Bill Text: NY S07888 | 2023-2024 | General Assembly | Introduced
Bill Title: Provides for an exemption from real property taxation of certain multiple dwellings in certain municipalities for affordable housing from commercial conversions.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2024-01-03 - REFERRED TO HOUSING, CONSTRUCTION AND COMMUNITY DEVELOPMENT [S07888 Detail]
Download: New_York-2023-S07888-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 7888 IN SENATE January 3, 2024 ___________ Introduced by Sen. HARCKHAM -- 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 labor law and the real property tax law, in relation to the exemption from real property taxation of certain multiple dwellings in certain municipalities The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Paragraph a of subdivision 3 of section 224-a of the labor 2 law, as added by section 1 of part FFF of chapter 58 of the laws of 3 2020, is amended to read as follows: 4 a. Benefits under section four hundred twenty-one-a or four hundred 5 sixty-seven-m of the real property tax law; 6 § 2. The real property tax law is amended by adding a new section 7 467-m to read as follows: 8 § 467-m. Exemption from local real property taxation of certain multi- 9 ple dwellings in certain municipalities. 1. Definitions. For purposes 10 of this section, the following terms shall have the following meanings: 11 a. "Affordable housing from commercial conversions tax incentive bene- 12 fits" hereinafter referred to as "AHCC program benefits", shall mean the 13 exemption from real property taxation authorized pursuant to this 14 section. 15 b. "Affordability requirement" shall mean that within any eligible 16 multiple dwelling: (i) not less than twenty percent of the dwelling 17 units are affordable housing units; (ii) not less than five percent of 18 the dwelling units are affordable housing forty percent units; (iii) the 19 weighted average of all income bands for all of the affordable housing 20 units does not exceed seventy percent of the area median income, 21 adjusted for family size; (iv) there are no more than three income bands 22 for all of the affordable housing units; and (v) no income band for 23 affordable housing units exceeds one hundred percent of the area median 24 income, adjusted for family size. 25 c. "Affordable housing forty percent unit" shall mean a dwelling unit 26 that: (i) is situated within the eligible multiple dwelling for which EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD13774-01-3S. 7888 2 1 AHCC program benefits are granted; and (ii) upon initial rental and upon 2 each subsequent rental following a vacancy during the restriction peri- 3 od, is affordable to and restricted to occupancy by individuals or fami- 4 lies whose household income does not exceed forty percent of the area 5 median income, adjusted for family size, at the time that such household 6 initially occupies such dwelling unit. 7 d. "Affordable housing unit" shall mean, collectively and individual- 8 ly: (i) an affordable housing forty percent unit; and (ii) any other 9 unit that meets the affordability requirement upon initial occupancy and 10 upon each subsequent rental following a vacancy during the restriction 11 period, and is affordable to and restricted to occupancy by individuals 12 or families whose household income does not exceed the income bands 13 established in conjunction with such affordability requirement. 14 e. "Agency" shall mean the local housing agency, provided, however, 15 within a city having a population of one million or more, "agency" shall 16 mean the New York city department of housing preservation and develop- 17 ment. 18 f. "Application" shall mean an application for AHCC program benefits. 19 g. "Building service employee" shall mean any person who is regularly 20 employed at, and performs work in connection with the care or mainte- 21 nance of, an eligible multiple dwelling, including, but not limited to, 22 a watchman, guard, doorman, building cleaner, porter, handyman, janitor, 23 gardener, groundskeeper, elevator operator and starter, and window 24 cleaner, but not including persons regularly scheduled to work fewer 25 than eight hours per week at such eligible multiple dwelling. 26 h. "Commencement date" shall mean the date upon which the actual 27 construction of the eligible conversion lawfully begins in good faith. 28 i. "Completion date" shall mean the date upon which the local depart- 29 ment of buildings issues the first temporary or permanent certificate of 30 occupancy covering all residential areas of an eligible multiple dwell- 31 ing. 32 j. "Construction period" shall mean, with respect to any eligible 33 multiple dwelling, a period: (i) beginning on the later of the commence- 34 ment date or three years before the completion date; and (ii) ending on 35 the day preceding the completion date. 36 k. "Dwelling" or "dwellings" shall have the same meaning as set forth 37 in subdivision four of section four of the multiple dwelling law. 38 l. "Eligible conversion" shall mean the conversion of a non-residen- 39 tial building to an eligible multiple dwelling. 40 m. "Eligible multiple dwelling" shall mean a multiple dwelling in 41 which: (i) all dwelling units included in any application are operated 42 as rental housing; (ii) six or more dwelling units have been created 43 through an eligible conversion; (iii) the commencement date is after 44 December thirty-first, two thousand twenty-two and on or before December 45 thirty-first, two thousand thirty-two; and (iv) the completion date is 46 on or before December thirty-first, two thousand thirty-eight. 47 n. "Fiscal officer" shall mean the comptroller or other analogous 48 officer in a municipality. 49 o. "Floor area" shall mean the horizontal areas of the several floors, 50 or any portion thereof, of a dwelling or dwellings, and accessory struc- 51 tures on a lot measured from the exterior faces of exterior walls, or 52 from the center line of party walls. 53 p. "Income band" shall mean a percentage of the area median income, 54 adjusted for family size, that is a multiple of ten percent. 55 q. "Market unit" shall mean a dwelling unit in an eligible multiple 56 dwelling other than an affordable housing unit.S. 7888 3 1 r. "Marketing band" shall mean maximum rent amounts ranging from twen- 2 ty percent to thirty percent of the area median income or income band, 3 respectively, that is applicable to a specific affordable housing unit. 4 s. "Multiple dwelling" shall have the same meaning as set forth in 5 subdivision seven of section four of the multiple dwelling law. 6 t. "Municipality" shall mean a county, city, town or village. 7 u. "Nineteen-year benefit" shall mean: (i) for the construction peri- 8 od, a one hundred percent exemption from real property taxation, other 9 than assessments for local improvements; (ii) for the first fifteen 10 years of the restriction period, a thirty-five percent exemption from 11 real property taxation, other than assessments for local improvements; 12 (iii) for the sixteenth year of the restriction period, a twenty-eight 13 percent exemption from real property taxation, other than assessments 14 for local improvements; (iv) for the seventeenth year of the restriction 15 period, a twenty-one percent exemption from real property taxation, 16 other than assessments for local improvements; (v) for the eighteenth 17 year of the restriction period, a fourteen percent exemption from real 18 property taxation, other than assessments for local improvements; and 19 (vi) for the nineteenth year of the restriction period, a seven percent 20 exemption from real property taxation, other than assessments for local 21 improvements. 22 v. "Non-residential building" shall mean a structure or portion of a 23 structure having at least one floor, a roof and at least three walls 24 enclosing all or most of the space used in connection with the structure 25 or portion of the structure, which has a certificate of occupancy for 26 commercial, manufacturing or other non-residential use for not less than 27 ninety percent of the aggregate floor area of such structure or portion 28 of such structure, or other proof of such non-residential use as is 29 acceptable to the agency. 30 w. "Non-residential tax lot" shall mean a tax lot that does not 31 contain any dwelling units. 32 x. "Rent stabilization" shall mean, collectively, the rent stabiliza- 33 tion law of nineteen hundred sixty-nine, the rent stabilization code, 34 and the emergency tenant protection act of nineteen seventy-four, all as 35 in effect as of the effective date of this section or as amended there- 36 after, together with any successor statutes or regulations addressing 37 substantially the same subject matter. 38 y. "Residential tax lot" shall mean a tax lot that contains dwelling 39 units. 40 z. "Restriction period" shall mean a period commencing on the 41 completion date and extending in perpetuity, notwithstanding any earlier 42 termination or revocation of AHCC program benefits. 43 2. Benefit. In a municipality subsequent to the effective date of a 44 local law adopted pursuant to this section, notwithstanding the 45 provisions of any other general, special or local law to the contrary, a 46 new eligible multiple dwelling, except a hotel, that complies with the 47 provisions of this section shall be exempt from real property taxation, 48 other than assessments for local improvements, in the amounts and for 49 the periods specified in this section, provided that such eligible 50 multiple dwelling is used or held out for use for dwelling purposes. A 51 municipality may, by local law, provide for the exemption of real prop- 52 erty from taxation as provided in this section. A copy of such local law 53 shall be filed with the commissioner and the assessor of such munici- 54 pality who prepares the assessment roll on which the taxes of such muni- 55 cipality are levied. An eligible multiple dwelling that meets all of 56 the requirements of this section shall receive a nineteen-year benefit.S. 7888 4 1 3. Tax payments. In addition to any other amounts payable pursuant to 2 this section, the owner of any eligible multiple dwelling receiving AHCC 3 program benefits shall pay, in each tax year in which such AHCC program 4 benefits are in effect, all assessments for local improvements. 5 4. Limitation on benefits for non-residential space. If the aggregate 6 floor area of commercial, community facility and accessory use space in 7 an eligible multiple dwelling exceeds twelve percent of the aggregate 8 floor area in such eligible multiple dwelling, any AHCC program benefits 9 shall be reduced by a percentage equal to such excess. If an eligible 10 multiple dwelling contains multiple tax lots, the tax arising out of 11 such reduction in AHCC program benefits shall first be apportioned pro 12 rata among any non-residential tax lots. After any such non-residential 13 tax lots are fully taxable, the remainder of the tax arising out of such 14 reduction in AHCC program benefits, if any, shall be apportioned pro 15 rata among the remaining residential tax lots. For the purposes of this 16 section, accessory use space shall not include home occupation space or 17 accessory parking space located not more than twenty-three feet above 18 the curb level. 19 5. Application of benefit. Based on the certification of the agency 20 certifying eligibility for AHCC program benefits, the department of 21 finance shall determine the amount of the exemption pursuant to subdivi- 22 sions two and four of this section and shall apply the exemption to the 23 assessed value of the eligible multiple dwelling. 24 6. Affordability requirements. An eligible multiple dwelling shall 25 comply with the following affordability requirements during the 26 restriction period: 27 a. All affordable housing units in an eligible multiple dwelling shall 28 share the same common entrances and common areas as rental market rate 29 units in such eligible multiple dwelling and shall not be isolated to a 30 specific floor or area of an eligible multiple dwelling. Common 31 entrances shall mean any means of ingress or egress regularly used by 32 any resident of a rental dwelling unit in the eligible multiple dwell- 33 ing. 34 b. Unless preempted by the requirements of a federal, state or local 35 housing program, either: (i) the affordable housing units in an eligible 36 multiple dwelling shall have a unit mix proportional to the rental 37 market units; or (ii) at least fifty percent of the affordable housing 38 units in an eligible multiple dwelling shall have two or more bedrooms 39 and no more than twenty-five percent of the affordable housing units 40 shall have less than one bedroom. 41 c. Notwithstanding any provision of rent stabilization to the contra- 42 ry: (i) all affordable housing units shall remain fully subject to rent 43 stabilization during the restriction period; and (ii) any affordable 44 housing unit occupied by a tenant that has been approved by the agency 45 prior to the agency's denial of an eligible multiple dwelling's applica- 46 tion for AHCC program benefits shall remain subject to rent stabiliza- 47 tion until such tenant vacates such affordable housing unit. 48 d. All rent stabilization registrations required to be filed shall 49 contain a designation that specifically identifies affordable housing 50 units created pursuant to this section as "AHCC program affordable hous- 51 ing units" and shall contain an explanation of the requirements that 52 apply to all such affordable housing units. 53 e. Failure to comply with the provisions of this subdivision that 54 require the creation, maintenance, rent stabilization compliance, and 55 occupancy of affordable housing units shall result in revocation of AHCC 56 program benefits.S. 7888 5 1 f. Nothing in this section shall: (i) prohibit the occupancy of an 2 affordable housing unit by individuals or families whose income at any 3 time is less than the maximum percentage of the area median income or 4 income band, as applicable, adjusted for family size, specified for such 5 affordable housing unit pursuant to this section; or (ii) prohibit the 6 owner of an eligible multiple dwelling from requiring, upon initial 7 rental or upon any rental following a vacancy, the occupancy of any 8 affordable housing unit by such lower income individuals or families. 9 g. Following issuance of a temporary certificate of occupancy and upon 10 each vacancy thereafter, an affordable housing unit shall promptly be 11 offered for rental by individuals or families whose income does not 12 exceed the maximum percentage of the area median income or income band, 13 as applicable, adjusted for family size, specified for such affordable 14 housing unit pursuant to this section and who intend to occupy such 15 affordable housing unit as their primary residence. An affordable hous- 16 ing unit shall not be: (i) rented to a corporation, partnership or other 17 entity; or (ii) held off the market for a period longer than is reason- 18 ably necessary to perform repairs needed to make such affordable housing 19 unit available for occupancy. 20 h. An affordable housing unit shall not be rented on a temporary, 21 transient or short-term basis. Every lease and renewal thereof for an 22 affordable housing unit shall be for a term of one or two years, at the 23 option of the tenant. 24 i. An affordable housing unit shall not be converted to cooperative or 25 condominium ownership. 26 j. The agency may establish by rule such requirements as the agency 27 deems necessary or appropriate for: (i) the marketing of affordable 28 housing units, both upon initial occupancy and upon any vacancy; (ii) 29 monitoring compliance with the provisions of this subdivision; and (iii) 30 the establishment of marketing bands for affordable housing units. Such 31 requirements may include, but need not be limited to, retaining a moni- 32 tor approved by the agency and paid for by the owner of the eligible 33 multiple dwelling. 34 k. Notwithstanding any provision of this section to the contrary, a 35 market unit shall not be subject to rent stabilization unless, in the 36 absence of AHCC program benefits, the unit would be subject to rent 37 stabilization. 38 7. Building service employees. a. For the purposes of this subdivi- 39 sion, "applicant" shall mean an applicant for AHCC program benefits, any 40 successor to such applicant, or any employer of building service employ- 41 ees for such applicant including, but not limited to, a property manage- 42 ment company or contractor. 43 b. All building service employees employed by the applicant at the 44 eligible multiple dwelling shall receive the applicable prevailing wage 45 for the duration of the nineteen-year benefit period, regardless of 46 whether such benefits are revoked or terminated. 47 c. The fiscal officer shall have the power to enforce the provisions 48 of this subdivision. In enforcing such provisions, the fiscal officer 49 shall have the power: (i) to investigate or cause an investigation to be 50 made to determine the prevailing wages for building service employees, 51 and in making such investigation, the fiscal officer may utilize wage 52 and fringe benefit data from various sources, including, but not limited 53 to, data and determinations of federal, state or other governmental 54 agencies; provided, however, that the provision of a dwelling unit shall 55 not be considered wages or a fringe benefit; (ii) to institute and 56 conduct inspections at the site of the work or elsewhere; (iii) to exam-S. 7888 6 1 ine the books, documents and records pertaining to the wages paid to, 2 and the hours of work performed by, building service employees; (iv) to 3 hold hearings and, in connection therewith, to issue subpoenas, the 4 enforcement of which shall be regulated by the civil practice law and 5 rules, administer oaths and examine witnesses; (v) to make a classifica- 6 tion by craft, trade or other generally recognized occupational category 7 of the building service employees and to determine whether such work has 8 been performed by the building service employees in such classification; 9 (vi) to require the applicant to file with the fiscal officer a record 10 of the wages actually paid by such applicant to the building service 11 employees and of their hours of work; (vii) to delegate any of the fore- 12 going powers to his or her deputy or other authorized representative; 13 (viii) to promulgate rules as he or she shall consider necessary for the 14 proper execution of the duties, responsibilities and powers conferred 15 upon him or her by the provisions of this subdivision; and (ix) to 16 prescribe appropriate sanctions for failure to comply with the 17 provisions of this subdivision. For each violation of paragraph b of 18 this subdivision, the fiscal officer may require the payment of (A) back 19 wages and fringe benefits; (B) liquidated damages up to three times the 20 amount of the back wages and fringe benefits for willful violations; 21 and/or (C) reasonable attorneys' fees. If the fiscal officer finds that 22 the applicant has failed to comply with the provisions of this subdivi- 23 sion, he or she shall present evidence of such non-compliance to the 24 agency. 25 d. Paragraph b of this subdivision shall not be applicable to: (i) an 26 eligible multiple dwelling containing less than thirty dwelling units; 27 or (ii) an eligible multiple dwelling whose eligible conversion is 28 carried out with the substantial assistance of grants, loans or subsi- 29 dies provided by a federal, state or local governmental agency or 30 instrumentality pursuant to a program for the development of affordable 31 housing. 32 e. The applicant shall submit a sworn affidavit with its application 33 certifying that it shall comply with the requirements of this subdivi- 34 sion or is exempt in accordance with paragraph d of this subdivision. 35 Upon the agency's approval of such application, the applicant who is not 36 exempt in accordance with paragraph d of this subdivision shall submit 37 annually a sworn affidavit to the fiscal officer certifying that it 38 shall comply with the requirements of this subdivision. 39 8. Concurrent exemptions or abatements. An eligible multiple dwelling 40 receiving AHCC program benefits shall not receive any exemption from or 41 abatement of real property taxation under any other law. 42 9. Voluntary renunciation or termination. Notwithstanding the 43 provisions of any general, special or local law to the contrary, an 44 owner shall not be entitled to voluntarily renounce or terminate AHCC 45 program benefits unless the agency authorizes such renunciation or 46 termination in connection with the commencement of a tax exemption 47 pursuant to the private housing finance law or section four hundred 48 twenty-c of this title. 49 10. Termination or revocation. The agency may terminate or revoke AHCC 50 program benefits for noncompliance with this section. All of the afford- 51 able housing units shall remain subject to rent stabilization and all 52 other requirements of this section for the duration of the restriction 53 period, regardless of whether such benefits have been terminated or 54 revoked. 55 11. Powers cumulative. The enforcement provisions of this section 56 shall not be exclusive, and are in addition to any other rights, reme-S. 7888 7 1 dies or enforcement powers set forth in any other law or available at 2 law or in equity. 3 12. Multiple tax lots. If an eligible multiple dwelling contains 4 multiple tax lots, an application may be submitted with respect to one 5 or more of such tax lots. The agency shall determine eligibility for 6 AHCC program benefits based upon the tax lots included in such applica- 7 tion and benefits for each such eligible multiple dwelling shall be 8 based upon the completion date of each such multiple dwelling. 9 13. Applications. a. The application with respect to any eligible 10 multiple dwelling shall be filed with the agency no earlier than the 11 completion date and not later than one year after the completion date of 12 such eligible multiple dwelling. 13 b. Notwithstanding the provisions of any general, special, or local 14 law to the contrary, the agency may require by rule that applications be 15 filed electronically. 16 c. The agency may rely on certification by an architect or engineer 17 submitted by an applicant in connection with the filing of an applica- 18 tion. A false certification by such architect or engineer shall be 19 deemed to be professional misconduct pursuant to section sixty-five 20 hundred nine of the education law. Any architect or engineer found 21 guilty of such misconduct under the procedures prescribed in section 22 sixty-five hundred ten of the education law shall be subject to the 23 penalties prescribed in section sixty-five hundred eleven of the educa- 24 tion law and shall thereafter be ineligible to submit a certification 25 pursuant to this section. 26 d. Such application shall also certify that all taxes, water charges, 27 and sewer rents currently due and owing on the property which is the 28 subject of the application have been paid or are currently being paid in 29 timely installments pursuant to a written agreement with the department 30 of finance or other appropriate agency. 31 14. Filing fee. The agency may require a filing fee of no less than 32 three thousand dollars per dwelling unit in connection with any applica- 33 tion, except that the agency may promulgate rules: 34 a. imposing a lesser fee for an eligible multiple dwelling whose 35 eligible conversion is carried out with the substantial assistance of 36 grants, loans or subsidies provided by a federal, state or local govern- 37 mental agency or instrumentality pursuant to a program for the develop- 38 ment of affordable housing; and 39 b. requiring a portion of the filing fee to be paid upon the 40 submission of the information the agency requires in advance of approv- 41 ing the commencement of the marketing process for such eligible conver- 42 sion. 43 15. Rules. Except as provided in subdivision seven of this section, 44 the agency shall have the sole authority to enforce the provisions of 45 this section and may promulgate rules to carry out the provisions of 46 this section. 47 16. Penalties for violations of affordability requirements. a. On or 48 after the expiration date of the nineteen-year benefit, the agency may 49 impose, after notice and an opportunity to be heard, a penalty for any 50 violation by an eligible multiple dwelling of the affordability require- 51 ments of subdivision six of this section. 52 b. A penalty imposed under this subdivision shall be computed as a 53 percentage of the capitalized value of all AHCC program benefits on the 54 eligible multiple dwelling, calculated as of the first year that bene- 55 fits were granted, not to exceed one thousand percent. The agency shallS. 7888 8 1 establish a schedule and method of calculation of such penalties pursu- 2 ant to subdivision fifteen of this section. 3 c. A penalty imposed under this subdivision shall be imposed against 4 the owner of the eligible multiple dwelling at the time the violation 5 occurred, even if such owner no longer owns such eligible multiple 6 dwelling at the time of the agency's determination. 7 d. A person or entity who fails to pay a penalty imposed pursuant to 8 this subdivision shall be guilty of a misdemeanor punishable by impri- 9 sonment not to exceed six months. 10 § 3. This act shall take effect immediately.
