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

          APPEALS OF                              DOCKET NOS.:

                                                  GI220096RT, GJ210006RT
                                                  GJ2200007RT, GJ230039RO
          AND 1819 AVENUE  L. L.P., OWNER
                                                  RENT ADMINISTRATOR'S
                                                  DOCKET NO.: EG230009OM


          The above-named petitioners filed petitions for administrative 
          review of an order issued on September 4, 1992 by a Rent 
          Administrator (Gertz Plaza), concerning the housing accommodations 
          known as various apartments, 1819 Avenue L, Brooklyn, New York.

          Since these petitions pertain to the same order, they have been 
          consolidated for a uniform disposition.

          The Commissioner has reviewed all the evidence in the record and 
          has carefully considered that portion of the record relevant to the 
          issues raised by the petitions for review.

          The owner of the subject premises commenced this proceeding by 
          filing its major capital improvement (MCI) rent increase 
          application with the agency on July 2, 1990. The owner's 
          application contained contractor affirmations which indicated that 
          a boiler/burner and elevator upgrading installations had been 
          completed on the subject premises in June 1988. 

          On September 4, 1992 the Rent Administrator issued the order herein  
          appealed denying MCI rent increases for the subject premises' rent 
          stabilized tenants based on a determination  that the owner had 
          failed to file its MCI application within two years after the 
          installations were completed. Rent increases based on the 
          boiler/burner and elevator installations were granted for the rent 
          controlled tenants. 


          ADMIN. REVIEW DOCKET NOS.: GI220096RT et. al.

          In its petition the owner, by its representative, asserts, in 
          substance, that the boiler/burner installation was completed upon 
          the issuance of the certificate of electrical inspection, issued on 
          November 9, 1988, and therefore,  its application based on same was 
          filed with the agency within two years of the installation on July 
          2, 1990.

          In their petitions the tenants (apartments 2E, 5B, & 6H) assert, in 
          substance, the elevator does not function properly, requires 
          upgrading and is in violation of  New York City Local Law #16 (per 
          a preliminary draft of an engineers report dated May 19, 1988 
          prepared in anticipation of a coop-conversion); the boiler/burner 
          installation constitutes maintenance; the owner received a tax 
          abatement for the improvements which should be reflected in the 
          rent increase granted; and one tenant objects to the fact that the 
          two year rule is not applicable to the rent-controlled tenants.

          After a careful consideration of the entire evidence of record, the 
          Commissioner is of the opinion that the owner's petition, under 
          Docket Number GJ230039RO should be denied and the tenants' 
          petitions, under Docket Numbers GI220096RT et al., should be 
          granted in part; and the Administrator's order be modified as 
          provided hereinbelow.

          The Commissioner notes that despite the tenant's assertion to the 
          contrary, a boiler/burner installation is generally MCI rent 
          increase eligible.

          Section 2522.4(a)(8) of the Rent Stabilization Code precludes a 
          rent increase for a major capital improvement when the application 
          is filed more than two years after the completion of the 
          installation, not the date of issuance of any required governmental 
          certificate.  (Accord EG430076RO; EL210007RT et. al; and 
          EL630365RO).  In the last cited proceeding, a window installation 
          was considered complete when the old windows were actually replaced 
          and not when all adjustments or defects were attended to.  While 
          the applicable section of the Code envisions governmental sign-offs 
          be submitted with the application to be filed within two years of 
          the physical completion of the work, the Code provides for a 
          reasonable extension of time where the applicant can demonstrate a 
          delay, beyond the applicant's control, in obtaining such approvals 
          for which the applicant has promptly applied within such two year 
          period.  The case cited by the owner on appeal does not stand for 
          the proposition alleged. The Code does not create a new two year 
          filing period dating from the time governmental approval is 
          actually obtained.

          Turning to the case at hand, the Commissioner notes that the 
          heating contract dated September 30, 1987 specifies payment terms 
          to be $15,000.00 upon signing of the contract, $15,000.00 upon 
          start of installation and $13,000.00 due upon completion of the 

          ADMIN. REVIEW DOCKET NOS.:  GI220096RT et. al

          job, with the balance of $2,000.000 to be withheld until plans and 
          permits are obtained.  The record shows that the contractor was 
          paid $28,000.00 on November 11, 1987, upon the completion of the 
          job.  Even if the last payment to the contractor, dated March 23, 
          1988, were to be considered evidence of completion (which it is 
          not), the Administrator properly disallowed a rent increase for the 
          boiler/burner as to stabilized apartments based on the fact that 
          the application filed July 2, 1990 was still not filed within two 
          years of completion of the installation.  It is significant to note 
          that the application filed with the Buildings Department in July 
          1988 indicates that the filing was to "legalize" the oil burner and 

          The owner has not established that the two year period should be 
          extended due to delay beyond the owner's control in obtaining 
          governmental approvals.  The final government certificate (issued 
          by the Bureau of Electrical Control) submitted in the instant case 
          was issued on November 9, 1988, but the owner failed to file its 
          MCI application until July 28, 1990, more than two years after the 
          November, 1987 completion as well as the completion date listed in 
          the application, and more than 19 1/2 months after the final 
          governmental approval was obtained.  Having not even filed its 
          application within a reasonable time of receiving the final 
          governmental sign-off, the owner has clearly failed to meet the two 
          year filing requirement of the Code.

          Regarding the owner's reference to J-51 tax abatement regulations, 
          the Commissioner notes that the J-51 program is governed by an 
          independent body of law and regulations.  Thus, the "completion 
          definition in such program is not determinative in this proceeding 
          which requires an independent determination as to when an 
          installation is complete within the purview of the specified Rent 
          Laws and Code applicable to this matter.

          Regarding the tenants' contention that tax abatements which may 
          have been granted for the subject improvements should have been 
          taken into account,  the record indicates that the owner was 
          granted a tax abatement for the subject improvements as evidenced 
          by a Certificate of Eligibility dated March 22, 1990 which was 
          issued by the Department of Housing Preservation and Development.  
          The Commissioner notes that the owner's application for or receipt 
          of a J-51 tax benefit based on the subject improvements does not 
          preclude the entitlement to a major capital improvement rent 
          increase therefor. However, rent controlled tenants are entitled to 
          share in such benefit in accordance with the Rent and Eviction 
          Regulations and Administrator's Interpretation  No. 16. (Pursuant 
          to the Rent Stabilization Law, tenants of stabilized apartments may 
          share in such benefits, provided an MCI rent increase for 
          stabilized apartments is ordered, but only as to improvements 
          commenced after June 28, 1988).  


          ADMIN. REVIEW DOCKET NOS.: GI220096RT  et. al

          Thus, the MCI rent increase for rent controlled apartments is 
          modified to be $5.46 per room per month (reflecting a J-51 tax 
          abatement offset of $1.30 per room, per month taken from $6.76), 
          effective October 1, 1992, the first rent payment date after the 
          issuance of the Administrator's order as indicated therein; and 
          that the Administrator's order as so modified is affirmed.

          The Commissioner notes that this decrease will be in effect for the 
          life of the tax abatement.  Upon the expiration of the tax 
          benefits, the owner shall be entitled to restore the rent to the 
          full amount of the MCI rent increase indicated in the 
          Administrator's order.

          The fact that the installation of the improvements was made to 
          facilitate the cooperative conversion process does not constitute 
          a basis for denying an MCI rent increase to which the owner is 
          otherwise entitled.  As to the tenants assertions that the elevator 
          is in violatin of local law, predicated on a draft engineer's 
          report dated May 19,1988, the Commissioner notes that such 
          assertion is best established by the submission of a violation 
          report from the government agency having jurisdiction thereof, 
          which the tenants failed to do both in the proceeding below or on 
          appeal.  Furthermore, the Commissioner notes that the elevator 
          certificate was issued by the New York City Department of Buildings 
          as reflected in the sign-offs therefor by such Department.
          The tenants are reminded that this order is issued without 
          prejudice to their rights to file service complaints with the 
          Division, if the facts so warrant.

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

          ORDERED, that the owner's petition under Docket Number GJ230039RO 
          be, and the same hereby is denied, and that the tenants' petitions, 
          under Docket Numbers GI220096 et al., be and the same hereby are, 
          granted in part, that the Administrator's order be, and the same 
          hereby is modified to reflect a tax abatement off-set as 
          hereinabove provided; and that as so modified said order be, and 
          the same hereby is affirmed; and it is further

          ORDERED, that the owner refund to the tenants of rent controlled 
          apartments any excess rent collected arising as a result of this 
          order, within thirty (30) days of issuance hereof.

                                                   JOSEPH A. D'AGOSTA
                                                   Deputy Commissioner       




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