S T A T E O F N E W Y O R K
________________________________________________________________________
7782
I N S E N A T E
February 19, 2020
___________
Introduced by Sen. KAVANAGH -- read twice and ordered printed, and when
printed to be committed to the Committee on Housing, Construction and
Community Development
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:
Section 1. The private housing finance law is amended by adding a new
article 31 to read as follows:
ARTICLE XXXI
AFFORDABILITY PLUS PROGRAM
SECTION 1280. SHORT TITLE.
1281. STATEMENT OF LEGISLATIVE FINDINGS AND PURPOSE.
1282. DEFINITIONS.
1283. LOANS AND GRANTS.
1284. RENTS.
1285. RULES; ENFORCEMENT.
1286. SEVERABILITY.
1287. REPORTING.
§ 1280. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
THE "AFFORDABILITY PLUS PROGRAM".
§ 1281. STATEMENT OF LEGISLATIVE FINDINGS AND PURPOSE. THE LEGISLATURE
HEREBY FINDS AND DECLARES THAT THERE IS, IN CITIES HAVING A POPULATION
OF ONE MILLION OR MORE, A SERIOUSLY INADEQUATE SUPPLY OF SAFE AND SANI-
TARY HOUSING ACCOMMODATIONS WITHIN THE FINANCIAL REACH OF FAMILIES AND
PERSONS OF LOW INCOME. THIS CONDITION IS CONTRARY TO THE PUBLIC INTEREST
AND THREATENS THE HEALTH, SAFETY, WELFARE, COMFORT AND SECURITY OF THE
PEOPLE OF SUCH CITIES. THE LEGISLATURE FURTHER FINDS AND DECLARES THAT
THE ORDINARY OPERATIONS OF PRIVATE ENTERPRISE CANNOT PROVIDE AN ADEQUATE
SUPPLY OF SAFE AND SANITARY HOUSING ACCOMMODATIONS AT RENTAL AND SALE
PRICES THAT FAMILIES AND PERSONS OF LOW INCOME CAN AFFORD. IT IS THE
PURPOSE OF THIS ACT TO PROVIDE LOANS AND GRANTS TO INCREASE THE SUPPLY
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD13342-01-9
S. 7782 2
OF HOUSING ACCOMMODATIONS FOR FAMILIES AND PERSONS OF LOW INCOME, AND
THEREBY IMPROVE THE QUALITY OF LIFE FOR ALL THE PEOPLE OF SUCH CITIES.
§ 1282. DEFINITIONS. FOR THE PURPOSES OF THIS ARTICLE, THE FOLLOWING
TERMS SHALL HAVE THE FOLLOWING MEANINGS:
1. "AGENCY" SHALL MEAN A DEPARTMENT OF HOUSING PRESERVATION AND DEVEL-
OPMENT IN A CITY HAVING A POPULATION OF ONE MILLION OR MORE.
2. "HOUSING ACCOMMODATIONS" SHALL MEAN:(A) A PRIVATE OR MULTIPLE
DWELLING, OR ANY OTHER STRUCTURE CONTAINING DWELLING UNITS, ROOMING
UNITS OR SLEEPING ACCOMMODATIONS, TOGETHER WITH THE LAND ON WHICH SUCH
STRUCTURE IS SITUATED; (B) ANY REAL PROPERTY TO BE CONVERTED TO SUCH
USER; OR (C) ALL OR A PORTION OF THE DWELLING UNITS, ROOMING UNITS OR
SLEEPING ACCOMMODATIONS THEREIN.
3. "OWNER" SHALL MEAN A PERSON HAVING RECORD OR BENEFICIAL OWNERSHIP
OF REAL PROPERTY OR A LESSEE OF REAL PROPERTY HAVING AN UNEXPIRED TERM
OF AT LEAST THIRTY YEARS.
4. "REGULATORY AGREEMENT" SHALL MEAN A WRITTEN AGREEMENT WITH OR
APPROVED BY A CITY HAVING A POPULATION OF ONE MILLION OR MORE THAT
REQUIRES THE PROVISION OF HOUSING ACCOMMODATIONS FOR FAMILIES AND
PERSONS OF LOW INCOME, IS ENTERED INTO ON OR AFTER THE EFFECTIVE DATE OF
THIS ARTICLE, SPECIFICALLY PROVIDES THAT IT IS ENTERED INTO PURSUANT TO
THIS ARTICLE, IS RECORDED AGAINST ONE OR MORE PARCELS OF REAL PROPERTY,
AND BINDS THE OWNER OF SUCH REAL PROPERTY AND ITS SUCCESSORS AND
ASSIGNS. A REGULATORY AGREEMENT MAY INCLUDE SUCH OTHER TERMS AND CONDI-
TIONS AS SUCH CITY SHALL DETERMINE.
5. "RENT STABILIZATION" SHALL MEAN, COLLECTIVELY, THE RENT STABILIZA-
TION LAW OF NINETEEN HUNDRED SIXTY-NINE, THE RENT STABILIZATION CODE,
AND THE EMERGENCY TENANT PROTECTION ACT OF NINETEEN HUNDRED SEVENTY-
FOUR, ALL AS IN EFFECT AS OF THE EFFECTIVE DATE OF THIS ARTICLE OR AS
AMENDED THEREAFTER, TOGETHER WITH ANY SUCCESSOR STATUTES OR REGULATIONS
ADDRESSING SUBSTANTIALLY THE SAME SUBJECT MATTER.
§ 1283. LOANS AND GRANTS. 1. NOTWITHSTANDING THE PROVISIONS OF ANY
GENERAL, SPECIAL OR LOCAL LAW, A CITY HAVING A POPULATION OF ONE MILLION
OR MORE IS AUTHORIZED TO MAKE LOANS OR GRANTS TO THE OWNER OF ANY REAL
PROPERTY FOR THE PURPOSE OF: (A) CONSTRUCTION, REHABILITATION, CONVER-
SION, ACQUISITION OR REFINANCING OF HOUSING ACCOMMODATIONS; (B) PROVID-
ING SITE IMPROVEMENTS, INCLUDING, BUT NOT LIMITED TO, WATER AND SEWER
FACILITIES, SIDEWALKS, LANDSCAPING, THE CURING OF PROBLEMS CAUSED BY
ABNORMAL SITE CONDITIONS, EXCAVATION AND CONSTRUCTION OF FOOTINGS AND
FOUNDATIONS AND OTHER IMPROVEMENTS ASSOCIATED WITH THE PROVISION OF
INFRASTRUCTURE FOR HOUSING ACCOMMODATIONS; OR (C) PROVIDING FOR OTHER
COSTS OF DEVELOPING HOUSING ACCOMMODATIONS.
2. ANY LOAN MADE IN ACCORDANCE WITH THIS SECTION SHALL BE EVIDENCED BY
A NOTE AND MAY BE SECURED BY: (A) A MORTGAGE UPON THE INTEREST OF THE
OWNER IN THE REAL PROPERTY ASSISTED; (B) IN THE CASE OF A CONDOMINIUM, A
MORTGAGE UPON EACH OF THE HOUSING ACCOMMODATIONS ASSISTED BY SUCH LOAN
OR; (C) IN THE CASE OF A COOPERATIVE HOUSING CORPORATION, A LIEN UPON
THE ECONOMIC INTEREST IN SUCH CORPORATION OF EACH TENANT-SHAREHOLDER
ASSISTED BY SUCH LOAN, OR A MORTGAGE UPON THE REAL PROPERTY ASSISTED, OR
BOTH SUCH LIEN AND SUCH MORTGAGE. ANY SUCH MORTGAGE MAY BE CONSOLIDATED
WITH A MUNICIPALLY-AIDED MORTGAGE THAT ENCUMBERS THE REAL PROPERTY AT
THE TIME OF THE MAKING OF THE LOAN PURSUANT TO THIS SECTION. FOR
PURPOSES OF THIS ARTICLE, THE TERM "MORTGAGE" SHALL INCLUDE ANY PLEDGE
OR ASSIGNMENT OF SHARES, OR ASSIGNMENT OF A PROPRIETARY LEASE, IN A
COOPERATIVE HOUSING CORPORATION WHERE SUCH PLEDGE OR ASSIGNMENT IS
INTENDED AS SECURITY FOR THE PERFORMANCE OF AN OBLIGATION AND IMPOSES A
LIEN ON OR AFFECTS TITLE TO SUCH SHARES OR SUCH PROPRIETARY LEASE.
S. 7782 3
3. THE REPAYMENT OF ANY LOAN MADE IN ACCORDANCE WITH THIS SECTION
SHALL BE MADE IN SUCH MANNER AS MAY BE PROVIDED IN THE NOTE AND ANY
MORTGAGE IN CONNECTION WITH SUCH LOAN. SUCH NOTE AND MORTGAGE MAY
CONTAIN SUCH TERMS AND CONDITIONS AS THE CITY MAY DEEM NECESSARY OR
DESIRABLE TO EFFECTUATE THE PURPOSES AND PROVISIONS OF THIS ARTICLE.
SUCH TERMS AND CONDITIONS MAY INCLUDE, BUT SHALL NOT BE LIMITED TO,
PROVISIONS CONCERNING: (A) THE REPAYMENT OF THE LOAN; (B) THE INTEREST,
IF ANY, THEREON; (C) THE CHARGES, IF ANY, IN CONNECTION THEREWITH; AND
(D) THE PREPAYMENT OF THE PRINCIPAL OF THE LOAN. SUCH NOTE AND MORTGAGE
MAY PROVIDE THAT ALL OR A PORTION OF THE PRINCIPAL OF THE LOAN SHALL
AUTOMATICALLY BE REDUCED TO ZERO OVER A PERIOD OF CONTINUOUS COMPLIANCE
BY THE OWNER WITH A REGULATORY AGREEMENT AND UPON THE SATISFACTION OF
ANY ADDITIONAL CONDITIONS SPECIFIED THEREIN. NOTWITHSTANDING SUCH
PROVISION AS CONTAINED IN THE NOTE AND MORTGAGE, ALL OR A PORTION OF THE
PRINCIPAL OF THE LOAN SHALL BE REDUCED TO ZERO ONLY IF, PRIOR TO OR
SIMULTANEOUSLY WITH DELIVERY OF SUCH NOTE AND MORTGAGE, THE AGENCY MADE
A WRITTEN DETERMINATION THAT SUCH REDUCTION WOULD BE NECESSARY TO ENSURE
THE CONTINUED AFFORDABILITY OR ECONOMIC VIABILITY OF THE HOUSING ACCOM-
MODATIONS ASSISTED BY SUCH LOAN. SUCH WRITTEN DETERMINATION SHALL DOCU-
MENT THE BASIS UPON WHICH THE LOAN WAS DETERMINED TO BE ELIGIBLE FOR
EVAPORATION.
4. THE CITY SHALL REQUIRE THE OWNER OF ANY REAL PROPERTY THAT IS THE
SUBJECT OF A LOAN OR GRANT PURSUANT TO THIS SECTION TO EXECUTE AND
RECORD A REGULATORY AGREEMENT HAVING A TERM COMMENCING NOT LATER THAN
THE DATE OF SUCH LOAN OR GRANT. THE REGULATORY AGREEMENT SHALL PROVIDE
THAT THE OWNER SHALL RENT OR SELL ALL HOUSING ACCOMMODATIONS REQUIRED TO
BE OCCUPIED BY FAMILIES AND PERSONS OF LOW INCOME AT RENTAL OR SALES
PRICES THAT DO NOT EXCEED, AVERAGING ALL HOUSING ACCOMMODATIONS REQUIRED
TO BE OCCUPIED BY FAMILIES AND PERSONS OF LOW INCOME BY THE REGULATORY
AGREEMENT, RENTAL OR SALES PRICES THAT ARE AFFORDABLE TO HOUSEHOLDS
EARNING ONE HUNDRED TWENTY PERCENT OF THE AREA MEDIAN INCOME, ADJUSTED
FOR HOUSEHOLD SIZE.
5. THE CITY SHALL NOT MAKE ANY LOAN OR GRANT PURSUANT TO THIS SECTION
UNLESS THE AGENCY HAS MADE A WRITTEN DETERMINATION, WHICH SHALL BE STAT-
ED OR REFERENCED IN THE REGULATORY AGREEMENT, THAT SUCH LOAN OR GRANT IS
NECESSARY TO ENSURE THE AFFORDABILITY OR ECONOMIC VIABILITY OF THE HOUS-
ING ACCOMMODATIONS IN ACCORDANCE WITH THE TERMS OF THE REGULATORY AGREE-
MENT.
6. AT THE DISCRETION OF THE AGENCY, A MORTGAGE SECURING A LOAN MADE
PURSUANT TO THIS SECTION MAY BE EXEMPT FROM THE TAX ON MORTGAGES IMPOSED
BY ARTICLE ELEVEN OF THE TAX LAW AND THE TAX ON MORTGAGES IMPOSED BY
CHAPTER TWENTY-SIX OF TITLE ELEVEN OF THE ADMINISTRATIVE CODE OF THE
CITY OF NEW YORK.
7. AT THE DISCRETION OF THE AGENCY, ANY TRANSFER OF REAL PROPERTY MADE
IN CONNECTION WITH A LOAN OR GRANT MADE PURSUANT TO THIS SECTION MAY BE
EXEMPT FROM THE REAL ESTATE TRANSFER TAX IMPOSED BY ARTICLE THIRTY-ONE
OF THE TAX LAW AND THE REAL PROPERTY TRANSFER TAX IMPOSED BY CHAPTER
TWENTY-ONE OF TITLE ELEVEN OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW
YORK.
8. THE AGENCY MAY MAKE PROVISION, EITHER IN THE MORTGAGE OR BY SEPA-
RATE AGREEMENT, FOR THE PERFORMANCE OF SUCH LOAN SERVICING FUNCTIONS,
INCLUDING FUNCTIONS RELATED TO CONSTRUCTION LENDING, AS MAY GENERALLY BE
PERFORMED BY AN INSTITUTIONAL LENDER. THE AGENCY MAY ACT IN SUCH CAPACI-
TY OR APPOINT OR CONSENT TO THE APPOINTMENT OF A FINANCIAL INSTITUTION
TO ACT IN SUCH CAPACITY ON BEHALF OF THE AGENCY. THE AGENCY IS AUTHOR-
S. 7782 4
IZED TO PAY A REASONABLE AND CUSTOMARY FEE TO SUCH FINANCIAL INSTITUTION
FOR THE PERFORMANCE OF SUCH SERVICES.
§ 1284. RENTS. NOTWITHSTANDING THE PROVISIONS OF RENT STABILIZATION OR
THE LOCAL EMERGENCY HOUSING RENT CONTROL ACT, OR ANY REGULATION OR LOCAL
LAW ENACTED PURSUANT THERETO:
1. THE REGULATORY AGREEMENT SHALL PROVIDE THAT ALL HOUSING ACCOMMO-
DATIONS REQUIRED TO BE OCCUPIED BY FAMILIES AND PERSONS OF LOW INCOME
SHALL BE SUBJECT TO RENT STABILIZATION AS OF THE EFFECTIVE DATE OF THE
REGULATORY AGREEMENT; PROVIDED, HOWEVER, THAT THE AGENCY MAY EXEMPT FROM
THE REQUIREMENTS OF THIS SECTION ANY HOUSING ACCOMMODATIONS THAT ARE:
(A) LOCATED IN A STRUCTURE CONTAINING FEWER THAN SIX DWELLING UNITS OR
ROOMING UNITS; (B) TO BE OCCUPIED ON A TRANSITIONAL BASIS BY PERSONS WHO
ARE FORMERLY HOMELESS OR HAVE SPECIAL NEEDS; (C) SUBJECT TO ANY LAW
PROVIDING FOR THE REGULATION OF RENTS BY A GOVERNMENTAL AGENCY OR
INSTRUMENTALITY; OR (D) TO BE OCCUPIED AS HOMEOWNERSHIP, RATHER THAN
RENTAL, HOUSING ACCOMMODATIONS.
2. EXCEPT AS OTHERWISE PROVIDED IN SUBDIVISION ONE OF THIS SECTION, IF
ANY HOUSING ACCOMMODATIONS REQUIRED TO BE OCCUPIED BY FAMILIES AND
PERSONS OF LOW INCOME ARE NOT SUBJECT TO RENT STABILIZATION AS OF THE
EFFECTIVE DATE OF THE REGULATORY AGREEMENT, THE AGENCY SHALL ESTABLISH
THE INITIAL RENTS FOR SUCH HOUSING ACCOMMODATIONS AS OF SUCH DATE.
3. UPON COMPLETION OF THE CONSTRUCTION OR REHABILITATION OF A HOUSING
ACCOMMODATION WHICH IS ASSISTED BY A LOAN OR GRANT MADE BY A CITY PURSU-
ANT TO SECTION TWELVE HUNDRED EIGHTY-THREE OF THIS ARTICLE, THE AGENCY
MAY ESTABLISH A NEW INITIAL RENT FOR EACH DWELLING UNIT SUBJECT TO RENT
STABILIZATION WITHIN THE HOUSING ACCOMMODATION PURSUANT TO SUBDIVISION
ONE OF THIS SECTION OR OTHERWISE. PRIOR TO THE MAKING OF A REHABILI-
TATION LOAN OR GRANT PURSUANT TO THIS ARTICLE, THE AGENCY SHALL CAUSE
EACH TENANT IN OCCUPANCY OF A DWELLING UNIT FOR WHICH THE AGENCY INTENDS
TO ESTABLISH A NEW INITIAL RENT TO BE NOTIFIED OF AND HAVE AN OPPORTU-
NITY TO COMMENT ON THE CONTEMPLATED REHABILITATION. SUCH NOTIFICATION
SHALL ADVISE SUCH TENANTS OF THE APPROXIMATE EXPECTED INITIAL RENT. SUCH
NOTIFICATION AND OPPORTUNITY TO COMMENT SHALL BE PROVIDED BEFORE THE
REHABILITATION AND AGAIN AFTER THE REHABILITATION IS COMPLETED AND PRIOR
TO THE ESTABLISHMENT OF THE NEW INITIAL RENTS. A REPRESENTATIVE OF THE
AGENCY SHALL MEET OR OFFER TO MEET WITH ALL TENANTS IN OCCUPANCY OF
DWELLING UNITS AFFECTED BY THE PROVISIONS OF THIS SUBDIVISION AT LEAST
ONCE BEFORE THE REHABILITATION.
§ 1285. RULES; ENFORCEMENT. 1. THE AGENCY MAY PROMULGATE RULES TO
CARRY OUT THE PROVISIONS OF THIS ARTICLE, AND MAY REQUIRE A FILING FEE
IN AN AMOUNT EQUAL TO ONE THOUSAND DOLLARS PER DWELLING UNIT, OR SUCH
LESSER AMOUNT AS MAY BE PROVIDED BY SUCH RULES, IN CONNECTION WITH ANY
APPLICATION FOR A LOAN OR GRANT PURSUANT TO THIS ARTICLE.
2. THE AGENCY SHALL HAVE THE POWER TO: (A) SUBPOENA, REQUIRE THE
ATTENDANCE OF AND EXAMINE AND TAKE TESTIMONY UNDER OATH OF SUCH PERSONS
AS IT MAY DEEM NECESSARY IN ORDER TO MONITOR AND ENFORCE COMPLIANCE WITH
THE REGULATORY AGREEMENT; AND (B) SUBPOENA AND REQUIRE THE PRODUCTION OF
BOOKS, ACCOUNTS, PAPERS, DOCUMENTS AND OTHER EVIDENCE RELATED TO SUCH
MONITORING AND ENFORCEMENT.
§ 1286. SEVERABILITY. IF ANY CLAUSE, SENTENCE, PARAGRAPH, SECTION OR
PART OF THIS ARTICLE SHALL BE ADJUDGED BY ANY COURT OF COMPETENT JURIS-
DICTION TO BE INVALID, SUCH JUDGMENT SHALL NOT AFFECT, IMPAIR OR INVALI-
DATE THE REMAINDER THEREOF, BUT SHALL BE CONFINED IN ITS OPERATION TO
THE CLAUSE, SENTENCE, PARAGRAPH, SECTION OR PART THEREOF DIRECTLY
INVOLVED IN THE CONTROVERSY IN WHICH SUCH JUDGMENT SHALL HAVE BEEN
RENDERED.
S. 7782 5
§ 1287. REPORTING. ON OR BEFORE SEPTEMBER THIRTIETH OF EACH YEAR,
BEGINNING IN TWO THOUSAND TWENTY, THE AGENCY SHALL SUBMIT A REPORT TO
THE TEMPORARY PRESIDENT OF THE SENATE AND THE SPEAKER OF THE ASSEMBLY ON
THE HOUSING PRODUCTION ACTIVITY OF THE AFFORDABILITY PLUS PROGRAM FOR
THE PREVIOUS CITY FISCAL YEAR.
§ 2. Subdivision a of section 11.00 of the local finance law is
amended by adding a new paragraph 41-f to read as follows:
41-F. AFFORDABILITY PLUS PROGRAM. THE MAKING OF LOANS OR GRANTS,
PURSUANT TO ARTICLE THIRTY-ONE OF THE PRIVATE HOUSING FINANCE LAW, THIR-
TY YEARS; IMPROVEMENTS ASSOCIATED WITH THE CONSTRUCTION, REHABILITATION,
CONVERSION, ACQUISITION OR REFINANCING OF HOUSING ACCOMMODATIONS, PURSU-
ANT TO ARTICLE THIRTY-ONE OF THE PRIVATE HOUSING FINANCE LAW, THIRTY
YEARS.
§ 3. This act shall take effect immediately.