S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  5342--A
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               March 7, 2023
                                ___________
 
 Introduced by M. of A. EPSTEIN, BURDICK -- read once and referred to the
   Committee  on  Housing  -- committee discharged, bill amended, ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the real property law, in relation  to  establishing  an
   accessory dwelling unit incentive program; to amend the executive law,
   in  relation to including an accessory dwelling unit in the term hous-
   ing accommodations in the human rights law;  and  to  amend  the  real
   property  tax  law,  in  relation  to providing a tax exemption on the
   increase in value of property resulting from the addition of an acces-
   sory dwelling unit
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The real property law is amended by adding a new article 16
 to read as follows:
                                ARTICLE 16
                         ACCESSORY DWELLING UNITS
 SECTION 480. DEFINITIONS.
         481. ACCESSORY DWELLING UNIT INCENTIVE PROGRAM AND LOCAL LAWS.
         482. LOW- AND MODERATE-INCOME HOMEOWNERS PROGRAM.
   § 480. DEFINITIONS. AS USED IN THIS ARTICLE, UNLESS THE CONTEXT OTHER-
 WISE REQUIRES, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
   1.  "ACCESSORY  DWELLING  UNIT"  SHALL  MEAN AN ATTACHED OR A DETACHED
 RESIDENTIAL DWELLING UNIT  THAT  PROVIDES  COMPLETE  INDEPENDENT  LIVING
 FACILITIES  FOR  ONE  OR  MORE  PERSONS WHICH IS LOCATED ON A LOT WITH A
 PROPOSED OR EXISTING  PRIMARY  RESIDENCE  AND  SHALL  INCLUDE  PERMANENT
 PROVISIONS  FOR LIVING, SLEEPING, EATING, COOKING, AND SANITATION ON THE
 SAME LOT AS THE SINGLE-FAMILY OR MULTI-FAMILY DWELLING.
   2. "LOCAL GOVERNMENT" SHALL MEAN A CITY, TOWN OR VILLAGE.
   3. "LOW-INCOME HOMEOWNERS"  SHALL  MEAN  HOMEOWNERS  WITH  AN  INCOME,
 ADJUSTED FOR FAMILY SIZE, NOT EXCEEDING EIGHTY PERCENT OF THE AREA MEDI-
 AN INCOME.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD09847-04-3
              

 A. 5342--A                          2
 
   4.  "MODERATE-INCOME HOMEOWNERS" SHALL MEAN HOMEOWNERS WITH AN INCOME,
 ADJUSTED FOR FAMILY SIZE, NOT EXCEEDING ONE HUNDRED  TWENTY  PERCENT  OF
 THE AREA MEDIAN INCOME AS DEFINED BY THE DIVISION.
   5.  "NONCONFORMING ZONING CONDITION" SHALL MEAN A PHYSICAL IMPROVEMENT
 ON A PROPERTY THAT DOES NOT CONFORM WITH CURRENT ZONING STANDARDS.
   6. "PROPOSED DWELLING" SHALL MEAN A DWELLING THAT IS THE SUBJECT OF  A
 PERMIT APPLICATION AND THAT MEETS THE REQUIREMENTS FOR PERMITTING.
   7.  "DIVISION"  SHALL  MEAN THE NEW YORK STATE DIVISION OF HOUSING AND
 COMMUNITY RENEWAL.
   § 481. ACCESSORY DWELLING UNIT INCENTIVE PROGRAM AND  LOCAL  LAWS.  1.
 WITHIN  ONE  HUNDRED  EIGHTY DAYS OF THE EFFECTIVE DATE OF THIS ARTICLE,
 THE DIVISION SHALL ESTABLISH AN OPT-IN PROGRAM FOR LOCAL GOVERNMENTS WHO
 ALREADY HAVE OR WHO ENACT A  LOCAL  LAW  OR  ORDINANCE  THAT  MEETS  THE
 REQUIREMENTS  OF  SUBDIVISION  TWO  OF THIS SECTION WHICH ENCOURAGES THE
 CREATION OF ACCESSORY DWELLING UNITS. A LOCAL GOVERNMENT SHALL HAVE FIVE
 YEARS FROM THE DATE SUCH PROGRAM IS ESTABLISHED TO ENACT SUCH LOCAL  LAW
 OR ORDINANCE TO QUALIFY FOR THE PROGRAM.
   2.  (A) TO QUALIFY FOR THE PROGRAM ESTABLISHED PURSUANT TO SUBDIVISION
 ONE OF THIS SECTION, A LOCAL LAW OR ORDINANCE SHALL:
   (I) DESIGNATE AREAS WITHIN THE JURISDICTION OF  THE  LOCAL  GOVERNMENT
 WHERE  ACCESSORY  DWELLING  UNITS  SHALL  BE PERMITTED. DESIGNATED AREAS
 SHALL INCLUDE ALL AREAS ZONED FOR SINGLE-FAMILY OR MULTI-FAMILY RESIDEN-
 TIAL USE, AND ALL LOTS WITH AN EXISTING RESIDENTIAL USE.
   (II) PROVIDE FOR PROTECTIONS FOR EXISTING ILLEGAL  ACCESSORY  DWELLING
 UNITS  TO  AID  IN  THE  CONVERSION OF SUCH UNITS TO BECOME LEGAL AND IN
 COMPLIANCE WITH STATE AND LOCAL REGULATIONS, INCLUDING BUT  NOT  LIMITED
 TO:  (1) A MECHANISM FOR THE CONVERSION OF AN ILLEGAL ACCESSORY DWELLING
 UNIT TO BE A LEGAL UNIT, PROVIDED SUCH UNIT IS IN  COMPLIANCE  WITH  ALL
 APPLICABLE  FIRE  AND  SAFETY  CODES; AND (2) PROTECTIONS FOR TENANTS OF
 ILLEGAL ACCESSORY DWELLING UNITS FROM UNREASONABLE RENT INCREASES.
   (III) PROVIDE FOR A STREAMLINED APPROVAL  PROCESS  INVOLVING  NO  MORE
 THAN  ONE  MEETING WITH THE APPLICABLE APPROVING AUTHORITY, AND LIMITING
 THE COST OF ANY NECESSARY APPLICATIONS AND PERMITS TO A  TOTAL  OF  FIVE
 HUNDRED DOLLARS.
   (IV) PROVIDE THAT SEWER AND SEPTIC HOOKUPS SHALL BE GOVERNED UNDER THE
 APPLICABLE EXISTING LOCAL REQUIREMENTS.
   (B) A QUALIFYING LOCAL LAW OR ORDINANCE MAY:
   (I)  REQUIRE OWNER OCCUPANCY IN EITHER THE PRIMARY OR ACCESSORY DWELL-
 ING UNIT.
   (II) SET A MINIMUM LEASE DURATION FOR ACCESSORY DWELLING UNITS.
   (III) LIMIT THE TOTAL BUILD OUT TO THE EXISTING ALLOWABLE SQUARE-FOOT-
 UNDER-FLOOR RATIO AND LOT COVERAGE, CONSISTENT WITH EXISTING SETBACK FOR
 OTHER ACCESSORY USES.
   (IV) SET MINIMUM OR MAXIMUM SIZE  LIMITS  FOR  AN  ACCESSORY  DWELLING
 UNIT.
   (C) TO QUALIFY FOR THE PROGRAM ESTABLISHED PURSUANT TO SUBDIVISION ONE
 OF THIS SECTION, A LOCAL LAW OR ORDINANCE SHALL NOT:
   (I)  IMPOSE AN OFF-STREET PARKING REQUIREMENT ON AN ACCESSORY DWELLING
 UNIT,  EXCEPT  WHERE  NO  ADJACENT  PUBLIC  STREET  PERMITS   YEAR-ROUND
 ON-STREET  PARKING  AND THE ACCESSORY DWELLING UNIT IS GREATER THAN ONE-
 HALF MILE FROM A SUBWAY STOP, RAIL STATION OR BUS STOP. FOR PURPOSES  OF
 THIS  SUBPARAGRAPH,  AN  ADJACENT  PUBLIC  STREET SHALL BE CONSIDERED AS
 PERMITTING  YEAR-ROUND  ON-STREET  PARKING  NOTWITHSTANDING  RULES  THAT
 PROHIBIT PARKING DURING LIMITED HOURS OR ON CERTAIN DAYS OF THE WEEK.
   (II)  IMPOSE  UNDUE  OR UNNECESSARY FIRE AND SAFETY CODES ON ACCESSORY
 DWELLING UNITS.
 A. 5342--A                          3
 
   (III) REQUIRE MORE THAN ONE POINT OF EXTERIOR ACCESS  BY  DOOR  TO  AN
 ACCESSORY DWELLING UNIT.
   3. TO OPT-IN TO THE PROGRAM ESTABLISHED PURSUANT TO SUBDIVISION ONE OF
 THIS  SECTION A LOCAL GOVERNMENT SHALL SUBMIT A COPY OF ITS LOCAL LAW OR
 ORDINANCE TO THE DIVISION. WITHIN NINETY DAYS  OF  RECEIPT  OF  A  LOCAL
 GOVERNMENT'S  LAW  OR ORDINANCE, THE DIVISION SHALL SUBMIT WRITTEN FIND-
 INGS TO THE LOCAL GOVERNMENT AS TO WHETHER THE LOCAL GOVERNMENT'S  LOCAL
 LAW OR ORDINANCE QUALIFIES FOR THE PROGRAM.
   4.  ALL LOCAL GOVERNMENTS WHO OPT-IN TO THE PROGRAM AND ARE DETERMINED
 BY THE DIVISION TO HAVE A QUALIFYING LOCAL LAW  OR  ORDINANCE  SHALL  BE
 ELIGIBLE FOR A TEN PERCENT INCREASE OF POINTS ON SUCH LOCAL GOVERNMENT'S
 CONSOLIDATED  FUNDING  APPLICATION,  A  TEN  PERCENT INCREASE IN AID AND
 INCENTIVES FOR MUNICIPALITIES AND AID AND INCENTIVES FOR  MUNICIPALITIES
 RELATED  PAYMENTS,  INCREASED ELIGIBILITY FOR INDIVIDUAL INFRASTRUCTURE,
 TRANSPORTATION, PARKS, AND ECONOMIC DEVELOPMENT GRANTS.
   § 482. LOW- AND MODERATE-INCOME  HOMEOWNERS  PROGRAM.  1.  WITHIN  ONE
 HUNDRED  EIGHTY DAYS OF THE EFFECTIVE DATE OF THIS ARTICLE, THE DIVISION
 SHALL ESTABLISH A LENDING PROGRAM TO ASSIST  LOW-INCOME  HOMEOWNERS  AND
 MODERATE-INCOME  HOMEOWNERS  IN  SECURING  FINANCING FOR THE CREATION OF
 ACCESSORY DWELLING UNITS.
   2. AN ACCESSORY DWELLING UNIT FINANCED WITH  THE  ASSISTANCE  OF  SUCH
 PROGRAM  SHALL,  IF SUCH ASSISTANCE IS IN THE FORM OF A FORGIVABLE GRANT
 AT A BELOW-MARKET RATE FOR A PERIOD OF NO LESS THAN THIRTY YEARS AND  IF
 ANY  SUCH  ASSISTANCE IS IN THE FORM OF A REPAYABLE LOAN, BE OFFERED FOR
 RENT AT A BELOW-MARKET RATE FOR A PERIOD OF FIFTEEN YEARS.
   3. SUCH PROGRAM SHALL BE FUNDED  THROUGH  CAPITAL  PROJECTS  APPROPRI-
 ATIONS  AND  REAPPROPRIATIONS SET FORTH IN THE STATE FISCAL YEAR HOUSING
 PROGRAM.
   4. WITHIN ONE HUNDRED EIGHTY DAYS OF THE EFFECTIVE DATE OF THIS  ARTI-
 CLE, THE DIVISION SHALL ESTABLISH A PROGRAM TO PROVIDE TECHNICAL ASSIST-
 ANCE TO ALL HOMEOWNERS SEEKING TO CREATE AN ACCESSORY DWELLING UNIT, AND
 TO  PROTECT  TENANTS OF ACCESSORY DWELLING UNITS AGAINST DISCRIMINATION,
 UNREASONABLE RENT INCREASES AND UNWARRANTED EVICTIONS.
   5. AN ACCESSORY DWELLING UNIT FINANCED WITH  THE  ASSISTANCE  OF  SUCH
 PROGRAM SHALL BE LIMITED TO AN ANNUAL MAXIMUM RENT INCREASE OF THE LOWER
 OF (A) THREE PERCENT OR (B) ONE AND ONE-HALF TIMES THE ANNUAL PERCENTAGE
 CHANGE IN THE CONSUMER PRICE INDEX FOR THE REGION IN WHICH THE ACCESSORY
 DWELLING UNIT IS LOCATED.
   6.  THE  DIVISION  SHALL  PROMULGATE  PROGRAM  CRITERIA AND GUIDELINES
 NECESSARY TO CARRY OUT SUCH PROGRAM.
   § 2. Section 292 of the executive law  is  amended  by  adding  a  new
 subdivision 42 to read as follows:
   42.  THE  TERM  "HOUSING  ACCOMMODATION" AS USED IN THIS ARTICLE SHALL
 INCLUDE AN ACCESSORY DWELLING UNIT AS  DEFINED  IN  SUBDIVISION  ONE  OF
 SECTION FOUR HUNDRED EIGHTY OF THE REAL PROPERTY LAW.
   §  3.  Paragraph  (a) of subdivision 1 of section 296 of the executive
 law, as separately amended by chapters 202 and 748 of the laws of  2022,
 is amended to read as follows:
   (a)  For  an  employer or licensing agency, because of an individual's
 age, race, creed, color, national  origin,  citizenship  or  immigration
 status,  sexual  orientation,  gender  identity  or expression, military
 status, sex, disability, predisposing genetic characteristics,  familial
 status,  marital  status, or status as a victim of domestic violence, to
 refuse to hire or employ or to bar or to discharge from employment  such
 individual or to discriminate against such individual in compensation or
 in  terms,  conditions  or  privileges  of employment. IN THE CASE OF AN
 A. 5342--A                          4
 
 ACCESSORY DWELLING UNIT AS DEFINED IN SUBDIVISION ONE  OF  SECTION  FOUR
 HUNDRED  EIGHTY  OF  THE  REAL  PROPERTY  LAW,  THE  EXEMPTION  FROM THE
 PROVISIONS OF THIS PARAGRAPH FOR THE RENTAL OF A  HOUSING  ACCOMMODATION
 IN  A  BUILDING  WHICH CONTAINS HOUSING ACCOMMODATIONS FOR NOT MORE THAN
 TWO FAMILIES LIVING INDEPENDENTLY OF EACH OTHER, IF THE OWNER RESIDES IN
 ONE OF SUCH ACCOMMODATIONS, SHALL NOT APPLY.
   § 4. The real property tax law is amended  by  adding  a  new  section
 421-p to read as follows:
   §   421-P.  EXEMPTION  OF  CAPITAL  IMPROVEMENTS  TO  RESIDENTIAL  NEW
 CONSTRUCTION INVOLVING THE CREATION  OF  ACCESSORY  DWELLING  UNITS.  1.
 RESIDENTIAL   BUILDINGS   RECONSTRUCTED,  ALTERED,  IMPROVED,  OR  NEWLY
 CONSTRUCTED IN ORDER TO CREATE ONE OR MORE ADDITIONAL RESIDENTIAL DWELL-
 ING UNITS ON THE SAME PARCEL AS A PRE-EXISTING RESIDENTIAL  BUILDING  TO
 PROVIDE INDEPENDENT LIVING FACILITIES FOR ONE OR MORE PERSONS SUBSEQUENT
 TO  THE  EFFECTIVE DATE OF A LOCAL LAW OR RESOLUTION ENACTED PURSUANT TO
 THIS SECTION SHALL BE EXEMPT FROM TAXATION AND SPECIAL AD VALOREM LEVIES
 TO THE EXTENT PROVIDED HEREINAFTER. AFTER A PUBLIC HEARING, THE  GOVERN-
 ING BOARD OF A COUNTY, CITY, TOWN OR VILLAGE MAY ADOPT A LOCAL LAW AND A
 SCHOOL  DISTRICT, OTHER THAN A SCHOOL DISTRICT SUBJECT TO ARTICLE FIFTY-
 TWO OF THE EDUCATION LAW, MAY ADOPT A RESOLUTION TO GRANT THE  EXEMPTION
 AUTHORIZED  PURSUANT TO THIS SECTION. A COPY OF SUCH LOCAL LAW OR RESOL-
 UTION SHALL BE FILED WITH THE COMMISSIONER  AND  THE  ASSESSOR  OF  SUCH
 COUNTY,  CITY, TOWN OR VILLAGE WHO PREPARES THE ASSESSMENT ROLL ON WHICH
 THE TAXES OF SUCH COUNTY, CITY, TOWN, VILLAGE  OR  SCHOOL  DISTRICT  ARE
 LEVIED.
   2.  (A)  SUCH  BUILDINGS SHALL BE EXEMPT FOR A PERIOD OF FIVE YEARS TO
 THE EXTENT OF ONE HUNDRED PER CENTUM OF THE INCREASE IN  ASSESSED  VALUE
 THEREOF ATTRIBUTABLE TO SUCH RECONSTRUCTION, ALTERATION, IMPROVEMENT, OR
 NEW  CONSTRUCTION  FOR  SUCH  ADDITIONAL  RESIDENTIAL UNIT OR UNITS THAT
 PROVIDE INDEPENDENT LIVING FACILITIES FOR ONE OR MORE PERSONS,  AND  FOR
 AN ADDITIONAL PERIOD OF FIVE YEARS SUBJECT TO THE FOLLOWING:
   (I) THE EXTENT OF SUCH EXEMPTION SHALL BE DECREASED BY TWENTY-FIVE PER
 CENTUM  OF THE "EXEMPTION BASE" FOR EACH OF THE FIRST THREE YEARS DURING
 SUCH ADDITIONAL PERIOD AND SHALL BE  DECREASED  BY  A  FURTHER  TEN  PER
 CENTUM  OF  THE  "EXEMPTION  BASE" DURING EACH OF THE FINAL TWO YEARS OF
 SUCH ADDITIONAL PERIOD. THE EXEMPTION SHALL EXPIRE AT  THE  END  OF  THE
 EXTENDED  PERIOD. THE "EXEMPTION BASE" SHALL BE THE INCREASE IN ASSESSED
 VALUE AS DETERMINED IN THE INITIAL YEAR OF THE TERM  OF  THE  EXEMPTION,
 EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS PARAGRAPH.
   (II)  IN  ANY YEAR IN WHICH A CHANGE IN LEVEL OF ASSESSMENT OF FIFTEEN
 PERCENT OR MORE IS CERTIFIED FOR A FINAL ASSESSMENT ROLL PURSUANT TO THE
 RULES OF THE COMMISSIONER, THE EXEMPTION BASE SHALL BE MULTIPLIED  BY  A
 FRACTION,  THE  NUMERATOR  OF WHICH SHALL BE THE TOTAL ASSESSED VALUE OF
 THE PARCEL ON SUCH FINAL ASSESSMENT ROLL (AFTER ACCOUNTING FOR ANY PHYS-
 ICAL OR QUANTITY CHANGES TO THE PARCEL SINCE THE  IMMEDIATELY  PRECEDING
 ASSESSMENT  ROLL),  AND  THE  DENOMINATOR  OF  WHICH  SHALL BE THE TOTAL
 ASSESSED VALUE OF THE PARCEL ON THE IMMEDIATELY PRECEDING FINAL  ASSESS-
 MENT  ROLL.  THE  RESULT  SHALL BE THE NEW EXEMPTION BASE. THE EXEMPTION
 SHALL THEREUPON BE RECOMPUTED TO TAKE INTO  ACCOUNT  THE  NEW  EXEMPTION
 BASE,  NOTWITHSTANDING THE FACT THAT THE ASSESSOR RECEIVES CERTIFICATION
 OF THE CHANGE IN LEVEL OF ASSESSMENT AFTER THE COMPLETION,  VERIFICATION
 AND  FILING OF THE FINAL ASSESSMENT ROLL. IN THE EVENT THE ASSESSOR DOES
 NOT HAVE CUSTODY OF THE ROLL WHEN SUCH CERTIFICATION  IS  RECEIVED,  THE
 ASSESSOR  SHALL  CERTIFY  THE RECOMPUTED EXEMPTION TO THE LOCAL OFFICERS
 HAVING CUSTODY AND CONTROL OF THE ROLL,  AND  SUCH  LOCAL  OFFICERS  ARE
 HEREBY  DIRECTED AND AUTHORIZED TO ENTER THE RECOMPUTED EXEMPTION CERTI-
 A. 5342--A                          5
 
 FIED BY THE ASSESSOR ON THE ROLL. THE ASSESSOR SHALL GIVE WRITTEN NOTICE
 OF SUCH RECOMPUTED EXEMPTION TO THE PROPERTY OWNER, WHO MAY,  IF  HE  OR
 SHE  BELIEVES THAT THE EXEMPTION WAS RECOMPUTED INCORRECTLY, APPLY FOR A
 CORRECTION IN THE MANNER PROVIDED BY TITLE THREE OF ARTICLE FIVE OF THIS
 CHAPTER FOR THE CORRECTION OF CLERICAL ERRORS.
   (III)  SUCH EXEMPTION SHALL BE LIMITED TO TWO HUNDRED THOUSAND DOLLARS
 IN INCREASED MARKET VALUE OF THE PROPERTY ATTRIBUTABLE  TO  SUCH  RECON-
 STRUCTION, ALTERATION, IMPROVEMENT, OR NEW CONSTRUCTION AND ANY INCREASE
 IN  MARKET  VALUE GREATER THAN SUCH AMOUNT SHALL NOT BE ELIGIBLE FOR THE
 EXEMPTION PURSUANT TO THIS SECTION. FOR THE PURPOSES  OF  THIS  SECTION,
 THE  MARKET VALUE OF THE RECONSTRUCTION, ALTERATION, IMPROVEMENT, OR NEW
 CONSTRUCTION AS AUTHORIZED BY SUBDIVISION ONE OF THIS SECTION  SHALL  BE
 EQUAL  TO  THE  INCREASED  ASSESSED  VALUE  ATTRIBUTABLE  TO SUCH RECON-
 STRUCTION, ALTERATION, IMPROVEMENT, OR NEW CONSTRUCTION DIVIDED  BY  THE
 CLASS  ONE RATIO IN A SPECIAL ASSESSING UNIT OR THE MOST RECENTLY ESTAB-
 LISHED STATE EQUALIZATION RATE  OR  SPECIAL  EQUALIZATION  RATE  IN  THE
 REMAINDER  OF  THE  STATE,  EXCEPT  WHERE THE STATE EQUALIZATION RATE OR
 SPECIAL EQUALIZATION RATE EQUALS  OR  EXCEEDS  NINETY-FIVE  PERCENT,  IN
 WHICH  CASE  THE  INCREASE IN ASSESSED VALUE ATTRIBUTABLE TO SUCH RECON-
 STRUCTION, ALTERATION, IMPROVEMENT, OR NEW CONSTRUCTION SHALL BE  DEEMED
 TO  EQUAL  THE MARKET VALUE OF SUCH RECONSTRUCTION, ALTERATION, IMPROVE-
 MENT, OR NEW CONSTRUCTION.
   (B) NO SUCH EXEMPTION SHALL  BE  GRANTED  FOR  RECONSTRUCTION,  ALTER-
 ATIONS, IMPROVEMENTS, OR NEW CONSTRUCTION UNLESS:
   (I)  SUCH RECONSTRUCTION, ALTERATION, IMPROVEMENT, OR NEW CONSTRUCTION
 WAS COMMENCED SUBSEQUENT TO THE EFFECTIVE  DATE  OF  THE  LOCAL  LAW  OR
 RESOLUTION ADOPTED PURSUANT TO SUBDIVISION ONE OF THIS SECTION; AND
   (II) THE VALUE OF SUCH RECONSTRUCTION, ALTERATION, IMPROVEMENT, OR NEW
 CONSTRUCTION EXCEEDS THREE THOUSAND DOLLARS; AND
   (III)   SUCH   RECONSTRUCTION,   ALTERATION,   IMPROVEMENT,   OR   NEW
 CONSTRUCTION CREATED ONE OR MORE ADDITIONAL RESIDENTIAL  DWELLING  UNITS
 ON  THE  SAME PARCEL AS THE PRE-EXISTING RESIDENTIAL BUILDING TO PROVIDE
 INDEPENDENT LIVING FACILITIES FOR ONE OR MORE PERSONS.
   (C) FOR PURPOSES OF THIS SECTION THE TERMS RECONSTRUCTION, ALTERATION,
 IMPROVEMENT, AND NEW CONSTRUCTION SHALL NOT INCLUDE ORDINARY MAINTENANCE
 AND REPAIRS.
   3. SUCH EXEMPTION SHALL BE GRANTED ONLY UPON APPLICATION BY THE  OWNER
 OF  SUCH BUILDING ON A FORM PRESCRIBED BY THE COMMISSIONER. THE APPLICA-
 TION SHALL BE FILED WITH THE ASSESSOR OF  THE  CITY,  TOWN,  VILLAGE  OR
 COUNTY HAVING THE POWER TO ASSESS PROPERTY FOR TAXATION ON OR BEFORE THE
 APPROPRIATE TAXABLE STATUS DATE OF SUCH CITY, TOWN, VILLAGE OR COUNTY.
   4.  IF SATISFIED THAT THE APPLICANT IS ENTITLED TO AN EXEMPTION PURSU-
 ANT TO THIS SECTION, THE ASSESSOR SHALL APPROVE THE APPLICATION AND SUCH
 BUILDING SHALL THEREAFTER BE EXEMPT FROM TAXATION AND SPECIAL AD VALOREM
 LEVIES AS HEREIN PROVIDED COMMENCING WITH THE ASSESSMENT  ROLL  PREPARED
 ON THE BASIS OF THE TAXABLE STATUS DATE REFERRED TO IN SUBDIVISION THREE
 OF THIS SECTION. THE ASSESSED VALUE OF ANY EXEMPTION GRANTED PURSUANT TO
 THIS  SECTION  SHALL  BE  ENTERED BY THE ASSESSOR ON THE ASSESSMENT ROLL
 WITH THE TAXABLE PROPERTY, WITH THE AMOUNT OF THE EXEMPTION SHOWN  IN  A
 SEPARATE COLUMN.
   5. FOR THE PURPOSES OF THIS SECTION, A RESIDENTIAL BUILDING SHALL MEAN
 ANY BUILDING OR STRUCTURE DESIGNED AND OCCUPIED EXCLUSIVELY FOR RESIDEN-
 TIAL PURPOSES BY NOT MORE THAN TWO FAMILIES.
   6.  IN THE EVENT THAT A BUILDING GRANTED AN EXEMPTION PURSUANT TO THIS
 SECTION CEASES TO BE USED PRIMARILY FOR RESIDENTIAL PURPOSES,  OR  TITLE
 A. 5342--A                          6
 
 THERETO  IS  TRANSFERRED  TO OTHER THAN THE HEIRS OR DISTRIBUTEES OF THE
 OWNER, THE EXEMPTION GRANTED PURSUANT TO THIS SECTION SHALL CEASE.
   7.  (A)  A  COUNTY,  CITY,  TOWN  OR VILLAGE MAY, BY ITS LOCAL LAW, OR
 SCHOOL DISTRICT, BY ITS RESOLUTION:
   (I) REDUCE THE PER CENTUM OF EXEMPTION OTHERWISE ALLOWED  PURSUANT  TO
 THIS SECTION; AND
   (II)  LIMIT  ELIGIBILITY  FOR  THE  EXEMPTION TO THOSE FORMS OF RECON-
 STRUCTION,  ALTERATIONS,  IMPROVEMENTS,  OR  NEW  CONSTRUCTION  AS   ARE
 PRESCRIBED IN SUCH LOCAL LAW OR RESOLUTION.
   (B)  NO SUCH LOCAL LAW OR RESOLUTION SHALL REPEAL AN EXEMPTION GRANTED
 PURSUANT TO THIS SECTION UNTIL THE EXPIRATION OF THE  PERIOD  FOR  WHICH
 SUCH EXEMPTION WAS GRANTED.
   §  5.  This  act shall take effect immediately; provided however, that
 section four of this act shall apply to assessment rolls based on  taxa-
 ble status dates occurring on or after such effective date.