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

      APPEAL OF                                 ADMINISTRATIVE REVIEW
                                            :   DOCKET NO. IA120003RP
                STUART HOUSE,                   DISTRICT RENT ADMINISTRATOR'S
                                            :   DOCKET NO. EC120002BO
                             PETITIONER                   (DL122961BR)


      On October 10, 1990, the above-named landlord filed a petition for 
      administrative review of an order issued on September 12, 1990 by a Rent 
      Administrator concerning various housing accommodations known as 36-35 167th 
      Street, Flushing, New York.

      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 Commissioner issued an order and opinion on June 8, 1993 under Docket 
      No. EJ130057RO which denied the subject landlord's petition.  Subsequently, 
      the landlord commenced a proceeding in the Supreme Court of the State of New 
      York pursuant to Article 78 of the Civil Practice Law and Rules (C.P.L.R.), 
      seeking review of the above-mentioned Commissioner's order of June 8, 1993.

      By order dated December 16, 1993, the Supreme Court, Queens County, remanded 
      the matter to the rent agency for further processing.

      The Division of Housing and Community Renewal (D.H.C.R.) issued an order on 
      March 2, 1990 under Docket No. DL122961BR which granted the landlord maximum 
      base rent (M.B.R.) increases for the 1990-1991 period effective on January 
      1, 1990.

      The above-mentioned order noted that there was an M.B.R. factor of 8% for 
      the 1990-1991 period.

      In the landlord's challenge it alleged, among other things, that it objects 
      to the "8% MBR factor" established in the above-mentioned order, and that as 
      the subject building has no commercial income the building's M.B.R. factor 
      should have been calculated on an individual basis.


          DOCKET NO.:  IA120003RP

      In the order under review herein issued on September 12, 1990 under Docket 
      No. EC120002BO, the Administrator denied the landlord's challenge to the 
      aforementioned M.B.R. order of eligibility.  The Administrator determined 
      that the proposed M.B.R. factor was "presented at public hearings"; that at 
      the public hearings all interested parties were given an opportunity to 
      comment on the proposed M.B.R. factor, and that "such comment were taken 
      into consideration" prior to the approval of the M.B.R. factor.

      In its petition the subject landlord, among other things, reiterates the 
      issues that were raised in its challenge to the aforementioned M.B.R. order 
      of eligibility.

      After careful consideration, the Commissioner finds that the proceeding 
      should be remanded to the Rent Administrator.

      The Commissioner points out that calculating the M.B.R. factor based upon a 
      city-wide statistical average is a long established policy followed by the 
      D.H.C.R. and its predecessor agency in administrating the various statutes 
      providing for the regulation of housing.  The Commissioner is of the 
      opinion, based upon several court cases, that the courts have approved the 
      above-mentioned policy of the rent agency.

      However, when a party can prove that calculating their building's M.B.R. 
      factor based upon a city-wide statistical average would lead to an 
      inequitable result, the Commissioner finds that the rent agency may 
      calculate that building's M.B.R. factor individually.

      Based upon the record, the Commissioner is of the opinion that the subject 
      landlord has met its burden of proof in showing that calculating the subject 
      building's 1990-1991 M.B.R. factor based upon a city-wide statistical 
      average would lead to an inequitable result as to its 1990-1991 M.B.R. 

      Accordingly, the Commissioner finds that calculating the subject building's 
      1990-1991 M.B.R. factor individually is warranted in this proceeding.

      The Commissioner finds that this proceeding is being remanded to the Rent 
      Administrator for the ministerial act of obtaining the necessary data to 
      calculate the subject building's 1990-1991 M.B.R. factor, and to calculate 
      the above-mentioned M.B.R. factor individually.

      THEREFORE, in accordance with the City Rent and Rehabilitation Law and the 
      Rent and Eviction Regulations, it is

      ORDERED, that this proceeding be, and the same hereby is, remanded to the 
      Rent Administrator for the ministerial act of calculating the subject 
      building's 1990-1991 M.B.R. factor on an individual basis; and it is 

      FURTHER ORDERED, that the Administrator's order issued under Docket No. 
      EC120002BO, be, and the same hereby is, revoked, and it is


          DOCKET NO.:  IA120003RP

      FURTHER ORDERED, that the subject building's 1990-1991 M.B.R. factor of 8% 
      remains in full force and effect until a new order is issued upon remand.


                                                      JOSEPH A. D'AGOSTA
                                                      Deputy Commissioner 


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