A group of tenants at the Craigie Arms apartments which charged Harvard with violating Cambridge's strict rent control ordinances is nearly ready to drop its formal complaint against the University.

An attorney for the tenants at 122 Mt. Auburn St., Lee Goldstein, said yesterday that more than a month of private negotiations with representatives of the developer Harvard has chosen to dramatically revamp the Craigie building are almost completed.

"We appear to be fairly close," Goldstein said, declining to discuss specifics of the proposed agreement. Negotiators for the tenants and the developer, Housing Associates of Cambridge, have said in the past, however, that under the proposed settlement tenants would be paid a relocation fee if they agreed to move out of the building and drop their rent control board complaint against the University.

Denunciation

Also at issue between the tenants and the developer, Goldstein said, is the tenants' effort to force Harvard to admit that the University violated the Cambridge ordinance prohibiting removal of rent-controlled units from the housing market.

In their November hearings at the rent board, the tenants charged that Harvard owes the city more than $3 million in fines for keeping a set of Craigie apartments off the market.

The tenants are also hoping to obtain a guarantee that the Craigie building will remain as residential housing after the $2.5 million renovation is completed.

Harvard has sought removal permits from the rent board in order to perform the building renovation, but the rent board hearing examiner James Packer has continued the case pending a private settlement.

Harvard's plans call for Housing Associates to acquire ownership of the apartments after completing the repairs.

Brrrr

In the negotiations with tenants, Housing Associates officials have acted as intermediaries between the residents and the University, Robert H. Kuehne Jr., president of Housing Associates, said yesterday.

Kuehne added that the issue of monetary compensation "is fairly well squared away." Harvard had directly offered the tenants about $1500 to move out, but Housing Associates reportedly increased that amount.

The Craigie apartments are located across from the Mt. Auburn post office, next to the site of Harvard's $20 million planned condominium and commercial office complex.

Some neighborhood leaders have speculated recently that the Craigie building in its current condition constitutes an eyesore and could pose a potential obstaele to the University Place project.

But Harvard officials have denied that their desire to rehabilitate Craigie Arms is in any way connected with the plans for University Place, adding that the Craigie building is simply in need of major structural repairs.