S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7185
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                               June 4, 2021
                                ___________
 
 Introduced  by  Sen.  MAY -- (at request of the New York State Homes and
   Community Renewal) -- read twice and ordered printed, and when printed
   to be committed to the Committee on Rules
 
 AN ACT  to  amend  the  public  authorities  law,  in  relation  to  the
   construction of modular and manufactured housing

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 2401 of the public authorities law  is  amended  by
 adding a new undesignated paragraph to read as follows:
   IT  IS  FURTHER  FOUND  AND  DETERMINED  THAT  THERE  IS A SHORTAGE OF
 ADEQUATE FUNDS TO ASSIST IN THE NEW CONSTRUCTION OF MODULAR AND MANUFAC-
 TURED HOUSING.
   § 2. Subdivisions 2, 5, and 12 of section 2402 of the public  authori-
 ties  law,  subdivision 2 as amended by chapter 806 of the laws of 1990,
 subdivision 5 as amended by chapter 151 of the laws of 2013, and  subdi-
 vision  12  as  added by chapter 915 of the laws of 1982, are amended to
 read as follows:
   (2) "Bank". Any bank or trust company, savings bank, savings and  loan
 association,  industrial  bank,  credit  union, national banking associ-
 ation, federal savings and loan association,  federal  savings  bank  or
 federal  credit  union  which  is  located in the state. The term "bank"
 shall also include a New York  state  licensed  mortgage  banker,  or  a
 domestic   not-for-profit  corporation  whose  public  purposes  include
 combatting community deterioration and which is an  exempt  organization
 as  defined  in paragraph (e) of subdivision one of section five hundred
 ninety of the banking law, or an entity exempt from licensing provisions
 in accordance with paragraph (a) of  subdivision  two  of  SUCH  section
 [five hundred ninety of such law], which in any such case is approved as
 a mortgage lender by the Federal National Mortgage Association or by the
 Federal  Home  Loan  Mortgage  Corporation,  OR  DOMESTIC NOT-FOR-PROFIT
 CORPORATIONS THAT ARE CERTIFIED BY THE UNITED STATES DEPARTMENT OF TREA-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD11153-01-1

 S. 7185                             2
 
 SURY AS COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS OR LICENSED BY  THE
 NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES.
   (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
 simple  or  leasehold  estate  in real property located in the state and
 improved by a residential structure OR, ON WHICH A RESIDENTIAL STRUCTURE
 FOR USE AS SINGLE-FAMILY MODULAR OR MANUFACTURED HOUSING  PURCHASED  AND
 SITED  ON  LAND  SHALL  BE  CONSTRUCTED USING THE PROCEEDS OF SUCH LOAN,
 whether or not insured or guaranteed by the United States of America  or
 any  agency  thereof. The term "mortgage" shall also include a loan owed
 to a bank secured by a second lien on a fee simple or  leasehold  estate
 in  real  property  located  in  the state and improved by a residential
 structure OR ON WHICH A RESIDENTIAL STRUCTURE FOR USE  AS  SINGLE-FAMILY
 MODULAR  OR  MANUFACTURED  HOUSING  PURCHASED AND SITED ON LAND SHALL BE
 CONSTRUCTED USING THE PROCEEDS OF THE RELATED LOAN  DESCRIBED  IN  PARA-
 GRAPH  (A) OR (B) OF THIS SUBDIVISION, whether or not insured or guaran-
 teed by the United States of America or any  agency  thereof,  provided,
 however,  that  such  second  lien:  (a) secures a loan purchased by the
 agency, and (b) is made at the same time as a first lien securing a loan
 purchased by the agency pursuant to its  programs  or  by  a  government
 sponsored  enterprise  or is made at the same time as a new housing loan
 purchased by the agency pursuant to section twenty-four  hundred  five-c
 of  this  part. The term "mortgage" shall also include loans made by the
 agency and secured by a second lien on a fee simple or leasehold  estate
 in  real  property  located  in  the state and improved by a residential
 structure OR ON WHICH A RESIDENTIAL STRUCTURE FOR USE  AS  SINGLE-FAMILY
 MODULAR  OR  MANUFACTURED  HOUSING  PURCHASED AND SITED ON LAND SHALL BE
 CONSTRUCTED USING THE PROCEEDS OF SUCH LOAN, whether or not  insured  or
 guaranteed  by  the  United  States  of  America  or any agency thereof,
 provided however, that the loan made by the agency and secured  by  such
 second lien is made at the same time as a first lien securing a mortgage
 loan purchased by the agency pursuant to its programs or by a government
 sponsored  enterprise.  In the case of any second lien purchased or made
 hereunder, the mortgagor shall be obligated to contribute  from  his  or
 her  own verifiable funds an amount not less than such percentage as the
 agency shall determine, of the lower of the purchase price or  appraised
 value of the property subject to the first lien. "Real property" as used
 in this subdivision shall include air rights.
   For  the purposes of this title and of [section one hundred ninety and
 subsection (a) of section one thousand four hundred  fifty-six]  SECTION
 ONE  HUNDRED EIGHTY-SEVEN of the tax law, "mortgage" shall include hous-
 ing loans as defined below. Except for the purposes of subdivision seven
 of section [two thousand four] TWENTY-FOUR hundred five and  subdivision
 eight  of  section two thousand four hundred five-b of this part, "mort-
 gage" shall also include a loan owed to a bank by an individual borrower
 incurred for the purpose of financing the purchase  of  certificates  of
 stock  or  other evidence of ownership of an interest in, and a proprie-
 tary lease from,  a  cooperative  housing  corporation  formed  for  the
 purpose  of  the cooperative ownership of residential real estate in the
 state, secured by an assignment or transfer  of  the  benefits  of  such
 cooperative  ownership,  and containing such terms and conditions as the
 agency may approve.
   (12)  "Forward  commitment  mortgage".  A  mortgage,  WHICH   INCLUDES
 CONSTRUCTION  LOANS  FOR  SINGLE-FAMILY  MODULAR OR MANUFACTURED HOUSING
 PURCHASED AND SITED ON LAND, for which a commitment to advance funds  is
 made  not  earlier  than  the  date  the  agency issues an invitation to
 purchase mortgages or such later date as specified in the invitation.  A

 S. 7185                             3
 
 mortgage  made in satisfaction of the obligation of a bank under section
 twenty-four hundred five of this [title] PART is not a  forward  commit-
 ment mortgage.
   §  3.  Subdivisions 7 and 14 of section 2404 of the public authorities
 law, subdivision 7 as amended by chapter 782 of the laws  of  1992,  and
 subdivision  14 as added by chapter 612 of the laws of 1970, are amended
 to read as follows:
   (7) To (a) acquire, and contract to acquire, existing mortgages  owned
 by banks and to enter into advance commitments to banks for the purchase
 of  said  mortgages, all subject to the provisions of section [two thou-
 sand four] TWENTY-FOUR hundred five of this [title] PART,  (b)  acquire,
 and  contract to acquire, forward commitment mortgages made by banks and
 to enter into advance commitments to banks  for  the  purchase  of  said
 mortgages,  all subject to the provisions of section [two thousand four]
 TWENTY-FOUR hundred five-b  of  this  [title]  PART,  (c)  acquire,  and
 contract  to  acquire, new housing loans made by banks and to enter into
 advance commitments to banks for the purchase of said housing loans, all
 subject to the provisions of section  [two  thousand  four]  TWENTY-FOUR
 hundred  five-c  of this [title] PART, [and] (d) to acquire and contract
 to acquire mortgages pursuant to section twenty-four hundred  five-d  of
 this  title,  AND (E) ACQUIRE, AND CONTRACT TO ACQUIRE, NEW CONSTRUCTION
 MORTGAGE  LOANS  FOR  SINGLE-FAMILY  MODULAR  OR  MANUFACTURED   HOUSING
 PURCHASED  AND  SITED  ON  LAND OWNED BY BANKS AND TO ENTER INTO ADVANCE
 COMMITMENTS TO BANKS FOR THE PURCHASE OF SUCH MORTGAGES, ALL SUBJECT  TO
 THE PROVISIONS OF SECTION TWENTY-FOUR HUNDRED FIVE-B OF THIS PART;
   (14) To renegotiate, refinance or foreclose, or contract for the fore-
 closure  of, any mortgage in default; to waive any default or consent to
 the modification of the terms of any mortgage; to commence any action to
 protect or enforce any right conferred upon it  by  any  law,  mortgage,
 contract  or  other agreement, and to bid for and purchase such property
 at any foreclosure or at any other sale, or acquire or  take  possession
 of  any such property; to operate, manage, lease, dispose of, and other-
 wise deal with such property, in such manner as  [may  be  necessary  to
 protect  the  interests  of  the agency and the holders of its bonds and
 notes] WOULD FURTHER THE PURPOSES OF THE AGENCY, SUBJECT TO  ANY  AGREE-
 MENT WITH ITS BONDHOLDERS OR NOTEHOLDERS;
   §  4. Subdivisions 3 and 5 and paragraphs (a) and (h) of subdivision 8
 of section 2405-b of the public authorities law, subdivisions  3  and  5
 and  paragraphs  (a) and (h) of subdivision 8 as added by chapter 915 of
 the laws of 1982, paragraph (h) of subdivision 8 as further  amended  by
 section  104 of part A of chapter 62 of the laws of 2011, are amended to
 read as follows:
   (3) In conducting its program of purchasing forward  commitment  mort-
 gages,  the  agency shall be governed by the provisions of paragraph (b)
 of subdivision three of section twenty-four hundred five of this [title]
 PART; HOWEVER, WITH RESPECT TO NEW CONSTRUCTION LOANS FOR  SINGLE-FAMILY
 MODULAR  OR MANUFACTURED HOUSING PURCHASED AND SITED ON LAND, THE AGENCY
 SHALL BE GOVERNED BY THE PROVISIONS OF ONLY SUBPARAGRAPH (III) OF  PARA-
 GRAPH  (B)  OF  SUBDIVISION THREE OF SECTION TWENTY-FOUR HUNDRED FIVE OF
 THIS PART.
   (5) Notwithstanding the  maximum  interest  rate,  if  any,  fixed  by
 section  5-501  of  the  general  obligations  law  or any other law not
 specifically amending or applicable to this section, the agency may  set
 the  interest rate to be borne by forward commitment mortgages purchased
 by the agency from banks at a rate or rates which the agency  from  time
 to  time  shall determine [to], PROVIDED HOWEVER, THAT IF SUCH MORTGAGES

 S. 7185                             4
 
 ARE FINANCED THROUGH THE ISSUANCE OF THE AGENCY'S BONDS  OR  NOTES,  THE
 INTEREST  RATE  SHALL  be  at  least sufficient, together with any other
 available monies, to provide for the payment of its bonds and notes, and
 forward  commitment  mortgages  bearing  such interest rate shall not be
 deemed to violate any such law or to be unenforceable if originated by a
 bank in good faith pursuant to  an  undertaking  with  the  agency  with
 respect  to  the  sale thereof notwithstanding any subsequent failure of
 the agency to purchase the mortgage or any subsequent sale  or  disposi-
 tion of the mortgage by the agency to such bank or any other person.
   (a) OTHER THAN WITH RESPECT TO NEW CONSTRUCTION LOANS FOR SINGLE-FAMI-
 LY  MODULAR  OR  MANUFACTURED  HOUSING  PURCHASED AND SITED ON LAND, the
 mortgage was not made in satisfaction of an obligation of the bank under
 section twenty-four hundred five of this [title] PART;
   (h) the improvements to, OR NEW CONSTRUCTION OF SINGLE-FAMILY  MODULAR
 OR  MANUFACTURED HOUSING PURCHASED AND SITED ON LAND, the mortgaged real
 property are covered by a  valid  and  subsisting  policy  of  insurance
 issued  by  a  company  authorized  by  the  superintendent of financial
 services to issue such policies in the state of New York  and  providing
 fire  and extended coverage to an amount not less than eighty percent of
 the insurable value of the improvements to, OR NEW CONSTRUCTION OF,  the
 mortgaged real property.
   § 5. This act shall take effect immediately; provided, however, that:
   a.  the  amendments to subdivisions 2, 5 and 12 of section 2402 of the
 public authorities law made by section two of this act shall not  affect
 the expiration of such subdivisions and shall be deemed to expire there-
 with;
   b.  the  amendments  to  subdivision  7  of section 2404 of the public
 authorities law made by section three of this act shall not  affect  the
 expiration  of such subdivision and shall be deemed to expire therewith;
 and
   c. the amendments to section 2405-b of the public authorities law made
 by section four of this act shall not affect the repeal of such  section
 and shall be deemed repealed therewith.