S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7771
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               May 15, 2017
                                ___________
 
 Introduced by M. of A. MOSLEY -- read once and referred to the Committee
   on Aging
 
 AN  ACT  to amend the real property tax law, in relation to the addition
   of preferential rent for senior citizens or persons with  disabilities
   rent increase exemptions
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraph e of subdivision 1, subdivision 2 and  paragraphs
 c,  d,  and e of subdivision 3 of section 467-b of the real property tax
 law, paragraph e of subdivision 1 as amended by chapter 555 of the  laws
 of  1977,  subdivision  2 as amended by chapter 747 of the laws of 1985,
 paragraph (c) of subdivision 2 as added and subparagraph 3 of  paragraph
 d and subparagraph 3 of paragraph e of subdivision 3 as amended by chap-
 ter  553 of the laws of 2015, paragraph (d) of subdivision 2 as added by
 chapter 343 of the laws of 2016,  paragraphs c, d and e of subdivision 3
 as amended by chapter 188 of the laws of 2005, are amended  to  read  as
 follows:
   e.  "Increase  in  maximum  rent, PREFERENTIAL RENT or legal regulated
 rent" means any increase in the maximum rent, PREFERENTIAL RENT  or  the
 legal  regulated  rent for the dwelling unit in question pursuant to the
 applicable rent control law, RENT STABILIZATION LAW or to the  emergency
 tenant  protection  act  of nineteen seventy-four, respectively, or such
 classes of increase thereunder as may be specified in a local law, ordi-
 nance or resolution enacted pursuant to this  section,  over  such  base
 period  rent as shall be provided therein or an exemption from the maxi-
 mum rent or legal regulated rent as specified in paragraph  c  or  d  of
 subdivision  three  of  this  section. PREFERENTIAL RENT FOR PURPOSES OF
 THIS SECTION SHALL MEAN THE SAME AS PARAGRAPH FOURTEEN OF SUBDIVISION  C
 OF SECTION 26-511 OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK;
   2.  The  governing body of any municipal corporation is hereby author-
 ized and empowered to adopt, after public hearing,  in  accordance  with
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD09829-01-7

 A. 7771                             2
 
 the  provisions  of  this  section, a local law, ordinance or resolution
 providing for the abatement  of  taxes  of  said  municipal  corporation
 imposed on real property containing a dwelling unit as defined herein by
 one  of  the following amounts: (a) where the head of the household does
 not receive a monthly allowance  for  shelter  pursuant  to  the  social
 services law, an amount not in excess of that portion of any increase in
 maximum  rent,  PREFERENTIAL  RENT  or legal regulated rent which causes
 such maximum rent, PREFERENTIAL RENT or legal regulated rent  to  exceed
 one-third of the combined income of all members of the household; or
   (b)  where  the head of the household receives a monthly allowance for
 shelter pursuant to the social services law, an amount not in excess  of
 that portion of any increase in maximum rent, PREFERENTIAL RENT or legal
 regulated rent which is not covered by the maximum allowance for shelter
 which such person is entitled to receive pursuant to the social services
 law.
   (c)  Provided,  however, that in a city of a population of one million
 or more, where the head of household has been granted  a  rent  increase
 exemption  order  that  is  in  effect as of January first, two thousand
 fifteen or takes effect on or before July first, two  thousand  fifteen,
 the  amount  determined by paragraph (a) of this subdivision shall be an
 amount not in excess of the difference between the maximum rent, PREFER-
 ENTIAL RENT or legal regulated rent and the  amount  specified  in  such
 order, as adjusted by any other provision of this section.
   (d)  (1)  Provided,  however,  that in a city with a population of one
 million or more, a head  of  the  household  who  has  received  a  rent
 increase exemption order that has expired and who, upon renewal applica-
 tion  for  the  period  commencing immediately after such expiration, is
 determined to be ineligible for a rent increase exemption order  because
 the  combined income of all members of the household exceeds the maximum
 amount allowed by this section or the maximum rent, PREFERENTIAL RENT or
 legal regulated rent does not exceed one-third of the combined income of
 all members of the household, may submit a new  application  during  the
 following  calendar  year,  and if such head of the household receives a
 rent increase exemption order that commences during such calendar  year,
 the  tax  abatement amount for such order shall be calculated as if such
 prior rent increase exemption order had not  expired.  However,  no  tax
 abatement benefits may be provided for the period of ineligibility.
   (2) No head of the household may receive more than three rent increase
 exemption  orders calculated as if a prior rent increase exemption order
 had not expired, as described in subparagraph one of this paragraph.
   c. upon issuance of a tax abatement certificate as provided in  subdi-
 vision  four  of  this section, the amount set forth in said certificate
 shall be deducted from the legal maximum rent, LEGAL  PREFERENTIAL  RENT
 or  legal regulated rent chargeable for a dwelling unit of a head of the
 household.
   d. notwithstanding any other provision of law,  when  a  head  of  the
 household  to  whom  a then current, valid tax abatement certificate has
 been issued moves his principal residence from one dwelling  unit  to  a
 subsequent  dwelling unit located within the same municipal corporation,
 the head of the household may apply  for  a  tax  abatement  certificate
 relating  to  the  subsequent  dwelling  unit,  and such certificate may
 provide that the head of the household shall be exempt from paying  that
 portion  of  the maximum rent, PREFERENTIAL RENT or legal regulated rent
 for the subsequent dwelling unit which is the least of the following:

 A. 7771                             3

   (1) the amount by which the rent  for  the  subsequent  dwelling  unit
 exceeds  the  last rent, as reduced, which the head of the household was
 required to actually pay in the original dwelling unit;
   (2)  the last amount deducted from the maximum rent, PREFERENTIAL RENT
 or legal regulated rent pursuant to this section in the original  dwell-
 ing unit; or
   (3)  where the head of the household does not receive a monthly allow-
 ance for shelter pursuant to the social  services  law,  the  amount  by
 which the maximum rent, PREFERENTIAL RENT or legal regulated rent of the
 subsequent dwelling unit exceeds one-third of the combined income of all
 members  of the household, except that this subparagraph shall not apply
 to a head of  the  household  who  has  been  granted  a  rent  increase
 exemption  order  that  is  in  effect as of January first, two thousand
 fifteen or takes effect on or before July first, two thousand fifteen.
   e. notwithstanding any other provision of law,  when  a  head  of  the
 household  to  whom  a then current, valid tax abatement certificate has
 been issued moves his principal residence from one dwelling unit subject
 to the provisions of articles II, IV, V or XI  of  the  private  housing
 finance  law  to  a subsequent dwelling unit subject to either the local
 emergency housing rent control law or to the emergency tenant protection
 act of nineteen seventy-four which is located within the same  municipal
 corporation,  the  head  of  the household may apply for a tax abatement
 certificate relating to the subsequent dwelling unit, and  such  certif-
 icate  may  provide  that the head of the household shall be exempt from
 paying that portion of the maximum  rent,  PREFERENTIAL  RENT  or  legal
 regulated  rent  for  the subsequent dwelling unit which is the least of
 the following:
   (1) the amount by which the rent  for  the  subsequent  dwelling  unit
 exceeds  the  last  rent, as so reduced, which the head of the household
 was required to actually pay in the original dwelling unit;
   (2) the most recent amount so deducted from the maximum rent,  PREFER-
 ENTIAL RENT or legal regulated rent in the original dwelling unit; or
   (3)  where the head of the household does not receive a monthly allow-
 ance for shelter pursuant to the social  services  law,  the  amount  by
 which the maximum rent, PREFERENTIAL RENT or legal regulated rent of the
 subsequent dwelling unit exceeds one-third of the combined income of all
 members  of the household, except that this subparagraph shall not apply
 to a head of  the  household  who  has  been  granted  a  rent  increase
 exemption  order  that  is  in  effect as of January first, two thousand
 fifteen or takes effect on or before July first, two thousand fifteen.
   § 2. Paragraph e of subdivision  1,  subdivision  2,  paragraph  c  of
 subdivision  3  and subdivisions 4, 6 and 8 of section 467-b of the real
 property tax law, as added by chapter 689 of the laws of 1972,  subdivi-
 sion  2 as amended by chapter 553 of the laws of 2015 and paragraph c of
 subdivision 3 as amended by chapter 188 of the laws of 2005, are amended
 to read as follows:
   e. "Increase in PREFERENTIAL RENT OR maximum rent" means any  increase
 in  the PREFERENTIAL RENT OR maximum rent for the dwelling unit in ques-
 tion pursuant to the applicable RENT STABILIZATION OR rent  control  law
 RESPECTIVELY, or such classes of increase thereunder as may be specified
 in  a  local  law,  ordinance  or  resolution  enacted  pursuant to this
 section, over such base period rent as shall be provided therein.  PREF-
 ERENTIAL  RENT FOR PURPOSES OF THIS SECTION SHALL MEAN THE SAME AS PARA-
 GRAPH FOURTEEN OF SUBDIVISION C OF SECTION 26-511 OF THE  ADMINISTRATIVE
 CODE OF THE CITY OF NEW YORK;

 A. 7771                             4
 
   2.  The  governing body of any city, town or village is hereby author-
 ized and empowered to adopt, after public hearing,  in  accordance  with
 the  provisions  of  this  section, a local law, ordinance or resolution
 providing for the abatement  of  taxes  of  said  municipal  corporation
 imposed on real property containing a dwelling unit as defined herein by
 an  amount not in excess of that portion of any increase in PREFERENTIAL
 RENT OR maximum rent which causes such PREFERENTIAL RENT OR maximum rent
 to exceed one-third of the combined income of all members of the  house-
 hold, except that in a city of a population of one million or more where
 the  head  of  the  household has been granted a rent increase exemption
 order that is in effect as of January first,  two  thousand  fifteen  or
 takes  effect on or before July first, two thousand fifteen, such abate-
 ment of taxes shall be in an amount not  in  excess  of  the  difference
 between  the PREFERENTIAL RENT, maximum rent or legal regulated rent and
 the amount specified in such order, as adjusted by any  other  provision
 of this section.
   c.  upon issuance of a tax abatement certificate as provided in subdi-
 vision four of this section, the amount of increase in  PREFERENTIAL  OR
 maximum  rent  set  forth in said certificate shall be deducted from the
 legal PREFERENTIAL RENT OR maximum rent chargeable for a  dwelling  unit
 of a head of the household.
   4.  The  head of the household must apply each year to the appropriate
 rent control agency for a tax abatement certificate on a form prescribed
 by said agency. A tax abatement certificate setting forth an amount  not
 in  excess  of the increase in PREFERENTIAL RENT OR maximum rent for the
 taxable period shall be issued by said agency to each head of the house-
 hold who is found to be eligible under this section  on  or  before  the
 last  date  prescribed  by law for the payment of the taxes or the first
 installment thereof of any city, town or village which  has  granted  an
 abatement  of  taxes.  Copies of such certificate shall be issued to the
 owner of the real property containing the dwelling unit of the  head  of
 the  household  and  to  the collecting officer charged with the duty of
 collecting the taxes of each city, town or village which has granted the
 abatement of taxes authorized by this section.
   6. The portion of the increase in PREFERENTIAL OR maximum rent for the
 taxable period set  forth  in  a  tax  abatement  certificate  shall  be
 deducted  from  the total taxes levied by or on behalf of the city, town
 or village which has granted such abatement on real property  containing
 the dwelling unit of a head of the household to whom the certificate has
 been issued. In the event that both a town and a village included there-
 in  grant  such  abatement, such deduction for properties located in the
 village shall be made first from taxes levied by or  on  behalf  of  the
 village and any excess thereof shall be deducted from town taxes.
   8.  Where a tax abatement certificate has been issued to a head of the
 household as authorized by a local law, ordinance or resolution  adopted
 pursuant  to  this  section  and  the  landlord  collects or attempts to
 collect the increase in the PREFERENTIAL RENT  OR  maximum  rent  for  a
 dwelling unit occupied by such head of the household, the amount of such
 abatement  shall  be  deemed a rent overcharge under the applicable RENT
 STABILIZATION OR rent control law RESPECTIVELY.
   § 3. Paragraphs h and i of subdivision 1 and subdivisions 3, 5, 6,  7,
 and  8  of  section  467-c  of the real property tax law, paragraph h of
 subdivision 1 and paragraph b of subdivision 3 as amended and  paragraph
 i of subdivision 1 as added by chapter 420 of the laws of 1991, subdivi-
 sion  3 as amended by chapter 747 of the laws of 1985, subparagraph 3 of
 paragraph a of subdivision 3 as added and subparagraph 3 of paragraph  b

 A. 7771                             5
 
 of  subdivision 3 and paragraph d of subdivision 3 as amended by chapter
 553 of the laws of 2015, subparagraph 4 of paragraph a of subdivision  3
 as  added by chapter 343 of the laws of 2016, paragraph c of subdivision
 3  as  added by chapter 17 of the laws of 1987, subdivision 5 as amended
 by chapter 538 of the laws of 1976 and subdivisions 6, 7 and 8 as  added
 by chapter 208 of the laws of 1975, are amended to read as follows:
   h.  "Increase in maximum rent OR PREFERENTIAL RENT" means any increase
 in the maximum rent OR PREFERENTIAL RENT for the dwelling unit  becoming
 effective  on  or  after the eligibility date, including capital assess-
 ments and voluntary capital contributions but excluding any increase  in
 maximum  rent  OR  PREFERENTIAL  RENT  attributable to gas or electrical
 utility charges or an increase in dwelling space, services or equipment,
 or an exemption from the maximum rent, PREFERENTIAL RENT or legal  regu-
 lated  rent  as  specified  in  paragraph b of subdivision three of this
 section, provided, however, that with respect to any dwelling unit in  a
 dwelling  which  is  or  was  subject to a mortgage insured or initially
 insured by the federal government pursuant to section two hundred  thir-
 teen of the National Housing Act, as amended, "increase in maximum rent"
 shall  not  include any increase in maximum rent attributable to capital
 assessments or voluntary capital contributions.
   i. "Maximum rent OR PREFERENTIAL RENT" means the maximum rent OR PREF-
 ERENTIAL RENT, excluding gas and electric  utility  charges,  which  has
 been authorized or approved by the commissioner or the supervising agen-
 cy  or the legal regulated rent established for the dwelling unit pursu-
 ant to the provisions of either Article II, IV, V or XI of  the  private
 housing finance law, or the rental established for a cooperatively owned
 dwelling unit previously regulated pursuant to the provisions of Article
 II,  IV,  V  or  XI of the private housing finance law; or such approved
 rent for a dwelling unit in a dwelling subject to a mortgage insured  or
 initially  insured  by  the  federal  government pursuant to section two
 hundred thirteen of the National Housing Act, as amended; or  such  rent
 established  for a dwelling unit which was subject to a mortgage insured
 or initially insured by the federal government pursuant to  section  two
 hundred  thirteen  of the National Housing Act, as amended. PREFERENTIAL
 RENT FOR PURPOSES OF THIS SECTION SHALL MEAN THE SAME AS PARAGRAPH FOUR-
 TEEN OF SUBDIVISION C OF SECTION 26-511 OF THE  ADMINISTRATIVE  CODE  OF
 THE CITY OF NEW YORK.
   3.  Any such local law or ordinance shall provide that: a. an eligible
 head of the household may obtain a  rent  increase  exemption  order/tax
 abatement  certificate  entitling  him to an exemption from increases in
 the maximum rent OR PREFERENTIAL RENT otherwise payable in  one  of  the
 following amounts:
   (1) where the eligible head of the household does not receive a month-
 ly allowance for shelter pursuant to the social services law, the amount
 by  which  increases in the maximum rent OR PREFERENTIAL RENT subsequent
 to such person's eligibility date have resulted in the maximum  rent  OR
 PREFERENTIAL  RENT  exceeding  one-third  of  the combined income of all
 members of the household for the taxable period, except that in no event
 shall a rent increase exemption order/tax abatement  certificate  become
 effective prior to January first, nineteen hundred seventy-six; or
   (2) where the eligible head of the household receives a monthly allow-
 ance  for  shelter  pursuant  to  the social services law, an amount not
 exceeding that portion of any increase in maximum rent  OR  PREFERENTIAL
 RENT  subsequent  to such person's eligibility date which is not covered
 by the maximum allowance for shelter which such person  is  entitled  to
 receive pursuant to the social services law.

 A. 7771                             6
 
   (3)  provided,  however, that in a city of a population of one million
 or more, where the eligible head of the household  has  been  granted  a
 rent  increase  exemption order as a person with a disability as defined
 in paragraph m of subdivision one of this section that is in  effect  as
 of January first, two thousand fifteen or takes effect on or before July
 first,  two  thousand fifteen, the amount determined by subparagraph one
 of this paragraph shall be an amount not in  excess  of  the  difference
 between  the  maximum rent OR PREFERENTIAL RENT and the amount specified
 in such order, as adjusted by any other provision of this section.
   (4) (a) Provided, however, that in a city with  a  population  of  one
 million  or  more,  a  head  of  the  household  who has received a rent
 increase exemption order that has expired and who, upon renewal applica-
 tion for the period commencing immediately  after  such  expiration,  is
 determined  to be ineligible for a rent increase exemption order because
 the combined income of all members of the household exceeds the  maximum
 amount allowed by this section or the maximum rent, PREFERENTIAL RENT or
 legal regulated rent does not exceed one-third of the combined income of
 all  members  of  the household, may submit a new application during the
 following calendar year, and if such head of the  household  receives  a
 rent  increase exemption order that commences during such calendar year,
 the tax abatement amount for such order shall be calculated as  if  such
 prior  rent  increase  exemption  order had not expired. However, no tax
 abatement benefits may be provided for the period of ineligibility.
   (b) No head of the household may receive more than three rent increase
 exemption orders calculated as if a prior rent increase exemption  order
 had not expired, as described in clause (a) of this subparagraph.
   b.  notwithstanding  any  other  provision  of law, when a head of the
 household to whom a then current, valid tax  abatement  certificate  has
 been issued moves his principal residence from one dwelling unit subject
 to  this  section, to the local emergency housing rent control law or to
 the emergency tenant protection act of nineteen seventy-four to a subse-
 quent dwelling unit which is subject to the provisions of  articles  II,
 IV,  V  or  XI  of  the  private  housing finance law or which is or was
 subject to a mortgage  insured  or  initially  insured  by  the  federal
 government  pursuant  to  section  two  hundred thirteen of the National
 Housing Act, as amended, and which is located within the same  municipal
 corporation,  the  head  of  the household may apply for a tax abatement
 certificate relating to the subsequent dwelling  unit,  subject  to  any
 terms  and conditions imposed by reason of any fund created under subdi-
 vision eight of this section, and such certificate may provide that  the
 head  of  the  household shall be exempt from paying that portion of the
 maximum rent, PREFERENTIAL RENT or legal regulated rent for  the  subse-
 quent dwelling unit which is the least of the following:
   (1)  the  amount  by  which  the rent for the subsequent dwelling unit
 exceeds the last rent, as so reduced, which the head  of  the  household
 was required to actually pay in the original dwelling unit;
   (2)  the most recent amount so deducted from the maximum rent, PREFER-
 ENTIAL RENT or legal regulated rent in the original dwelling unit; or
   (3) where the head of the household does not receive a monthly  allow-
 ance  for  shelter  pursuant  to  the social services law, the amount by
 which the maximum rent, PREFERENTIAL RENT or legal regulated rent of the
 subsequent dwelling unit exceeds one-third of the combined income of all
 members of the household, except that this subparagraph shall not  apply
 to  a  head  of  the  household  who  has  been  granted a rent increase
 exemption order as a person with a disability as defined in paragraph  m
 of  subdivision  one  of  this  section  that is in effect as of January

 A. 7771                             7
 
 first, two thousand fifteen or takes effect on or before July first, two
 thousand fifteen.
   c.  Notwithstanding  any  other provision of law, when a dwelling unit
 subject to the provisions of article II, IV, V  or  XI  of  the  private
 housing  finance  law  or  subject  to  a  mortgage insured or initially
 insured by the federal government pursuant to section two hundred  thir-
 teen  of  the national housing act, as amended, is later reclassified by
 order of the commissioner, the supervising agency or any  other  govern-
 mental  agency supervising such dwelling unit, or by operation of law to
 a dwelling unit subject to any of the provisions of article II, IV, V or
 XI of the private housing finance law, the  rent  stabilization  law  of
 nineteen  hundred  sixty-nine  of  the city of New York or the emergency
 tenant protection act of nineteen seventy-four, or when a dwelling  unit
 subject  to  such  rent  stabilization  law  or  such  emergency  tenant
 protection act, or subject to the emergency housing rent control law  or
 to  the  rent  and  rehabilitation  law  of the city of New York enacted
 pursuant to the local emergency housing rent control act,  is  reclassi-
 fied by order of the commissioner or the supervising agency or by opera-
 tion  of  law  to  a  dwelling unit subject to any of the aforementioned
 provisions of the private housing finance law or subject to  a  mortgage
 insured  or  initially  insured  by  the  federal government pursuant to
 section two hundred thirteen of the national housing act, as amended,  a
 head  of the household who held or holds a valid rent increase exemption
 order at the time  of  the  reclassification  shall  be  issued  a  rent
 increase  exemption  order  under applicable law continuing the previous
 exemption notwithstanding the reclassification of the dwelling unit.
   d. notwithstanding any other provision of law to the contrary, where a
 eligible head of the household holds  a  current,  valid  rent  increase
 exemption  order/tax abatement certificate and, after the effective date
 of this paragraph, there is a permanent decrease in income in an  amount
 which  exceeds  twenty  percent  of  such  income as represented in such
 eligible head of  household's  last  approved  application  for  a  rent
 increase exemption order/tax abatement certificate or for renewal there-
 of,  such eligible head of the household may apply for a redetermination
 of the amount set forth therein. Upon application, such amount shall  be
 redetermined  so as to re-establish the ratio of adjusted rent to income
 which existed at the time of approval  of  such  eligible  head  of  the
 household's  last  application  for  a rent increase exemption order/tax
 abatement certificate or for renewal thereof; provided, however, that in
 no event shall the amount of the adjusted rent be redetermined to be (i)
 in the case of an eligible head of the household who does not receive  a
 monthly  allowance for shelter pursuant to the social services law, less
 than one-third of income unless such head  of  the  household  has  been
 granted a rent increase exemption order as a person with a disability as
 defined  in  paragraph  m  of subdivision one of this section that is in
 effect as of January first, two thousand fifteen or takes effect  on  or
 before  July  first,  two  thousand  fifteen;  or (ii) in the case of an
 eligible head of the household who  receives  a  monthly  allowance  for
 shelter  pursuant  to  the  social  services  law, less than the maximum
 allowance for shelter which such eligible head of the household is enti-
 tled to receive pursuant to law.  For  purposes  of  this  paragraph,  a
 decrease  in  income  shall not include any decrease in income resulting
 from the manner in which income is calculated pursuant to any  amendment
 to paragraph f of subdivision one of this section made on or after April
 first,  nineteen  hundred  eighty-seven. For purposes of this paragraph,
 "adjusted rent" shall mean maximum rent OR PREFERENTIAL  RENT  less  the

 A. 7771                             8
 
 amount  set  forth  in  a  rent  increase  exemption order/tax abatement
 certificate.
   5. Any such local law or ordinance may provide that the effective date
 of  a  rent  increase exemption order/tax abatement certificate shall be
 the date of the first increase in  maximum  rent  OR  PREFERENTIAL  RENT
 becoming effective after the applicant's eligibility date except that in
 no event shall a rent increase exemption order/tax abatement certificate
 become effective prior to January first, nineteen hundred seventy-six.
   6.  Any such local law or ordinance may provide that upon receipt of a
 copy of the rent increase exemption order/tax abatement certificate, the
 housing company managing the dwelling unit of the eligible head  of  the
 household  shall  promptly  accord to the eligible head of the household
 covered by such order/certificate the  appropriate  credit  against  the
 monthly maximum rent OR PREFERENTIAL RENT then or thereafter payable. To
 the  extent the full amount of such credit has not been accorded for any
 past period since the effective date specified in the order/certificate,
 the housing company shall credit the total aggregate amount not so cred-
 ited to the monthly maximum rent OR PREFERENTIAL RENT next payable or to
 such subsequent monthly maximum rents  as  the  supervising  agency  may
 authorize.  It  shall  be illegal to collect any amount for which a rent
 increase exemption order/tax abatement certificate provides credit or to
 withhold credit for any such amounts already collected,  and  collection
 or  retention  of  any  such amount for a dwelling unit occupied by such
 eligible head of the household shall be deemed a  rent  overcharge,  and
 upon  conviction  therefor the housing company and its directors and any
 employee and any agent responsible therefor shall be guilty of a  misde-
 meanor,  punishable  by  a  fine  not  to exceed one thousand dollars or
 imprisonment not to exceed six months, or both.
   7. Any such local law or ordinance may provide that in order to obtain
 the tax benefits to which it is entitled under this section,  a  housing
 company  must  file with the collecting officer charged with the duty of
 collecting taxes of the municipality a sworn application, in  such  form
 as  such  officer  may  prescribe, for any quarterly period in which the
 housing company has accorded  an  eligible  head  of  the  household  an
 exemption hereunder from the payment of the maximum rent OR PREFERENTIAL
 RENT.  Subject to prior or subsequent verification thereof, the collect-
 ing officer shall credit the total amount of  such  exemptions  actually
 accorded  to  occupants  of  dwelling  units  contained  in the property
 against the real property taxes otherwise payable with  respect  to  the
 property. The housing company shall attach to such application copies of
 all  rent increase exemption orders/tax abatement certificates issued to
 eligible heads of the household residing in dwelling units in such  real
 property.
   8.  Any such local law or ordinance may provide that in the event that
 the real property of a housing company containing one or  more  dwelling
 units  shall  be  totally  exempt from local and municipal real property
 taxes for any fiscal year as a result of  the  exemptions  from  maximum
 rent  OR  PREFERENTIAL RENT credited pursuant to this section, or other-
 wise, such municipality may make or contract to make payments to a hous-
 ing company in an amount not exceeding the amount necessary to reimburse
 the housing company for the total dollar amount of all  exemptions  from
 the  payment  of the maximum rent OR PREFERENTIAL RENT accorded pursuant
 to this section to eligible heads of the household residing in  dwelling
 units in such real property.
   A municipality may create and establish a fund in order to provide for
 the  payments made in accordance with contracts entered into pursuant to

 A. 7771                             9
 
 this subdivision. There may be paid into such fund (1) all of the rental
 surcharges collected by the municipality from housing  companies  organ-
 ized  and  existing pursuant to Articles II, IV, V and XI of the private
 housing  finance  law  and (2) any moneys appropriated or otherwise made
 available by the municipality for the purpose of such fund.
   § 4. This act shall take effect immediately; provided that the  amend-
 ments  to section 467-b of the real property tax law made by section one
 of this act shall be subject to the expiration  and  reversion  of  such
 section  pursuant  to  section 17 of chapter 576 of the laws of 1974, as
 amended, when upon such date the provisions of section two of  this  act
 shall take effect.