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.HI620028RO
: DRO DOCKET NO.
Stanley Wasserman FG620039RP
Real Estate TENANT: Samuel Armand
PETITIONER :
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ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On September 1, 1993, the above-named owner filed a Petition for
Administrative Review against an order of a Rent Administrator
issued on July 28, 1993, wherein the Administrator determined that
the owner of the housing accommodations known as Apartment 3C at
2106 Bronx Park East, Bronx, New York, had overcharged the tenant
thereof.
Since February 1989, when the tenant filed the complaint herein,
the subject apartment has been the subject of various
determinations and appeals culminating in the aforementioned
Administrator's order, which states inter alia: that a rental
increase based on the installation of major capital improvements
("MCI increase") was granted by the Division effective August 1,
1986; that the initial overcharge, calculated under order number 18
of the Rent Guidelines Board, was in the amount of $15.00 for each
month from May, 1987, through April of 1989; and that the
aforementioned MCI increase became collectible on February 1, 1989.
The owner's petition now attacks that order "based upon the
agency's failure to take into account the $15.00 per month
surcharge allowable under Rent Guideline Board (RGB) Order #18,"
adding that "RGB 18 allows the addition of a $15.00 surcharge for
apartments renting under $350.00 on September 30, 1986," the
tenant's rent having been $317.62 on that date. In a supplementary
letter, the owner adds: "Since the Rent Stabilization Code . . .
precludes the collection of anything more than 6% of the permanent
MCI increase ($19.06) in the definition of the legal regulated
rent," the rent on September 30, 1986 -- even adding the MCI
increase -- was under the $350.00 threshhold.
HI620028RO
The Commissioner is of the opinion that this petition should be
denied.
It is of course true that when the owner added the $15.00 surcharge
to the rent computed under order number 18, it did not then
constitute an overcharge since the MCI increase in question, which
brought the rent over $350.00 and thus made the owner ineligible
for the $15.00 surcharge, had not yet been approved. However, the
Commissioner notes that the owner has received retroactive "credit"
in the Administrator's calculations, for an MCI increase commencing
in 1986. That credit indeed results in the owner's retention of
$15.00 more in rent, for 21 months, than was permissible for the
period with which the Administrator's order deals. If the owner,
that is, were to retain the low-rent surcharge after being credited
with an MCI increase that effectively lifts the lawful rent above
the maximum for surcharge eligibility, the tenant would have paid
too much, to the extent of the surcharge. The latter must
therefore be refunded, which is precisely what the Administrator
has ordered.
With regard to the owner's contention that it was still below the
$350.00 threshhold because of the 6% annual limitation on MCI rent
increases, it is noted that for purposes of calculating a lawful
stabilization base rent to determine if an owner is entitled to a
low-rent surcharge, the entire amount of the MCI in included even
though the owner is barred by a 6% annual cap. Morever in this
case, due to the effective date of the MCI rent increase, the owner
was entitled to a 6% cap on the MCI arrears as well. This addition
clearly made the rent exceed the threshhold amount of $350.00.
The Commissioner has determined in this Order and Opinion that the
owner collected overcharges of $496.13. The tenant may offset up
to 20 percent per month of that overcharge against any rent
hereafter due the owner. The tenant may add to the overcharge,
interest at the rate payable on a judgment pursuant to Section 5004
of the Civil Practice Law and Rules, from the date of the Rent
Administrator's order to the date of this Commissioner's order.
THEREFORE, in accordance with the provisions of the Rent
Stabilization Law and Code, it is
HI620028RO
ORDERED, that this petition for Administrative Review be, and the
same hereby is, denied, and, that the order of the Rent
Administrator be, and the same hereby is, affirmed.
ISSUED:
JOSEPH A. D'AGOSTA
Deputy Commissioner
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