NY State Senate Bill 2019-S8904

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Aug 12, 2020	referred to rules

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2019-S8904 (ACTIVE) - Details

See Assembly Version of this Bill:: A10936
Current Committee:: Senate Rules
Law Section:: Real Property Tax Law
Laws Affected:: Add Art 4 Title 6 §§499-aaaaa & 499-bbbbb, RPT L
Versions Introduced in 2021-2022 Legislative Session:: S2140, A2380

2019-S8904 (ACTIVE) - Summary

Establishes the COVID-19 small business recovery lease act of 2020; authorizes real property tax abatements for certain properties entering into COVID-19 recovery leases in a city having a population of one million or more.

2019-S8904 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S8904

SPONSOR: KAVANAGH
 
TITLE OF BILL:

An act to amend the real property tax law, in relation to establishing
the COVID-19 small business recovery lease act of 2020

 
PURPOSE:

This bill would authorize the City of New York to enact local legis-
lation to offer property owners an abatement on their real property
taxes if they enter into recovery leases with their commercial small
business tenants.

 
SUMMARY OF PROVISIONS:

Section one of the bill creates a new Title 6 in Article 4 of the real
property tax law authorizing tax abatements to property owners entering
into COVID-19 recovery leases which limit rent increases for certain
commercial tenants.

Section 499-aaaaa of the new Title 6 sets forth definitions for what
constitutes an eligible commercial tenant, a COVID-19 recovery lease,
and the covered period. This section requires recovery leases to be
entered into within two years of the enactment of the law. These leases
must last at least ten years, and the abatement benefit period must be
no longer than ten years.

Section 499-bbbbb of the new Title 6 authorizes the City of New York to
adopt or amend any local law or ordinance to offer property tax abate-
ments when building owners enter into a recovery lease with an eligible
commercial tenant. The local law shall provide for:  standards to deter-
mine whether commercial tenants and building owners have suffered finan-
cial hardship, the maximum annual rent increases permitted in recovery
leases, duration of the tax abatement, and the way the abatement shall
be calculated.

Section two of the bill sets forth the effective date.

 
JUSTIFICATION:

New York's small businesses have been devastated by the COVID-19 pandem-
ic. Commercial rent remains, for many, the biggest single fixed cost,
other than their workforce. Even before the COVID-19 crisis, untenable
commercial rents were causing many storefronts across the city to close.
Meanwhile, spaces sat vacant for years, as some property owners sought
higher rents and higher-credit tenants.  If left unaddressed, the
COVID-19 crisis is likely to result in the shuttering of many beloved
small businesses in neighborhoods throughout the city - businesses that
have served as the backbone of our communities into which owners have
poured their hearts, souls, and savings. An increase in commercial
vacancies is sure to follow, undermining retail strips and the neighbor-
hoods they anchor. While this may lead to a drop in commercial rents
over time, there is no guarantee that this would help existing tenants,
already locked into their leases, especially as more commercial land-
lords choose to leave their storefronts empty, waiting to see if a
recovery allows them to strike a higher price down the road.

Giving New York City the authority to encourage property owners to
restructure existing leases and rent commercial spaces at affordable
rates will be a lifeline not only to the small businesses struggling to
survive now, but to the communities across New York who have seen their
Main Streets vacant for too long.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

None to the state.

 
EFFECTIVE DATE:
This act shall take effect immediately and shall expire and be deemed
repealed after a period of two years.

2019-S8904 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8904
 
                             I N  S E N A T E
 
                              August 12, 2020
                                ___________
 
 Introduced  by Sen. KAVANAGH -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the real property tax law, in relation  to  establishing
   the COVID-19 small business recovery lease act of 2020
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Short title. This act shall be known and may  be  cited  as
 the "COVID-19 small business recovery lease act of 2020".
   § 2. Article 4 of the real property tax law is amended by adding a new
 title 6 to read as follows:
                                  TITLE 6
         AUTHORIZATION OF REAL PROPERTY TAX ABATEMENT FOR CERTAIN
             PROPERTIES ENTERING INTO COVID-19 RECOVERY LEASES
 SECTION 499-AAAAA. DEFINITIONS.
         499-BBBBB. REAL PROPERTY TAX ABATEMENT.
   § 499-AAAAA. DEFINITIONS. FOR THE PURPOSE OF THIS TITLE:
   1.  "ELIGIBLE  COMMERCIAL  TENANT"  SHALL  MEAN  A  SMALL BUSINESS, AS
 DEFINED BY SECTION ONE HUNDRED THIRTY-ONE OF  THE  ECONOMIC  DEVELOPMENT
 LAW,  THAT  ENTERS INTO OR SEEKS TO ENTER INTO A COVID-19 RECOVERY LEASE
 FOR PROPERTY SUCH TENANT CURRENTLY OCCUPIES, OR  FOR  PROPERTY  THAT  IS
 VACANT FOR REASONS OTHER THAN EVICTION.
   2.  "COVID-19  RECOVERY LEASE" SHALL MEAN A COMMERCIAL LEASE AGREEMENT
 THAT: (A) IS ENTERED INTO WITHIN TWO YEARS OF THE EFFECTIVE DATE OF THIS
 TITLE BETWEEN AN ELIGIBLE COMMERCIAL TENANT AND A PROPERTY OWNER,  WHERE
 EITHER THE ELIGIBLE COMMERCIAL TENANT OR THE PROPERTY OWNER HAS SUFFERED
 A  FINANCIAL  HARDSHIP  DURING THE COVID-19 COVERED PERIOD, OR BOTH HAVE
 SUFFERED SUCH A HARDSHIP; (B) HAS A TERM OF NOT LESS THAN TEN YEARS; (C)
 PROVIDES FOR ANNUAL RENT INCREASES DURING A TERM OF  NOT  LESS  THAN  AT
 LEAST  TEN  YEARS THAT DO NOT EXCEED THE AMOUNTS PERMITTED PURSUANT TO A
 LOCAL LAW ENACTED FOR THE PURPOSE OF SETTING SUCH MAXIMUM INCREASES; (D)
 SETTLES ANY ARREARS OWED BY THE TENANT PURSUANT TO  ANY  PREVIOUS  LEASE
 AGREEMENT  FOR  THE  LEASED  PROPERTY;  AND  (E) INCLUDES ANY ADDITIONAL
 PROVISIONS THAT MAY BE REQUIRED PURSUANT TO LOCAL LAW.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD17094-02-0

 S. 8904                             2
 
   3. "BENEFIT PERIOD" SHALL MEAN THE AMOUNT OF TIME ESTABLISHED BY LOCAL
 LAW DURING WHICH AN ELIGIBLE PROPERTY SHALL RECEIVE AN ABATEMENT OF REAL
 PROPERTY TAXES PURSUANT TO SECTION  FOUR  HUNDRED  NINETY-NINE-BBBBB  OF
 THIS TITLE, PROVIDED THAT IN NO EVENT SHALL THE BENEFIT PERIOD BE LONGER
 THAN TEN YEARS.
   4.  "COVID-19  COVERED  PERIOD"  SHALL MEAN THE PERIOD BEGINNING MARCH
 SEVENTH, TWO THOUSAND TWENTY, UNTIL THE END OF THE COVID-19 STATE DISAS-
 TER EMERGENCY DECLARED BY EXECUTIVE ORDER NUMBER TWO HUNDRED TWO AND ANY
 FURTHER AMENDMENTS OR MODIFICATIONS  THERETO,  AND  AS  MAY  BE  FURTHER
 EXTENDED  PURSUANT  TO SECTION TWENTY-EIGHT OF THE EXECUTIVE LAW, ISSUED
 IN RESPONSE TO THE COVID-19 PANDEMIC,  CONTINUES  TO  APPLY  IN  A  CITY
 HAVING A POPULATION OF ONE MILLION OR MORE.
   § 499-BBBBB. REAL PROPERTY TAX ABATEMENT. 1. NOTWITHSTANDING ANY OTHER
 PROVISION  OF  LAW  TO  THE  CONTRARY, A CITY HAVING A POPULATION OF ONE
 MILLION OR MORE MAY, BY ADOPTING OR AMENDING A LOCAL LAW,  OFFER  ABATE-
 MENTS OF REAL PROPERTY TAXES DURING A PRESCRIBED BENEFIT PERIOD TO PROP-
 ERTIES  IN WHICH THE PROPERTY OWNER ENTERS INTO A RECOVERY LEASE WITH AN
 ELIGIBLE COMMERCIAL TENANT. SUCH LOCAL LAW SHALL PROVIDE  FOR:  (A)  THE
 MANNER  IN  WHICH  IT SHALL BE DETERMINED WHETHER AN ELIGIBLE COMMERCIAL
 TENANT OR A PROPERTY OWNER HAS SUFFERED A FINANCIAL HARDSHIP DURING  THE
 COVID-19 COVERED PERIOD; (B) THE MAXIMUM ANNUAL RENT INCREASES PERMITTED
 DURING  THE  TERM  OF  A RECOVERY LEASE; (C) THE DURATION OF THE BENEFIT
 PERIOD; (D) THE MANNER IN WHICH THE AMOUNT OF  THE  ABATEMENT  SHALL  BE
 CALCULATED; AND (E) ANY OTHER TERMS AND CONDITIONS THE CITY DEEMS NECES-
 SARY  TO  EFFECTUATE THE PURPOSES OF THIS TITLE. SUCH LOCAL LAW MAY ALSO
 PROVIDE FOR A MAXIMUM AGGREGATE VALUE OF ALL TAX ABATEMENTS THAT MAY  BE
 GRANTED UNDER THIS TITLE.
   2.  IN  NO  EVENT  SHALL  AN  ABATEMENT GRANTED PURSUANT TO THIS TITLE
 EXCEED THE TAX LIABILITY OF THE PROPERTY  FOR  WHICH  THE  ABATEMENT  IS
 GRANTED.
   §  3.  This  act shall take effect immediately and shall expire and be
 deemed repealed 12 years after it shall have become a law.

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Senate Bill S8904

Sponsored By

Archive: Last Bill Status - In Senate Committee Rules Committee

co-Sponsors

2019-S8904 (ACTIVE) - Details

2019-S8904 (ACTIVE) - Summary

2019-S8904 (ACTIVE) - Sponsor Memo

2019-S8904 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S8904

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Sponsored By

Archive: Last Bill Status - In Senate Committee Rules Committee

co-Sponsors

2019-S8904 (ACTIVE) - Details

2019-S8904 (ACTIVE) - Summary

2019-S8904 (ACTIVE) - Sponsor Memo

2019-S8904 (ACTIVE) - Bill Text download pdf

Comments