NY State Senate Bill 2023-S1868

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development 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
Jan 03, 2024	referred to housing, construction and community development
Jan 17, 2023	referred to housing, construction and community development

2023-S1868 (ACTIVE) - Details

Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Emergency Tenant Protection Act of 1974
Laws Affected:: Amd §12-a, Emerg Ten Prot Act of 1974; amd §26-517, NYC Ad Cd; amd §421-a, RPT L
Versions Introduced in 2021-2022 Legislative Session:: S9155

2023-S1868 (ACTIVE) - Summary

Requires rent concessions to be reported to the division of housing and community renewal; requires the inclusion of a statement of net effective rent for units with concessions; requires annual statements filed for the year 2021 or 2022 to include reporting of rent concessions.

2023-S1868 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S1868

SPONSOR: CLEARE
 
TITLE OF BILL:

An act to amend the emergency tenant protection act of nineteen seven-
ty-four, the administrative code of the city of New York and the real
property tax law, in relation to reporting rent concessions

 
PURPOSE OR GENERAL IDEA OF BILL:

The purpose of this bill is to clarify that rent concessions should be
factored into the calculation of a rent that is reported to the Division
of Housing and Community Renewal for the purposes of the rent stabiliza-
tion laws and to that end to require rent concessions to be reported in
annual rent registration statements.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section one is the legislative intent and findings.

Section two amends the emergency tenant protection act of 1974 to

require that rent concessions are reported on annual rent registration
statements with the DHCR and that the current rent reported by a land-
lord on such statements reflects the "net effective rent," which
includes the value of concessions. Section two defines "concession" and
"net effective rent" for the purposes of the subdivision.

Section three makes the same changes to the New York City Admin. Code.

Section four requires that annual rent registration statements are
amended to reflect the "net effective rent" paid by tenants and any
rental concessions offered going back to March 1, 2020.

Section five amends RPTL § 421-a to include the value of rental conces-
sions in the definition of "adjusted monthly rent."

Section six is the effective date.

 
JUSTIFICATION:

The use of rental concessions to undermine the rent stabilization laws
(RBL) has become commonplace in recent years and widespread after the
outbreak of the COVID-19 pandemic. Landlords offered tenants highly-dis-
counted rents through the use of rental concessions while reporting a
different-higher-rent to the Division of Housing and Community Renewal.
When leases have come due for renewal, tenants in rent-stabilized units
have faced rent increases far in excess of those permitted by the rent
stabilization laws. This practice undermines the spirit and the purpose
of the RSL and must end.

This bill aims to clarify, for the purposes of the RSL, that rent
concessions effectively create a preferential rent and should be treated
similarly under the law. Although a correct interpretation of the law
should reach the same conclusion regardless of the legislature's clar-
ification, in order to effectuate the meaning and intent of the RSL the
bill also requires rental concessions to be reported in annual rent
registration statements and requires that the rent reported to the DHCR
in such statements is inclusive of the value of concessions.  Ultimately
this bill will close a mile-wide loophole to ensure that the rent
stabilization laws are not undermined and that rent stabilized tenants
who faced unfair and illegal rent overcharges since the beginning of the
COVID-19 pandemic can seek appropriate reductions in rent and damages
they might be owed.

 
PRIOR LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None.

 
EFFECTIVE DATE:
This bill is effective immediately.

2023-S1868 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1868
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 17, 2023
                                ___________
 
 Introduced  by  Sen.  CLEARE -- 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 emergency tenant protection act of nineteen seven-
   ty-four, the administrative code of the city of New York and the  real
   property tax law, in relation to reporting rent concessions
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative intent and findings.  The legislature finds and
 declares that the use of rental concessions in  rent  stabilized  apart-
 ments  to charge one rent to tenants while reporting another rent to the
 division of housing and community renewal undermines the purposes of the
 rent stabilization laws. The rent stabilization laws, as currently writ-
 ten, should be interpreted to find the use of rental concessions  equiv-
 alent  to  the creation of a preferential rent.  It is the intent of the
 legislature to clarify that, for the purposes of  the  emergency  tenant
 protection  act  of  nineteen seventy-four or any successor legislation,
 the amount of rent charged to and paid by  the  tenant  or  any  initial
 adjusted monthly rent charged and paid refers to the net effective rent,
 which  sum shall reflect the value of any rental concession. In order to
 effectuate the meaning and intent of the rent stabilization laws,  rents
 reported  to  the division should equal the net effective rent paid by a
 tenant based upon the value of any and  all  concessions,  and  in  this
 respect  the  application  of  the  law will be facilitated by including
 rental concessions and their value in annual  rent  registration  state-
 ments.
   §  2. Subdivision f of section 12-a of section 4 of chapter 576 of the
 laws of 1974, constituting the emergency tenant protection act of  1974,
 as  added  by  chapter  403  of  the laws of 1983, is amended to read as
 follows:

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD00268-01-3
 S. 1868                             2

 
   f. An annual statement shall be filed containing the current rent  for
 each  unit and such other information contained in subdivision a of this
 section as shall be required by the division. The  owner  shall  provide
 each tenant then in occupancy with a copy of that portion of such annual
 statement as pertains to the tenant's unit.  SUCH ANNUAL STATEMENT SHALL
 ALSO CONTAIN INFORMATION RELATING TO ANY AND ALL CONCESSIONS GRANTED FOR
 A  UNIT  AND, IN ANY CASE WHERE A CONCESSION INCLUDES A DISCOUNT ON RENT
 PAID FOR A UNIT BY THE TENANT, THE CURRENT RENT FOR EACH  UNIT  REPORTED
 BY THE OWNER TO THE DIVISION SHALL EQUAL THE NET EFFECTIVE RENT FOR SUCH
 UNIT BASED UPON THE VALUE OF SUCH CONCESSION.
   (1)  FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "CONCESSION" SHALL
 MEAN ANY TEMPORARY ADJUSTMENT TO A LEASE INTENDED TO INDUCE A TENANT  TO
 SIGN  OR  RENEW  SUCH  LEASE,  INCLUDING  WITHOUT  LIMITATION  A REBATE,
 DISCOUNT, WAIVER, LICENSE AGREEMENT, PRORATION, MONEY PAYMENT, OR  PHYS-
 ICAL GOOD OR SERVICE OR ACCESS THERETO.
   (2)  FOR  THE  PURPOSES  OF  THIS SUBDIVISION, THE TERM "NET EFFECTIVE
 RENT" SHALL MEAN THE AVERAGE MONTHLY RENT  CHARGED  TO  AND  PAID  BY  A
 TENANT  OVER  THE DURATION OF A TENANT'S OCCUPANCY OF A UNIT PURSUANT TO
 AN UNEXPIRED LEASE AND ANY RELATED RIDER OR AGREEMENT.
   § 3.  Subdivision f of section 26-517 of the  administrative  code  of
 the city of New York is amended to read as follows:
   f.  An annual statement shall be filed containing the current rent for
 each unit and such other information contained in subdivision a of  this
 section  as  shall  be required by the division. The owner shall provide
 each tenant then in occupancy with a copy of that portion of such annual
 statement as pertains to the tenant's unit.  SUCH ANNUAL STATEMENT SHALL
 ALSO CONTAIN INFORMATION RELATING TO ANY AND ALL CONCESSIONS GRANTED FOR
 A UNIT AND, IN ANY CASE WHERE A CONCESSION INCLUDES A DISCOUNT  ON  RENT
 PAID  FOR  A UNIT BY THE TENANT, THE CURRENT RENT FOR EACH UNIT REPORTED
 BY THE OWNER TO THE DIVISION SHALL EQUAL THE NET EFFECTIVE RENT FOR SUCH
 UNIT BASED UPON THE VALUE OF SUCH CONCESSION.
   (1) FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "CONCESSION"  SHALL
 MEAN  ANY TEMPORARY ADJUSTMENT TO A LEASE INTENDED TO INDUCE A TENANT TO
 SIGN OR  RENEW  SUCH  LEASE,  INCLUDING  WITHOUT  LIMITATION  A  REBATE,
 DISCOUNT,  WAIVER, LICENSE AGREEMENT, PRORATION, MONEY PAYMENT, OR PHYS-
 ICAL GOOD OR SERVICE OR ACCESS THERETO.
   (2) FOR THE PURPOSES OF THIS  SUBDIVISION,  THE  TERM  "NET  EFFECTIVE
 RENT"  SHALL  MEAN  THE  AVERAGE  MONTHLY  RENT CHARGED TO AND PAID BY A
 TENANT OVER THE DURATION OF A TENANT'S OCCUPANCY OF A UNIT  PURSUANT  TO
 AN UNEXPIRED LEASE AND ANY RELATED RIDER OR AGREEMENT.
   §  4. Every owner of housing accommodations subject to section 12-a of
 the emergency tenant protection act of nineteen seventy-four or  section
 26-517  of  the  administrative code of the city of New York shall amend
 the annual statement filed pursuant to subdivision f of such  applicable
 section  for  the  year  2021  and,  if applicable, for the year 2022 to
 include information required to be reported pursuant to section  two  or
 three of this act relating to concessions granted on a rental unit on or
 after  March  1,  2021.   Such amended statement shall be filed with the
 filing of the next annual statement or January  1,  2024,  whichever  is
 sooner.  If  an annual statement was not filed for the year 2021 or 2022
 prior to the effective date of this act, then the provisions of sections
 two and three of this act shall apply to the next filing,  and  informa-
 tion  relating  to concessions granted on rental units on or after March
 1, 2021 shall be included in such annual statement.
 S. 1868                             3
 
   § 5. Paragraph a of subdivision 1 of section 421-a of the real proper-
 ty tax law, as amended by chapter 857 of the laws of 1975 and as  renum-
 bered by chapter 110 of the laws of 1977, is amended to read as follows:
   a.  "Adjusted Monthly Rent." The rent payable per month as provided in
 the first effective lease or occupancy agreement upon initial  occupancy
 of  a  rental  dwelling  unit  of a multiple dwelling after construction
 aided by exemption under this section less the cost of providing parking
 facilities and electricity, gas, cooking fuel and other utilities  other
 than  heat  and hot water to occupants of such dwelling units, WHICH SUM
 SHALL REFLECT THE VALUE OF ANY AND  ALL  CONCESSIONS  AS  SUCH  TERM  IS
 DEFINED  BY  SUBDIVISION  F  OF SECTION TWELVE-A OF THE EMERGENCY TENANT
 PROTECTION ACT OF 1974 OR ANY SUCCESSOR LEGISLATION.
   § 6. This act shall take effect immediately; provided,  however,  that
 the  amendments to section 26-517 of chapter 4 of title 26 of the admin-
 istrative code of the city of New York made by section three of this act
 shall expire on the same date as such law expires and shall  not  affect
 the expiration of such law as provided under section 26-520 of such law.

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Senate Bill S1868

Sponsored By

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

2023-S1868 (ACTIVE) - Details

2023-S1868 (ACTIVE) - Summary

2023-S1868 (ACTIVE) - Sponsor Memo

2023-S1868 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S1868

Share this bill

Sponsored By

Cordell Cleare

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

2023-S1868 (ACTIVE) - Details

2023-S1868 (ACTIVE) - Summary

2023-S1868 (ACTIVE) - Sponsor Memo

2023-S1868 (ACTIVE) - Bill Text download pdf

Comments