Senate Bill S6028

2009-2010 Legislative Session

Relates to the insurance of certain preservation loans of the state of New York mortgage agency mortgage insurance fund

download bill text pdf

Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions Committee

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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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2010	referred to corporations, authorities and commissions
Jun 19, 2009	referred to rules

2009-S6028 (ACTIVE) - Details

Current Committee:: Senate Corporations, Authorities And Commissions
Law Section:: Public Authorities Law
Laws Affected:: Amd §2428, Pub Auth L

2009-S6028 (ACTIVE) - Summary

Relates to the insurance of certain preservation loans of the state of New York mortgage agency mortgage insurance fund.

2009-S6028 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S6028

 TITLE OF BILL :

An act to amend the public authorities law, in relation to the
insurance of certain preservation loans by the state of New York
mortgage agency mortgage insurance fund


 PURPOSE :

The bill would grant the State of New York Mortgage Agency Mortgage
Insurance Fund ("MIF') authority to insure the full principal amount
of certain preservation loans thereby enabling the MIF to provide
needed support for the refinancing of certain multi-family affordable
housing accommodations which became overleveraged during the current
housing crisis.

 SUMMARY OF PROVISIONS :

Section 1 of the bill would amend Public Authority Law ("PAL") § 2428
by adding a new subdivision 2-a to the Agency's statute to authorize
the Agency to provide mortgage insurance for the full amount of
certain refinancing/preservation loans which meet the following
requirements (i) the indebtedness being refinanced was originated
during the period from January 1, 2004 through December 31, 2008, (ii)

the amount of such loan does not exceed $150 million, (iii) the loan
will preserve affordable housing units in the State, and (iv) the loan
shall have been made by a public benefit corporation of the state of
New York which has issued bonds or notes to make such loan, or the
loan shall have been made by a public employee pension fund.

Section 2 of the bill would amend PAL § 2428(8)( c) to provide that
the Agency may issue commitments for, and insure preservation loans
made with respect to, multi-family residential buildings seeking to
refinance existing indebtedness that was originated during the period
from January 1, 2004 through December 31, 2008 where the loan will
preserve affordable housing accommodations. .

Section 3 would provide that this bill and powers delineated therein
be liberally construed to effectuate the intent and purpose of the
bill.

Section 4 would contain a severability clause.

Section 5 would provide that the bill takes effect immediately.

 EXISTING LAW :

Under current law, the MIF has the authority to insure preservation
loans with respect to one to four family dwellings and certain
buildings and real property and improvements owned by cooperative
housing corporations, both up to an amount not exceeding fifty per
centum of the outstanding principal indebtedness of such loans.

 LEGISLATIVE HISTORY :

None.

 STATEMENT IN SUPPORT :

In the years immediately preceeding 2009, the real estate market in
the state of New York saw an unprecedented increase in real estate
values and in the level of acquisition and rehabilitation financing
available to owners. As values have retreated in recent months and the
rental market has declined, many of the multi-family residential
buildings which where financed or refinanced prior to 2009 have become
overleveraged and struggle to avoid loan defaults. In many communities
in the State, refinancing is effectively unavailable for these
buildings. Those communities face the loss or deterioration of
affordable housing accommodations and the related retail and other
community facilities they attract.

This bill would give the MIF the authority to provide one hundred per
cent mortgage insurance on certain loans extended for the sole purpose
of refinancing existing indebtedness which relate to overleveraged
multi-family residential buildings. At present, the MIF is authorized
to insure preservation loans in an amount up to fifty percent of the
outstanding principal amount of refinancing loans which relate to one
to four family dwellings and certain cooperative housing corporations.
The preservation loans to be insured pursuant to the expanded
authority would remain subject to statutory and other requirements
governing loans insured by the MIF. In addition, the bill would
require that the existing indebtedness to be refinanced be originated
during a targeted period during which over expansive lending practices
resulted in overleveraged multi-family residential buildings, each
such preservation loan be subject to a per loan cap, and each such
preservation loan preserve affordable housing accommodations. It is
the intention that this authority be targeted, and enable the
resources of the MIF to be committed to, the refinancing of certain
troubled multi-family loans pursuant to statutory and other
requirements consistent with the MIF's established mortgage insurance
standards.

 BUDGET IMPLICATIONS :

None.

 EFFECTIVE DATE :
The act takes effect immediately.

2009-S6028 (ACTIVE) - Bill Text download pdf

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

                                  6028

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                              June 19, 2009
                               ___________

Introduced by COMMITTEE ON RULES -- (at request of the State of New York
  Mortgage  Agency)  -- 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 insurance
  of certain preservation loans by the state of New York mortgage agency
  mortgage insurance fund

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

  Section  1.  Section  2428 of the public authorities law is amended by
adding a new subdivision 2-a to read as follows:
  2-A. THE AGENCY MAY ISSUE A COMMITMENT TO PROVIDE  AND  MAY  INSURE  A
PRESERVATION  LOAN  IN AN AMOUNT EQUAL TO THE FULL OUTSTANDING PRINCIPAL
INDEBTEDNESS OF SUCH PRESERVATION LOAN IF: (A) THE EXISTING INDEBTEDNESS
SHALL HAVE BEEN ORIGINATED DURING THE PERIOD  FROM  JANUARY  FIRST,  TWO
THOUSAND FOUR THROUGH DECEMBER THIRTY-FIRST, TWO THOUSAND EIGHT, (B) THE
AMOUNT  OF  EACH  INSURED PRESERVATION LOAN SHALL NOT EXCEED ONE HUNDRED
FIFTY MILLION DOLLARS, (C) SUCH PRESERVATION LOAN SHALL PRESERVE AFFORD-
ABLE HOUSING ACCOMMODATIONS, AND (D) THE PRESERVATION  LOAN  SHALL  HAVE
BEEN MADE BY A PUBLIC BENEFIT CORPORATION OF THE STATE OF NEW YORK WHICH
PUBLIC BENEFIT CORPORATION HAS ISSUED OR WILL ISSUE BONDS OR NOTES, SOME
OR  ALL OF THE PROCEEDS OF WHICH BONDS OR NOTES SHALL HAVE BEEN, OR WILL
BE, USED TO MAKE SUCH PRESERVATION LOAN, OR THE PRESERVATION LOAN  SHALL
HAVE BEEN MADE BY A PUBLIC EMPLOYEE PENSION FUND.
  S  2.  Paragraph  (c)  of  subdivision 8 of section 2428 of the public
authorities law, as amended by chapter 113  of  the  laws  of  2000,  is
amended to read as follows:
  (c)  The  agency  shall  not issue a commitment to insure nor shall it
provide loan insurance for a preservation loan unless (i) such  loan  is
made with respect to a one to four family dwelling; or (ii) such loan is
made  with  respect  to  a building, which on the effective date of this
subparagraph, is owned by a cooperative housing corporation  formed  for

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14119-01-9

S. 6028                             2

the  purpose  of the cooperative ownership of residential real estate in
the state where such refinancing is not  otherwise  available  and  such
loan  will  facilitate  or accommodate affordable homeownership opportu-
nities; or (iii) such loan is made with respect to the real property and
improvements  owned  by a cooperative housing corporation formed for the
purpose of the cooperative ownership of residential  manufactured  homes
in  the state where such refinancing is not otherwise available and such
loan will facilitate or accommodate  affordable  homeownership  opportu-
nities;  OR (IV) SUCH LOAN IS MADE WITH RESPECT TO MULTI-FAMILY RESIDEN-
TIAL BUILDINGS WITH EXISTING INDEBTEDNESS ORIGINATED DURING  THE  PERIOD
FROM JANUARY FIRST, TWO THOUSAND FOUR THROUGH DECEMBER THIRTY-FIRST, TWO
THOUSAND EIGHT, WHERE SUCH LOAN WILL FACILITATE OR ACCOMMODATE THE PRES-
ERVATION OF AFFORDABLE HOUSING ACCOMMODATIONS.
  S  3.  Construction.  This  act and all powers granted hereby shall be
liberally construed to effectuate its intent and their purposes, without
implied limitations thereon. This act shall constitute full and complete
authority for all things herein contemplated to be done. All rights  and
powers  herein granted shall be cumulative with those derived from other
sources and shall not, except as expressly stated herein,  be  construed
in  limitation thereof. Insofar as the provisions of this act are incon-
sistent with the provisions of any other act, general  or  special,  the
provisions of this act shall be controlling.
  S  4. Severability clause. If any clause, sentence, paragraph, section
or part of this act be adjudged by any court of  competent  jurisdiction
to  be invalid, such judgment shall not affect, impair or invalidate the
remainder hereof but shall be applied in its operation  to  the  clause,
sentence,  paragraph,  section  or  part hereof directly involved in the
controversy in which such judgment shall have been rendered.
  S 5. This act shall take effect immediately; provided however that the
amendments to paragraph (c) of subdivision 8  of  section  2428  of  the
public  authorities law made by section two of this act shall not affect
the expiration of such subdivision and shall be deemed to expire  there-
with.

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Senate Bill S6028

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Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions Committee

Actions

2009-S6028 (ACTIVE) - Details

2009-S6028 (ACTIVE) - Summary

2009-S6028 (ACTIVE) - Sponsor Memo

2009-S6028 (ACTIVE) - Bill Text download pdf

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Sponsored By

Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions Committee

Actions

2009-S6028 (ACTIVE) - Details

2009-S6028 (ACTIVE) - Summary

2009-S6028 (ACTIVE) - Sponsor Memo

2009-S6028 (ACTIVE) - Bill Text download pdf

Comments