Bill Text: NY S06352 | 2023-2024 | General Assembly | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Provides that when a housing accommodation has been vacated after continuous tenancy or occupancy of ten years or more prior to vacancy, and the owner can demonstrate restoration of the unit, the new legal regulated rent shall be the rent agreed to by the owner and first tenant after such restoration and reserved in a lease or other rental agreement; makes related provisions.
Spectrum: Partisan Bill (Democrat 10-0)
Status: (Introduced - Dead) 2024-02-09 - PRINT NUMBER 6352C [S06352 Detail]
Download: New_York-2023-S06352-Amended.html
Bill Title: Provides that when a housing accommodation has been vacated after continuous tenancy or occupancy of ten years or more prior to vacancy, and the owner can demonstrate restoration of the unit, the new legal regulated rent shall be the rent agreed to by the owner and first tenant after such restoration and reserved in a lease or other rental agreement; makes related provisions.
Spectrum: Partisan Bill (Democrat 10-0)
Status: (Introduced - Dead) 2024-02-09 - PRINT NUMBER 6352C [S06352 Detail]
Download: New_York-2023-S06352-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 6352--A 2023-2024 Regular Sessions IN SENATE April 17, 2023 ___________ Introduced by Sens. COMRIE, FERNANDEZ, SEPULVEDA, ADDABBO, MANNION, MARTINEZ, PARKER, PERSAUD, SCARCELLA-SPANTON, SKOUFIS, THOMAS -- read twice and ordered printed, and when printed to be committed to the Committee on Housing, Construction and Community Development -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the administrative code of the city of New York, in relation to certain housing accommodations; and to amend chapter 576 of the laws of 1974, constituting the emergency tenant protection act of nineteen seventy-four, in relation to certain hardship provisions The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision c of section 26-511 of the administrative code 2 of the city of New York is amended by adding a new paragraph 15 to read 3 as follows: 4 (15) provides that, notwithstanding any other provision of this chap- 5 ter to the contrary, when a housing accommodation subject to this chap- 6 ter has been vacated after continuous tenancy or occupancy of ten years 7 or more prior to vacancy, and the owner has submitted documentation to 8 the division demonstrating restoration of the unit as set forth in 9 section 26-511.2 of this chapter, the new legal regulated rent shall be 10 the rent agreed to by the owner and first tenant after such restoration 11 and reserved in a lease or other rental agreement; provided that such 12 new legal regulated rent may be adjusted on audit by the division under 13 section 26-511.2 of this chapter, or on application of a tenant under 14 section 26-513.1 of this chapter. The legal regulated rent adjustment 15 set forth in this paragraph shall be known as the local regulated hous- 16 ing restoration adjustment. 17 § 2. The administrative code of the city of New York is amended by 18 adding a new section 26-511.2 to read as follows: 19 § 26-511.2 The local regulated housing restoration adjustment. a. The 20 division of housing and community renewal, the "division" shall estab- 21 lish a notification procedure and documentation submission guidelines 22 for the local regulated housing restoration adjustment. Documentation EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD10320-09-3S. 6352--A 2 1 to qualify for the local regulated housing restoration adjustment shall 2 be limited to: 3 (1) XRF test results demonstrating a lead-free housing accommodation 4 under applicable local definitions; 5 (2) any required tenant protection plans or similar submission in 6 connection with such restoration; 7 (3) any required contractor licenses; 8 (4) list and specifications of new electric appliances installed; 9 (5) before and after photos; 10 (6) lease or rental agreement listing new legal regulated rent; 11 (7) evidence of renting to a housing subsidy voucher holder, or the 12 legal regulated rent amount or amounts for substantially similar unit or 13 units as defined by section 26-513.1 of this chapter; 14 (8) evidence of renting to a housing subsidy voucher holder, or 15 documentation confirming that, as of the date of the commencement of the 16 incoming tenant's lease, any physical condition within the unit that was 17 the basis for a previously issued violation has been corrected; and 18 (9) for units vacated after the effective date of this section, a form 19 to be promulgated by the division and signed by the previous tenant 20 affirming that the vacatur prior to the local regulated housing restora- 21 tion adjustment was voluntary and not the result of unlawful owner 22 harassment. In considering the sufficiency of alternate documentation, 23 and notwithstanding other potentially sufficient documentation, vacatur 24 shall be presumed voluntary and not the result of owner harassment when 25 (i) the owner recovered possession of the unit through judicial 26 proceedings, (ii) the owner demonstrates abandonment of the unit through 27 electronic communications, recordings, or other evidence of voluntary 28 vacatur, or (iii) the owner demonstrates the previous tenant died and 29 the unit was not occupied by a lawful successor. 30 b. The local regulated housing restoration adjustment shall not be 31 permitted: 32 (1) for units that are rented within a twenty-four-month period after 33 an arm's length transfer of ownership; 34 (2) for units that are rented within a thirty-six-month period after 35 determination by the division that the owner has engaged in unlawful 36 harassment with respect to the unit; or 37 (3) for units in buildings subject to housing preservation and devel- 38 opment's alternate enforcement program. 39 c. The division shall establish an audit process to review a percent- 40 age, as established by the division, of housing accommodations that 41 register adjusted legal regulated rents under the local regulated hous- 42 ing restoration adjustment. The division's established audit process 43 shall be subject to the following requirements: 44 (1) any audit shall be limited to: (i) confirmation that documentation 45 set forth in subdivision a of this section has been submitted; (ii) 46 visual inspection of the subject unit; and (iii) unless rented to a 47 housing subsidy voucher holder, review of the unit's registered rent in 48 comparison to the legal regulated rents of substantially similar housing 49 accommodations in the same geographic area considering the same factors 50 set forth in section 26-513.1 of this chapter, including the owner's 51 right to submit the legal regulated rent of a substantially similar unit 52 or units. Such audit shall be initiated within one year of the filing of 53 an annual apartment registration indicating an adjustment to the legal 54 regulated rent under the local regulated housing restoration adjustment; 55 andS. 6352--A 3 1 (2) if an audit under this subdivision determines that an owner has 2 failed to submit documentation set forth in subdivision a of this 3 section and the owner then fails to submit any missing documentation 4 after sixty days' written notice from the division, or if an audit under 5 this subdivision determines the local housing restoration adjustment 6 exceeds the legal rent for all substantially similar housing accommo- 7 dations as defined by this section, the division shall then set the 8 subject unit's legal regulated rent at an amount equal to the legal 9 regulated rent for a substantially similar unit in the same geographic 10 area, provided, however, that the legal regulated rents for units 11 subject to housing subsidy vouchers shall be established at the contract 12 rent amount approved by the agency administering the voucher. 13 (3) Any required refunds shall be made in accordance with section 14 26-513.1 of this chapter. 15 d. To encourage rental of units subject to a local housing restoration 16 adjustment to individuals and families with housing subsidy vouchers or 17 that are in communities of need, the division shall establish incen- 18 tives, in addition to those already contained in this section, for hous- 19 ing providers who rent to housing subsidy voucher holders located in 20 very low- and low-income zip codes. 21 e. Access to the documentation submitted as part of the local regu- 22 lated housing restoration adjustment shall be governed by the same laws 23 governing access to building and apartment registrations filed with the 24 division. 25 § 3. The administrative code of the city of New York is amended by 26 adding a new section 26-513.1 to read as follows: 27 § 26-513.1 Application for adjustment of local regulated housing 28 restoration adjustment. a. The tenant of a housing accommodation that 29 was vacant on, or became vacant after, June 14, 2019, and has been 30 subject to the local regulated housing restoration adjustment, may file 31 with the commissioner of housing and community renewal within 120 days 32 after notice has been received under subdivision c of this section an 33 application for the adjustment of the rent for such housing accommo- 34 dation. Such applications shall be subject to the following: 35 (1) in the application, the tenant must allege that the local regu- 36 lated housing restoration adjustment rent exceeds the rent for substan- 37 tially similar units within the same geographic area. 38 (2) in determining an application filed pursuant to this section, the 39 commissioner shall only consider legal regulated rents for substantially 40 similar housing accommodations within a one-mile radius of the subject 41 unit in the same borough or applicable municipal subdivision. Substan- 42 tially similar housing accommodations are those rent-stabilized units 43 with similar room counts and square footage, similar levels of code 44 compliance, including state laws, local laws and codes for health, safe- 45 ty, and environmental sustainability, similar regulatory status, similar 46 apartment conditions and quality of fixtures and finishes, similar unit 47 and building amenities, similar quality and condition of the building 48 and common areas, and with vacancy or renewal leases starting within 49 twelve months from the start date of the complaining tenant's vacancy 50 lease. For purposes of considering legal regulated rents of similar 51 housing accommodations, the geographic area may be expanded by incre- 52 ments of one-quarter mile radii as many times as necessary to find a 53 substantially similar housing accommodation located in the same borough 54 or applicable municipal subdivision. Notwithstanding the foregoing, any 55 local regulated housing restoration adjustment rent amount for units 56 subject to housing subsidy vouchers that does not exceed the contractS. 6352--A 4 1 rent amounts approved by the local housing agency administering the 2 voucher shall be determined to be fair. 3 (3) the owner of the housing accommodation subject to an application 4 under this section shall be given an opportunity to submit proof of 5 legal regulated rents for up to three substantially similar housing 6 accommodations, in addition to any already submitted as part of the 7 notification procedure under section 26-511.2 of this chapter. 8 (4) when the local regulated housing restoration adjustment rent 9 amount is determined to exceed the legal regulated rent for a substan- 10 tially similar housing accommodation as defined by this section, the 11 commissioner of housing and community renewal shall order that the legal 12 regulated rent for the subject unit shall be equal to the legal regu- 13 lated rent for a substantially similar housing accommodation in the same 14 geographic area; provided, however, that the legal regulated rents for 15 units subject to housing subsidy vouchers shall be equal to the contract 16 rent amount approved by the local housing authority that issues the 17 voucher. Any required refunds shall be made by the owner in cash or as a 18 credit against unpaid rent over a period not to exceed six months. 19 b. Notwithstanding subdivision a of this section, provided that the 20 owner has submitted to the division documentation in accordance with 21 subdivision a of section 26-511.2 of this chapter, the division shall 22 only determine whether the tenancy is subject to a housing subsidy 23 voucher and, if not, whether the rent charged to the first tenant after 24 the local regulated housing restoration adjustment is supported by the 25 rent for a substantially similar unit. Any documentation deficiencies 26 shall be resolved through the audit process set forth in section 27 26-511.2 of this chapter. 28 c. In the lease execution package for the first lease after the legal 29 rent was adjusted under the local regulated housing restoration adjust- 30 ment, the owner shall give notice, both in the lease and subsequently in 31 writing by certified mail, or by electronic delivery if the tenant has 32 opted to receive electronic delivery of documents, to the tenant of such 33 housing accommodation on a form prescribed by the commissioner of hous- 34 ing and community renewal that the local regulated housing restoration 35 adjustment was applied, including notification of the prior legal regu- 36 lated rent, a description of work completed, the building address and 37 legal regulated rent amounts for at least one and up to three substan- 38 tially similar units, and such tenant's right to file an application 39 challenging the new legal regulated rent of such housing accommodation. 40 § 4. Paragraph 5 of subdivision d of section 6 of section 4 of chapter 41 576 of the laws of 1974, constituting the emergency tenant protection 42 act of nineteen seventy-four, as amended by chapter 102 of the laws of 43 1984, is amended and a new paragraph 6 is added to read as follows: 44 (5) as an alternative to the hardship application provided under para- 45 graph four of this subdivision, owners of buildings acquired by the same 46 owner or a related entity owned by the same principals three years prior 47 to the date of application may apply to the division for increases in 48 excess of the level of applicable guideline increases established under 49 this law based on a finding by the commissioner that such guideline 50 increases are not sufficient to enable the owner to maintain an annual 51 gross rent income for such building which exceeds the annual operating 52 expenses of such building by a sum equal to at least five percent of 53 such gross rent. For the purposes of this paragraph, operating expenses 54 shall consist of the actual, reasonable, costs of fuel, labor, utili- 55 ties, taxes, other than income or corporate franchise taxes, fees, 56 permits, necessary contracted services and non-capital repairs, insur-S. 6352--A 5 1 ance, parts and supplies, management fees and other administrative costs 2 and mortgage interest. For the purposes of this paragraph, mortgage 3 interest shall be deemed to mean interest on a bona fide mortgage 4 including an allocable portion of charges related thereto. Criteria to 5 be considered in determining a bona fide mortgage other than an institu- 6 tional mortgage shall include; condition of the property, location of 7 the property, the existing mortgage market at the time the mortgage is 8 placed, the term of the mortgage, the amortization rate, the principal 9 amount of the mortgage, security and other terms and conditions of the 10 mortgage. The commissioner shall set a rental value for any unit occu- 11 pied by the owner or a person related to the owner or unoccupied at the 12 owner's choice for more than one month at the last regulated rent plus 13 the minimum number of guidelines increases or, if no such regulated rent 14 existed or is known, the commissioner shall impute a rent consistent 15 with other rents in the building. The amount of hardship increase shall 16 be such as may be required to maintain the annual gross rent income as 17 provided by this paragraph. The division shall not grant a hardship 18 application under this paragraph or paragraph four of this subdivision 19 for a period of three years subsequent to granting a hardship applica- 20 tion under the provisions of this paragraph. The collection of any 21 increase in the rent for any housing accommodation pursuant to this 22 paragraph shall not exceed six percent in any year from the effective 23 date of the order granting the increase over the rent set forth in the 24 schedule of gross rents, with collectability of any dollar excess above 25 said sum to be spread forward in similar increments and added to the 26 rent as established or set in future years. No application shall be 27 approved unless the owner's equity in such building exceeds five percent 28 of: (i) the arms length purchase price of the property; (ii) the cost of 29 any capital improvements for which the owner has not collected a 30 surcharge; (iii) any repayment of principal of any mortgage or loan used 31 to finance the purchase of the property or any capital improvements for 32 which the owner has not collected a surcharge; and (iv) any increase in 33 the equalized assessed value of the property which occurred subsequent 34 to the first valuation of the property after purchase by the owner. For 35 the purposes of this paragraph, owner's equity shall mean the sum of (i) 36 the purchase price of the property less the principal of any mortgage or 37 loan used to finance the purchase of the property, (ii) the cost of any 38 capital improvement for which the owner has not collected a surcharge 39 less the principal of any mortgage or loan used to finance said improve- 40 ment, (iii) any repayment of the principal of any mortgage or loan used 41 to finance the purchase of the property or any capital improvement for 42 which the owner has not collected a surcharge, and (iv) any increase in 43 the equalized assessed value of the property which occurred subsequent 44 to the first valuation of the property after purchase by the owner[.]; 45 or 46 (6) provides that, notwithstanding any other provision of this chapter 47 to the contrary, when a housing accommodation subject to this chapter 48 has been vacated after continuous tenancy or occupancy of ten years or 49 more prior to vacancy, and the owner has submitted documentation to the 50 division demonstrating restoration of the unit as set forth in subdivi- 51 sion (a-1) of section ten of this chapter, the new legal regulated rent 52 shall be the rent agreed to by the owner and first tenant after such 53 restoration and reserved in a lease or other rental agreement; provided 54 that such new legal regulated rent may be adjusted on audit by the divi- 55 sion under subdivision (a-1) of section ten of this section, or on 56 application of a tenant under subdivision d-1 of section nine of thisS. 6352--A 6 1 chapter. The legal regulated rent adjustment set forth in this paragraph 2 shall be known as the local regulated housing restoration adjustment. 3 § 5. Section 10 of section 4 of chapter 576 of the laws of 1974, 4 constituting the emergency tenant protection act of nineteen seventy- 5 four is amended by adding a new subdivision (a-1) to read as follows: 6 (a-1) the division of housing and community renewal shall establish a 7 notification procedure and documentation submission guidelines for the 8 local regulated housing restoration adjustment. a. Documentation to 9 qualify for the local regulated housing restoration adjustment shall be 10 limited to: 11 (1) XRF test results demonstrating a lead-free housing accommodation 12 under applicable local definitions; 13 (2) any required tenant protection plans or similar submission in 14 connection with such restoration; 15 (3) any required contractor licenses; 16 (4) list and specifications of new electric appliances installed; 17 (5) before and after photos; 18 (6) lease or rental agreement listing new legal regulated rent; 19 (7) evidence of renting to a housing subsidy voucher holder, or the 20 legal regulated rent amount or amounts for substantially similar unit or 21 units as defined by section 26-513.1 of the administrative code of the 22 city of New York; 23 (8) evidence of renting to a housing subsidy voucher holder, or 24 documentation confirming that, as of the date of the commencement of the 25 incoming tenant's lease, any physical condition within the unit that was 26 the basis for a previously issued violation has been corrected; and 27 (9) for units vacated after the effective date of this subdivision, a 28 form to be promulgated by the division and signed by the previous tenant 29 affirming that the vacatur prior to the local regulated housing restora- 30 tion adjustment was voluntary and not the result of unlawful owner 31 harassment. In considering the sufficiency of alternate documentation, 32 and notwithstanding other potentially sufficient documentation, vacatur 33 shall be presumed voluntary and not the result of owner harassment when 34 (i) the owner recovered possession of the unit through judicial 35 proceedings, (ii) the owner demonstrates abandonment of the unit through 36 electronic communications, recordings, or other evidence of voluntary 37 vacatur, or (iii) the owner demonstrates the previous tenant died and 38 the unit was not occupied by a lawful successor. 39 b. The local regulated housing restoration adjustment shall not be 40 permitted: 41 (1) for units that are rented within a twenty-four-month period after 42 an arm's length transfer of ownership; 43 (2) for units that are rented within a thirty-six-month period after 44 determination by the division that the owner has engaged in unlawful 45 harassment with respect to the unit; or 46 (3) for units in buildings subject to housing preservation and devel- 47 opment's alternate enforcement program. 48 c. The division of housing and community renewal shall establish an 49 audit process to review a percentage, as established by the division, of 50 housing accommodations that register adjusted legal regulated rents 51 under the local regulated housing restoration adjustment. The divi- 52 sion's established audit process shall be subject to the following 53 requirements: 54 (1) any audit shall be limited subdivision to: (i) confirmation that 55 documentation set forth in paragraph a of this subdivision has been 56 submitted, (ii) visual inspection of the subject unit, and (iii) reviewS. 6352--A 7 1 of the unit's registered rent in comparison to the legal regulated rents 2 of substantially similar housing accommodations in the same geographic 3 area considering the same factors set forth in subdivision d-1 of 4 section nine of this chapter, including the owner's right to submit the 5 legal regulated rent of a substantially similar unit or units. Such 6 audit shall be initiated within one year of the filing of an annual 7 apartment registration indicating an adjustment to the legal regulated 8 rent under the local regulated housing restoration adjustment; and 9 (2) if an audit under this subdivision determines that an owner has 10 failed to submit documentation set forth in subdivision a of this 11 section and the owner then fails to submit any missing documentation 12 after sixty days' written notice from the division, or if an audit under 13 this subdivision determines the local housing restoration adjustment 14 exceeds the legal rent for all substantially similar housing accommo- 15 dations as defined by this section, the division shall then set the 16 subject unit's legal regulated rent at an amount equal to the legal 17 regulated rent for a substantially similar unit in the same geographic 18 area, provided, however, that the legal regulated rents for units 19 subject to housing subsidy vouchers shall be established at the contract 20 rent amount approved by the agency administering the voucher. 21 (3) Any required refunds shall be made in accordance with section 22 26-513.1 of this chapter. 23 d. To encourage rental of units subject to a local housing restoration 24 adjustment to individuals and families with housing subsidy vouchers or 25 that are in communities of need, the division shall establish incen- 26 tives, in addition to those already contained in this section, for hous- 27 ing providers who rent to housing subsidy voucher holders located in 28 very low- and low-income zip codes. 29 e. Access to the documentation submitted as part of the local regu- 30 lated housing restoration adjustment shall be governed by the same laws 31 governing access to building and apartment registrations filed with the 32 division. 33 § 6. Section 9 of section 4 of chapter 576 of the laws of 1974, 34 constituting the emergency tenant protection act of nineteen seventy- 35 four is amended by adding a new subdivision d-1 to read as follows: 36 d-1. (1) The tenant of a housing accommodation that was vacant on, or 37 became vacant after, June 14, 2019, and has been subject to the local 38 regulated housing restoration adjustment, may file with the commissioner 39 within 120 days after notice has been received under paragraph three of 40 this subdivision an application for the adjustment of the rent for such 41 housing accommodation. Such applications shall be subject to the 42 following: 43 (i) in the application, the tenant must allege that the local regu- 44 lated housing restoration adjustment rent exceeds the rent for a 45 substantially similar unit within the same geographic area; 46 (ii) in determining an application filed pursuant to this section, the 47 commissioner of housing and community renewal shall only consider legal 48 regulated rents for substantially similar regulated housing accommo- 49 dations within a one-mile radius of the subject unit in the same borough 50 or applicable municipal subdivision. Substantially similar housing 51 accommodations are those rent-stabilized units with similar room counts 52 and square footage, similar levels of code compliance, including state 53 laws, local laws and codes for health, safety, and environmental 54 sustainability, similar regulatory status, similar apartment conditions 55 and quality of fixtures and finishes, similar unit and building amen- 56 ities, similar quality and condition of the building and common areas,S. 6352--A 8 1 and with vacancy or renewal leases starting within twelve months from 2 the start date of the complaining tenant's vacancy lease. For purposes 3 of considering legal regulated rents of similar housing accommodations, 4 the geographic area may be expanded by increments of one-quarter mile 5 radii as many times as necessary to find a substantially similar housing 6 accommodation located in the same borough or applicable municipal subdi- 7 vision. Notwithstanding the foregoing, any local regulated housing 8 restoration adjustment rent amount for units subject to housing subsidy 9 vouchers that does not exceed the contract rent amounts approved by the 10 local housing agency administering the voucher shall be determined to be 11 fair; 12 (iii) the owner of the housing accommodation subject to an application 13 under this section shall be given an opportunity to submit proof of 14 legal regulated rents for up to three substantially similar housing 15 accommodations, in addition to any already submitted as part of the 16 notification procedure under paragraph three of this subdivision; and 17 (iv) when the local regulated housing restoration adjustment rent 18 amount is determined to exceed the legal regulated rent for a substan- 19 tially similar housing accommodation as defined by this section, the 20 commissioner of housing and community renewal shall order that the legal 21 regulated rent for the subject unit shall be equal to the legal regu- 22 lated rent for a substantially similar housing accommodation in the same 23 geographic area; provided, however, that the legal regulated rents for 24 units subject to housing subsidy vouchers shall be equal to the contract 25 rent amounts approved by the local housing agency administering the 26 voucher. Any required refunds shall be made by the owner in cash or as 27 a credit against unpaid rent over a period not to exceed six months. 28 (2) Notwithstanding paragraph a of this subdivision, provided that the 29 owner has submitted to the division documentation in accordance with 30 subdivision (a-1) of section ten of this chapter, the division shall 31 only determine whether the tenancy is subject to a housing subsidy 32 voucher and, if not, whether the rent charged to the first tenant after 33 the local regulated housing restoration adjustment is supported by a 34 comparable legal regulated rent for a substantially similar regulated 35 unit. Any documentation deficiencies shall be resolved through the audit 36 process set forth in subdivision (a-1) of section ten of this chapter. 37 (3) In the lease execution package for the first lease after the legal 38 rent was adjusted under the local regulated housing restoration adjust- 39 ment, the owner shall give notice, both in the lease and subsequently in 40 writing by certified mail, or by electronic delivery if the tenant has 41 opted to receive electronic delivery of documents, to the tenant of such 42 housing accommodation on a form prescribed by the commissioner of hous- 43 ing and community renewal that the local regulated housing restoration 44 adjustment was applied, including notification of the prior legal regu- 45 lated rent, a description of work completed, the building address and 46 legal regulated rent amounts for at least one and up to three substan- 47 tially similar units, and such tenant's right to file an application for 48 adjustment of the new legal regulated rent of such housing accommo- 49 dation. 50 § 7. This act shall take effect immediately; and provided that the 51 amendments to chapter 4 of title 26 of the administrative code of the 52 city of New York made by sections one, two and three of this act shall 53 expire on the same date as such law expires and shall not affect the 54 expiration of such law as provided under section 26-520 of such law.
