S T A T E   O F   N E W   Y O R K
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                                  4880

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            February 8, 2011
                               ___________

Introduced  by  M.  of  A.  TOWNS, N. RIVERA, ROBINSON, ORTIZ, GIBSON --
  Multi-Sponsored by -- M.  of A. BRENNAN -- read once and  referred  to
  the Committee on Housing

AN  ACT  to amend the private housing finance law, in relation to estab-
  lishing the urban homeowners assistance program; and making an  appro-
  priation therefor

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

  Section 1. The private housing finance law is amended by adding a  new
article 16-B to read as follows:
                               ARTICLE XVI-B
                 URBAN HOMEOWNERSHIP ASSISTANCE PROGRAM
SECTION 930. DECLARATION OF LEGISLATIVE FINDINGS.
        931. DEFINITIONS.
        932. CONTRACTS WITH NEIGHBORHOOD PRESERVATION COMPANIES.
        933. PAYMENT TO NEIGHBORHOOD PRESERVATION COMPANIES FOR HOMEOWN-
               ERSHIP TECHNICAL ASSISTANCE AND TRAINING.
        934. LEGAL AID AGREEMENTS.
        935. ANNUAL REPORT TO THE LEGISLATURE.
  S  930. DECLARATION  OF  LEGISLATIVE  FINDINGS. THE LEGISLATURE HEREBY
FINDS AND DECLARES THAT THERE HAS DEVELOPED A DAMAGING IMPACT OF  PREDA-
TORY  AND  SUBPRIME  RESIDENTIAL  MORTGAGE  LENDING  PATTERNS IN VARIOUS
VULNERABLE NEIGHBORHOODS AND COMMUNITIES  OF  THE  STATE  AND  THAT  THE
RELATIONSHIP BETWEEN THE PREDOMINANCE OF SUBPRIME LOANS AND HIGH CONCEN-
TRATIONS OF FORECLOSURE ACTIONS BEING FILED HAS BEEN FORECAST AND CLEAR-
LY  DOCUMENTED.  THE  LEGISLATURE  FURTHER  FINDS  THAT  THE SCARCITY OF
RESOURCES DEDICATED TO  HOUSING  COUNSELING  AND  HOME  BUYER  EDUCATION
SERVICES HAS LEFT MANY FIRST TIME, LOW AND/OR MODERATE INCOME, OR MINOR-
ITY HOMEBUYERS AT RISK.
  THE  LEGISLATURE  FURTHER  FINDS  THAT IN MANY URBAN COMMUNITIES WHERE
SUBPRIME LENDERS DOMINATE REFINANCING AND HOME EQUITY MORTGAGE  MARKETS,

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05889-01-1
              

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AND  WHERE NECESSITY COMBINED WITH POOR DECISION-MAKING OFTEN PLACES LOW
AND/OR MODERATE INCOME HOMEOWNERS IN NON-SUSTAINABLE MORTGAGE  PRODUCTS,
THE  ADJUSTED COST OF A HOME IS FREQUENTLY EXCEEDED AS A RESULT OF REFI-
NANCING  PRODUCTS, HOME EQUITY PRODUCTS COMPOUNDED WITH FIRST MORTGAGES,
AND RUNAWAY FEES. AS A RESULT MANY HOMEOWNERS ARE RENDERED  AT  RISK  OF
FORECLOSURE. BESIDES THE PERSONAL TRAGEDIES THESE HOUSEHOLDS FACE, FORE-
CLOSURE  FURTHER AFFECTS NEIGHBORHOODS AND COMMUNITIES BY DE-STABILIZING
THE CHARACTER OF THE AREA. THE LEGISLATURE FURTHER FINDS THAT  IN  ORDER
TO  PREVENT  AND/OR  MITIGATE  FORECLOSURES,  FINANCIAL LITERACY MUST BE
IMPARTED TO INDIVIDUALS WHO ARE ABOUT TO PURCHASE A HOME OR ARE AT  RISK
OF FORECLOSURE.
  THE  LEGISLATURE  FURTHER  FINDS  THAT  THE  NEIGHBORHOOD PRESERVATION
COMPANIES WHICH HAVE BEEN ESTABLISHED THROUGHOUT THE STATE  ARE  INSTRU-
MENTAL AS PROVIDERS OF INFORMATION, TRAINING AND ASSISTANCE TO RESIDENTS
IN  THEIR  SERVICE AREAS IN NEED OF HOUSING SERVICES INTERVENTION IN THE
RETENTION OF AFFORDABLE HOMEOWNERSHIP; THAT CONDITIONS AGGRAVATED BY  AN
AFFORDABLE  RENTAL  HOUSING CRISIS HAVE OVERBURDENED THEIR RESOURCES AND
ARE BEING COMPOUNDED BY THE DEMAND FOR  HOME  OWNERSHIP  ASSISTANCE  AND
FORECLOSURE  PREVENTION;  AND THAT THERE IS A NECESSITY FOR THE SERVICES
OF NEIGHBORHOOD PRESERVATION COMPANIES FAMILIAR WITH THE SPECIFIC  NEEDS
OF  THE  RESIDENTS IN THEIR SERVICE AREAS TO PROVIDE TARGETED ASSISTANCE
TO EXISTING AND POTENTIAL HOMEOWNERS TO SECURE PERMANENT, AFFORDABLE AND
FISCALLY VIABLE HOMEOWNERSHIP. THE NECESSITY IN THE PUBLIC INTEREST  FOR
THE  PROVISIONS  HEREINAFTER  ENACTED  IS HEREBY DECLARED AS A MATTER OF
LEGISLATIVE DETERMINATION.
  S 931. DEFINITIONS. AS USED IN THIS ARTICLE, THE FOLLOWING  WORDS  AND
PHRASES SHALL HAVE THE FOLLOWING MEANINGS:
  1. "COMMISSIONER" SHALL MEAN THE COMMISSIONER OF THE STATE DIVISION OF
HOUSING AND COMMUNITY RENEWAL.
  2.  "DIVISION"  SHALL MEAN THE STATE DIVISION OF HOUSING AND COMMUNITY
RENEWAL.
  3. "NEIGHBORHOOD PRESERVATION COMPANY" SHALL MEAN A CORPORATION ORGAN-
IZED UNDER THE PROVISIONS OF THE NOT-FOR-PROFIT  CORPORATION  LAW  WHICH
HAS  BEEN  PRIMARILY  ENGAGED  IN  ONE OR MORE NEIGHBORHOOD PRESERVATION
ACTIVITIES AS DEFINED IN SUBDIVISION FIVE OF SECTION NINE HUNDRED TWO OF
THIS CHAPTER.
  4. "HOMEOWNERSHIP ASSISTANCE ACTIVITIES"  SHALL  MEAN  COUNSELING  FOR
DEFAULT  AND  FORECLOSURE  PREVENTION, BUDGET MANAGEMENT, DEBT REDUCTION
PLANNING, CREDIT REPAIR, REFINANCING  OPTIONS,  IN  THE  RECOGNITION  OF
PREDATORY  LENDERS,  CONSUMER  SCAMS, HOMEOWNER BASICS AND THE HIRING OF
CONTRACTORS AND ALL SUCH OTHER ACTIVITIES AS MAY BE DEEMED ESSENTIAL  TO
ENSURING THE PREVENTION OF FORECLOSURE.
  5. "ACCESSIBILITY" SHALL MEAN CULTURAL AND LINGUISTIC ACCESSIBILITY TO
DIVERSE RESIDENTS.
  6.  "RESIDENTS"  SHALL  MEAN  INDIVIDUALS OR FAMILIES WITH INCOMES NOT
EXCEEDING NINETY PERCENT OF MEDIAN  INCOME  RESIDING  IN  MUNICIPALITIES
WITH   POPULATIONS  OF  TWENTY-FIVE  THOUSAND  OR  GREATER  INHABITANTS,
CURRENTLY IN RESIDENCE OR WITH EVIDENCE OF FORTHCOMING RESIDENCY IN  THE
SERVICE AREA.
  7. "SERVICE AREA" SHALL MEAN THE ESTABLISHED BOUNDARIES OF A NEIGHBOR-
HOOD  PRESERVATION  COMPANY AS SPECIFIED IN SUBDIVISION THREE OF SECTION
NINE HUNDRED THREE OF THIS CHAPTER.
  8. "SIGNIFICANT" SHALL MEAN NO LESS THAN SEVENTY-FIVE PERCENT  OF  THE
SPECIFIED CONTRACTED SERVICES.
  S  932.  CONTRACTS  WITH  NEIGHBORHOOD  PRESERVATION COMPANIES. 1. THE
COMMISSIONER SHALL ENTER INTO CONTRACTS WITH  NEIGHBORHOOD  PRESERVATION

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COMPANIES  FOR  THE  PERFORMANCE OF HOMEOWNERSHIP ASSISTANCE ACTIVITIES.
SUCH CONTRACTS SHALL BE ENTERED INTO, HOWEVER,  ONLY  AFTER  APPROPRIATE
FINDINGS  BY THE COMMISSIONER AND SHALL BE SUBJECT TO THE LIMITATIONS AS
SET FORTH IN THIS SECTION.
  2.  PRIOR  TO  ENTERING  INTO A CONTRACT WITH AN EXISTING NEIGHBORHOOD
PRESERVATION COMPANY, THE COMMISSIONER SHALL HAVE MADE A  FINDING,  THAT
THE COMPANY IS IN GOOD STANDING PURSUANT TO THE PROVISIONS OF PARAGRAPHS
(A)  AND  (B)  OF SUBDIVISION FIVE OF SECTION NINE HUNDRED THREE OF THIS
CHAPTER AND THAT THERE IS A NEED FOR PROPOSED  HOMEOWNERSHIP  ACTIVITIES
BEING PROPOSED BASED ON THE DOCUMENTED SUBMISSION OF THE COMPANY.
  3.  PRIOR  TO  ENTERING  INTO A CONTRACT WITH AN EXISTING NEIGHBORHOOD
PRESERVATION COMPANY, THE COMMISSIONER SHALL HAVE MADE  A  FINDING  THAT
THE  COMPANY  HAS  OR  IS PREPARED TO ENGAGE IN SERVICES OR HAS EMPLOYED
PERSONS TO RENDER CULTURAL AND LINGUISTIC ACCESSIBILITY TO  THE  DIVERSE
TARGET POPULATION.
  4.  CONTRACTS  ENTERED  INTO  HEREUNDER WITH NEIGHBORHOOD PRESERVATION
COMPANIES SHALL BE LIMITED IN DURATION TO PERIODS OF ONE YEAR,  BUT  MAY
THEREAFTER  BE RENEWED, EXTENDED OR SUCCEEDED BY NEW CONTRACTS FROM YEAR
TO YEAR IN THE DISCRETION OF THE COMMISSIONER; THEY SHALL BE LIMITED  IN
AMOUNT  TO FORTY-FIVE THOUSAND DOLLARS PER YEAR AND SHALL NOT BE CONSID-
ERED PART OF THE AGGREGATE SUM  LIMITATIONS  IMPOSED  UNDER  SUBDIVISION
FOUR OF SECTION NINE HUNDRED THREE OF THIS CHAPTER.
  5.  PRIOR TO RENEWING OR EXTENDING A CONTRACT OR ENTERING A SUCCEEDING
CONTRACT WITH A NEIGHBORHOOD PRESERVATION  COMPANY  THE  DIVISION  SHALL
DETERMINE THAT:
  (A)  THE  COMPANY SHALL HAVE SUBSTANTIALLY COMPLETED THE HOMEOWNERSHIP
ACTIVITIES SPECIFIED IN THE CONTRACT TO BE RENEWED OR SUCCEEDED;
  (B) THE COMPANY SHALL HAVE RECEIVED THE SUMS AND  FUNDS  SPECIFIED  IN
THIS SECTION; AND
  (C) THE ACTIVITIES CARRIED OUT BY THE COMPANY PURSUANT TO ITS CONTRACT
SHALL  HAVE RESULTED IN A SIGNIFICANT IMPACT ON THE NEEDS OF THE AT RISK
EXISTING AND POTENTIAL HOMEOWNERS IN THE SERVICE AREA.
  6. PRIOR TO TERMINATING OR NOT ENTERING INTO A SUCCEEDING CONTRACT THE
DIVISION SHALL:
  (A) DETERMINE THAT THE COMPANY IS IN VIOLATION OF THE TERMS AND CONDI-
TIONS OF THE CONTRACT OR THAT FUNDS PROVIDED PURSUANT  TO  THE  CONTRACT
ARE  BEING  EXPENDED  IN  A  MANNER  NOT  CONSISTENT  WITH  THE TERMS OR
PROVISIONS OF THIS ARTICLE; OR
  (B) DETERMINE THAT THE SIGNIFICANT NEED IN THE SERVICE AREA  HAS  BEEN
FULFILLED;
  (C)  PROVIDE THE COMPANY WITH WRITTEN NOTICE, AT LEAST FORTY-FIVE DAYS
IN ADVANCE, OF ITS INTENT TO TERMINATE OR NOT  RENEW  THE  CONTRACT  AND
PROVIDE  THE  COMPANY WITH THE OPPORTUNITY TO APPEAR AND BE HEARD BEFORE
THE DIVISION WITH RESPECT TO THE REASONS FOR SUCH  PROPOSED  TERMINATION
OR NON-RENEWAL. AT THE SAME TIME THAT A COMPANY IS NOTIFIED OF THE DIVI-
SION'S  INTENT  TO  TERMINATE,  OR  NOT RENEW THE CONTRACT, THE DIVISION
SHALL LIKEWISE INFORM THE SENATE  AND  ASSEMBLY  MEMBERS  WHO  REPRESENT
AREAS WITHIN SUCH COMPANY'S GEOGRAPHIC BOUNDARIES.
  7. THE DIVISION MAY TEMPORARILY WITHHOLD PAYMENTS AND MAY ELECT NOT TO
ENTER  INTO  A  SUCCEEDING  CONTRACT  WITH ANY NEIGHBORHOOD PRESERVATION
COMPANY IF THE COMPANY IS NOT IN COMPLIANCE WITH  THE  CONTRACT  OR  HAS
WITHOUT GOOD CAUSE FAILED TO SUBMIT THE DOCUMENTATION REQUIRED UNDER THE
CONTRACT.
  S  933.  PAYMENT TO NEIGHBORHOOD PRESERVATION COMPANIES FOR HOMEOWNER-
SHIP TECHNICAL ASSISTANCE AND TRAINING. 1. EACH  CONTRACT  ENTERED  INTO
WITH  A  NEIGHBORHOOD  PRESERVATION COMPANY SHALL PROVIDE PAYMENT TO THE

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NEIGHBORHOOD PRESERVATION COMPANY  FOR  URBAN  HOMEOWNERSHIP  ASSISTANCE
ACTIVITIES WHICH THE COMPANY HAS PERFORMED.
  2.  PAYMENT  TO  NEIGHBORHOOD  PRESERVATION COMPANIES PURSUANT TO THIS
ARTICLE SHALL BE RESTRICTED TO SUMS REQUIRED FOR THE PAYMENT OF SALARIES
AND WAGES TO EMPLOYEES OF SUCH COMPANIES AND FEES TO  LEGAL  CONSULTANTS
RETAINED  BY  THEM WHO ARE ENGAGED IN RENDERING HOMEOWNERSHIP ASSISTANCE
ACTIVITIES TO THE TARGET POPULATION.
  3. PAYMENTS SHALL BE MADE BY THE DIVISION TO THE NEIGHBORHOOD  PRESER-
VATION COMPANY, NOT LESS FREQUENTLY THAN SEMIANNUALLY AT OR PRIOR TO THE
COMMENCEMENT OF THE CONTRACT, TO COMPENSATE THE COMPANY FOR THE HOMEOWN-
ERSHIP  ASSISTANCE  ACTIVITIES  WHICH  IT  SHALL  UNDERTAKE  TO PERFORM;
PROVIDED THAT WITH RESPECT TO CONTRACTS ENTERED INTO ON  OR  AFTER  JUNE
THIRTIETH,  THE  FIRST SUCH PAYMENT SHALL BE MADE BY THE DIVISION BEGIN-
NING ON OR AFTER JULY FIRST OF THE FISCAL YEAR FOR  WHICH  AN  APPROPRI-
ATION  IN  SUPPORT OF SUCH PAYMENT IS MADE AND PROVIDED FURTHER THAT THE
FINAL SUCH PAYMENT TO THE NEIGHBORHOOD  PRESERVATION  COMPANY  SHALL  BE
MADE  NO  LATER THAN MARCH THIRTY-FIRST OF SUCH FISCAL YEAR, UNLESS SUCH
PAYMENT HAS BEEN WITHHELD PURSUANT  TO  THE  PROVISIONS  OF  SUBDIVISION
SEVEN OF SECTION NINE HUNDRED THIRTY-TWO OF THIS ARTICLE.
  S  934.  LEGAL  AID  AGREEMENTS. A PORTION OF THE FUNDS, NOT TO EXCEED
TWENTY PERCENT OF THE APPROPRIATION, FOR THE ACTIVITIES SPECIFIED  UNDER
THIS  ARTICLE  SHALL  BE  DEDICATED, ON A COMPETITIVE BASIS AND BASED ON
NEEDS IDENTIFIED BY EACH COMPANY, TO LEGAL AID ORGANIZATIONS WITH ESTAB-
LISHED TIES TO THE NEIGHBORHOOD PRESERVATION COMPANY APPLICANT'S SERVICE
AREA FOR THE PROVISION  OF  LEGAL  SERVICES.  IN  THE  EVENT  THAT  SUCH
NOT-FOR-PROFIT  LEGAL AID ORGANIZATIONS ARE NOT AVAILABLE, THE NEIGHBOR-
HOOD PRESERVATION COMPANY SHALL SUBCONTRACT WITH INDIVIDUAL ATTORNEYS OR
LAW FIRMS WITH THE APPROVAL OF THE COMMISSIONER.
  S 935. ANNUAL REPORT TO THE LEGISLATURE. THE COMMISSIONER SHALL SUBMIT
AN ANNUAL REPORT TO THE LEGISLATURE ON OR BEFORE  DECEMBER  THIRTY-FIRST
ON  THE  IMPLEMENTATION  OF THIS ARTICLE. SUCH REPORT SHALL INCLUDE, BUT
NOT BE LIMITED TO, FOR EACH COMPANY RECEIVING FUNDS UNDER THIS  ARTICLE,
A DESCRIPTION OF SUCH COMPANY'S CONTRACT AMOUNT, THE SPECIFIC HOMEOWNER-
SHIP  ACTIVITIES PERFORMED BY SUCH COMPANY, THE NUMBER OF PERSONS SERVED
BY THE COMPANY AND, IF APPLICABLE, ITS  LEGAL  AID  CONSULTANT  AND  THE
IMPACT OF THE ACTIVITIES PERFORMED.
  S  2.  The sum of two million dollars ($2,000,000), or so much thereof
as may be necessary, is hereby appropriated to  the  state  division  of
housing and community renewal out of any moneys in the state treasury in
the  general fund to the credit of the division of housing and community
renewal, not otherwise appropriated, and made immediately available, for
the purpose of carrying out the provisions  of  this  act.  Such  moneys
shall be payable on the audit and warrant of the comptroller on vouchers
certified or approved by the commissioner of the state division of hous-
ing and community renewal in the manner prescribed by law.
  S 3. This act shall take effect immediately.