Senate Bill S2760

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  2760

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                              March 2, 2009
                               ___________

Introduced  by  Sen.  MONSERRATE  -- read twice and ordered printed, and
  when printed to be committed to the Committee on Banks

AN ACT to amend the banking law  and  the  real  property  tax  law,  in
  relation  to establishing the reverse mortgage fairness act and making
  certain technical corrections thereto

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Short  title. This act shall be known and may be cited as
the "reverse mortgage fairness act of 2009".
  S 2. Section 6-h of the banking law is amended by adding a new  undes-
ignated paragraph to read as follows:
  THE  PROCEEDS  OF A REVERSE MORTGAGE SHALL NOT BE CONSIDERED AS INCOME
FOR THE PURPOSES OF SECTION FOUR HUNDRED SIXTY-SEVEN OF THE REAL PROPER-
TY TAX LAW; PROVIDED, HOWEVER, THAT MONIES USED TO REPAY A REVERSE MORT-
GAGE MAY NOT BE DEDUCTED FROM INCOME, AND PROVIDED ADDITIONALLY THAT ANY
INTEREST OR DIVIDENDS REALIZED FROM THE INVESTMENT OF  REVERSE  MORTGAGE
PROCEEDS SHALL BE CONSIDERED INCOME.
  S 3. Paragraph (a) of subdivision 3 of section 467 of the real proper-
ty tax law, as amended by chapter 186 of the laws of 2006, is amended to
read as follows:
  (a) if the income of the owner or the combined income of the owners of
the  property  for the income tax year immediately preceding the date of
making application for exemption  exceeds  the  sum  of  three  thousand
dollars, or such other sum not less than three thousand dollars nor more
than twenty-six thousand dollars beginning July first, two thousand six,
twenty-seven  thousand dollars beginning July first, two thousand seven,
twenty-eight thousand dollars beginning July first, two thousand  eight,
and  twenty-nine  thousand  dollars  beginning  July first, two thousand
nine, as may be provided by  the  local  law,  ordinance  or  resolution
adopted  pursuant to this section. Income tax year shall mean the twelve
month period for which the owner or  owners  filed  a  federal  personal

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09632-01-9
              

S. 2760                             2

income  tax  return,  or  if no such return is filed, the calendar year.
Where title is vested in either the husband or the wife, their  combined
income  may  not  exceed  such sum, except where the husband or wife, or
ex-husband or ex-wife is absent from the property as provided in subpar-
agraph  (ii)  of paragraph (d) of this subdivision, then only the income
of the spouse or ex-spouse residing on the property shall be  considered
and  may  not exceed such sum. Such income shall include social security
and retirement benefits, interest, dividends, total gain from  the  sale
or  exchange  of  a capital asset which may be offset by a loss from the
sale or exchange of a capital asset in the same  income  tax  year,  net
rental  income, salary or earnings, and net income from self-employment,
but shall not include a return of capital, gifts, inheritances, payments
made to individuals because of their status as victims  of  Nazi  perse-
cution,  as  defined in P.L. 103-286 or monies earned through employment
in the federal foster grandparent program and any such income  shall  be
offset by all medical and prescription drug expenses actually paid which
were  not reimbursed or paid for by insurance, if the governing board of
a municipality, after a public hearing, adopts a local law, ordinance or
resolution providing therefor.    FURTHERMORE,  SUCH  INCOME  SHALL  NOT
INCLUDE  THE  PROCEEDS  OF  A REVERSE MORTGAGE, AS AUTHORIZED BY SECTION
SIX-H OF THE BANKING LAW,  AND  SECTIONS  TWO  HUNDRED  EIGHTY  AND  TWO
HUNDRED  EIGHTY-A  OF  THE  REAL  PROPERTY  LAW; PROVIDED, HOWEVER, THAT
MONIES USED TO REPAY A REVERSE MORTGAGE MAY NOT BE DEDUCTED FROM INCOME,
AND PROVIDED ADDITIONALLY THAT ANY INTEREST OR DIVIDENDS  REALIZED  FROM
THE  INVESTMENT OF REVERSE MORTGAGE PROCEEDS SHALL BE CONSIDERED INCOME.
The provisions of this paragraph notwithstanding, such income shall  not
include  veterans disability compensation, as defined in Title 38 of the
United States Code provided the governing board  of  such  municipality,
after  public  hearing,  adopts  a  local  law,  ordinance or resolution
providing therefor. In computing net rental income and net  income  from
self-employment  no  depreciation  deduction  shall  be  allowed for the
exhaustion, wear and tear of real or  personal  property  held  for  the
production of income;
  S  4.  This  act shall take effect on the ninetieth day after it shall
have become a law; provided that the superintendent of banks is  author-
ized  to promulgate any and all rules and regulations and take any meas-
ures necessary to implement this act on or before such effective date.