Bill Text: NY S00135 | 2023-2024 | General Assembly | Introduced

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Bill Title: Provides for a transfer fee of 75% of the fair market value in dissolution or sales of a rental project or mutual company.

Spectrum: Partisan Bill (Democrat 6-0)

Status: (Introduced) 2024-01-03 - REFERRED TO HOUSING, CONSTRUCTION AND COMMUNITY DEVELOPMENT [S00135 Detail]

Download: New_York-2023-S00135-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                           135

                               2023-2024 Regular Sessions

                    IN SENATE

                                       (Prefiled)

                                     January 4, 2023
                                       ___________

        Introduced  by Sens. KRUEGER, BAILEY, HOYLMAN, LIU, SERRANO, STAVISKY --
          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, in relation to windfall
          profits  on  the dissolution or first sale of rental companies and the
          dissolution and/or reconstitution of mutual companies

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1. Subdivision 2 of section 35 of the private housing finance
     2  law, as amended by chapter 229 of the laws of 1989, is amended  to  read
     3  as follows:
     4    2.  A  company  aided by a loan made after May first, nineteen hundred
     5  fifty-nine, may voluntarily  be  dissolved,  sold  and/or  reconstituted
     6  without the consent of the commissioner or of the supervising agency, as
     7  the  case  may  be,  not less than twenty years after the occupancy date
     8  upon the payment in full of  the  remaining  balance  of  principal  and
     9  interest due and unpaid upon the mortgage or mortgages [and], of any and
    10  all  expenses  incurred in effecting such voluntary dissolution and of a
    11  transfer fee equal to seventy-five percent of the fair market  value  in
    12  the  case  of  dissolution  or sales price on the first sale of a rental
    13  project, or, in the case of a mutual company seventy-five percent of the
    14  sales price on each first sale thereafter for market value by a  selling
    15  shareholder.  The  proceeds  of  the transfer fees are to be paid into a
    16  fund held by the New York city housing development corporation  and  the
    17  New York state housing finance agency for the following purposes:
    18    (a)  to  continue  to  subsidize  the  development  for as long as the
    19  purchaser of a rental development remains in the Mitchell-Lama program;
    20    (b) for the city or state to purchase the land and to lease  the  land
    21  to the tenants and convert the project to a limited profit mutual compa-
    22  ny, with a ninety-nine year lease;

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD00873-01-3
        S. 135                              2

     1    (c)  for repair loans at zero percent interest to fund necessary capi-
     2  tal improvements for as long as the company remains in the Mitchell-Lama
     3  program;
     4    (d)  for each year that the company remains as a limited profit compa-
     5  ny, to forgive one-thirtieth of the principal of any  repair  loan  each
     6  year;
     7    (e)  for  the subsidization of other limited profit housing companies;
     8  and
     9    (f) for the development of other affordable housing.
    10    § 2. This act shall take effect on the sixtieth  day  after  it  shall
    11  have become a law.