,
Apartment 14R, Brooklyn, New York, wherein the Rent Administrator
determined that the owner was entitled to a rent increase based on
various major capital improvements.
The Commissioner has reviewed all of the evidence in the record and
has carefully considered that portion of the record relevant to the
issues raised by the petition for administrative review.
The owner commenced this proceeding on August 28, 1989 by initially
filing an application for a major capital improvement rent increase
predicated on the installation of the following items:
ITEMS CLAIMED COST
1. Boiler/burner $ 45,000.00
2. Apartment Windows $ 42,720.00
3. New Roof $ 7,000.00
4. Intercom $ 4,000.00
5. Mail Boxes $ 1,600.00
6. Doors $ 7,300.00
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CLAIMED COST $107,620.00
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In support of his application, the owner submitted copies of
permits, contracts, approvals and cancelled checks.
In response to the owner's application, two tenants filed answers
ADMIN. REVIEW DOCKET NO.: GA210013.RT
objecting to the rent increase. The tenants listed numerous
service complaints within their apartments but failed to identify
any pertinent reason why the request for a rent increase, based on
the subject installations, should not be granted.
On December 6, 1991 the Rent Administrator issued the order here
under review finding that the installations of apartment windows,
boiler/burner, roof, intercom and doors qualified as major capital
improvements, determining that the application, as it relates to
such items, complied with the relevant laws and regulations based
upon the supporting documentation submitted by the owner and
allowing rent increases for both rent controlled and rent
stabilized apartments based upon the total approved cost of
$106,020.00. Disallowed, by the Rent Administrator, was the sum of
$1,600.00 for mail boxes that were installed in the same location
since such installation did not qualify as a major capital
improvement. The owner was, however, directed by the Rent
Administrator to file an application to restore the rents
previously reduced by a building-wide rent reduction order that was
in effect (Docket No. BI210005B). Said building-wide rent reduction
order was based on service decreases involving the intercom system
and the entrance and vestibule doors. It was presumed that such
service problems had been adequately addressed by the installations
involved herein. The Rent Administrator's MCI order was issued
conditionally on the owner's filing of the application to restore
rent.
In his petition for administrative review, the tenant requests
reversal of the Administrator's order and contends, in substance,
that among other service complaints, the intercom does not work;
that doors have not been installed in all apartments; that the new
doors were not properly installed; that there are no locks on the
entrance doors and that the ceilings in the hallways need to be
painted.
A copy of the tenant's petition, mailed to the owner on March 12,
1992 failed to elicit any response.
After a careful consideration of the entire evidence of record, the
Commissioner is of the opinion that this proceeding should be
remanded to the Rent Administrator for further processing.
Rent increases for major capital improvements are authorized by
Section 2522.4 of the Rent Stabilization Code. Under rent
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ADMIN. REVIEW DOCKET NO.: GA210013RT
stabilization, the improvement must generally be building-wide;
depreciable under the Internal Revenue Code, other than for
ordinary repairs; be required for the operation, preservation, and
maintenance of the structure; and replace an item whose useful life
has expired.
With respect to the tenant's allegations that the owner is not
maintaining services, it is the established policy of the DHCR, as
reflected in Policy Statement 90-8, that "where there is a DHCR
order in effect determining a failure to maintain a building-wide
service which resulted in a rent reduction", such order will
constitute a bar to obtaining a major capital improvement rent
increase. The subsequent restoration of rent based on a finding of
service restoration will result in the prospective elimination of
this sanction.
The Commissioner notes that the building-wide replacement of
apartment windows and the installation of a boiler/burner, roof,
intercom and doors qualify as major capital improvements for which
an increase may be warranted, providing the owner otherwise so
qualifies. The record indicates that the owner substantiated its
application by submitting copies of the permits, contracts,
approvals and cancelled checks. However, for such work to qualify
for a major capital improvement rent increase, the work must be
performed in such a workmanlike manner that all tenants may enjoy
the benefits thereof.
A review of the Division's records reveals that the owner has not
filed a rent restoration application to restore the rents reduced
under Docket No. BI210005B. In view of the fact that the owner has
not filed an application for the restoration of rents, and
considering that it is alleged that service problems involving the
entrance doors and intercom were never adequately addressed, the
Commissioner is of the opinion and finds that the owner has not
fulfilled the conditional requirements of the order and that the
evidence of record is not sufficient to sustain a finding that the
installations were performed in a workmanlike manner so as to inure
to the benefit of the tenants. As such, the Commissioner finds
that this proceeding should be remanded to the Administrator for
such further processing as may be necessary to determine if the
owner qualifies for a major capital improvement rent increase. The
major capital improvement increase, granted under docket number
DH230189OM, should be suspended retroactive to the effective dates
in the said order.
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ADMIN. REVIEW DOCKET NO.: GA210013RT
The owner is hereby directed to file a rent restoration application
for the building-wide rent reduction order (Docket No. BI210005B),
within ninety days of the date of issue of this order. Any
increase granted for the installations involved herein may be on
a prospective basis only from the first rent payment date following
the date the owner restores services as determined by the Division
providing that the owner establishes to the Division that all
defects have been corrected and all services are being maintained.
The owner's failure to comply with said directive will result in a
permanent revocation of the increase.
THEREFORE, in accordance with the Rent Stabilization Law and Code,
it is
ORDERED, that this petition be, and the same is, granted to the
extent of remanding this proceeding to the Rent Administrator for
further processing in accordance with this order and opinion. The
owner is hereby directed to refund to the tenants of the rent
controlled apartments any excess rent collected as a result of this
order within thirty days from the date of issuance hereof. With
respect to rent stabilized apartments, the owner shall credit any
excess rent collected at the rate of 20% per month, commencing the
first rent payment date after issuance of this order, until all
over payments have been refunded.
ISSUED:
JOSEPH A D'AGOSTA
Deputy Commissioner
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