Bill Text: NY A08436 | 2019-2020 | General Assembly | Introduced


Bill Title: Establishes the affordability plus program in cities having a population of one million or more to provide loans and grants to increase the supply of housing accommodations for families and persons of low income; makes related provisions.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2020-01-08 - referred to housing [A08436 Detail]

Download: New_York-2019-A08436-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          8436

                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                      July 8, 2019
                                       ___________

        Introduced  by  M.  of  A.  CYMBROWITZ  -- read once and referred to the
          Committee on Housing

        AN ACT to amend the private housing finance law and  the  local  finance
          law,  in  relation to affordable housing in cities having a population
          of one million or more

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1. The private housing finance law is amended by adding a new
     2  article 31 to read as follows:
     3                                ARTICLE XXXI
     4                         AFFORDABILITY PLUS PROGRAM
     5  Section 1280. Short title.
     6          1281. Statement of legislative findings and purpose.
     7          1282. Definitions.
     8          1283. Loans and grants.
     9          1284. Rents.
    10          1285. Rules; enforcement.
    11          1286. Severability.
    12          1287. Reporting.
    13    § 1280. Short title. This article shall be known and may be  cited  as
    14  the "affordability  plus program".
    15    § 1281. Statement of legislative findings and purpose. The legislature
    16  hereby  finds  and declares that there is, in cities having a population
    17  of one million or more, a seriously inadequate supply of safe and  sani-
    18  tary  housing  accommodations within the financial reach of families and
    19  persons of low income. This condition is contrary to the public interest
    20  and threatens the health, safety, welfare, comfort and security  of  the
    21  people  of  such cities. The legislature further finds and declares that
    22  the ordinary operations of private enterprise cannot provide an adequate
    23  supply of safe and sanitary housing accommodations at  rental  and  sale
    24  prices  that  families  and  persons of low income can afford. It is the

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13342-01-9

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     1  purpose of this act to provide loans and grants to increase  the  supply
     2  of  housing  accommodations  for families and persons of low income, and
     3  thereby improve the quality of life for all the people of such cities.
     4    §  1282.  Definitions. For the purposes of this article, the following
     5  terms shall have the following meanings:
     6    1. "Agency" shall mean a department of housing preservation and devel-
     7  opment in a city having a population of one million or more.
     8    2. "Housing accommodations"  shall  mean:(a)  a  private  or  multiple
     9  dwelling,  or  any  other  structure  containing dwelling units, rooming
    10  units or sleeping accommodations, together with the land on  which  such
    11  structure  is  situated;  (b)  any real property to be converted to such
    12  user; or (c) all or a portion of the dwelling units,  rooming  units  or
    13  sleeping accommodations therein.
    14    3.  "Owner"  shall mean a person having record or beneficial ownership
    15  of real property or a lessee of real property having an  unexpired  term
    16  of at least thirty years.
    17    4.  "Regulatory  agreement"  shall  mean  a  written agreement with or
    18  approved by a city having a population  of  one  million  or  more  that
    19  requires  the  provision  of  housing  accommodations  for  families and
    20  persons of low income, is entered into on or after the effective date of
    21  this article, specifically provides that it is entered into pursuant  to
    22  this  article, is recorded against one or more parcels of real property,
    23  and binds the owner  of  such  real  property  and  its  successors  and
    24  assigns.  A regulatory agreement may include such other terms and condi-
    25  tions as such city shall determine.
    26    5. "Rent stabilization" shall mean, collectively, the rent  stabiliza-
    27  tion  law  of  nineteen hundred sixty-nine, the rent stabilization code,
    28  and the emergency tenant protection act  of  nineteen  hundred  seventy-
    29  four,  all  as  in effect as of the effective date of this article or as
    30  amended thereafter, together with any successor statutes or  regulations
    31  addressing substantially the same subject matter.
    32    §  1283.  Loans  and  grants. 1. Notwithstanding the provisions of any
    33  general, special or local law, a city having a population of one million
    34  or more is authorized to make loans or grants to the owner of  any  real
    35  property  for  the purpose of: (a) construction, rehabilitation, conver-
    36  sion, acquisition or refinancing of housing accommodations; (b)  provid-
    37  ing  site  improvements,  including, but not limited to, water and sewer
    38  facilities, sidewalks, landscaping, the curing  of  problems  caused  by
    39  abnormal  site  conditions,  excavation and construction of footings and
    40  foundations and other improvements  associated  with  the  provision  of
    41  infrastructure  for  housing  accommodations; or (c) providing for other
    42  costs of developing housing accommodations.
    43    2. Any loan made in accordance with this section shall be evidenced by
    44  a note and may be secured by: (a) a mortgage upon the  interest  of  the
    45  owner in the real property assisted; (b) in the case of a condominium, a
    46  mortgage  upon  each of the housing accommodations assisted by such loan
    47  or; (c) in the case of a cooperative housing corporation,  a  lien  upon
    48  the  economic  interest  in  such corporation of each tenant-shareholder
    49  assisted by such loan, or a mortgage upon the real property assisted, or
    50  both such lien and such mortgage. Any such mortgage may be  consolidated
    51  with  a  municipally-aided  mortgage that encumbers the real property at
    52  the time of the making  of  the  loan  pursuant  to  this  section.  For
    53  purposes  of  this article, the term "mortgage" shall include any pledge
    54  or assignment of shares, or assignment of  a  proprietary  lease,  in  a
    55  cooperative  housing  corporation  where  such  pledge  or assignment is

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     1  intended as security for the performance of an obligation and imposes  a
     2  lien on or affects title to such shares or such proprietary lease.
     3    3.  The  repayment  of  any  loan made in accordance with this section
     4  shall be made in such manner as may be provided  in  the  note  and  any
     5  mortgage  in  connection  with  such  loan.  Such  note and mortgage may
     6  contain such terms and conditions as the  city  may  deem  necessary  or
     7  desirable  to  effectuate  the  purposes and provisions of this article.
     8  Such terms and conditions may include, but  shall  not  be  limited  to,
     9  provisions  concerning: (a) the repayment of the loan; (b) the interest,
    10  if any, thereon; (c) the charges, if any, in connection  therewith;  and
    11  (d)  the prepayment of the principal of the loan. Such note and mortgage
    12  may provide that all or a portion of the principal  of  the  loan  shall
    13  automatically  be reduced to zero over a period of continuous compliance
    14  by the owner with a regulatory agreement and upon  the  satisfaction  of
    15  any   additional  conditions  specified  therein.  Notwithstanding  such
    16  provision as contained in the note and mortgage, all or a portion of the
    17  principal of the loan shall be reduced to zero  only  if,  prior  to  or
    18  simultaneously  with delivery of such note and mortgage, the agency made
    19  a written determination that such reduction would be necessary to ensure
    20  the continued affordability or economic viability of the housing  accom-
    21  modations  assisted by such loan. Such written determination shall docu-
    22  ment the basis upon which the loan was determined  to  be  eligible  for
    23  evaporation.
    24    4.  The  city shall require the owner of any real property that is the
    25  subject of a loan or grant pursuant  to  this  section  to  execute  and
    26  record  a  regulatory  agreement having a term commencing not later than
    27  the date of such loan or grant. The regulatory agreement  shall  provide
    28  that the owner shall rent or sell all housing accommodations required to
    29  be  occupied  by  families  and persons of low income at rental or sales
    30  prices that do not exceed, averaging all housing accommodations required
    31  to be occupied by families and persons of low income by  the  regulatory
    32  agreement,  rental  or  sales  prices  that are affordable to households
    33  earning one hundred twenty percent of the area median  income,  adjusted
    34  for household size.
    35    5.  The city shall not make any loan or grant pursuant to this section
    36  unless the agency has made a written determination, which shall be stat-
    37  ed or referenced in the regulatory agreement, that such loan or grant is
    38  necessary to ensure the affordability or economic viability of the hous-
    39  ing accommodations in accordance with the terms of the regulatory agree-
    40  ment.
    41    6. At the discretion of the agency, a mortgage securing  a  loan  made
    42  pursuant to this section may be exempt from the tax on mortgages imposed
    43  by  article  eleven  of  the tax law and the tax on mortgages imposed by
    44  chapter twenty-six of title eleven of the  administrative  code  of  the
    45  city of New York.
    46    7. At the discretion of the agency, any transfer of real property made
    47  in  connection with a loan or grant made pursuant to this section may be
    48  exempt from the real estate transfer tax imposed by  article  thirty-one
    49  of  the  tax  law  and the real property transfer tax imposed by chapter
    50  twenty-one of title eleven of the administrative code of the city of New
    51  York.
    52    8. The agency may make provision, either in the mortgage or  by  sepa-
    53  rate  agreement,  for  the performance of such loan servicing functions,
    54  including functions related to construction lending, as may generally be
    55  performed by an institutional lender. The agency may act in such capaci-
    56  ty or appoint or consent to the appointment of a  financial  institution

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     1  to  act  in such capacity on behalf of the agency. The agency is author-
     2  ized to pay a reasonable and customary fee to such financial institution
     3  for the performance of such services.
     4    § 1284. Rents. Notwithstanding the provisions of rent stabilization or
     5  the local emergency housing rent control act, or any regulation or local
     6  law enacted pursuant thereto:
     7    1.  The  regulatory  agreement shall provide that all housing accommo-
     8  dations required to be occupied by families and persons  of  low  income
     9  shall  be  subject to rent stabilization as of the effective date of the
    10  regulatory agreement; provided, however, that the agency may exempt from
    11  the requirements of this section any housing  accommodations  that  are:
    12  (a)  located  in a structure containing fewer than six dwelling units or
    13  rooming units; (b) to be occupied on a transitional basis by persons who
    14  are formerly homeless or have special needs;  (c)  subject  to  any  law
    15  providing  for  the  regulation  of  rents  by  a governmental agency or
    16  instrumentality; or (d) to be occupied  as  homeownership,  rather  than
    17  rental, housing accommodations.
    18    2. Except as otherwise provided in subdivision one of this section, if
    19  any  housing  accommodations  required  to  be  occupied by families and
    20  persons of low income are not subject to rent stabilization  as  of  the
    21  effective  date  of the regulatory agreement, the agency shall establish
    22  the initial rents for such housing accommodations as of such date.
    23    3. Upon completion of the construction or rehabilitation of a  housing
    24  accommodation which is assisted by a loan or grant made by a city pursu-
    25  ant  to  section twelve hundred eighty-three of this article, the agency
    26  may establish a new initial rent for each dwelling unit subject to  rent
    27  stabilization  within  the housing accommodation pursuant to subdivision
    28  one of this section or otherwise. Prior to the  making  of  a  rehabili-
    29  tation  loan  or  grant pursuant to this article, the agency shall cause
    30  each tenant in occupancy of a dwelling unit for which the agency intends
    31  to establish a new initial rent to be notified of and have  an  opportu-
    32  nity  to  comment  on the contemplated rehabilitation. Such notification
    33  shall advise such tenants of the approximate expected initial rent. Such
    34  notification and opportunity to comment shall  be  provided  before  the
    35  rehabilitation and again after the rehabilitation is completed and prior
    36  to  the  establishment of the new initial rents. A representative of the
    37  agency shall meet or offer to meet with  all  tenants  in  occupancy  of
    38  dwelling  units  affected by the provisions of this subdivision at least
    39  once before the rehabilitation.
    40    § 1285. Rules; enforcement. 1. The  agency  may  promulgate  rules  to
    41  carry  out  the provisions of this article, and may require a filing fee
    42  in an amount equal to one thousand dollars per dwelling  unit,  or  such
    43  lesser  amount  as may be provided by such rules, in connection with any
    44  application for a loan or grant pursuant to this article.
    45    2. The agency shall have the  power  to:  (a)  subpoena,  require  the
    46  attendance  of and examine and take testimony under oath of such persons
    47  as it may deem necessary in order to monitor and enforce compliance with
    48  the regulatory agreement; and (b) subpoena and require the production of
    49  books, accounts, papers, documents and other evidence  related  to  such
    50  monitoring and enforcement.
    51    §  1286.  Severability. If any clause, sentence, paragraph, section or
    52  part of this article shall be adjudged by any court of competent  juris-
    53  diction to be invalid, such judgment shall not affect, impair or invali-
    54  date  the  remainder  thereof, but shall be confined in its operation to
    55  the clause,  sentence,  paragraph,  section  or  part  thereof  directly

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     1  involved  in  the  controversy  in  which  such judgment shall have been
     2  rendered.
     3    §  1287.  Reporting.  On  or  before September thirtieth of each year,
     4  beginning in two thousand twenty, the agency shall submit  a  report  to
     5  the temporary president of the senate and the speaker of the assembly on
     6  the  housing  production  activity of the affordability plus program for
     7  the previous city fiscal year.
     8    § 2. Subdivision a of section  11.00  of  the  local  finance  law  is
     9  amended by adding a new paragraph 41-f to read as follows:
    10    41-f.  Affordability  plus  program.  The  making  of loans or grants,
    11  pursuant to article thirty-one of the private housing finance law, thir-
    12  ty years; improvements associated with the construction, rehabilitation,
    13  conversion, acquisition or refinancing of housing accommodations, pursu-
    14  ant to article thirty-one of the private  housing  finance  law,  thirty
    15  years.
    16    § 3. This act shall take effect immediately.
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