NY State Senate Bill 2009-S5296

Archive: Last Bill Status - On Floor Calendar

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Aug 03, 2010	ordered to third reading cal.1427 committee discharged and committed to rules
Jun 26, 2010	print number 5296a
Jun 26, 2010	amend and recommit to housing, construction and community development
Jan 06, 2010	referred to housing, construction and community development
Apr 27, 2009	referred to housing, construction and community development

Votes

- Aug 3, 2010 - Rules Committee Vote
  S5296
  
  10
  
  Aye
  
  10
  
  Nay
  
  3
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Rules Committee Vote: Aug 3, 2010
      
      aye (10)
      
      Duane
      
      Hassell-Thompson
      
      Klein
      
      Krueger
      
      Montgomery
      
      Padavan
      
      Parker
      
      Serrano
      
      Smith
      
      Stewart-Cousins
      
      nay (10)
      
      Espada
      
      Farley
      
      Hannon
      
      Johnson
      
      LaValle
      
      Larkin
      
      Saland
      
      Seward
      
      Skelos
      
      Volker
      
      aye wr (3)
      
      Dilan
      
      Stachowski
      
      Valesky

Bill Amendments

Original

A (Active)

co-Sponsors

View additional co-sponsors

2009-S5296 - Details

See Assembly Version of this Bill:: A5316
Law Section:: New York City Administrative Code
Laws Affected:: Amd §§26-405 & 26-511, NYC Ad Cd; amd §6, Emerg Ten Prot Act of 1974; amd §4, Emerg Hous Rent Cont L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S874
2013-2014: S799

2009-S5296 - Summary

Relates to adjustment to the maximum allowable rent.

2009-S5296 - Sponsor Memo

                                 BILL NUMBER:  S5296

 TITLE OF BILL :  An act to amend the administrative code of the city
of New York, the emergency tenant protection act of nineteen
seventy-four, and the emergency housing rent control law, in relation
to adjustment of maximum allowable rent

 PURPOSE OR GENERAL IDEA OF THE BILL : Expenses for individual
apartment improvements in rental housing are currently recovered over
three and a half years in calculating the permissible monthly rent
increase.  This bill increases the length of time to seven years and
authorizes the Division of Housing and Community Renewal (DHCR) to
approve such rent increases for vacant apartments.

 SUMMARY OF SPECIFIC PROVISIONS :  Sections 1 through 4 increase the
amortization period for expenses due to individual apartment increases
from 40 months to 84 months.

Section 2 provides that no rent increase shall be collectible for an
individual apartment improvement unless:

* the owner of the apartment has provided the tenant with a lease
rider explaining how the rent in the vacancy lease has been computed;

* there are no current hazardous violations of any municipal, county,
State or Federal law that relate to the maintenance of any required

services;

* there are no outstanding determination by the DHCR that the owner
has failed to maintain any required services;

* the owner of the apartment has filed an explanation of how the
vacancy rent was computed, that exceeds 20 percent of the rent charged
to the previous tenant including supporting documentation.

 EFFECTS OF PRESENT LAW WHICH THIS BILL WOULD ALTER :  Extends the
amortization period from 40 months to 84 months and gives DHCR a
stronger oversight role by authorizing it to approve or disapprove
increases in whole or in part.

 JUSTIFICATION : There is a major loophole in the rent regulation
system called the 1/40th loophole, also known as an Individual
Apartment Improvement Increase. This loophole allows a landlord to
raise the rent on an unoccupied rent Stabilized apartment by passing
the cost of physical improvements to the next tenant by raising the
monthly rent an amount equal to 1/40th of the total cost of the
improvements.  A 1/40th increase can be taken in addition to any other
rent increase to which the landlord is statutorily entitled. There is
no oversight of any kind of the 1/40th loophole. Landlords are allowed
to unilaterally impose I/40th rent increases without prior approval,
or even documentation.

This lack of oversight has led to widespread fraud, and has been a
major reason for the loss of affordable housing in New York.
Landlords are able to use the 1/40th increase to move the apartment
above the current $2,000 High Rent Vacancy Decontrol threshold that
allows them to permanently de-regulate the apartment. Although there
are not absolutely clear government records of the frequency with
which 1/40th increases are used, because there is no oversight of the
program, it is clear that rent regulated apartments are moving out of
affordability at a rate faster than statutory rent increases would
allow.

Fraudulent rent increases for apartment renovations are a major reason
affordable housing is disappearing from New York, claims a recent

study by the Association for Neighborhood and Housing Development
(ANHD).

The oversight mechanism is an inadequate tenant-initiated.complaint
filed with DHCR as a Complaint of Rent Overcharge. Because the
improvement occurs in a vacant apartment, the new tenant has no way of
knowing what the rent should be, and if the work done justifies the
increase. This legislation would give DHCR the authority to approve or
disapprove such increases in whole or in part based upon the proof of
expenses submitted by the landlord.

 PRIOR LEGISLATIVE HISTORY : New legislation.

 FISCAL IMPLICATIONS :  Some administrative expense associated with
DHCR overseeing this program.

 EFFECTIVE DATE : Immediately.

2009-S5296 - Bill Text download pdf

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

                                  5296

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 27, 2009
                               ___________

Introduced by Sens. SQUADRON, ADAMS, DIAZ, HASSELL-THOMPSON, MONSERRATE,
  ONORATO, 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 administrative code of the city  of  New  York,  the
  emergency  tenant  protection  act  of  nineteen seventy-four, and the
  emergency housing rent control law, in relation to adjustment of maxi-
  mum allowable rent

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

  Section 1. Subparagraph (e) of paragraph 1 of subdivision g of section
26-405 of the administrative code of the city of New York, as amended by
chapter 253 of the laws of 1993, is amended to read as follows:
  (e)  The  landlord  and  tenant  by mutual voluntary written agreement
agree to a substantial increase or  decrease  in  dwelling  space  or  a
change  in the services, furniture, furnishings or equipment provided in
the housing accommodations. An adjustment under this subparagraph  shall
be  equal to [one-fortieth] ONE EIGHTY-FOURTH of the total cost incurred
by the landlord in providing such modification or increase  in  dwelling
space, services, furniture, furnishings or equipment, including the cost
of  installation, but excluding finance charges, provided further [than]
THAT an owner who is entitled  to  a  rent  increase  pursuant  to  this
subparagraph shall not be entitled to a further rent increase based upon
the  installation  of similar equipment, or new furniture or furnishings
within the useful life of  such  new  equipment,  or  new  furniture  or
furnishings. The owner shall give written notice to the city rent agency
of any such adjustment pursuant to this subparagraph[.]; or
  S  2.  Paragraph 13 of subdivision c of section 26-511 of the adminis-
trative code of the city of New York, as added by  chapter  253  of  the
laws of 1993, is amended to read as follows:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11158-01-9

S. 5296                             2

  (13) provides that an owner is entitled to a rent increase where there
has  been a substantial modification or increase of dwelling space or an
increase in the services, or installation of new equipment  or  improve-
ments or new furniture or furnishings provided in or to a tenant's hous-
ing  accommodation,  on  written tenant consent to the rent increase. In
the case of a vacant housing accommodation, tenant consent shall not  be
required.
  (A)  The  permanent  increase  in  the  legal  regulated  rent for the
affected housing accommodation shall be [one-fortieth] ONE EIGHTY-FOURTH
of the total cost incurred by the landlord in providing  such  modifica-
tion  or increase in dwelling space, services, furniture, furnishings or
equipment, including the cost of  installation,  but  excluding  finance
charges. [Provided further that an]
  (B) AN owner who is entitled to a rent increase pursuant to this para-
graph  shall  not  be entitled to a further rent increase based upon the
installation of similar equipment, or new furniture or furnishings with-
in  the  useful  life  of  such  new  equipment,  or  new  furniture  or
furnishings.
  (C)  NO  INCREASE  SHALL BE COLLECTIBLE UNDER THIS PARAGRAPH UNTIL THE
LANDLORD HAS PROVIDED THE TENANT WITH A RIDER  PURSUANT  TO  SUBDIVISION
(D)  OF  THIS  SECTION,  INCLUDING AN EXPLANATION OF HOW THE RENT IN THE
VACANCY LEASE HAS BEEN COMPUTED, AND THE SPECIFIC AMOUNTS OF ALL EXPEND-
ITURES SUPPORTING A RENT INCREASE UNDER THIS PARAGRAPH.
  (D) NO INCREASE SHALL BE  COLLECTIBLE  UNDER  THIS  PARAGRAPH  IN  ANY
BUILDING  WHERE  THE  DEPARTMENT  OF  HOUSING  AND COMMUNITY RENEWAL HAS
DETERMINED THAT THE OWNER IS NOT MAINTAINING ALL REQUIRED  SERVICES,  OR
IN  WHICH THERE ARE CURRENT HAZARDOUS VIOLATIONS OF ANY MUNICIPAL, COUN-
TY, STATE, OR FEDERAL LAW  WHICH  RELATE  TO  THE  MAINTENANCE  OF  SUCH
SERVICES.
  (E)  WITHIN  THIRTY DAYS OF THE SIGNING OF A VACANCY LEASE INCLUDING A
RENT INCREASE PURSUANT TO THIS PARAGRAPH THAT EXCEEDS TWENTY PERCENT  OF
THE RENT CHARGED TO THE PREVIOUS TENANT, THE OWNER WILL FILE AN EXPLANA-
TION  OF  HOW THE VACANCY RENT WAS COMPUTED, AND ALL DOCUMENTS NECESSARY
TO SUPPORT THE COLLECTION OF SUCH INCREASE, INCLUDING  BUT  NOT  LIMITED
TO,  CANCELLED  CHECKS,  INVOICES AND SIGNED CONTRACTS CONTEMPORANEOUSLY
WITH THE IMPROVEMENTS ALLEGED, AND  CONTRACTOR'S  AFFIDAVITS  INDICATING
THAT  THE  INSTALLATION  WAS COMPLETED AND PAID IN FULL. UPON RECEIPT OF
ALL DOCUMENTS SUBMITTED BY THE OWNER,  THE  DEPARTMENT  OF  HOUSING  AND
COMMUNITY  RENEWAL  SHALL  ISSUE AN ORDER APPROVING OR DISAPPROVING SUCH
INCREASE IN WHOLE OR IN PART. BASED UPON SUCH DETERMINATION, THE DEPART-
MENT OF HOUSING AND COMMUNITY RENEWAL SHALL ORDER A REFUND TO THE TENANT
EQUAL TO THE AMOUNT COLLECTED IN EXCESS  OF  THE  LEGAL  REGULATED  RENT
APPROVED BY THE DEPARTMENT OF HOUSING AND COMMUNITY RENEWAL.
  (F) IF THE DEPARTMENT OF HOUSING AND COMMUNITY RENEWAL DETERMINES THAT
THE  OVERAGE WAS WILLFUL, IT MAY ORDER THE LANDLORD TO PAY TO THE TENANT
AN ADDITIONAL AMOUNT NOT TO EXCEED THREE TIMES THE EXCESS CHARGED.
  (G) THE NEXT ANNUAL  REGISTRATION  STATEMENT  FILED  FOR  ANY  HOUSING
ACCOMMODATION  SUBJECT  TO  AN INCREASE UNDER THIS PARAGRAPH, WHETHER OR
NOT SUBJECT TO THE PROVISIONS OF  SUBPARAGRAPH  (E)  OF  THIS  PARAGRAPH
SHALL  CONTAIN  A  DETAILED  BREAKDOWN  OF THE COSTS OF ALL IMPROVEMENTS
UNDERLYING SUCH INCREASE.
  S 3. Paragraph 2 of subdivision d of section 26-511 of the administra-
tive code of the city of New York is renumbered paragraph 3  and  a  new
paragraph 2 is added to read as follows:
  (2)  FOR VACANCY LEASES, SUCH RIDER SHALL ALSO INCLUDE A NOTICE OF THE
PRIOR LEGAL RENT, IF ANY, THAT WAS IN EFFECT IMMEDIATELY  PRIOR  TO  THE

S. 5296                             3

VACANCY,  AN  EXPLANATION  OF  HOW  THE RENTAL AMOUNT HAS BEEN COMPUTED,
INCLUDING A DETAILED BREAKDOWN OF THE NATURE AND COST  OF  ANY  IMPROVE-
MENTS  UNDERLYING  AN INCREASE UNDER PARAGRAPH THIRTEEN OF SUBDIVISION C
OF  THIS  SECTION,  AND A STATEMENT THAT ANY INCREASE ABOVE THE PREVIOUS
RENT IS IN ACCORDANCE WITH ADJUSTMENTS PERMITTED BY LAW.
  S 4. Paragraph 1 of subdivision d of section 6 of section 4 of chapter
576 of the laws of 1974, constituting the  emergency  tenant  protection
act  of  nineteen  seventy-four,  as added by chapter 253 of the laws of
1993, is amended to read as follows:
  (1) there has been a substantial modification or increase of  dwelling
space  or  an increase in the services, or installation of new equipment
or improvements or new furniture or furnishings, provided  in  or  to  a
tenant's  housing  accommodation,  on written tenant consent to the rent
increase. In the case of a vacant housing accommodation, tenant  consent
shall  not  be  required.  The permanent increase in the legal regulated
rent for the affected housing accommodation shall be [one-fortieth]  ONE
EIGHTY-FOURTH  of  the  total cost incurred by the landlord in providing
such modification or increase in dwelling  space,  services,  furniture,
furnishings  or  equipment,  including  the  cost  of  installation, but
excluding finance charges. Provided further [than] THAT an owner who  is
entitled  to  a  rent  increase  pursuant to this paragraph shall not be
entitled to a further rent increase based upon the installation of simi-
lar equipment, or new furniture or furnishings within the useful life of
such new equipment, or new furniture or furnishings.
  S 5. Clause 5 of the second undesignated paragraph of paragraph (a) of
subdivision 4 of section 4 of chapter 274 of the laws of  1946,  consti-
tuting the emergency housing rent control law, as amended by chapter 253
of the laws of 1993, is amended to read as follows:
  (5)  the  landlord  and  tenant  by mutual voluntary written agreement
agree to a substantial increase or  decrease  in  dwelling  space  or  a
change  in the services, furniture, furnishings or equipment provided in
the housing accommodations; provided that an owner shall be entitled  to
a  rent  increase  where  there  has  been a substantial modification or
increase of dwelling space or an increase in the services, or  installa-
tion  of  new  equipment or improvements or new furniture or furnishings
provided in or  to  a  tenant's  housing  accommodation.  The  permanent
increase  in  the  maximum  rent  for the affected housing accommodation
shall be [one-fortieth] ONE EIGHTY-FOURTH of the total cost incurred  by
the  landlord  in  providing  such  modification or increase in dwelling
space, services, furniture, furnishings or equipment, including the cost
of installation, but excluding finance charges provided further that  an
owner  who  is entitled to a rent increase pursuant to this clause shall
not be entitled to a further rent increase based upon  the  installation
of  similar equipment, or new furniture or furnishings within the useful
life of such new equipment, or new furniture or furnishings.  The  owner
shall  give  written  notice  to  the  commission of any such adjustment
pursuant to this clause; or
  S 6. This act shall take effect immediately; provided that the  amend-
ments  to section 26-405 of the city rent and rehabilitation law made by
section one of this act shall remain in full force and  effect  only  as
long  as  the  public  emergency requiring the regulation and control of
residential rents and evictions continues, as provided in subdivision  3
of  section 1 of the local emergency housing rent control act; provided,
however, that the amendments to section 26-511 of chapter 4 of title  26
of  the administrative code of the city of New York made by sections two
and three of this act shall expire on the same date as such law  expires

S. 5296                             4

and  shall  not  affect  the  expiration  of  such law as provided under
section 26-520 of such law; provided, further, that  the  amendments  to
section  6  of  the emergency tenant protection act of nineteen seventy-
four  made  by section four of this act shall expire on the same date as
such act expires and shall not affect the  expiration  of  such  act  as
provided  in section 17 of chapter 576 of the laws of 1974; and provided
that the amendments to section 4 of the emergency housing  rent  control
law  made  by  section five of this act shall expire on the same date as
such law expires and shall not affect the  expiration  of  such  law  as
provided  in  subdivision  2  of section 1 of chapter 274 of the laws of
1946.

co-Sponsors

View additional co-sponsors

2009-S5296A (ACTIVE) - Details

See Assembly Version of this Bill:: A5316
Law Section:: New York City Administrative Code
Laws Affected:: Amd §§26-405 & 26-511, NYC Ad Cd; amd §6, Emerg Ten Prot Act of 1974; amd §4, Emerg Hous Rent Cont L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S874
2013-2014: S799

2009-S5296A (ACTIVE) - Summary

Relates to adjustment to the maximum allowable rent.

2009-S5296A (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S5296A

TITLE OF BILL:
An act to amend the administrative code of the city of New York, the
emergency tenant protection act of nineteen seventy-four, and the emer-
gency housing rent control law, in relation to adjustment of maximum
allowable rent

PURPOSE OR GENERAL IDEA OF THE BILL:
Expenses for individual apartment improvements in rental housing are
currently recovered over three and a half years in calculating the
permissible monthly rent increase.  This bill increases the length of
time to five years and requires the Division of Housing and Community
Renewal (DHCR) to approve such rent increases for vacant apartments
which would increase the legal rent by more than ten percent. It also
would require owners to file exit registrations with DC", and give
notice to a new tenant after an apartment is Subject to vacancy decon-
trol stating the reason for deregulation and a calculation of how the
last rent was increased to exceed the $2,000 vacancy decontrol thresh-
old. The notice will also advise tenants as to how they can verify the
last legal regulated rent with DHCR.

SUMMARY OF SPECIFIC PROVISIONS:
Sections 1, 2, 4 and 5 increase the amortization period for expenses due
to individual apartment improvement increases from 40 months to 60
months.

Sections 2 and 4 provide that no rent increase shall be collectible for
an individual apartment improvement unless:

* the owner of the apartment has provided the tenant with.a lease rider
or a notice explaining in detail how the individual apartment improve-
ment rent increase in the vacancy lease has been computed;

* there are no current hazardous violations of any municipal, county,
State or Federal law that relate to the maintenance of any required
services;

* there is no outstanding determination by the DHCR that the owner has
failed to maintain any required services;

* the owner of the apartment has filed with DHCR an explanation and
documentation of how the individual apartment improvement rent increase
was computed, whenever such rent exceeds 10 percent of the rent charged
to the previous tenant including supporting documentation.  A new tenant
must be given an opportunity to respond to the owner's filing with the
DHCR prior to the DHCR's determination of the appropriate rent increase.

Section 3 provides that vacancy lease riders given to rent stabilized
tenants in New York City must include detailed breakdowns of any indi-
vidual apartment improvement rent increase charged to the new tenant.

Sections 6 and 7 require owners to file "exit" registrations with DHCR
and give notices to the first tenant after an apartment is subject to
vacancy decontrol stating the reason for deregulation and a calculation
of how the last rent was increased to exceed the $2,000 vacancy decon-
trol threshold.  The notice will also advise tenants as to how they can
verify the last legal regulated rent with DHCR.

These sections also stipulate that units cannot leave rent regulation
unless and until an "exit" registration is filed with DHCR and copies of
the registration and the notice of how the apartment was subjected to
vacancy deregulation are served upon the new tenant.

EFFECTS OF PRESENT LAW WHICH THIS BILL WOULD ALTER:
Extends the amortization period from 40 months to 60 months and gives
DHCR a stronger oversight role by authorizing it to approve or disap-
prove larger rent increases in whole or in part.

JUSTIFICATION:
There is a major loophole in the rent regulation system called the
1/40th loophole, also known as an Individual Apartment Improvement
Increase. This loophole allows a landlord to raise the rent on an unoc-
cupied rent stabilized apartment by passing the cost of physical
improvements to the next tenant by raising the monthly rent an amount
equal to 1/40th of the total cost of the improvements.  A 1/40th
increase can be taken in addition to any other rent increase to which
the landlord is statutorily entitled. There is no oversight of any kind
of the 1/40th loophole. Landlords are allowed to unilaterally impose
1/40th rent increases without prior approval, or even documentation.

This lack of oversight has led to widespread fraud, and has been a major
reason for the loss of affordable housing in New York.  Landlords are
able to use the 1/40th increase to move the apartment above the current
$2,000 High Rent Vacancy Decontrol threshold that allows them to perma-
nently de-regulate the apartment. Although there are not absolutely
clear government records of the frequency with which 1/40th increases
are used, because there is no oversight of the program, it is clear that
rent regulated apartments are moving out of affordability at a rate
faster than statutory rent increases would allow.

Fraudulent rent increases for apartment renovations are a major reason
affordable housing is disappearing from New York, according to a recent
study by the Association for Neighborhood and Housing Development
(ANHD).

The only present oversight mechanism is an inadequate tenant-initiated
complaint filed with DHCR as a Complaint of Rent Overcharge. Because the
improvement occurs in a vacant. apartment, the new tenant has no way of
knowing what the rent should be, and if the work done justifies the
increase.

This legislation would give DHCR the authority to approve or disapprove
such increases in whole or in part based upon the proof of expenses

submitted by the landlord. It will also give new tenants a breakdown of
how their rents are computed and information allowing them to challenge
such rents.

PRIOR LEGISLATIVE HISTORY:
New legislation.

FISCAL IMPLICATIONS:
Some expense associated with DHCR administration of this program.

EFFECTIVE DATE:
This act takes effect on the 90th day after it becomes law except that
sections six and seven take effect on the 30th day after the it becomes
law and DHCR is authorized and directed to promulgate rules, regu-
lations, and standards immediately.

2009-S5296A (ACTIVE) - Bill Text download pdf

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

                                 5296--A

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 27, 2009
                               ___________

Introduced  by  Sens.  SQUADRON, ADAMS, DIAZ, HASSELL-THOMPSON, KRUEGER,
  MONTGOMERY, ONORATO, PERKINS, SAVINO, SCHNEIDERMAN, SERRANO,  STAVISKY
  -- read twice and ordered printed, and when printed to be committed to
  the  Committee  on  Housing, Construction and Community Development --
  recommitted to the Committee on Housing,  Construction  and  Community
  Development  in  accordance  with  Senate  Rule 6, sec. 8 -- 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,  the
  emergency  tenant  protection  act  of  nineteen seventy-four, and the
  emergency housing rent control law, in relation to adjustment of maxi-
  mum allowable rent

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

  Section 1. Subparagraph (e) of paragraph 1 of subdivision g of section
26-405 of the administrative code of the city of New York, as amended by
chapter 253 of the laws of 1993, is amended to read as follows:
  (e)  The  landlord  and  tenant  by mutual voluntary written agreement
agree to a substantial increase or  decrease  in  dwelling  space  or  a
change  in the services, furniture, furnishings or equipment provided in
the housing accommodations. An adjustment under this subparagraph  shall
be  equal  to  [one-fortieth] ONE-SIXTIETH of the total cost incurred by
the landlord in providing such  modification  or  increase  in  dwelling
space, services, furniture, furnishings or equipment, including the cost
of  installation, but excluding finance charges, provided further [than]
THAT an owner who is entitled  to  a  rent  increase  pursuant  to  this
subparagraph shall not be entitled to a further rent increase based upon
the  installation  of similar equipment, or new furniture or furnishings
within the useful life of  such  new  equipment,  or  new  furniture  or
furnishings. The owner shall give written notice to the city rent agency
of any such adjustment pursuant to this subparagraph[.]; or

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11158-04-0

S. 5296--A                          2

  S  2.  Paragraph 13 of subdivision c of section 26-511 of the adminis-
trative code of the city of New York, as added by  chapter  253  of  the
laws of 1993, is amended to read as follows:
  (13) provides that an owner is entitled to a rent increase where there
has  been a substantial modification or increase of dwelling space or an
increase in the services, or installation of new equipment  or  improve-
ments or new furniture or furnishings provided in or to a tenant's hous-
ing  accommodation,  on  written tenant consent to the rent increase. In
the case of a vacant housing accommodation, tenant consent shall not  be
required.
  (A)  The  permanent  increase  in  the  legal  regulated  rent for the
affected housing accommodation shall be [one-fortieth]  ONE-SIXTIETH  of
the  total  cost incurred by the landlord in providing such modification
or increase in  dwelling  space,  services,  furniture,  furnishings  or
equipment,  including  the  cost  of installation, but excluding finance
charges. [Provided further that an]
  (B) AN owner who is entitled to a rent increase pursuant to this para-
graph shall not be entitled to a further rent increase  based  upon  the
installation of similar equipment, or new furniture or furnishings with-
in  the  useful  life  of  such  new  equipment,  or  new  furniture  or
furnishings.
  (C) NO INCREASE SHALL BE COLLECTIBLE UNDER THIS  PARAGRAPH  UNTIL  THE
LANDLORD  HAS PROVIDED THE TENANT WITH A RIDER PURSUANT TO SUBDIVISION D
OF THIS SECTION, INCLUDING AN EXPLANATION OF HOW THE RENT IN THE VACANCY
LEASE HAS BEEN COMPUTED, AND THE SPECIFIC AMOUNTS  OF  ALL  EXPENDITURES
SUPPORTING A RENT INCREASE UNDER THIS PARAGRAPH.
  (D)  NO  INCREASE SHALL BE COLLECTIBLE UNDER THIS  PARAGRAPH WHERE THE
DIVISION OF HOUSING AND COMMUNITY RENEWAL HAS DETERMINED THAT THE  OWNER
IS  NOT  MAINTAINING ALL BUILDING-WIDE REQUIRED SERVICES OR ALL REQUIRED
SERVICES WITH RESPECT TO THE AFFECTED HOUSING  ACCOMMODATION,  OR  WHERE
THERE  ARE  CURRENT HAZARDOUS VIOLATIONS OF ANY MUNICIPAL, COUNTY, STATE
OR FEDERAL LAW WHICH RELATE TO THE MAINTENANCE OF SUCH SERVICES.
  (E) WITHIN THIRTY DAYS OF THE SIGNING OF A VACANCY LEASE  INCLUDING  A
RENT INCREASE PURSUANT TO THIS PARAGRAPH THAT EXCEEDS TEN PERCENT OF THE
RENT  CHARGED TO THE PREVIOUS TENANT, THE OWNER WILL FILE WITH THE DIVI-
SION OF HOUSING AND COMMUNITY RENEWAL AN EXPLANATION OF HOW THE  VACANCY
RENT WAS COMPUTED, AND ALL DOCUMENTS NECESSARY TO SUPPORT THE COLLECTION
OF  SUCH  INCREASE,  INCLUDING  BUT  NOT  LIMITED  TO, CANCELLED CHECKS,
INVOICES AND SIGNED CONTRACTS CONTEMPORANEOUSLY  WITH  THE  IMPROVEMENTS
ALLEGED,  AND  CONTRACTOR'S  AFFIDAVITS INDICATING THAT THE INSTALLATION
WAS COMPLETED AND PAID IN FULL. UPON RECEIPT OF ALL DOCUMENTS  SUBMITTED
BY THE OWNER, AND AFTER GIVING THE TENANT NAMED IN SUCH VACANCY LEASE AN
OPPORTUNITY  TO  RESPOND,  THE DIVISION OF HOUSING AND COMMUNITY RENEWAL
SHALL ISSUE AN ORDER APPROVING OR DISAPPROVING SUCH INCREASE IN WHOLE OR
IN PART. BASED UPON SUCH DETERMINATION,  THE  DIVISION  OF  HOUSING  AND
COMMUNITY RENEWAL SHALL ORDER A REFUND TO THE TENANT EQUAL TO THE AMOUNT
COLLECTED IN EXCESS OF THE LEGAL REGULATED RENT APPROVED BY THE DIVISION
OF HOUSING AND COMMUNITY RENEWAL.
  (F) IF THE OWNER FAILS TO ESTABLISH BY A PREPONDERANCE OF THE EVIDENCE
THAT THE OVERCHARGE WAS NOT WILLFUL, THE DIVISION OF  HOUSING AND COMMU-
NITY  RENEWAL  SHALL  ORDER THE OWNER TO PAY TO THE TENANT AN ADDITIONAL
AMOUNT EQUAL TO THREE TIMES THE EXCESS CHARGED.
  (G) THE NEXT ANNUAL  REGISTRATION  STATEMENT  FILED  FOR  ANY  HOUSING
ACCOMMODATION  SUBJECT  TO  AN INCREASE UNDER THIS PARAGRAPH, WHETHER OR
NOT SUBJECT TO THE PROVISIONS OF  SUBPARAGRAPH  (E)  OF  THIS  PARAGRAPH

S. 5296--A                          3

SHALL  CONTAIN  A  DETAILED  BREAKDOWN  OF THE COSTS OF ALL IMPROVEMENTS
UNDERLYING SUCH INCREASE.
  S 3. Paragraph 2 of subdivision d of section 26-511 of the administra-
tive  code  of  the city of New York is renumbered paragraph 3 and a new
paragraph 2 is added to read as follows:
  (2) FOR VACANCY LEASES, SUCH RIDER SHALL ALSO INCLUDE A NOTICE OF  THE
PRIOR  LEGAL  RENT,  IF ANY, THAT WAS IN EFFECT IMMEDIATELY PRIOR TO THE
VACANCY, AN EXPLANATION OF HOW THE  RENTAL  AMOUNT  HAS  BEEN  COMPUTED,
INCLUDING  A  DETAILED  BREAKDOWN OF THE NATURE AND COST OF ANY IMPROVE-
MENTS UNDERLYING AN INCREASE UNDER PARAGRAPH THIRTEEN OF  SUBDIVISION  C
OF  THIS  SECTION,  AND A STATEMENT THAT ANY INCREASE ABOVE THE PREVIOUS
RENT IS IN ACCORDANCE WITH ADJUSTMENTS PERMITTED BY LAW.
  S 4. Paragraph 1 of subdivision d of section 6 of section 4 of chapter
576 of the laws of 1974, constituting the  emergency  tenant  protection
act  of  nineteen  seventy-four,  as added by chapter 253 of the laws of
1993, is amended to read as follows:
  (1) there has been a substantial modification or increase of  dwelling
space  or  an increase in the services, or installation of new equipment
or improvements or new furniture or furnishings, provided  in  or  to  a
tenant's  housing  accommodation,  on written tenant consent to the rent
increase. In the case of a vacant housing accommodation, tenant  consent
shall not be required. (A) The permanent increase in the legal regulated
rent  for  the  affected  housing  accommodation shall be [one-fortieth]
ONE-SIXTIETH of the total cost incurred by  the  landlord  in  providing
such  modification  or  increase in dwelling space, services, furniture,
furnishings or  equipment,  including  the  cost  of  installation,  but
excluding  finance  charges. [Provided further than an] (B) AN owner who
is entitled to a rent increase pursuant to this paragraph shall  not  be
entitled to a further rent increase based upon the installation of simi-
lar equipment, or new furniture or furnishings within the useful life of
such  new  equipment,  or  new furniture or furnishings.   (C) THE OWNER
SHALL GIVE WRITTEN NOTICE TO  THE  DIVISION  OF  HOUSING  AND  COMMUNITY
RENEWAL  AND  THE TENANT NAMED IN A VACANCY LEASE ON FORMS PRESCRIBED BY
THE DIVISION OF ANY SUCH ADJUSTMENT PURSUANT TO THIS PARAGRAPH  AND  THE
FAILURE TO PROVIDE SUCH WRITTEN NOTICE AS PROVIDED HEREIN SHALL PRECLUDE
THE  COLLECTION  OF  ANY  SUCH  ADJUSTMENT.  SUCH  NOTICE MUST INCLUDE A
DETAILED BREAKDOWN OF THE NATURE AND COST OF ANY IMPROVEMENTS UNDERLYING
AN INCREASE IN RENT UNDER  THIS  PARAGRAPH  AND  A  STATEMENT  THAT  ANY
INCREASE  ABOVE  THE  PREVIOUS  RENT  IS  IN ACCORDANCE WITH ADJUSTMENTS
PERMITTED BY LAW. (D) NO INCREASE SHALL BE COLLECTIBLE UNDER THIS  PARA-
GRAPH WHERE THE DIVISION OF HOUSING AND COMMUNITY RENEWAL HAS DETERMINED
THAT THE OWNER IS NOT MAINTAINING ALL BUILDING-WIDE REQUIRED SERVICES OR
ALL  REQUIRED  SERVICES  WITH  RESPECT  TO THE AFFECTED HOUSING ACCOMMO-
DATION, OR WHERE THERE ARE CURRENT HAZARDOUS VIOLATIONS OF  ANY  MUNICI-
PAL,  COUNTY,  STATE  OR  FEDERAL LAW WHICH RELATE TO THE MAINTENANCE OF
SUCH SERVICES.  (E) WITHIN THIRTY DAYS OF THE SIGNING OF A VACANCY LEASE
INCLUDING A RENT INCREASE PURSUANT TO THIS PARAGRAPH  THAT  EXCEEDS  TEN
PERCENT  OF THE RENT CHARGED TO THE PREVIOUS TENANT, THE OWNER WILL FILE
WITH THE DIVISION AN EXPLANATION OF HOW THE VACANCY RENT  WAS  COMPUTED,
AND  ALL DOCUMENTS NECESSARY TO SUPPORT THE COLLECTION OF SUCH INCREASE,
INCLUDING BUT NOT LIMITED TO,  CANCELLED  CHECKS,  INVOICES  AND  SIGNED
CONTRACTS  CONTEMPORANEOUSLY WITH THE IMPROVEMENTS ALLEGED, AND CONTRAC-
TOR'S AFFIDAVITS INDICATING THAT THE INSTALLATION WAS COMPLETED AND PAID
IN FULL. UPON RECEIPT OF ALL DOCUMENTS SUBMITTED BY THE OWNER AND  AFTER
GIVING  THE TENANT NAMED IN THE VACANCY LEASE AN OPPORTUNITY TO RESPOND,
THE DIVISION  SHALL  ISSUE  AN  ORDER  APPROVING  OR  DISAPPROVING  SUCH

S. 5296--A                          4

INCREASE  IN  WHOLE OR IN PART. BASED UPON SUCH DETERMINATION, THE DIVI-
SION SHALL ORDER A REFUND TO THE TENANT EQUAL TO THE AMOUNT COLLECTED IN
EXCESS OF THE LEGAL REGULATED RENT APPROVED BY THE DIVISION.  (F) IF THE
OWNER  FAILS  TO  ESTABLISH  BY A PREPONDERANCE OF THE EVIDENCE THAT THE
OVERCHARGE WAS NOT WILLFUL, THE DIVISION SHALL ORDER THE OWNER TO PAY TO
THE TENANT AN ADDITIONAL AMOUNT EQUAL TO THREE TIMES THE EXCESS CHARGED.
(G) THE NEXT ANNUAL REGISTRATION STATEMENT FILED FOR ANY HOUSING  ACCOM-
MODATION  SUBJECT  TO  AN  INCREASE UNDER THIS PARAGRAPH, WHETHER OR NOT
SUBJECT TO THE PROVISIONS OF SUBPARAGRAPH (E) OF  THIS  PARAGRAPH  SHALL
CONTAIN A DETAILED BREAKDOWN OF THE COSTS OF ALL IMPROVEMENTS UNDERLYING
SUCH INCREASE.
  S 5. Clause 5 of the second undesignated paragraph of paragraph (a) of
subdivision  4  of section 4 of chapter 274 of the laws of 1946, consti-
tuting the emergency housing rent control law, as amended by chapter 253
of the laws of 1993, is amended to read as follows:
  (5) the landlord and tenant  by  mutual  voluntary  written  agreement
agree  to  a  substantial  increase  or  decrease in dwelling space or a
change in the services, furniture, furnishings or equipment provided  in
the  housing accommodations; provided that an owner shall be entitled to
a rent increase where there  has  been  a  substantial  modification  or
increase  of dwelling space or an increase in the services, or installa-
tion of new equipment or improvements or new  furniture  or  furnishings
provided  in  or  to  a  tenant's  housing  accommodation. The permanent
increase in the maximum rent  for  the  affected  housing  accommodation
shall  be  [one-fortieth] ONE-SIXTIETH of the total cost incurred by the
landlord in providing such modification or increase in  dwelling  space,
services,  furniture,  furnishings  or  equipment, including the cost of
installation, but excluding finance charges  provided  further  that  an
owner  who  is entitled to a rent increase pursuant to this clause shall
not be entitled to a further rent increase based upon  the  installation
of  similar equipment, or new furniture or furnishings within the useful
life of such new equipment, or new furniture or furnishings.  The  owner
shall  give  written  notice  to  the  commission of any such adjustment
pursuant to this clause; or
  S 6. Section 26-504.2 of the administrative code of the  city  of  New
York is amended by adding a new subdivision c to read as follows:
  C.  NOTWITHSTANDING  ANYTHING  IN  SUBDIVISION  A  OF  THIS SECTION OR
SUBPARAGRAPH (K) OF PARAGRAPH TWO OF SUBDIVISION E OF SECTION 26-403  OF
THIS  TITLE TO THE CONTRARY, THE FAILURE OF THE OWNER TO COMPLY WITH THE
REQUIREMENTS OF SUBDIVISION B OF THIS SECTION SHALL RESULT IN THE  HOUS-
ING ACCOMMODATION REMAINING SUBJECT TO THE PROVISIONS OF THIS LAW OR THE
CITY  RENT  AND  REHABILITATION LAW AT THE LAST REGULATED RENT UNTIL THE
OWNER COMPLIES WITH THE REQUIREMENTS OF SUBDIVISION B OF THE SECTION.
  S 7. The opening paragraph of paragraph 13 of subdivision a of section
5 of section 4 of chapter 576 of the  laws  of  1974,  constituting  the
emergency  tenant  protection act of nineteen seventy-four is designated
subparagraph (i) and two new subparagraphs (ii) and (iii) are  added  to
read as follows:
  (II)  THE  OWNER  OF  ANY HOUSING ACCOMMODATION THAT IS NOT SUBJECT TO
THIS ACT PURSUANT TO THE PROVISIONS OF SUBPARAGRAPH (I)  OF  THIS  PARA-
GRAPH OR PARAGRAPH (N) OF SUBDIVISION TWO OF SECTION TWO OF THE EMERGEN-
CY  HOUSING RENT CONTROL LAW SHALL GIVE WRITTEN NOTICE CERTIFIED BY SUCH
OWNER TO THE FIRST TENANT OF THAT HOUSING ACCOMMODATION AFTER SUCH HOUS-
ING ACCOMMODATION BECOMES EXEMPT FROM THE PROVISIONS OF THIS ACT OR  THE
EMERGENCY  HOUSING  RENT CONTROL LAW. SUCH NOTICE SHALL CONTAIN THE LAST
REGULATED RENT, THE  REASON  THAT  SUCH  HOUSING  ACCOMMODATION  IS  NOT

S. 5296--A                          5

SUBJECT  TO THIS ACT OR THE EMERGENCY HOUSING RENT CONTROL LAW, A CALCU-
LATION OF HOW EITHER THE RENTAL AMOUNT CHARGED WHEN THERE IS NO LEASE OR
THE RENTAL AMOUNT PROVIDED FOR IN THE LEASE HAS BEEN DERIVED  SO  AS  TO
REACH  TWO THOUSAND DOLLARS OR MORE PER MONTH, A STATEMENT THAT THE LAST
LEGAL REGULATED RENT OR THE MAXIMUM RENT MAY BE VERIFIED BY  THE  TENANT
BY  CONTACTING  THE  STATE DIVISION OF HOUSING AND COMMUNITY RENEWAL, OR
ANY SUCCESSOR THERETO, AND THE ADDRESS  AND  TELEPHONE  NUMBER  OF  SUCH
AGENCY, OR ANY SUCCESSOR THERETO. SUCH NOTICE SHALL BE SENT BY CERTIFIED
MAIL WITHIN THIRTY DAYS AFTER THE TENANCY COMMENCES OR AFTER THE SIGNING
OF  THE LEASE BY BOTH PARTIES, WHICHEVER OCCURS FIRST OR SHALL BE DELIV-
ERED TO THE TENANT AT THE SIGNING OF THE LEASE. IN ADDITION,  THE  OWNER
SHALL  SEND  AND CERTIFY TO THE TENANT A COPY OF THE REGISTRATION STATE-
MENT FOR SUCH HOUSING ACCOMMODATION FILED WITH  THE  STATE  DIVISION  OF
HOUSING AND COMMUNITY RENEWAL INDICATING THAT SUCH HOUSING ACCOMMODATION
BECAME  EXEMPT  FROM THE PROVISIONS OF THIS ACT OR THE EMERGENCY HOUSING
RENT CONTROL LAW, WHICH FORM SHALL INCLUDE THE LAST REGULATED RENT,  AND
SHALL  BE  SENT  TO  THE  TENANT  WITHIN  THIRTY  DAYS AFTER THE TENANCY
COMMENCES OR THE FILING OF SUCH REGISTRATION, WHICHEVER OCCURS LATER.
  (III) NOTWITHSTANDING ANYTHING IN SUBPARAGRAPH (I) OF  THIS  PARAGRAPH
OR  PARAGRAPH  (N)  OF  SUBDIVISION  TWO OF SECTION TWO OF THE EMERGENCY
HOUSING RENT CONTROL LAW TO THE CONTRARY, THE FAILURE OF  THE  OWNER  TO
COMPLY  WITH  THE  REQUIREMENTS  OF  SUBPARAGRAPH (II) OF THIS PARAGRAPH
SHALL RESULT IN THE  HOUSING  ACCOMMODATION  REMAINING  SUBJECT  TO  THE
PROVISIONS  OF THIS ACT OR THE EMERGENCY HOUSING RENT CONTROL LAW AT THE
LAST REGULATED RENT UNTIL THE OWNER COMPLIES WITH  THE  REQUIREMENTS  OF
SUBPARAGRAPH (II) OF THIS PARAGRAPH.
  S  8.  This  act shall take effect on the ninetieth day after it shall
have become a law; provided that:
  (a) sections six and seven of this act shall take effect on the  thir-
tieth day after this act shall have become a law;
  (b)  the  amendments  to section 26-405 of the city rent and rehabili-
tation law made by section one of this act shall remain  in  full  force
and effect only as long as the public emergency requiring the regulation
and control of residential rents and evictions continues, as provided in
subdivision  3  of section 1 of the local emergency housing rent control
act;
  (c) the amendments to chapter 4 of title 26 of the administrative code
of the city of New York made by sections two, three and six of this  act
shall  expire  on the same date as such law expires and shall not affect
the expiration of such law as provided under section 26-520 of such law;
  (d) the amendments to the emergency tenant protection act of  nineteen
seventy-four made by sections four and seven of this act shall expire on
the same date as such act expires and shall not affect the expiration of
such act as provided in section 17 of chapter 576 of the laws of 1974;
  (e)  the amendments to section 4 of the emergency housing rent control
law made by section five of this act shall expire on the  same  date  as
such  law  expires  and  shall  not affect the expiration of such law as
provided in subdivision 2 of section 1 of chapter 274  of  the  laws  of
1946; and
  (f)  effective  immediately,  the  division  of  housing and community
renewal is authorized to and shall promulgate all rules, regulations and
standards necessary to implement the provisions of this act.

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Senate Bill S5296

Sponsored By

Archive: Last Bill Status - On Floor Calendar

Aug 3, 2010 - Rules Committee Vote

Rules Committee Vote: Aug 3, 2010

Bill Amendments

co-Sponsors

2009-S5296 - Details

2009-S5296 - Summary

2009-S5296 - Sponsor Memo

2009-S5296 - Bill Text download pdf

co-Sponsors

2009-S5296A (ACTIVE) - Details

2009-S5296A (ACTIVE) - Summary

2009-S5296A (ACTIVE) - Sponsor Memo

2009-S5296A (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S5296

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Sponsored By

Archive: Last Bill Status - On Floor Calendar

Bill Amendments

co-Sponsors

2009-S5296 - Details

2009-S5296 - Summary

2009-S5296 - Sponsor Memo

2009-S5296 - Bill Text download pdf

co-Sponsors

2009-S5296A (ACTIVE) - Details

2009-S5296A (ACTIVE) - Summary

2009-S5296A (ACTIVE) - Sponsor Memo

2009-S5296A (ACTIVE) - Bill Text download pdf

Comments