Senate Bill S2783

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

                                 2783--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            February 1, 2011
                               ___________

Introduced  by  Sens.  ESPAILLAT,  KRUEGER,  SQUADRON  -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Housing,   Construction   and   Community   Development  --  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 emer-
  gency  housing  rent  control  law, in relation to recovery of certain
  housing accommodations by a landlord (Part A); to amend  the  adminis-
  trative  code  of  the  city  of  New  York  and  the emergency tenant
  protection act of nineteen seventy-four, in relation to limiting  rent
  increase  after  vacancy of a housing accommodation (Part B); to amend
  the administrative code of the city of  New  York  and  the  emergency
  tenant  protection  act   of nineteen seventy-four, in relation to the
  declaration of emergencies for certain rental  housing  accommodations
  (Part  C);  to  amend the local emergency housing rent control act, in
  relation to rent regulation laws (Part D); to amend chapter 576 of the
  laws of 1974 amending the emergency housing rent control law  relating
  to  the  control  of  and  stabilization of rent in certain cases, the
  emergency housing rent control law, chapter 329 of the  laws  of  1963
  amending  the emergency housing rent control law relating to recontrol
  of rents in Albany, chapter 555 of  the  laws  of  1982  amending  the
  general  business  law  and the administrative code of the city of New
  York relating to conversion of residential property to cooperative  or
  condominium ownership in the city of New York, chapter 402 of the laws
  of  1983  amending  the general business law relating to conversion of
  rental residential property to cooperative or condominium ownership in
  certain municipalities in the  counties  of  Nassau,  Westchester  and
  Rockland  and  the  rent regulation reform act of 1997, in relation to
  extending the effectiveness thereof (Part E); to amend the administra-
  tive 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 (Part F); to
  repeal paragraph 13 of subdivision a of section  5  of  section  4  of

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

                                                           LBD08273-04-1

S. 2783--A                          2

  chapter  576  of  the  laws  of 1974 constituting the emergency tenant
  protection act of nineteen seventy-four, paragraph (n) of  subdivision
  2  of  section  2 of chapter 274 of the laws of 1946, constituting the
  emergency  housing rent control law, and section 26-504.2 and subpara-
  graph (k) of paragraph 2 of subdivision e of  section  26-403  of  the
  administrative  code  of  the  city  of  New York, relating to vacancy
  decontrol (Part G); to amend the emergency tenant  protection  act  of
  nineteen  seventy-four  and the administrative code of the city of New
  York, in relation to the regulation of rents (Part H);  to  amend  the
  administrative  code  of the city of New York and the emergency tenant
  protection act of  nineteen  seventy-four,  in  relation  to  hardship
  applications (Part I); 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 extending
  the length of time over which major capital improvement  expenses  may
  be recovered (Part J); to amend the emergency tenant protection act of
  nineteen seventy-four, in relation to the declaration of housing emer-
  gencies  for  rental housing accommodations located in buildings owned
  by certain limited-profit housing companies (Part K); and to amend the
  emergency tenant protection act of nineteen seventy-four, the emergen-
  cy housing rent control law, the administrative code of  the  city  of
  New York and the tax law, in relation to deregulation thresholds (Part
  L)

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

  Section 1. This act enacts into law major  components  of  legislation
related  to rent regulations in the state of New York. Each component is
wholly contained within a Part identified as  Parts  A  through  L.  The
effective  date for each particular provision contained within such Part
is set forth in the last section of such  Part.  Any  provision  in  any
section  contained  within  a  Part, including the effective date of the
Part, which makes reference to a section "of this  act",  when  used  in
connection  with  that particular component, shall be deemed to mean and
refer to the corresponding section of the Part in  which  it  is  found.
Section  three of this act sets forth the general effective date of this
act.

                                 PART A

  Section 1. Paragraph 1 of subdivision  b  of  section  26-408  of  the
administrative  code  of  the  city  of  New  York is amended to read as
follows:
  (1) The landlord seeks in good faith to recover possession of a  hous-
ing  accommodation because of immediate and compelling necessity for his
or her own personal use and occupancy AS HIS OR HER PRIMARY RESIDENCE or
for the use and occupancy of his or her immediate family AS THEIR PRIMA-
RY RESIDENCE provided,  however,  that  this  subdivision  shall  PERMIT
RECOVERY  OF  ONLY ONE HOUSING ACCOMMODATION AND SHALL not apply where a
member of the household lawfully occupying the housing accommodation  is
sixty-two years of age or older, has been a tenant in a housing accommo-
dation  in  that building for twenty years or more, or has an impairment
which results from anatomical,  physiological  or  psychological  condi-
tions,  other  than  addiction  to  alcohol, gambling, or any controlled

S. 2783--A                          3

substance, which are demonstrable by medically acceptable  clinical  and
laboratory diagnostic techniques, and which are expected to be permanent
and  which  prevent  the tenant from engaging in any substantial gainful
employment; or
  S  2.  Subparagraph  (b)  of  paragraph  9 of subdivision c of section
26-511 of the administrative code of the city of New York is amended  to
read as follows:
  (b)  where  he  or  she  seeks  to recover possession of one [or more]
dwelling [units] UNIT BECAUSE OF IMMEDIATE AND COMPELLING NECESSITY  for
his  or  her  own personal use and occupancy as his or her primary resi-
dence [in the city of New York and/or] OR for the use and occupancy of a
member of his or her immediate family as his or  her  primary  residence
[in  the  city  of  New  York], provided however, that this subparagraph
shall PERMIT RECOVERY OF ONLY ONE DWELLING  UNIT  AND  SHALL  not  apply
where a tenant or the spouse of a tenant lawfully occupying the dwelling
unit is sixty-two years of age or older, HAS BEEN A TENANT IN A DWELLING
UNIT  IN  THAT  BUILDING  FOR TWENTY YEARS OR MORE, or has an impairment
which results from anatomical,  physiological  or  psychological  condi-
tions,  other  than  addiction  to  alcohol, gambling, or any controlled
substance, which are demonstrable by medically acceptable  clinical  and
laboratory diagnostic techniques, and which are expected to be permanent
and  which  prevent  the tenant from engaging in any substantial gainful
employment, unless such  owner  offers  to  provide  and  if  requested,
provides  an equivalent or superior housing accommodation at the same or
lower stabilized rent in a closely proximate  area.  The  provisions  of
this  subparagraph shall only permit one of the individual owners of any
building to recover possession of one [or more]  dwelling  [units]  UNIT
for  his or her own personal use and/or for that of his or her immediate
family. [Any] A dwelling unit recovered by an  owner  pursuant  to  this
subparagraph  shall  not  for a period of three years be rented, leased,
subleased or assigned to any person other than a person for whose  bene-
fit recovery of the dwelling unit is permitted pursuant to this subpara-
graph  or  to  the tenant in occupancy at the time of recovery under the
same terms as the original lease. This subparagraph shall not be  deemed
to establish or eliminate any claim that the former tenant of the dwell-
ing  unit  may otherwise have against the owner. Any such rental, lease,
sublease or assignment during such period to any  other  person  may  be
subject  to  a  penalty of a forfeiture of the right to any increases in
residential rents in such building for a period of three years; or
  S 3. Subdivision a of section 10 of section 4 of chapter  576  of  the
laws  of 1974, constituting the emergency tenant protection act of nine-
teen seventy-four, as amended by chapter 234 of the  laws  of  1984,  is
amended to read as follows:
  a.  For  cities having a population of less than one million and towns
and villages, the state division of housing and community renewal  shall
be  empowered  to  implement  this  act by appropriate regulations. Such
regulations may encompass such speculative or manipulative practices  or
renting or leasing practices as the state division of housing and commu-
nity  renewal determines constitute or are likely to cause circumvention
of this act. Such regulations shall prohibit practices which are  likely
to prevent any person from asserting any right or remedy granted by this
act,  including  but  not limited to retaliatory termination of periodic
tenancies and shall require owners to grant a new one or two year vacan-
cy or renewal lease at the option of the tenant, except where a mortgage
or mortgage commitment existing as of the local effective date  of  this
act  provides that the owner shall not grant a one-year lease; and shall

S. 2783--A                          4

prescribe standards with respect to the terms and conditions of new  and
renewal  leases,  additional  rent  and such related matters as security
deposits, advance rental payments, the use of escalator clauses in leas-
es and provision for increase in rentals for garages and other ancillary
facilities,  so  as to insure that the level of rent adjustments author-
ized under this law will not be  subverted  and  made  ineffective.  Any
provision  of  the  regulations permitting an owner to refuse to renew a
lease on grounds that the owner seeks to recover possession of  [the]  A
housing  accommodation  for  his OR HER own use and occupancy or for the
use and occupancy of his OR HER immediate family shall  PERMIT  RECOVERY
OF  ONLY  ONE  HOUSING ACCOMMODATION, SHALL require that an owner demon-
strate immediate and compelling need AND THAT THE HOUSING  ACCOMMODATION
WILL  BE  THE  PROPOSED OCCUPANTS' PRIMARY RESIDENCE and shall not apply
where a member of the housing accommodation is sixty-two years of age or
older, has been a tenant in a housing accommodation in that building for
twenty years or more, or has an impairment which  results  from  anatom-
ical, physiological or psychological conditions, other than addiction to
alcohol,  gambling,  or any controlled substance, which are demonstrable
by medically acceptable clinical and laboratory  diagnostic  techniques,
and which are expected to be permanent and which prevent the tenant from
engaging in any substantial gainful employment.
  S 4. Paragraph (a) of subdivision 2 of section 5 of chapter 274 of the
laws  of  1946,  constituting the emergency housing rent control law, as
amended by chapter 234 of the laws  of  1984,  is  amended  to  read  as
follows:
  (a)  the landlord seeks in good faith to recover possession of A hous-
ing [accommodations] ACCOMMODATION because of immediate  and  compelling
necessity  for  his  OR HER own personal use and occupancy AS HIS OR HER
PRIMARY RESIDENCE or for the use and occupancy of his OR  HER  immediate
family  AS  THEIR PRIMARY RESIDENCE; provided, however, this subdivision
shall PERMIT RECOVERY OF ONLY ONE HOUSING ACCOMMODATION  AND  SHALL  not
apply  where  a  member  of the household lawfully occupying the housing
accommodation is sixty-two years of age or older, has been a tenant in a
housing accommodation in that building for twenty years or more, or  has
an impairment which results from anatomical, physiological or psycholog-
ical  conditions,  other  than  addiction  to  alcohol, gambling, or any
controlled substance, which are  demonstrable  by  medically  acceptable
clinical and laboratory diagnostic techniques, and which are expected to
be  permanent and which prevent the tenant from engaging in any substan-
tial gainful employment; or
  S 5. This act shall take effect immediately and  shall  apply  to  any
tenant in possession at or after the time it takes effect, regardless of
whether  the  landlord's  application  for  an order, refusal to renew a
lease or refusal to extend or renew a tenancy took place before this act
shall have taken effect, provided that:
  a. the amendments to section 26-408 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;
  b.  the amendments to section 26-511 of the rent stabilization  law of
nineteen hundred sixty-nine made by section two 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;

S. 2783--A                          5

  c. the amendments to subdivision a of section 10 of section 4  of  the
emergency tenant protection act of nineteen seventy-four made by section
three  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
  d.  the  amendments  to paragraph (a) of subdivision 2 of section 5 of
the emergency housing rent control law made by section four 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.

                                 PART B

  Section  1.  Paragraph  5-a  of subdivision c of section 26-511 of the
administrative code of the city of New York, as added by chapter 116  of
the laws of 1997, is amended to read as follows:
  (5-a)  provides  that,  notwithstanding any provision of this chapter,
the legal regulated rent for any vacancy lease entered  into  after  the
effective  date  of  this  paragraph shall be as hereinafter provided in
this paragraph. The previous  legal  regulated  rent  for  such  housing
accommodation  shall  be  increased by the following: (i) if the vacancy
lease is for a term of two years, [twenty] TEN percent of  the  previous
legal  regulated rent; or (ii) if the vacancy lease is for a term of one
year the increase shall be [twenty] TEN percent of  the  previous  legal
regulated  rent  less  an amount equal to the difference between (a) the
two year renewal lease guideline promulgated by the guidelines board  of
the  city  of  New York applied to the previous legal regulated rent and
(b) the one year renewal lease guideline promulgated by  the  guidelines
board  of  the  city of New York applied to the previous legal regulated
rent. In addition, if the legal regulated rent was  not  increased  with
respect  to  such housing accommodation by a permanent vacancy allowance
within eight years prior to a vacancy lease executed  on  or  after  the
effective  date  of  this  paragraph,  the  legal  regulated rent may be
further increased by an amount  equal  to  the  product  resulting  from
multiplying  such  previous  legal  regulated  rent by six-tenths of one
percent and further multiplying the amount of  rent  increase  resulting
therefrom by the greater of (A) the number of years since the imposition
of  the  last  permanent  vacancy  allowance, or (B) if the rent was not
increased by a permanent vacancy allowance since  the  housing  accommo-
dation  became  subject  to  this chapter, the number of years that such
housing accommodation has been subject to this chapter. Provided that if
the previous legal regulated rent was less than  three  hundred  dollars
the total increase shall be as calculated above plus one hundred dollars
per  month. Provided, further, that if the previous legal regulated rent
was at least three hundred dollars and no more than five hundred dollars
in no event shall the total increase pursuant to this paragraph be  less
than  one  hundred  dollars per month. Such increase shall be in lieu of
any allowance authorized for the one or two year renewal component ther-
eof, but shall be in addition to any other increases authorized pursuant
to this chapter including an  adjustment  based  upon  a  major  capital
improvement, or a substantial modification or increase of dwelling space
or  services,  or  installation  of new equipment or improvements or new
furniture or furnishings provided in or  to  the  housing  accommodation
pursuant to this section.  THE INCREASE AUTHORIZED IN THIS PARAGRAPH MAY
NOT BE IMPLEMENTED MORE THAN ONE TIME IN ANY CALENDAR YEAR NOTWITHSTAND-
ING THE NUMBER OF VACANCY LEASES ENTERED INTO IN SUCH YEAR.

S. 2783--A                          6

  S  2.  Subdivision  (a-1) of section 10 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 116 of the laws of 1997, is
amended to read as follows:
  (a-1)  provides  that,  notwithstanding any provision of this act, the
legal regulated rent for any vacancy lease entered into after the effec-
tive date of this subdivision shall be as hereinafter set  forth.    The
previous  legal  regulated  rent for such housing accommodation shall be
increased by the following: (i) if the vacancy lease is for  a  term  of
two years, [twenty] TEN percent of the previous legal regulated rent; or
(ii)  if  the vacancy lease is for a term of one year the increase shall
be [twenty] TEN percent of the previous legal  regulated  rent  less  an
amount  equal  to  the difference between (a) the two year renewal lease
guideline promulgated by the guidelines board of the county in which the
housing accommodation is located applied to the previous legal regulated
rent and (b) the one year renewal lease  guideline  promulgated  by  the
guidelines  board  of  the  county in which the housing accommodation is
located applied to the previous legal regulated rent.  In  addition,  if
the  legal regulated rent was not increased with respect to such housing
accommodation by a permanent vacancy allowance within eight years  prior
to  a  vacancy  lease  executed  on  or after the effective date of this
subdivision, the legal regulated rent may be  further  increased  by  an
amount  equal  to  the  product resulting from multiplying such previous
legal regulated rent by six-tenths of one percent and further  multiply-
ing  the  amount  of rent increase resulting therefrom by the greater of
(A) the number of years since  the  imposition  of  the  last  permanent
vacancy  allowance,  or (B) if the rent was not increased by a permanent
vacancy allowance since the housing accommodation became subject to this
act, the number of  years  that  such  housing  accommodation  has  been
subject  to this act. Provided that if the previous legal regulated rent
was less than three hundred dollars  the  total  increase  shall  be  as
calculated  above plus one hundred dollars per month. Provided, further,
that if the previous legal regulated rent was  at  least  three  hundred
dollars  and  no  more  than  five hundred dollars in no event shall the
total increase pursuant to this subdivision be  less  than  one  hundred
dollars  per  month.  Such  increase  shall  be in lieu of any allowance
authorized for the one or two year renewal component thereof, but  shall
be  in  addition  to any other increases authorized pursuant to this act
including an adjustment based upon a major  capital  improvement,  or  a
substantial  modification  or increase of dwelling space or services, or
installation of new  equipment  or  improvements  or  new  furniture  or
furnishings  provided  in  or  to  the housing accommodation pursuant to
section six of this act.  THE INCREASE AUTHORIZED  IN  THIS  SUBDIVISION
MAY  NOT BE IMPLEMENTED MORE THAN ONE TIME IN ANY CALENDAR YEAR NOTWITH-
STANDING THE NUMBER OF VACANCY LEASES ENTERED INTO IN SUCH YEAR.
  S 3. This act shall take effect immediately; provided that the  amend-
ments  to  section  26-511  of  the  rent  stabilization law of nineteen
hundred sixty-nine made by section one 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;  and  provided,
further,  that  the  amendments  to  section  4  of the emergency tenant
protection act of nineteen seventy-four made by section two 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.

S. 2783--A                          7

                                 PART C

  Section  1. Subdivision a of section 26-504 of the administrative code
of the city of New York, subparagraph (f) of paragraph 1 as  amended  by
chapter 422 of the laws of 2010, is amended to read as follows:
  a.  Class  A  multiple  dwellings  not  owned as a cooperative or as a
condominium, except as provided in section three hundred  fifty-two-eeee
of  the  general  business  law,  containing  six or more dwelling units
which:   (1) were  completed  after  February  first,  nineteen  hundred
forty-seven,  except  dwelling units (a) owned or leased by, or financed
by loans from, a  public  agency  or  public  benefit  corporation,  (b)
subject  to rent regulation under the private housing finance law or any
other state law, (c) aided by government insurance under  any  provision
of  the  national  housing  act, to the extent this chapter or any regu-
lation or order issued thereunder  is  inconsistent  therewith,  or  (d)
located  in  a building for which a certificate of occupancy is obtained
after March tenth, nineteen hundred sixty-nine[;], or (e)  any  class  A
multiple  dwelling which on June first, nineteen hundred sixty-eight was
and still is commonly regarded as a hotel, transient hotel  or  residen-
tial  hotel,  and  which customarily provides hotel service such as maid
service, furnishing and laundering of  linen,  telephone  and  bell  boy
service, secretarial or desk service and use and upkeep of furniture and
fixtures, or (f) not occupied by the tenant, not including subtenants or
occupants,  as his or her primary residence, as determined by a court of
competent jurisdiction, provided, however that no action  or  proceeding
shall  be  commenced  seeking to recover possession on the ground that a
housing accommodation is not occupied by the tenant as his or her prima-
ry residence unless the owner or lessor shall  have  given  thirty  days
notice  to the tenant of his or her intention to commence such action or
proceeding on such grounds. For  the  purposes  of  determining  primary
residency,  a tenant who is a victim of domestic violence, as defined in
section four hundred fifty-nine-a of the social services  law,  who  has
left  the  unit  because  of such violence, and who asserts an intent to
return to the housing accommodation shall be deemed to be occupying  the
unit  as his or her primary residence. For the purposes of this subpara-
graph where a housing accommodation is rented to a not-for-profit hospi-
tal for residential use, affiliated subtenants authorized  to  use  such
accommodations  by  such  hospital shall be deemed to be tenants, or (g)
became vacant on or after June thirtieth, nineteen hundred  seventy-one,
or  become vacant, provided however, that this exemption shall not apply
or become effective with respect to  housing  accommodations  which  the
commissioner  determines  or finds became vacant because the landlord or
any person acting on his or her behalf, with intent to cause the  tenant
to  vacate,  engaged in any course of conduct (including but not limited
to, interruption or discontinuance of essential services)  which  inter-
fered with or disturbed or was intended to interfere with or disturb the
comfort, repose, peace or quiet of the tenant in his or her use or occu-
pancy  of the housing accommodations and provided further that any hous-
ing accommodations exempted by this paragraph shall be subject  to  this
law to the extent provided in subdivision b of this section; or (2) were
decontrolled  by the city rent agency pursuant to section 26-414 of this
title; or (3) are exempt from control by virtue of item one, two, six or
seven of subparagraph (i) of paragraph two of subdivision e  of  section
26-403  of this title; OR (4) WERE COVERED BY A PROJECT BASED ASSISTANCE
CONTRACT PURSUANT TO SECTION EIGHT OF THE UNITED STATES HOUSING  ACT  OF
1937  WHICH  CONTRACT  IS  NO  LONGER  IN  EFFECT,  NOTWITHSTANDING  THE

S. 2783--A                          8

PROVISIONS OF SUBPARAGRAPH (D) OR (G) OF PARAGRAPH ONE OF THIS  SUBDIVI-
SION OR PARAGRAPH FIVE OF SUBDIVISION A OF SECTION FIVE OF THE EMERGENCY
TENANT  PROTECTION  ACT  OF NINETEEN SEVENTY-FOUR PROVIDED HOWEVER, THAT
ANY  DWELLING  UNIT  WHICH  BECOMES SUBJECT TO THIS LAW PURSUANT TO THIS
PARAGRAPH SHALL NOT BE SUBJECT TO THE PROVISIONS  OF  SUBDIVISION  A  OF
SECTION 26-513 OF THIS CHAPTER; and
  S 2. Section 5 of section 4 of chapter 576 of the laws of 1974 consti-
tuting  the  emergency tenant protection act of nineteen seventy-four is
amended by adding a new subdivision c to read as follows:
  C. NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH FIVE OF  SUBDIVISION  A
OF  THIS  SECTION BUT SUBJECT TO ANY OTHER APPLICABLE EXCEPTIONS IN SUCH
SUBDIVISION, NOTHING SHALL  PREVENT  THE  DECLARATION  OF  AN  EMERGENCY
PURSUANT TO SECTION THREE OF SECTION FOUR OF THIS ACT FOR RENTAL HOUSING
ACCOMMODATIONS  LOCATED  IN  A  BUILDING  WHICH WAS COVERED BY A PROJECT
BASED ASSISTANCE CONTRACT PURSUANT TO SECTION EIGHT OF THE UNITED STATES
HOUSING ACT OF 1937 WHICH CONTRACT  IS  NO  LONGER  IN  EFFECT  PROVIDED
HOWEVER,  THAT  ANY  HOUSING ACCOMMODATION WHICH BECOMES SUBJECT TO THIS
ACT PURSUANT TO THIS SUBDIVISION SHALL NOT BE SUBJECT TO THE  PROVISIONS
OF SUBDIVISION A OF SECTION NINE OF SECTION FOUR OF THIS ACT.
  S  3.  This  act  shall take effect immediately and shall apply to all
buildings which are covered  by  a  project  based  assistance  contract
pursuant to section eight of the United States housing act of 1937 which
contract  ceased to be effective on or after such date; provided, howev-
er, that the amendment to subdivision a of section 26-504 of the  admin-
istrative  code  of the city of New York made by section one of this act
shall not affect the expiration of  such  section  pursuant  to  section
26-520  of  such code and shall expire therewith; and provided, further,
that the amendment to section 5 of the emergency tenant  protection  act
of  nineteen  seventy-four  made  by  section  two of this act shall not
affect the expiration of such act as provided in section 17  of  chapter
576 of the laws of 1974, as amended, and shall expire therewith.

                                 PART D

  Section  1.  Subdivision  5  of section 1 of chapter 21 of the laws of
1962, constituting the local emergency  housing  rent  control  act,  as
amended  by  chapter 82 of the laws of 2003 and the closing paragraph as
amended by chapter 422 of the laws  of  2010,  is  amended  to  read  as
follows:
  5.  Authority  for local rent control legislation.  Each city having a
population of one million or more, acting through its local  legislative
body,  may  adopt  and  amend local laws or ordinances in respect of the
establishment or designation of a city  housing  rent  agency.  When  it
deems such action to be desirable or necessitated by local conditions in
order  to  carry  out the purposes of this section, such city, except as
hereinafter provided, acting through its local legislative body and  not
otherwise,  may  adopt  and amend local laws or ordinances in respect of
the regulation and control  of  residential  rents,  including  but  not
limited  to  provision  for  the establishment and adjustment of maximum
rents, the classification of housing accommodations, the  regulation  of
evictions,  and  the  enforcement  of such local laws or ordinances. The
validity of any such local laws or ordinances, and the  rules  or  regu-
lations  promulgated  in  accordance therewith, shall not be affected by
and need not be consistent with the state emergency housing rent control
law or with rules and regulations of the state division of  housing  and
community renewal.

S. 2783--A                          9

  Notwithstanding  any  local  law  or ordinance, housing accommodations
which became vacant on or after July first, nineteen hundred seventy-one
or which hereafter become vacant shall be subject to the  provisions  of
the  emergency tenant protection act of nineteen seventy-four, provided,
however,  that  this  provision shall not apply or become effective with
respect to housing accommodations which, by local law or ordinance,  are
made  directly  subject to regulation and control by a city housing rent
agency and such agency determines or finds  that  the  housing  accommo-
dations  became  vacant because the landlord or any person acting on his
behalf, with intent to cause the tenant to vacate, engaged in any course
of conduct (including but not limited to, interruption or discontinuance
of essential  services)  which  interfered  with  or  disturbed  or  was
intended  to  interfere  with  or  disturb the comfort, repose, peace or
quiet of the tenant in his use or  occupancy  of  the  housing  accommo-
dations.  The  removal  of any housing accommodation from regulation and
control of rents pursuant to the vacancy exemption provided for in  this
paragraph shall not constitute or operate as a ground for the subjection
to more stringent regulation and control of any housing accommodation in
such  property  or  in  any  other  property owned by the same landlord,
notwithstanding any prior agreement to the contrary by the landlord. The
vacancy exemption provided for in this paragraph shall  not  arise  with
respect  to  any  rented plot or parcel of land otherwise subject to the
provisions of this act, by reason of a transfer of title and  possession
occurring  on  or  after  July  first, nineteen hundred seventy-one of a
dwelling located on such plot or parcel and owned by  the  tenant  where
such  transfer  of  title  and  possession  is  made  to a member of the
tenant's immediate family provided that the member of the tenant's imme-
diate family occupies the dwelling with the tenant prior to the transfer
of title and possession for a continuous period of two years.
  The term "immediate family" shall include a husband, wife, son, daugh-
ter, stepson, stepdaughter, father, mother, father-in-law or  mother-in-
law.
  [Notwithstanding  the foregoing, no local law or ordinance shall here-
after provide for the regulation and control of  residential  rents  and
eviction in respect of any housing accommodations which are (1) present-
ly exempt from such regulation and control or (2) hereafter decontrolled
either by operation of law or by a city housing rent agency, by order or
otherwise. No housing accommodations presently subject to regulation and
control  pursuant  to  local laws or ordinances adopted or amended under
authority of this subdivision shall hereafter be by local law  or  ordi-
nance  or  by rule or regulation which has not been theretofore approved
by the state commissioner of housing and community renewal subjected  to
more  stringent or restrictive provisions of regulation and control than
those presently in effect.
  Notwithstanding any other provision of law, on and after the effective
date of this paragraph, a city having a population  of  one  million  or
more  shall not, either through its local legislative body or otherwise,
adopt or amend local laws or ordinances with respect to  the  regulation
and control of residential rents and eviction, including but not limited
to  provision for the establishment and adjustment of rents, the classi-
fication of housing accommodations, the regulation of evictions, and the
enforcement of such local laws or ordinances, or otherwise adopt laws or
ordinances pursuant to the provisions of this act, the emergency  tenant
protection  act  of  nineteen  seventy-four,  the New York city rent and
rehabilitation law or the New York city rent stabilization  law,  except
to  the extent that such city for the purpose of reviewing the continued

S. 2783--A                         10

need for the existing regulation and control of residential rents or  to
remove  a  classification  of housing accommodation from such regulation
and control adopts or amends local laws or ordinances pursuant to subdi-
vision  three of section one of this act, section three of the emergency
tenant protection act of nineteen seventy-four, section  26-415  of  the
New  York  city  rent  and  rehabilitation  law, and sections 26-502 and
26-520 of the New York city rent stabilization law of  nineteen  hundred
sixty-nine.]
  Notwithstanding  any  provision of this act to the contrary, any local
law adopted pursuant to this act shall provide that notwithstanding  any
provision  of such local law in the case where all tenants occupying the
housing accommodation on the  effective  date  of  this  paragraph  have
vacated  the  housing accommodation and a family member of such vacating
tenant or tenants is entitled to and continues  to  occupy  the  housing
accommodation  subject  to the protections of such act, if such accommo-
dation continues to be subject to such  act  after  such  family  member
vacates,  on the occurrence of such vacancy the maximum collectable rent
shall be increased by a sum equal to the allowance then  in  effect  for
vacancy leases for housing accommodations covered by the rent stabiliza-
tion law of nineteen hundred sixty-nine, including the amount allowed by
paragraph  (5-a)  of  subdivision  c of section 26-511 of such law. This
increase shall be in addition to any other  increases  provided  for  in
this  act  and  shall be applicable in like manner to each second subse-
quent succession.
  Notwithstanding the foregoing, no local law or ordinance shall subject
to such regulation and control any housing accommodation  which  is  not
occupied  by  the  tenant in possession as his or her primary residence;
provided, however, that such housing accommodation not occupied  by  the
tenant  in  possession as his or her primary residence shall continue to
be subject to regulation and control as provided for herein  unless  the
city  housing  rent  agency  issues an order decontrolling such accommo-
dation, which the agency shall do upon application by the landlord when-
ever it is established by any facts  and  circumstances  which,  in  the
judgment  of  the  agency, may have a bearing upon the question of resi-
dence, that the tenant maintains his or her primary  residence  at  some
place  other  than  at such housing accommodation.   For the purposes of
determining primary residency, a tenant who  is  a  victim  of  domestic
violence,  as defined in section four hundred fifty-nine-a of the social
services law, who has left the unit because of such  violence,  and  who
asserts an intent to return to the housing accommodation shall be deemed
to be occupying the unit as his or her primary residence.
  S  2.  This act shall take effect immediately; provided, however, that
the amendments to subdivision 5 of section 1 of chapter 21 of  the  laws
of  1962  made by section one of this act shall remain in full force and
effect only so 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 further, however, that the amendment to the second  undes-
ignated  paragraph  of  subdivision  5 of section 1 of chapter 21 of the
laws of 1962 made by section one of this act shall not affect the  expi-
ration of such paragraph and shall be deemed to expire therewith.

                                 PART E

  Section  1. Section 17 of chapter 576 of the laws of 1974 amending the
emergency housing rent control  law  relating  to  the  control  of  and

S. 2783--A                         11

stabilization  of rent in certain cases, as amended by chapter 82 of the
laws of 2003, is amended to read as follows:
  S  17.  Effective  date.    This act shall take effect immediately and
shall remain in full force and effect until and including the  fifteenth
day  of  June [2011] 2016; except that sections two and three shall take
effect with respect to any city having a population of  one  million  or
more  and  section one shall take effect with respect to any other city,
or any town or village whenever the local legislative body  of  a  city,
town  or village determines the existence of a public emergency pursuant
to section three of the emergency  tenant  protection  act  of  nineteen
seventy-four,  as enacted by section four of this act, and provided that
the housing accommodations subject on the effective date of this act  to
stabilization  pursuant  to  the New York city rent stabilization law of
nineteen hundred sixty-nine shall remain subject to such  law  upon  the
expiration of this act.
  S  2.  Subdivision  2  of section 1 of chapter 274 of the laws of 1946
constituting the emergency housing rent control law, as amended by chap-
ter 82 of the laws of 2003, is amended to read as follows:
  2. The provisions  of  this  act,  and  all  regulations,  orders  and
requirements  thereunder shall remain in full force and effect until and
including June  15, [2011] 2016.
  S 3. Section 2 of chapter 329 of the laws of 1963 amending  the  emer-
gency housing rent control law relating to recontrol of rents in Albany,
as  amended  by  chapter  82  of the laws of 2003, is amended to read as
follows:
  S 2. This act shall take effect  immediately  and  the  provisions  of
subdivision  6  of section 12 of the emergency housing rent control law,
as added by this act, shall remain in full force and  effect  until  and
including June 15, [2011] 2016.
  S 4. Section 10 of chapter 555 of the laws of 1982 amending the gener-
al  business  law  and  the  administrative code of the city of New York
relating to conversion of residential property to cooperative or  condo-
minium  ownership  in  the city of New York, as amended by chapter 82 of
the laws of 2003, is amended to read as follows:
  S 10. This act shall  take  effect  immediately;  provided,  that  the
provisions  of  sections  one,  two and nine of this act shall remain in
full force and effect only until and including  June  15,  [2011]  2016;
provided  further that the provisions of section three of this act shall
remain in full force and effect only so 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  emer-
gency  housing rent control act; provided further that the provisions of
sections four, five, six and seven of this act shall expire  in  accord-
ance with the provisions of section 26-520 of the administrative code of
the city of New York as such section of the administrative code is, from
time  to  time, amended; provided further that the provisions of section
26-511 of the administrative code of the city of New York, as amended by
this act, which the New York City Department of Housing Preservation and
Development must find are contained in  the  code  of  the  real  estate
industry  stabilization association of such city in order to approve it,
shall be deemed contained therein as of the effective date of this  act;
and provided further that any plan accepted for filing by the department
of  law on or before the effective date of this act shall continue to be
governed by the provisions of section 352-eeee of the  general  business
law  as they had existed immediately prior to the effective date of this
act.

S. 2783--A                         12

  S 5. Section 4 of chapter 402 of the laws of 1983 amending the general
business law relating to conversion of rental  residential  property  to
cooperative  or  condominium  ownership in certain municipalities in the
counties of Nassau, Westchester and Rockland, as amended by  chapter  82
of the laws of 2003, is amended to read as follows:
  S  4.  This  act  shall  take  effect  immediately; provided, that the
provisions of sections one and three of this act shall  remain  in  full
force  and  effect  only  until  and including June 15, [2011] 2016; and
provided further that any plan accepted for filing by the department  of
law  on  or  before  the effective date of this act shall continue to be
governed by the provisions of section 352-eee of  the  general  business
law  as they had existed immediately prior to the effective date of this
act.
  S 6. Subdivision 6 of section 46 of chapter 116 of the  laws  of  1997
constituting the rent regulation reform act of 1997, as amended by chap-
ter 82 of the laws of 2003, is amended to read as follows:
  6.  sections  twenty-eight, twenty-eight-a, twenty-eight-b and twenty-
eight-c of this act shall expire and be deemed repealed after  June  15,
[2011] 2016;
  S 7. This act shall take effect immediately.

                                 PART F

  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
  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]

S. 2783--A                         13

  (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
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:

S. 2783--A                         14

  (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
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:

S. 2783--A                         15

  (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.  This  act shall take effect on the ninetieth day after it shall
have become a law; provided that:
  (a) 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;
  (b) the amendments to 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 and shall not affect the
expiration of such law as provided under section 26-520 of such law;
  (c) the amendments to 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;
  (d) 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
  (e) 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.

                                 PART G

  Section  1.  Legislative  findings  and  declaration of emergency. The
legislature hereby finds and declares that the serious public  emergency
which  led  to the enactment of the existing laws regulating residential
rents and evictions continues to exist;  that  such  laws  would  better
serve  the public interest if certain changes were made thereto, includ-
ing the continued regulation  of  certain  housing  accommodations  that
become  vacant  and  the  reinstatement of regulation of certain housing
accommodations that have been deregulated upon vacancy.
  The legislature further  recognizes  that  severe  disruption  of  the
rental  housing market has occurred and threatens to be exacerbated as a

S. 2783--A                         16

result of the present state of the law in relation to  the  deregulation
of  housing  accommodations  upon  vacancy.  The situation has permitted
speculative and profiteering practices and has brought about the loss of
vital and irreplaceable affordable housing for working persons and fami-
lies.
  The legislature therefore declares that in order to prevent uncertain-
ty,  potential  hardship  and  dislocation  of tenants living in housing
accommodations subject to  government  regulations  as  to  rentals  and
continued occupancy as well as those not subject to such regulation, the
provisions of this act are necessary to protect the public health, safe-
ty  and  general  welfare.  The necessity in the public interest for the
provisions hereinafter enacted is hereby declared as a matter of  legis-
lative determination.
  S 2. Paragraph (n) of subdivision 2 of section 2 of chapter 274 of the
laws  of  1946,  constituting the emergency housing rent control law, is
REPEALED.
  S 3. Paragraph 13 of subdivision a of section 5 of section 4 of  chap-
ter  576  of  the  laws  of  1974,  constituting  the  emergency  tenant
protection act of nineteen seventy-four, is REPEALED.
  S 4. Subparagraph (k) of paragraph  2  of  subdivision  e  of  section
26-403 of the administrative code of the city of New York is REPEALED.
  S  5.  Section  26-504.2 of the administrative code of the city of New
York is REPEALED.
  S 6. Any housing accommodations that on or after January 1, 2007  were
excluded from coverage from the emergency tenant protection act of nine-
teen  seventy-four, the emergency housing rent control law or the admin-
istrative code of the city of New York pursuant to the provisions of law
repealed by sections two, three, four and five  of  this  act  shall  be
subject  to  the  provisions  of  such  act, law or administrative code,
respectively.  Notwithstanding the provisions of  any  lease  or  rental
agreement,  the  legal regulated rent or maximum collectible rent of any
housing accommodation excluded from regulation on or  after  January  1,
2007  by  reason of the provisions repealed by sections two, three, four
and five of this act shall  be  the  legal  regulated  rent  or  maximum
collectible  rent applicable to such accommodation on December 31, 2006,
subject to further adjustment in accordance with  applicable  provisions
of law.
  S  7.  Any  housing  accommodations that prior to January 1, 2007 were
excluded from coverage from the emergency tenant protection act of nine-
teen seventy-four, the emergency housing rent control law or the  admin-
istrative code of the city of New York pursuant to the provisions of law
repealed  by  sections two, three, four, and five of this act, and where
such housing accommodations were located outside the city  of  New  York
and  were  rented  to a tenant on or after January 1, 2007 for less than
$3,500 per month or were located within the city of New  York  and  were
rented  to  a tenant on or after January 1, 2007 for less than $5,000.00
per month, shall be subject to the provisions of such act, law or admin-
istrative code, respectively.   Notwithstanding the  provisions  of  any
lease  or rental agreement, the legal regulated rent or maximum collect-
ible rent of any housing accommodation excluded from regulation prior to
January 1, 2007 by reason of the provisions repealed  by  sections  two,
three, four and five of this act and made subject to regulation shall be
the  actual rent applicable to such accommodations on January 1, 2007 or
the first rent applicable to such accommodation after January  1,  2007,
subject  to  further adjustment in accordance with applicable provisions
of law.

S. 2783--A                         17

  S 8.  This act shall take effect immediately.

                                 PART H

  Section  1.  Subdivision a-2 of section 10 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 82 of the laws  of  2003,  is
amended to read as follows:
  [a-2.]  (A-2)  Provides  that  where the amount of rent charged to and
paid by the tenant is less than the legal regulated rent for the housing
accommodation, the amount of rent for such housing  accommodation  which
may be charged [upon renewal or] upon vacancy thereof may, at the option
of  the owner, be based upon such previously established legal regulated
rent, as  adjusted  by  [the  most  recent]  ALL  applicable  guidelines
increases and other increases authorized by law; PROVIDED, HOWEVER, THAT
SUCH VACANCY SHALL NOT BE CAUSED BY THE FAILURE OF THE OWNER OR AN AGENT
OF  THE  OWNER, TO MAINTAIN THE HOUSING ACCOMMODATION IN COMPLIANCE WITH
THE WARRANTY OF HABITABILITY SET FORTH IN SUBDIVISION ONE OF SECTION TWO
HUNDRED THIRTY-FIVE-B OF THE REAL PROPERTY LAW.   [Where, subsequent  to
vacancy,  such  legal  regulated  rent,  as  adjusted by the most recent
applicable guidelines increases and any other  increases  authorized  by
law  is  two  thousand  dollars or more per month, such housing accommo-
dation shall be excluded from the provisions of  this  act  pursuant  to
paragraph thirteen of subdivision a of section five of this act.]
  S  2.  Paragraph 14 of subdivision c of section 26-511 of the adminis-
trative code of the city of New York, as added by chapter 82 of the laws
of 2003, is amended to read as follows:
  (14) provides that where the amount of rent charged to and paid by the
tenant is less than the legal regulated rent for  the  housing  accommo-
dation,  the  amount of rent for such housing accommodation which may be
charged [upon renewal or] upon vacancy thereof may, at the option of the
owner, be based upon such previously established legal  regulated  rent,
as  adjusted  by the most recent applicable guidelines increases and any
other increases authorized by law; PROVIDED, HOWEVER, THAT SUCH  VACANCY
SHALL  NOT  BE  CAUSED  BY  THE  FAILURE OF THE OWNER OR AN AGENT OF THE
OWNER, TO MAINTAIN THE HOUSING  ACCOMMODATION  IN  COMPLIANCE  WITH  THE
WARRANTY  OF  HABITABILITY  SET  FORTH IN SUBDIVISION ONE OF SECTION TWO
HUNDRED THIRTY-FIVE-B OF THE REAL PROPERTY LAW.   [Where, subsequent  to
vacancy,  such  legal  regulated  rent,  as  adjusted by the most recent
applicable guidelines increases and any other  increases  authorized  by
law  is  two  thousand  dollars or more per month, such housing accommo-
dation shall be excluded from the provisions of  this  law  pursuant  to
section 26-504.2 of this chapter.]
  S  3.  This act shall take effect immediately; provided, however, that
the amendments to section 10 of the emergency tenant protection  act  of
nineteen  seventy-four  made  by section one 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, further, that the amendments to section 26-511 of the rent
stabilization  law of nineteen hundred sixty-nine made by section two 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.

                                 PART I

S. 2783--A                         18

  Section  1.  Paragraph  6-a  of subdivision c of section 26-511 of the
administrative code of the city of  New  York  is  amended  to  read  as
follows:
  (6-a)  provides  criteria  whereby  as  an alternative to the hardship
application provided under paragraph six of this subdivision  owners  of
buildings  acquired  by  the same owner or a related entity owned by the
same principals [three] SIX years prior to the date of  application  may
apply to the division for increases in excess of the level of applicable
guideline increases established under this law based on a finding by the
commissioner  that such guideline increases are not sufficient to enable
the owner to maintain an annual gross  rent  income  for  such  building
which  exceeds  the  annual operating expenses of such building by a sum
equal to at least five percent of such gross rent. For the  purposes  of
this  paragraph, operating expenses shall consist of the actual, reason-
able, costs of fuel, labor,  utilities,  taxes,  other  than  income  or
corporate  franchise taxes, fees, permits, necessary contracted services
and non-capital repairs, insurance, parts and supplies, management  fees
and  other  administrative costs and mortgage interest. For the purposes
of this paragraph, mortgage interest shall be deemed to mean interest on
a bona fide mortgage including an allocable portion of  charges  related
thereto.  Criteria  to be considered in determining a bona fide mortgage
other than an institutional mortgage shall  include;  condition  of  the
property,  location of the property, the existing mortgage market at the
time the mortgage is placed, the term of the mortgage, the  amortization
rate, the principal amount of the mortgage, security and other terms and
conditions  of  the  mortgage. The commissioner shall set a rental value
for any unit occupied by the owner or a person related to the  owner  or
unoccupied  at  the  owner's  choice for more than one month at the last
regulated rent plus the minimum number of guidelines increases or, if no
such regulated rent existed or is known, the commissioner shall impute a
rent consistent with other rents in the building. The amount of hardship
increase shall be such as may be required to maintain the  annual  gross
rent  income as provided by this paragraph. The division shall not grant
a hardship application under this paragraph or  paragraph  six  of  this
subdivision  for  a period of three years subsequent to granting a hard-
ship application under the provisions of this paragraph. The  collection
of  any  increase  in the rent for any housing accommodation pursuant to
this paragraph shall not exceed six percent in any year from the  effec-
tive  date of the order granting the increase over the rent set forth in
the schedule of gross rents, with collectability of  any  dollar  excess
above  said  sum to be spread forward in similar increments and added to
the rent as established or set in future years. No application shall  be
approved unless the owner's equity in such building exceeds five percent
of: (i) the arms length purchase price of the property; (ii) the cost of
any  capital  improvements  for  which  the  owner  has  not collected a
surcharge; (iii) any repayment of principal of any mortgage or loan used
to finance the purchase of the property or any capital improvements  for
which  the  owner has not collected a surcharge and (iv) any increase in
the equalized assessed value of the property which  occurred  subsequent
to  the first valuation of the property after purchase by the owner. For
the purposes of this paragraph, owner's equity shall mean the sum of (i)
the purchase price of the property less the principal of any mortgage or
loan used to finance the purchase of the property, (ii) the cost of  any
capital  improvement  for  which the owner has not collected a surcharge
less the principal of any mortgage or loan used to finance said improve-
ment, (iii) any repayment of the principal of any mortgage or loan  used

S. 2783--A                         19

to  finance  the purchase of the property or any capital improvement for
which the owner has not collected a surcharge, and (iv) any increase  in
the  equalized  assessed value of the property which occurred subsequent
to the first valuation of the property after purchase by the owner.
  S 2. Paragraph 5 of subdivision d of section 6 of section 4 of chapter
576  of the laws of 1974 enacting the emergency tenant protection act of
nineteen seventy-four, as amended by chapter 102 of the laws of 1984, is
amended to read as follows:
  (5) as an alternative to the hardship application provided under para-
graph four of this subdivision, owners of buildings acquired by the same
owner or a related entity owned by the same principals [three] SIX years
prior to the date of application may apply to the division for increases
in excess of the level of  applicable  guideline  increases  established
under  this  law based on a finding by the commissioner that such guide-
line increases are not sufficient to enable the  owner  to  maintain  an
annual  gross  rent  income  for  such building which exceeds the annual
operating expenses of such building by a sum  equal  to  at  least  five
percent  of such gross rent. For the purposes of this paragraph, operat-
ing expenses shall consist of the actual,  reasonable,  costs  of  fuel,
labor, utilities, taxes, other than income or corporate franchise taxes,
fees,  permits,  necessary  contracted services and non-capital repairs,
insurance, parts and supplies, management fees and other  administrative
costs  and  mortgage interest. For the purposes of this paragraph, mort-
gage interest shall be deemed to mean interest on a bona  fide  mortgage
including  an allocable portion of charges related thereto.  Criteria to
be considered in determining a bona fide mortgage other than an institu-
tional mortgage shall include; condition of the  property,  location  of
the  property,  the existing mortgage market at the time the mortgage is
placed, the term of the mortgage, the amortization rate,  the  principal
amount  of  the mortgage, security and other terms and conditions of the
mortgage. The commissioner shall set a rental value for any  unit  occu-
pied  by the owner or a person related to the owner or unoccupied at the
owner's choice for more than one month at the last regulated  rent  plus
the minimum number of guidelines increases or, if no such regulated rent
existed  or  is  known,  the commissioner shall impute a rent consistent
with other rents in the building. The amount of hardship increase  shall
be  such  as may be required to maintain the annual gross rent income as
provided by this paragraph. The division  shall  not  grant  a  hardship
application  under  this paragraph or paragraph four of this subdivision
for a period of three years subsequent to granting a  hardship  applica-
tion  under  the  provisions  of  this  paragraph. The collection of any
increase in the rent for any  housing  accommodation  pursuant  to  this
paragraph  shall  not  exceed six percent in any year from the effective
date of the order granting the increase over the rent set forth  in  the
schedule  of gross rents, with collectability of any dollar excess above
said sum to be spread forward in similar increments  and  added  to  the
rent  as  established  or  set  in future years. No application shall be
approved unless the owner's equity in such building exceeds five percent
of: (i) the arms length purchase price of the property; (ii) the cost of
any capital improvements  for  which  the  owner  has  not  collected  a
surcharge; (iii) any repayment of principal of any mortgage or loan used
to  finance the purchase of the property or any capital improvements for
which the owner has not collected a surcharge; and (iv) any increase  in
the  equalized  assessed value of the property which occurred subsequent
to the first valuation of the property after purchase by the owner.  For
the purposes of this paragraph, owner's equity shall mean the sum of (i)

S. 2783--A                         20

the purchase price of the property less the principal of any mortgage or
loan  used to finance the purchase of the property, (ii) the cost of any
capital improvement for which the owner has not  collected  a  surcharge
less the principal of any mortgage or loan used to finance said improve-
ment,  (iii) any repayment of the principal of any mortgage or loan used
to finance the purchase of the property or any capital  improvement  for
which  the owner has not collected a surcharge, and (iv) any increase in
the equalized assessed value of the property which  occurred  subsequent
to the first valuation of the property after purchase by the owner.
  S  3. This act shall take effect immediately; provided that the amend-
ments to section 26-511 of chapter 4 of title 26 of  the  administrative
code  of  the  city  of  New  York made by section one 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; and
provided  that  the  amendments  to  section  6  of the emergency tenant
protection act of nineteen seventy-four made by section two 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.

                                 PART J

  Section 1. Subparagraph (g) of paragraph 1 of subdivision g of section
26-405 of the administrative code of the city of New York, as amended by
chapter 749 of the laws of 1990,  is amended to read as follows:
  (g) (I) COLLECTION OF SURCHARGES TO THE MAXIMUM RENT AUTHORIZED PURSU-
ANT  TO  ITEM  (II)  OF THIS SUBPARAGRAPH SHALL CEASE WHEN THE OWNER HAS
RECOVERED THE COST OF THE MAJOR CAPITAL IMPROVEMENT;
  (II) There has been since July  first,  nineteen  hundred  seventy,  a
major  capital  improvement [required for the operation, preservation or
maintenance of the structure. An adjustment under this subparagraph  (g)
shall  be  in  an amount sufficient to amortize the cost of the improve-
ments pursuant to this  subparagraph  (g)  over  a  seven-year  period];
PROVIDED  THAT  THE COMMISSIONER FINDS THAT SUCH IMPROVEMENTS ARE DEEMED
DEPRECIABLE UNDER THE INTERNAL REVENUE CODE AND  SUCH  IMPROVEMENTS  ARE
REQUIRED  FOR  THE  OPERATION, PRESERVATION OR MAINTENANCE OF THE STRUC-
TURE. THE INCREASE PERMITTED  FOR  SUCH  CAPITAL  IMPROVEMENT  SHALL  BE
COLLECTED  AS A MONTHLY SURCHARGE TO THE MAXIMUM RENT. IT SHALL BE SEPA-
RATELY DESIGNATED AND BILLED AS SUCH AND SHALL NOT BE COMPOUNDED BY  ANY
OTHER  ADJUSTMENT  TO  THE MAXIMUM RENT. THE SURCHARGE ALLOCABLE TO EACH
APARTMENT SHALL BE AN AMOUNT  EQUAL  TO  THE  COST  OF  THE  IMPROVEMENT
DIVIDED BY  EIGHTY-FOUR, DIVIDED BY THE NUMBER OF ROOMS IN THE BUILDING,
AND  THEN  MULTIPLIED BY THE NUMBER OF ROOMS IN SUCH APARTMENT; PROVIDED
THAT THE SURCHARGE ALLOCABLE TO ANY APARTMENT IN ANY ONE  YEAR  MAY  NOT
EXCEED  AN  AMOUNT EQUAL TO SIX PERCENT OF THE MONTHLY RENT COLLECTED BY
THE OWNER FOR SUCH APARTMENT AS SET  FORTH  IN  THE  SCHEDULE  OF  GROSS
RENTS.    ANY EXCESS ABOVE SAID SIX PERCENT SHALL BE CARRIED FORWARD AND
COLLECTED IN FUTURE YEARS AS A FURTHER SURCHARGE NOT TO EXCEED AN  ADDI-
TIONAL  SIX  PERCENT  IN  ANY  ONE YEAR PERIOD UNTIL THE TOTAL SURCHARGE
EQUALS THE AMOUNT IT WOULD HAVE BEEN IF THE AFOREMENTIONED  SIX  PERCENT
LIMITATION DID NOT APPLY; or
  S  2.  Subparagraph  (k)  of  paragraph  1 of subdivision g of section
26-405 of the administrative code of the city of New York, as amended by
chapter 749 of the laws of 1990,  is amended to read as follows:
  (k) The landlord has incurred, since January first,  nineteen  hundred
seventy,  in connection with and in addition to a concurrent major capi-

S. 2783--A                         21

tal improvement pursuant to subparagraph (g) of  this  paragraph,  other
expenditures  to  improve, restore or preserve the quality of the struc-
ture. An adjustment under this subparagraph shall  be  granted  only  if
such  improvements  represent  an  expenditure equal to at least ten per
centum of the total operating and maintenance expenses for the preceding
year. An adjustment under this subparagraph shall be in addition to  any
adjustment  granted  for  the  concurrent  major capital improvement and
shall be [in an amount sufficient to amortize the cost of  the  improve-
ments  pursuant  to  this subparagraph over a seven-year  period] IMPLE-
MENTED IN THE SAME MANNER AS SUCH MAJOR CAPITAL IMPROVEMENT AS A FURTHER
SURCHARGE TO THE MAXIMUM RENT.
  S 3. Paragraph 6 of subdivision c of section 26-511 of the administra-
tive code of the city of New York, as amended by chapter 116 of the laws
of 1997,  is amended to read as follows:
  (6) provides criteria whereby the commissioner may act  upon  applica-
tions  by  owners  for  increases  in  excess  of the level of fair rent
increase established under this law provided, however, that such  crite-
ria  shall provide [(a)] as to hardship applications, for a finding that
the level of fair rent increase is not sufficient to enable the owner to
maintain approximately the same average annual net income  (which  shall
be  computed  without regard to debt service, financing costs or manage-
ment fees) for the three year period ending on or within six  months  of
the  date  of  an application pursuant to such criteria as compared with
annual net income, which prevailed on the average over the period  nine-
teen  hundred  sixty-eight  through nineteen hundred seventy, or for the
first three years of operation if the building was completed since nine-
teen hundred sixty-eight or for the first three  fiscal  years  after  a
transfer of title to a new owner provided the new owner can establish to
the  satisfaction  of  the commissioner that he or she acquired title to
the building as a result of a bona fide sale of the entire building  and
that  the new owner is unable to obtain requisite records for the fiscal
years nineteen hundred  sixty-eight  through  nineteen  hundred  seventy
despite  diligent  efforts to obtain same from predecessors in title and
further provided that the new owner can provide financial data  covering
a  minimum  of  six  years under his or her continuous and uninterrupted
operation of the building to meet the three year to three  year  compar-
ative  test  periods herein provided[; and (b) as to completed building-
wide major capital improvements, for a finding  that  such  improvements
are deemed depreciable under the Internal Revenue Code and that the cost
is  to  be  amortized over a seven-year period, based upon cash purchase
price exclusive  of  interest  or  service  charges].    Notwithstanding
anything  to the contrary contained herein, no hardship increase granted
pursuant to this paragraph shall, when added to the annual gross  rents,
as  determined  by  the  commissioner, exceed the sum of, (i) the annual
operating expenses, (ii) an allowance for management services as  deter-
mined  by  the  commissioner,  (iii) actual annual mortgage debt service
(interest and amortization) on its indebtedness to  a  lending  institu-
tion,  an  insurance company, a retirement fund or welfare fund which is
operated under the supervision of the banking or insurance laws  of  the
state  of  New  York  or  the United States, and (iv) eight and one-half
percent of that portion of the fair market value of the  property  which
exceeds  the  unpaid  principal  amount  of  the  mortgage  indebtedness
referred to in subparagraph (iii) of this paragraph. Fair  market  value
for  the  purposes of this paragraph shall be six times the annual gross
rent. The collection of any increase in  the  stabilized  rent  for  any
apartment pursuant to this paragraph shall not exceed six percent in any

S. 2783--A                         22

year from the effective date of the order granting the increase over the
rent  set  forth  in the schedule of gross rents, with collectability of
any dollar excess above said sum to be spread forward in similar  incre-
ments  and  added to the stabilized rent as established or set in future
years;
  S 4. Subdivision c of section 26-511 of the administrative code of the
city of New York is amended by adding two new paragraphs 6-b and 6-c  to
read as follows:
  (6-B) PROVIDES CRITERIA WHEREBY THE COMMISSIONER MAY ACT UPON APPLICA-
TION  BY  OWNERS  FOR  INCREASES  IN  EXCESS  OF  THE LEVEL OF FAIR RENT
INCREASE ESTABLISHED UNDER THIS LAW PROVIDED, HOWEVER, THAT SUCH  CRITE-
RIA  SHALL  PROVIDE AS TO COMPLETED BUILDING-WIDE MAJOR CAPITAL IMPROVE-
MENTS, FOR A FINDING THAT SUCH IMPROVEMENTS ARE DEEMED DEPRECIABLE UNDER
THE INTERNAL REVENUE CODE AND SUCH IMPROVEMENTS  ARE  REQUIRED  FOR  THE
OPERATION,  PRESERVATION  OR  MAINTENANCE OF THE STRUCTURE. THE INCREASE
PERMITTED FOR SUCH CAPITAL IMPROVEMENT SHALL BE COLLECTED AS  A  MONTHLY
SURCHARGE TO THE LEGAL REGULATED RENT. IT SHALL BE SEPARATELY DESIGNATED
AND  BILLED AS SUCH AND SHALL NOT BE COMPOUNDED BY ANY ANNUAL ADJUSTMENT
OF THE LEVEL OF FAIR RENT PROVIDED FOR UNDER SUBDIVISION  B  OF  SECTION
26-510  OF THIS LAW.  THE SURCHARGE ALLOCABLE TO EACH APARTMENT SHALL BE
AN AMOUNT EQUAL TO THE COST OF THE IMPROVEMENT DIVIDED  BY  EIGHTY-FOUR,
DIVIDED  BY  THE NUMBER OF ROOMS IN THE BUILDING, AND THEN MULTIPLIED BY
THE NUMBER OF ROOMS IN SUCH APARTMENT; PROVIDED THAT THE SURCHARGE ALLO-
CABLE TO ANY APARTMENT, IN ANY ONE YEAR MAY NOT EXCEED AN  AMOUNT  EQUAL
TO  SIX  PERCENT  OF  THE  MONTHLY  RENT COLLECTED BY THE OWNER FOR SUCH
APARTMENT AS SET FORTH IN THE SCHEDULE OF GROSS RENTS.  ANY EXCESS ABOVE
SAID SIX PERCENT SHALL BE CARRIED FORWARD AND COLLECTED IN FUTURE  YEARS
AS  A  FURTHER  SURCHARGE NOT TO EXCEED AN ADDITIONAL SIX PERCENT IN ANY
ONE YEAR PERIOD UNTIL THE TOTAL SURCHARGE EQUALS  THE  AMOUNT  IT  WOULD
HAVE BEEN IF THE AFOREMENTIONED SIX PERCENT LIMITATION DID NOT APPLY.
  (6-C)  COLLECTION  OF  SURCHARGES  IN EXCESS OF THE LEVEL OF FAIR RENT
AUTHORIZED PURSUANT TO PARAGRAPH SIX-B OF THIS SUBDIVISION  SHALL  CEASE
WHEN THE OWNER HAS RECOVERED THE COST OF THE MAJOR CAPITAL IMPROVEMENT.
  S 5. Paragraph 3 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 amended by chapter 749 of the  laws  of
1990, is amended to read as follows:
  (3)  (I)  COLLECTION  OF SURCHARGES IN ADDITION TO THE LEGAL REGULATED
RENT AUTHORIZED PURSUANT TO SUBPARAGRAPH (II) OF  THIS  PARAGRAPH  SHALL
CEASE  WHEN  THE  OWNER  HAS  RECOVERED  THE  COST  OF THE MAJOR CAPITAL
IMPROVEMENT;
  (II) there has been since January first, nineteen hundred seventy-four
a major capital improvement [required for the operation, preservation or
maintenance of the structure.  An adjustment under this paragraph  shall
be  in  an  amount  sufficient  to amortize the cost of the improvements
pursuant to this paragraph over a seven-year period]; PROVIDED THAT  THE
COMMISSIONER  FINDS  THAT SUCH IMPROVEMENTS ARE DEEMED DEPRECIABLE UNDER
THE INTERNAL REVENUE CODE AND SUCH IMPROVEMENTS  ARE  REQUIRED  FOR  THE
OPERATION,  PRESERVATION  OR MAINTENANCE OF THE STRUCTURE.  THE INCREASE
PERMITTED FOR SUCH CAPITAL IMPROVEMENT SHALL BE COLLECTED AS  A  MONTHLY
SURCHARGE TO THE LEGAL REGULATED RENT. IT SHALL BE SEPARATELY DESIGNATED
AND  BILLED  AS  SUCH  AND  SHALL  NOT  BE COMPOUNDED BY ANY ANNUAL RENT
ADJUSTMENT AUTHORIZED BY THE RENT GUIDELINES BOARD UNDER THIS  ACT.  THE
SURCHARGE  ALLOCABLE  TO  EACH APARTMENT SHALL BE AN AMOUNT EQUAL TO THE
COST OF THE IMPROVEMENT DIVIDED BY EIGHTY-FOUR, DIVIDED BY THE NUMBER OF
ROOMS IN THE BUILDING, AND THEN MULTIPLIED BY THE  NUMBER  OF  ROOMS  IN

S. 2783--A                         23

SUCH  APARTMENT;  PROVIDED THAT THE SURCHARGE ALLOCABLE TO ANY APARTMENT
IN ANY ONE YEAR MAY NOT EXCEED AN AMOUNT EQUAL TO  SIX  PERCENT  OF  THE
MONTHLY  RENT  COLLECTED BY THE OWNER FOR SUCH APARTMENT AS SET FORTH IN
THE SCHEDULE OF GROSS RENTS.  ANY EXCESS ABOVE SAID SIX PERCENT SHALL BE
CARRIED FORWARD AND COLLECTED IN FUTURE YEARS AS A FURTHER SURCHARGE NOT
TO  EXCEED  AN  ADDITIONAL  SIX PERCENT IN ANY ONE YEAR PERIOD UNTIL THE
TOTAL SURCHARGE EQUALS THE AMOUNT IT WOULD HAVE BEEN  IF  THE  AFOREMEN-
TIONED SIX PERCENT LIMITATION DID NOT APPLY, or
  S 6. The second undesignated paragraph of paragraph (a) of subdivision
4  of  section  4  of  chapter 274 of the laws of 1946, constituting the
emergency housing rent control law, as amended by chapter 21 of the laws
of 1962, clause 5 as amended by chapter 253 of  the  laws  of  1993,  is
amended to read as follows:
  No application for adjustment of maximum rent based upon a sales price
valuation  shall  be filed by the landlord under this subparagraph prior
to six months from the date of such sale of the property.  In  addition,
no  adjustment  ordered  by  the  commission based upon such sales price
valuation shall be effective prior to one year from  the  date  of  such
sale.    Where, however, the assessed valuation of the land exceeds four
times the assessed valuation of the buildings  thereon,  the  commission
may determine a valuation of the property equal to five times the equal-
ized  assessed  valuation  of  the  buildings,  for the purposes of this
subparagraph.  The commission may make a determination  that  the  valu-
ation  of  the  property  is  an  amount  different  from such equalized
assessed valuation where there is a request  for  a  reduction  in  such
assessed  valuation  currently  pending;  or  where  there  has  been  a
reduction in the assessed valuation for  the  year  next  preceding  the
effective  date  of the current assessed valuation in effect at the time
of the filing of the application.  Net annual return shall be the amount
by which the earned income exceeds the operating expenses of the proper-
ty, excluding mortgage interest and amortization, and  excluding  allow-
ances  for  obsolescence  and  reserves,  but including an allowance for
depreciation of two per centum of the value of the  buildings  exclusive
of  the  land,  or the amount shown for depreciation of the buildings in
the latest required federal  income  tax  return,  whichever  is  lower;
provided,  however, that (1) no allowance for depreciation of the build-
ings shall be included where the buildings have been  fully  depreciated
for federal income tax purposes or on the books of the owner; or (2) the
landlord  who  owns  no more than four rental units within the state has
not been fully compensated by increases in rental income  sufficient  to
offset  unavoidable increases in property taxes, fuel, utilities, insur-
ance and repairs and maintenance, excluding mortgage interest and  amor-
tization,  and  excluding  allowances for depreciation, obsolescence and
reserves, which have occurred since the  federal  date  determining  the
maximum rent or the date the property was acquired by the present owner,
whichever  is  later;  or (3)   the landlord operates a hotel or rooming
house or owns a cooperative apartment and has not been fully compensated
by increases in rental income from the controlled housing accommodations
sufficient to offset unavoidable increases in property taxes  and  other
costs  as  are  allocable  to  such  controlled  housing accommodations,
including costs of operation of such hotel or rooming house, but exclud-
ing mortgage interest and amortization,  and  excluding  allowances  for
depreciation,  obsolescence  and reserves, which have occurred since the
federal date determining the maximum  rent  or  the  date  the  landlord
commenced the operation of the property, whichever is later; or (4)  the
landlord and tenant voluntarily enter into a valid written lease in good

S. 2783--A                         24

faith  with  respect  to any housing accommodation, which lease provides
for an increase in the maximum rent not in excess of fifteen per  centum
and  for a term of not less than two years, except that where such lease
provides  for  an increase in excess of fifteen per centum, the increase
shall be automatically reduced to fifteen per centum; or (5)  the  land-
lord  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  installation  of  new
equipment or improvements or new furniture or furnishings provided in or
to a tenant's housing accommodation. The permanent increase in the maxi-
mum rent for the affected housing accommodation shall be one-fortieth 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 furni-
ture 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 (6)  there
has been, since March first, nineteen hundred fifty, an increase in  the
rental  value of the housing accommodations as a result of a substantial
rehabilitation of the building or housing  accommodation  therein  which
materially adds to the value of the property or appreciably prolongs its
life,  excluding  ordinary repairs, maintenance and replacements; or (7)
(I) COLLECTION OF SURCHARGES TO THE MAXIMUM RENT AUTHORIZED PURSUANT  TO
ITEM  (II)  OF  THIS CLAUSE SHALL CEASE WHEN THE OWNER HAS RECOVERED THE
COST OF THE MAJOR CAPITAL IMPROVEMENT; (II) there has been  since  March
first, nineteen hundred fifty, a major capital improvement [required for
the  operation,  preservation or maintenance of the structure]; PROVIDED
THAT THE COMMISSIONER FINDS THAT SUCH IMPROVEMENTS ARE DEEMED  DEPRECIA-
BLE  UNDER  THE INTERNAL REVENUE CODE AND SUCH IMPROVEMENTS ARE REQUIRED
FOR THE OPERATION, PRESERVATION OR MAINTENANCE  OF  THE  STRUCTURE.  THE
INCREASE  PERMITTED FOR SUCH CAPITAL IMPROVEMENT SHALL BE COLLECTED AS A
MONTHLY SURCHARGE TO THE MAXIMUM RENT. IT SHALL BE SEPARATELY DESIGNATED
AND BILLED AS SUCH AND SHALL NOT BE COMPOUNDED BY ANY  OTHER  ADJUSTMENT
TO  THE MAXIMUM RENT. THE SURCHARGE ALLOCABLE TO EACH APARTMENT SHALL BE
AN AMOUNT EQUAL TO THE COST OF THE IMPROVEMENT DIVIDED BY   EIGHTY-FOUR,
DIVIDED  BY  THE NUMBER OF ROOMS IN THE BUILDING, AND THEN MULTIPLIED BY
THE NUMBER OF ROOMS IN SUCH APARTMENT; PROVIDED THAT THE SURCHARGE ALLO-
CABLE TO ANY APARTMENT IN ANY ONE YEAR MAY NOT EXCEED AN AMOUNT EQUAL TO
SIX PERCENT OF THE MONTHLY RENT COLLECTED BY THE OWNER FOR  SUCH  APART-
MENT AS SET FORTH IN THE SCHEDULE OF GROSS RENTS.  ANY EXCESS ABOVE SAID
SIX  PERCENT SHALL BE CARRIED FORWARD AND COLLECTED IN FUTURE YEARS AS A
FURTHER SURCHARGE NOT TO EXCEED AN ADDITIONAL SIX  PERCENT  IN  ANY  ONE
YEAR  PERIOD  UNTIL  THE TOTAL SURCHARGE EQUALS THE AMOUNT IT WOULD HAVE
BEEN IF THE AFOREMENTIONED SIX PERCENT LIMITATION DID NOT APPLY; or  (8)
there  has been since March first, nineteen hundred fifty, in structures
containing more than four  housing  accommodations,  other  improvements
made  with  the  express consent of the tenants in occupancy of at least
seventy-five per  centum of the housing accommodations, provided, howev-
er, that no adjustment granted hereunder shall exceed fifteen per centum
unless the tenants have agreed to a higher percentage  of  increase,  as

S. 2783--A                         25

herein  provided;  or  (9)   there has been, since March first, nineteen
hundred fifty, a subletting without written consent from the landlord or
an increase in the number of adult occupants who are not members of  the
immediate  family  of  the tenant, and the landlord has not been compen-
sated therefor by adjustment of the maximum rent by lease  or  order  of
the  commission or pursuant to the federal act; or (10)  the presence of
unique or peculiar circumstances materially affecting the  maximum  rent
has  resulted  in  a  maximum rent which is substantially lower than the
rents generally prevailing in the same area  for  substantially  similar
housing accommodations.
  S  7. This act shall take effect immediately; provided that the amend-
ments to section 26-405 of the city rent and rehabilitation law made  by
sections  one  and two of this act shall remain in full force and effect
only so 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;  and  provided further that the amendments to section 26-511 of the
rent stabilization law of nineteen hundred sixty-nine made  by  sections
three  and  four  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, as from time to time amended; and
provided further that the amendment to section 6 of the emergency tenant
protection act of nineteen seventy-four made by section five 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, as from time to time  amended;  and  further  provided
that  the  amendment  to section 4 of the emergency housing rent control
law made by section 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 in subdivision 2 of section 1 of chapter 274  of  the  laws  of
1946.

                                 PART K

  Section  1. Section 5 of section 4 of chapter 576 of the laws of 1974,
constituting the emergency tenant protection act  of  nineteen  seventy-
four, is amended by adding a new subdivision d to read as follows:
  D. NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH THREE OR FIVE OF SUBDI-
VISION  A OF THIS SECTION BUT SUBJECT TO ANY OTHER APPLICABLE EXCEPTIONS
IN SUCH SUBDIVISION, NOTHING SHALL PREVENT THE DECLARATION OF  AN  EMER-
GENCY  PURSUANT TO SECTION THREE OF THIS ACT FOR RENTAL HOUSING ACCOMMO-
DATIONS LOCATED IN BUILDINGS WHICH WERE OWNED BY A  COMPANY  ESTABLISHED
UNDER  ARTICLE 2 OF THE PRIVATE HOUSING FINANCE LAW, OTHER THAN A MUTUAL
COMPANY, BY REASON OF A VOLUNTARY DISSOLUTION PURSUANT TO SECTION 35  OF
SUCH  LAW.  THE  PROVISION  OF SUBDIVISION A OF SECTION NINE OF THIS ACT
SHALL NOT APPLY TO ANY HOUSING ACCOMMODATION  WHICH  BECAME  SUBJECT  TO
THIS ACT PURSUANT TO THIS SUBDIVISION.
  S 2. This act shall take effect immediately and shall apply to housing
companies  that dissolve before, on or after such date; provided, howev-
er, that the amendments to the emergency tenant protection act of  nine-
teen  seventy-four  made  by this act shall not affect the expiration of
such act as provided in section 17 of chapter 576 of the laws  of  1974,
as amended and shall be deemed to expire therewith.

                                 PART L

S. 2783--A                         26

  Section  1. Paragraph 12 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, as amended by chapter 116 of
the laws of 1997, is amended to read as follows:
  (12) upon issuance of an order by the division, housing accommodations
which  are:  (1)  occupied by persons who have a total annual income [in
excess of one hundred  seventy-five  thousand  dollars  per  annum],  AS
DEFINED  IN  AND  SUBJECT  TO  THE  LIMITATIONS AND PROCESS SET FORTH IN
SECTION FIVE-A OF THIS ACT, THAT EXCEEDS THE DEREGULATION INCOME THRESH-
OLD, AS DEFINED IN SECTION FIVE-A OF THIS ACT in each of the two preced-
ing calendar years[, as defined in and subject to  the  limitations  and
process  set  forth in section five-a of this act]; and (2) have a legal
regulated rent [of two thousand dollars or more per month]  THAT  EQUALS
OR EXCEEDS THE DEREGULATION RENT THRESHOLD, AS DEFINED IN SECTION FIVE-A
OF  THIS ACT.   Provided however, that this exclusion shall not apply to
housing accommodations which became or become subject to this act (a) by
virtue of receiving tax benefits pursuant to section four hundred  twen-
ty-one-a  or  four  hundred  eighty-nine  of  the real property tax law,
except as otherwise provided in subparagraph (i)  of  paragraph  (f)  of
subdivision two of section four hundred twenty-one-a of the real proper-
ty tax law, or (b) by virtue of article seven-C of the multiple dwelling
law.
  S  2.  Section  5-a  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, subdivision (b) and
paragraphs 1 and 2 of subdivision (c) as amended and subdivision (e)  as
added by chapter 116 of the laws of 1997, is amended to read as follows:
  S 5-a. High income rent [decontrol] DEREGULATION.  (a) 1. For purposes
of  this  section,  annual  income shall mean the federal adjusted gross
income as reported on the New York state income tax return. Total annual
income means the sum of the annual incomes of all  persons  whose  names
are recited as the tenant or co-tenant on a lease who occupy the housing
accommodation  and  all  other  persons that occupy the housing accommo-
dation as their primary residence  on  other  than  a  temporary  basis,
excluding  bona  fide  employees  of  such occupants residing therein in
connection with such employment and excluding bona  fide  subtenants  in
occupancy pursuant to the provisions of section two hundred twenty-six-b
of  the real property law.  In the case where a housing accommodation is
sublet, the annual income of the tenant  or  co-tenant  recited  on  the
lease who will reoccupy the housing accommodation upon the expiration of
the sublease shall be considered.
  2. DEREGULATION INCOME THRESHOLD MEANS THREE HUNDRED THOUSAND DOLLARS.
FOR  PROCEEDINGS  COMMENCED  ON  OR  AFTER  JANUARY  FIRST, TWO THOUSAND
TWELVE, THE DEREGULATION INCOME THRESHOLD SHALL BE ADJUSTED ANNUALLY  ON
THE FIRST DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT
YEAR  BY  THE  CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN
CONSUMERS, NEW YORK-NORTHERN NEW  JERSEY-LONG  ISLAND,  NY-NJ-CT-PA,  AS
ESTABLISHED THE PRECEDING AUGUST.
  3.  DEREGULATION  RENT  THRESHOLD  MEANS  THREE  THOUSAND DOLLARS. FOR
PROCEEDINGS COMMENCED ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  TWELVE,
THE  DEREGULATION RENT THRESHOLD SHALL BE ADJUSTED ANNUALLY ON THE FIRST
DAY OF OCTOBER EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT YEAR BY  THE
CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS, NEW
YORK-NORTHERN  NEW  JERSEY-LONG  ISLAND, NY-NJ-CT-PA, AS ESTABLISHED THE
PRECEDING AUGUST.

S. 2783--A                         27

  (b) On or before the first day of May in each calendar year, the owner
of each housing accommodation for which the legal regulated MONTHLY rent
[is two thousand dollars or more per month] EQUALS OR EXCEEDS THE DEREG-
ULATION RENT THRESHOLD may provide the tenant or tenants residing there-
in with an income certification form prepared by the division of housing
and community renewal on which such tenant or tenants shall identify all
persons referred to in subdivision (a) of this section and shall certify
whether  the  total  annual income is in excess of [one hundred seventy-
five thousand dollars] THE DEREGULATION INCOME THRESHOLD in each of  the
two preceding calendar years. Such income certification form shall state
that  the  income  level  certified  to  by the tenant may be subject to
verification by the department  of  taxation  and  finance  pursuant  to
section  one hundred seventy-one-b of the tax law, and shall not require
disclosure of any information  other  than  whether  the  aforementioned
threshold has been exceeded. Such income certification form shall clear-
ly state that: (i) only tenants residing in housing accommodations which
had  a legal regulated MONTHLY rent [of two thousand dollars or more per
month] THAT EQUALS  OR  EXCEEDS  THE  DEREGULATION  RENT  THRESHOLD  are
required  to  complete  the  certification  form; (ii) that tenants have
protections available to them which are designed to prevent  harassment;
(iii) that tenants are not required to provide any information regarding
their  income except that which is requested on the form and may contain
such other information the division deems  appropriate.  The  tenant  or
tenants  shall  return  the  completed certification to the owner within
thirty days after service upon the tenant or tenants. In the event  that
the total annual income as certified is in excess of [one hundred seven-
ty-five thousand dollars] THE DEREGULATION INCOME THRESHOLD in each such
year,  the  owner  may file the certification with the state division of
housing and community renewal on or before June thirtieth of such  year.
Upon  filing  such  certification with the division, the division shall,
within thirty days after the filing, issue an order providing that  such
housing accommodation shall not be subject to the provisions of this act
upon the expiration of the existing lease. A copy of such order shall be
mailed  by  regular and certified mail, return receipt requested, to the
tenant or tenants and a copy thereof shall be mailed to the owner.
  (c) 1. In the event that the tenant or tenants either fail  to  return
the  completed certification to the owner on or before the date required
by subdivision (b) of this section or the  owner  disputes  the  certif-
ication  returned  by the tenant or tenants, the owner may, on or before
June thirtieth of such year, petition the state division of housing  and
community  renewal  to  verify, pursuant to section one hundred seventy-
one-b of the tax law, whether  the  total  annual  income  exceeds  [one
hundred seventy-five thousand dollars] THE DEREGULATION INCOME THRESHOLD
in  each  of  the two preceding calendar years. Within twenty days after
the filing of such request with the division, the division shall  notify
the  tenant  or  tenants  that such tenant or tenants named on the lease
must provide the division with such information as the division and  the
department  of  taxation and finance shall require to verify whether the
total annual income exceeds [one hundred seventy-five thousand  dollars]
THE  DEREGULATION  INCOME  THRESHOLD  in  each such year. The division's
notification shall require the tenant or tenants to provide the informa-
tion to the division within sixty days of service upon  such  tenant  or
tenants  and  shall include a warning in bold faced type that failure to
respond will result in an order being issued by the  division  providing
that  such housing accommodations shall not be subject to the provisions
of this act.

S. 2783--A                         28

  2. If the department of taxation and finance determines that the total
annual income  is  in  excess  of  [one  hundred  seventy-five  thousand
dollars]  THE DEREGULATION INCOME THRESHOLD in each of the two preceding
calendar years, the division shall, on or before November  fifteenth  of
such year, notify the owner and tenants of the results of such verifica-
tion. Both the owner and the tenants shall have thirty days within which
to  comment  on such verification results.  Within forty-five days after
the expiration of the comment period, the division shall,  where  appro-
priate,  issue  an order providing that such housing accommodation shall
not be subject to the provisions of this  act  upon  expiration  of  the
existing  lease.  A  copy  of  such order shall be mailed by regular and
certified mail, return receipt requested, to the tenant or tenants and a
copy thereof shall be sent to the owner.
  3. In the event the tenant or tenants fail to provide the  information
required  pursuant  to  paragraph  one of this subdivision, the division
shall issue, on or before December first of such year, an order  provid-
ing  that  such  housing  accommodation  shall  not  be  subject  to the
provisions of this act upon the expiration [or] OF the current lease.  A
copy of such order shall be mailed by regular and certified mail, return
receipt  requested, to the tenant or tenants and a copy thereof shall be
sent to the owner.
  4. The provisions of the state freedom of information  act  shall  not
apply  to  any  income  information obtained by the division pursuant to
this section.
  (d) This section shall apply only to paragraph twelve of subdivision a
of section five of this act.
  (e) Upon receipt of such order of [decontrol] DEREGULATION pursuant to
this section, an owner shall offer the housing accommodation subject  to
such  order  to  the  tenant at a rent not in excess of the market rent,
which for the purposes of this section means a  rent  obtainable  in  an
arm's  length  transaction. Such rental offer shall be made by the owner
in writing to the tenant by certified and regular mail and shall  inform
the  tenant  that such offer must be accepted in writing within ten days
of receipt.  The tenant shall respond within ten days after  receipt  of
such  offer. If the tenant declines the offer or fails to respond within
such period, the owner may commence an  action  or  proceeding  for  the
eviction of such tenant.
  S 3. Paragraph (m) of subdivision 2 of section 2 of chapter 274 of the
laws  of  1946,  constituting the emergency housing rent control law, as
amended by chapter 116 of the laws  of  1997,  is  amended  to  read  as
follows:
  (m)  upon  the issuance of an order of [decontrol] DEREGULATION by the
division, housing accommodations which: (1) are occupied by persons  who
have a total annual income, AS DEFINED IN AND SUBJECT TO THE LIMITATIONS
AND  PROCESS  SET  FORTH IN SECTION TWO-A OF THIS LAW, in excess of [one
hundred seventy-five thousand dollars] THE DEREGULATION INCOME THRESHOLD
AS DEFINED IN SECTION TWO-A OF THIS LAW in each  of  the  two  preceding
calendar  years[, as defined in and subject to the limitations and proc-
ess set forth in section two-a of this law]; and (2) have a maximum rent
[of two thousand dollars or more per month].
  S 4. Section 2-a of chapter 274 of the laws of 1946, constituting  the
emergency  housing rent control law, as added by chapter 253 of the laws
of 1993, subdivision (b) and paragraphs 1 and 2 of  subdivision  (c)  as
amended and subdivision (e) as added by chapter 116 of the laws of 1997,
is amended to read as follows:

S. 2783--A                         29

  S 2-a.  (a)  1. For purposes of this section, annual income shall mean
the federal adjusted gross income as reported  on  the  New  York  state
income  tax  return.  Total  annual  income  means the sum of the annual
incomes of all persons who occupy the  housing  accommodation  as  their
primary  residence  on other than a temporary basis, excluding bona fide
employees of such occupants residing therein  in  connection  with  such
employment  and  excluding bona fide subtenants in occupancy pursuant to
the provisions of section two hundred twenty-six-b of the real  property
law.    In  the case where a housing accommodation is sublet, the annual
income of the sublessor shall be considered.
  2. DEREGULATION INCOME THRESHOLD MEANS THREE HUNDRED THOUSAND DOLLARS.
FOR PROCEEDINGS COMMENCED  ON  OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
TWELVE,  THE DEREGULATION INCOME THRESHOLD SHALL BE ADJUSTED ANNUALLY ON
THE FIRST DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT
YEAR BY THE CHANGE IN THE REGIONAL CONSUMER PRICE INDEX  FOR  ALL  URBAN
CONSUMERS,  NEW  YORK-NORTHERN  NEW  JERSEY-LONG ISLAND, NY-NJ-CT-PA, AS
ESTABLISHED THE PRECEDING AUGUST.
  3. DEREGULATION RENT THRESHOLD MEANS  THREE  THOUSAND  DOLLARS.    FOR
PROCEEDINGS  COMMENCED  ON  OR AFTER JANUARY FIRST, TWO THOUSAND TWELVE,
THE DEREGULATION RENT THRESHOLD SHALL BE ADJUSTED ANNUALLY ON THE  FIRST
DAY  OF  OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT YEAR BY
THE CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS,
NEW YORK-NORTHERN NEW JERSEY-LONG ISLAND,  NY-NJ-CT-PA,  AS  ESTABLISHED
THE PRECEDING AUGUST.
  (b) On or before the first day of May in each calendar year, the owner
of each housing accommodation for which the maximum MONTHLY rent [is two
thousand  dollars  or more per month] EQUALS OR EXCEEDS THE DEREGULATION
RENT THRESHOLD may provide the tenant or tenants residing  therein  with
an  income  certification  form  prepared by the division of housing and
community renewal on which such tenant or  tenants  shall  identify  all
persons referred to in subdivision (a) of this section and shall certify
whether  the  total  annual income is in excess of [one hundred seventy-
five thousand dollars] THE DEREGULATION INCOME THRESHOLD in each of  the
two preceding calendar years. Such income certification form shall state
that  the  income  level  certified  to  by the tenant may be subject to
verification by the department  of  taxation  and  finance  pursuant  to
section  one  hundred seventy-one-b of the tax law and shall not require
disclosure of any income information other than  whether  the  aforemen-
tioned threshold has been exceeded. Such income certification form shall
clearly  state that: (i) only tenants residing in housing accommodations
which had a maximum MONTHLY rent EQUAL TO OR IN EXCESS of [two  thousand
dollars  or more per month] THE DEREGULATION RENT THRESHOLD are required
to complete the certification form; (ii) that tenants  have  protections
available  to  them which are designed to prevent harassment; (iii) that
tenants are not required to  provide  any  information  regarding  their
income  except  that which is requested on the form and may contain such
other information the division deems appropriate. The tenant or  tenants
shall return the completed certification to the owner within thirty days
after  service  upon  the tenant or tenants. In the event that the total
annual income as certified is in excess  of  [one  hundred  seventy-five
thousand  dollars  in each such year] THE DEREGULATION INCOME THRESHOLD,
the owner may file the certification with the state division of  housing
and  community  renewal  on  or before June thirtieth of such year. Upon
filing such certification with the division, the division shall,  within
thirty days after the filing, issue an order of [decontrol] DEREGULATION
providing  that  such housing accommodations shall not be subject to the

S. 2783--A                         30

provisions of this law as of the first day of  June  in  the  year  next
succeeding  the filing of the certification by the owner. A copy of such
order shall be mailed by regular  and  certified  mail,  return  receipt
requested,  to  the tenant or tenants and a copy thereof shall be mailed
to the owner.
  (c) 1. In the event that the tenant or tenants either fail  to  return
the  completed certification to the owner on or before the date required
by subdivision (b) of this section or the  owner  disputes  the  certif-
ication  returned  by the tenant or tenants, the owner may, on or before
June thirtieth of such year, petition the state division of housing  and
community  renewal  to  verify, pursuant to section one hundred seventy-
one-b of the tax law, whether  the  total  annual  income  exceeds  [one
hundred seventy-five thousand dollars] THE DEREGULATION INCOME THRESHOLD
in  each  of  the two preceding calendar years. Within twenty days after
the filing of such request with the division, the division shall  notify
the tenant or tenants that such tenant or tenants must provide the divi-
sion  with  such information as the division and the department of taxa-
tion and finance shall require to verify whether the total annual income
exceeds [one hundred seventy-five  thousand  dollars]  THE  DEREGULATION
INCOME  THRESHOLD  in  each such year. The division's notification shall
require the tenant or tenants to provide the information to the division
within sixty days of service upon  such  tenant  or  tenants  and  shall
include a warning in bold faced type that failure to respond will result
in an order of [decontrol] DEREGULATION being issued by the division for
such housing accommodation.
  2. If the department of taxation and finance determines that the total
annual  income  is  in  excess  of  [one  hundred  seventy-five thousand
dollars] THE DEREGULATION INCOME THRESHOLD in each of the two  preceding
calendar  years,  the division shall, on or before November fifteenth of
such year, notify the owner and tenants of the results of such verifica-
tion. Both the owner and the tenants shall have thirty days within which
to comment on such verification results.  Within forty-five  days  after
the  expiration  of the comment period, the division shall, where appro-
priate, issue an order of [decontrol] DEREGULATION providing  that  such
housing accommodation shall not be subject to the provisions of this law
as  of  the first day of March in the year next succeeding the filing of
the owner's petition with the division. A copy of such  order  shall  be
mailed  by  regular and certified mail, return receipt requested, to the
tenant or tenants and a copy thereof shall be sent to the owner.
  3. In the event the tenant or tenants fail to provide the  information
required  pursuant  to  paragraph  one of this subdivision, the division
shall issue, on or before December first  of  such  year,  an  order  of
[decontrol] DEREGULATION providing that such housing accommodation shall
not  be  subject  to  the  provisions of this law as of the first day of
March in the year next succeeding the last day on which  the  tenant  or
tenants  were required to provide the information required by such para-
graph. A copy of such order shall be mailed  by  regular  and  certified
mail,  return  receipt  requested,  to  the tenant or tenants and a copy
thereof shall be sent to the owner.
  4. The provisions of the state freedom of information  act  shall  not
apply  to  any  income  information obtained by the division pursuant to
this section.
  (d) This section shall apply only to paragraph (m) of subdivision  two
of section two of this law.
  (e) Upon receipt of such order of [decontrol] DEREGULATION pursuant to
this  section, an owner shall offer the housing accommodation subject to

S. 2783--A                         31

such order to the tenant at a rent not in excess  of  the  market  rent,
which  for  the  purposes  of this section means a rent obtainable in an
arm's length transaction. Such rental offer shall be made by  the  owner
in  writing to the tenant by certified and regular mail and shall inform
the tenant that such offer must be accepted in writing within  ten  days
of  receipt.   The tenant shall respond within ten days after receipt of
such offer. If the tenant declines the offer or fails to respond  within
such  period,  the  owner  may  commence an action or proceeding for the
eviction of such tenant.
  S 5. Subparagraph (j) of paragraph  2  of  subdivision  e  of  section
26-403 of the administrative code of the city of New York, as amended by
chapter 116 of the laws of 1997, is amended to read as follows:
  (j)  Upon  the issuance of an order of [decontrol] DEREGULATION by the
division, housing accommodations which: (1) are occupied by persons  who
have a total annual income, AS DEFINED IN AND SUBJECT TO THE LIMITATIONS
AND  PROCESS SET FORTH IN SECTION 26-403.1 OF THIS CHAPTER, in excess of
[one hundred seventy-five  thousand  dollars]  THE  DEREGULATION  INCOME
THRESHOLD,  AS DEFINED IN SECTION 26-403.1 OF THIS CHAPTER, per annum in
each of the two preceding calendar years[, as defined in and subject  to
the  limitations and process set forth in section 26-403.1 of this chap-
ter]; and (2) have a maximum rent [of two thousand dollars or  more  per
month]  THAT  EQUALS  OR  EXCEEDS  THE  DEREGULATION  RENT THRESHOLD, AS
DEFINED IN SECTION 26-403.1 OF THIS CHAPTER.    Provided  however,  that
this exclusion shall not apply to housing accommodations which became or
become  subject to this law by virtue of receiving tax benefits pursuant
to section four hundred eighty-nine of the real property tax law.
  S 6. Section 26-403.1 of the administrative code of the  city  of  New
York,  as  added by chapter 253 of the laws of 1993, subdivision (b) and
paragraphs 1 and 2 of subdivision (c) as amended and subdivision (e)  as
added by chapter 116 of the laws of 1997, is amended to read as follows:
  S  26-403.1  High  income  rent [decontrol] DEREGULATION.   (a) 1. For
purposes of this section, annual income shall mean the federal  adjusted
gross  income as reported on the New York state income tax return. Total
annual income means the sum of the annual incomes  of  all  persons  who
occupy  the  housing accommodation as their primary residence other than
on a temporary basis, excluding bona fide employees  of  such  occupants
residing  therein  in connection with such employment and excluding bona
fide subtenants in occupancy pursuant to the provisions of  section  two
hundred twenty-six-b of the real property law. In the case where a hous-
ing accommodation is sublet, the annual income of the sublessor shall be
considered.
  2. DEREGULATION INCOME THRESHOLD MEANS THREE HUNDRED THOUSAND DOLLARS.
FOR  PROCEEDINGS  COMMENCED  ON  OR  AFTER  JANUARY  FIRST, TWO THOUSAND
TWELVE, THE DEREGULATION INCOME THRESHOLD SHALL BE ADJUSTED ANNUALLY  ON
THE FIRST DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT
YEAR  BY  THE  CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN
CONSUMERS, NEW YORK-NORTHERN NEW  JERSEY-LONG  ISLAND,  NY-NJ-CT-PA,  AS
ESTABLISHED THE PRECEDING AUGUST.
  3.  DEREGULATION  RENT  THRESHOLD  MEANS THREE THOUSAND DOLLARS.   FOR
PROCEEDINGS COMMENCED ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  TWELVE,
THE  DEREGULATION RENT THRESHOLD SHALL BE ADJUSTED ANNUALLY ON THE FIRST
DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT  YEAR  BY
THE CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS,
NEW  YORK-NORTHERN  NEW  JERSEY-LONG ISLAND, NY-NJ-CT-PA, AS ESTABLISHED
THE PRECEDING AUGUST.

S. 2783--A                         32

  (b) On or before the first day of May in each calendar year, the owner
of each housing accommodation for which the maximum rent [is  two  thou-
sand  dollars or more per month] EQUALS OR EXCEEDS THE DEREGULATION RENT
THRESHOLD may provide the tenant or tenants  residing  therein  with  an
income certification form prepared by the division of housing and commu-
nity  renewal on which such tenant or tenants shall identify all persons
referred to in subdivision (a) of this section and shall certify whether
the total annual income is in excess of [one hundred seventy-five  thou-
sand  dollars]  THE  DEREGULATION  INCOME  THRESHOLD  in each of the two
preceding calendar years. Such income  certification  form  shall  state
that  the  income  level  certified  to  by the tenant may be subject to
verification by the department  of  taxation  and  finance  pursuant  to
section  one  hundred seventy-one-b of the tax law and shall not require
disclosure of any income information other than  whether  the  aforemen-
tioned threshold has been exceeded. Such income certification form shall
clearly  state that: (i) only tenants residing in housing accommodations
which have a maximum MONTHLY rent [of two thousand dollars or  more  per
month]  THAT  EQUALS  OR  EXCEEDS  THE  DEREGULATION  RENT THRESHOLD are
required to complete the certification  form;  (ii)  that  tenants  have
protections  available to them which are designed to prevent harassment;
(iii) that tenants are not required to provide any information regarding
their income except that which is requested on the form and may  contain
such  other  information  the  division deems appropriate. The tenant or
tenants shall return the completed certification  to  the  owner  within
thirty  days after service upon the tenant or tenants. In the event that
the total annual income as certified is in excess of [one hundred seven-
ty-five thousand dollars] THE DEREGULATION INCOME THRESHOLD in each such
year, the owner may file the certification with the  state  division  of
housing  and community renewal on or before June thirtieth of such year.
Upon filing such certification with the division,  the  division  shall,
within  thirty  days  after  the  filing,  issue an order of [decontrol]
DEREGULATION providing that such housing  accommodations  shall  not  be
subject to the provisions of this law as of the first day of June in the
year  next  succeeding  the  filing of the certification by the owner. A
copy of such order shall be mailed by regular and certified mail, return
receipt requested, to the tenant or tenants and a copy thereof shall  be
mailed to the owner.
  (c)  1.  In the event that the tenant or tenants either fail to return
the completed certification to the owner on or before the date  required
by  subdivision  (b)  of  this section or the owner disputes the certif-
ication returned by the tenant or tenants, the owner may, on  or  before
June  thirtieth of such year, petition the state division of housing and
community renewal to verify, pursuant to section  one  hundred  seventy-
one-b  of  the  tax  law,  whether  the total annual income exceeds [one
hundred seventy-five thousand dollars] THE DEREGULATION INCOME THRESHOLD
in each of the two preceding calendar years. Within  twenty  days  after
the  filing of such request with the division, the division shall notify
the tenant or tenants that such tenant or tenants must provide the divi-
sion with such information as the division and the department  of  taxa-
tion and finance shall require to verify whether the total annual income
exceeds  [one  hundred  seventy-five  thousand dollars] THE DEREGULATION
INCOME THRESHOLD in each such year. The  division's  notification  shall
require the tenant or tenants to provide the information to the division
within  sixty  days  of  service  upon  such tenant or tenants and shall
include a warning in bold faced type that failure to respond will result

S. 2783--A                         33

in an order of [decontrol] DEREGULATION being issued by the division for
such housing accommodation.
  2. If the department of taxation and finance determines that the total
annual  income  is  in  excess  of  [one  hundred  seventy-five thousand
dollars] THE DEREGULATION INCOME THRESHOLD in each of the two  preceding
calendar  years,  the division shall, on or before November fifteenth of
such year, notify the owner and tenants of the results of such verifica-
tion. Both the owner and the tenants shall have thirty days within which
to comment on such verification results.  Within forty-five  days  after
the  expiration  of the comment period, the division shall, where appro-
priate, issue an order of [decontrol] DEREGULATION providing  that  such
housing accommodation shall not be subject to the provisions of this law
as  of  the first day of March in the year next succeeding the filing of
the owner's petition with the division. A copy of such  order  shall  be
mailed  by  regular and certified mail, return receipt requested, to the
tenant or tenants and a copy thereof shall be sent to the owner.
  3. In the event the tenant or tenants fail to provide the  information
required  pursuant  to  paragraph  one of this subdivision, the division
shall issue, on or before December first  of  such  year,  an  order  of
[decontrol] DEREGULATION providing that such housing accommodation shall
not  be  subject  to  the  provisions of this law as of the first day of
March in the year next succeeding the last day on which  the  tenant  or
tenants  were required to provide the information required by such para-
graph. A copy of such order shall be mailed  by  regular  and  certified
mail,  return  receipt  requested,  to  the tenant or tenants and a copy
thereof shall be sent to the owner.
  4. The provisions of the state freedom of information  act  shall  not
apply  to  any  income  information obtained by the division pursuant to
this section.
  (d) This section shall apply only to subparagraph (j) of paragraph two
of subdivision e of section 26-403 of this [code] CHAPTER.
  (e) Upon receipt of such order of [decontrol] DEREGULATION pursuant to
this section, an owner shall offer the housing accommodation subject  to
such  order  to  the  tenant at a rent not in excess of the market rent,
which for the purposes of this section means a  rent  obtainable  in  an
arm's  length  transaction. Such rental offer shall be made by the owner
in writing to the tenant by certified and regular mail and shall  inform
the  tenant  that such offer must be accepted in writing within ten days
of receipt.  The tenant shall respond within ten days after  receipt  of
such  offer. If the tenant declines the offer or fails to respond within
such period, the owner may commence an  action  or  proceeding  for  the
eviction of such tenant.
  S  7.  Section  26-504.1 of the administrative code of the city of New
York, as amended by chapter 116 of the laws of 1997, is amended to  read
as follows:
  S  26-504.1  Exclusion  of accommodations of high income renters. Upon
the issuance of an order by the division, "housing accommodations" shall
not include housing accommodations which: (1) are  occupied  by  persons
who have a total annual income, AS DEFINED IN AND SUBJECT TO THE LIMITA-
TIONS  AND  PROCESS  SET  FORTH  IN SECTION 26-504.3 OF THIS CHAPTER, in
excess of [one hundred seventy-five thousand dollars  per  annum]    THE
DEREGULATION  INCOME  THRESHOLD,  AS DEFINED IN SECTION 26-504.3 OF THIS
CHAPTER, for each of the two preceding calendar years[,  as  defined  in
and subject to the limitations and process set forth in section 26-504.3
of  this  chapter];  and (2) have a legal regulated MONTHLY rent [of two
thousand dollars or more per month] THAT EQUALS OR EXCEEDS  THE  DEREGU-

S. 2783--A                         34

LATION  RENT  THRESHOLD, AS DEFINED IN SECTION 26-504.3 OF THIS CHAPTER.
Provided, however, that this exclusion shall not apply to housing accom-
modations which became or become subject to this law (a)  by  virtue  of
receiving  tax benefits pursuant to section four hundred twenty-one-a or
four hundred eighty-nine of the real property tax law, except as  other-
wise provided in subparagraph (i) of paragraph (f) of subdivision two of
section  four  hundred twenty-one-a of the real property tax law, or (b)
by virtue of article seven-C of the multiple dwelling law.
  S 8. Section 26-504.3 of the administrative code of the  city  of  New
York,  as  added by chapter 253 of the laws of 1993, subdivision (b) and
paragraphs 1 and 2 of subdivision (c) as amended and subdivision (e)  as
added by chapter 116 of the laws of 1997, is amended to read as follows:
  S  26-504.3  High  income  rent [decontrol] DEREGULATION.   (a) 1. For
purposes of this section, annual income shall mean the federal  adjusted
gross  income as reported on the New York state income tax return. Total
annual income means the sum of the annual incomes of all  persons  whose
names  are  recited as the tenant or co-tenant on a lease who occupy the
housing accommodation and all other  persons  that  occupy  the  housing
accommodation  as  their  primary  residence  on  other than a temporary
basis, excluding bona fide employees of such occupants residing  therein
in connection with such employment and excluding bona fide subtenants in
occupancy pursuant to the provisions of section two hundred twenty-six-b
of  the  real property law. In the case where a housing accommodation is
sublet, the annual income of the tenant  or  co-tenant  recited  on  the
lease who will reoccupy the housing accommodation upon the expiration of
the sublease shall be considered.
  2. DEREGULATION INCOME THRESHOLD MEANS THREE HUNDRED THOUSAND DOLLARS.
FOR  PROCEEDINGS  COMMENCED  ON  OR  AFTER  JANUARY  FIRST, TWO THOUSAND
TWELVE, THE DEREGULATION INCOME THRESHOLD SHALL BE ADJUSTED ANNUALLY  ON
THE FIRST DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT
YEAR  BY  THE  CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN
CONSUMERS, NEW YORK-NORTHERN NEW  JERSEY-LONG  ISLAND,  NY-NJ-CT-PA,  AS
ESTABLISHED THE PRECEDING AUGUST.
  3.  DEREGULATION  RENT  THRESHOLD  MEANS THREE THOUSAND DOLLARS.   FOR
PROCEEDINGS COMMENCED ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  TWELVE,
THE  DEREGULATION RENT THRESHOLD SHALL BE ADJUSTED ANNUALLY ON THE FIRST
DAY OF OCTOBER OF EACH YEAR FOR PROCEEDINGS IN EACH SUBSEQUENT  YEAR  BY
THE CHANGE IN THE REGIONAL CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS,
NEW  YORK-NORTHERN  NEW  JERSEY-LONG ISLAND, NY-NJ-CT-PA, AS ESTABLISHED
THE PRECEDING AUGUST.
  (b) On or before the first day of May in each calendar year, the owner
of each housing accommodation for which the legal regulated rent [is two
thousand dollars or more per month] EQUALS OR EXCEEDS  THE  DEREGULATION
RENT  THRESHOLD  may provide the tenant or tenants residing therein with
an income certification form prepared by the  division  of  housing  and
community  renewal  on  which  such tenant or tenants shall identify all
persons referred to in subdivision (a) of this section and shall certify
whether the total annual income is in excess of  [one  hundred  seventy-
five  thousand dollars] THE DEREGULATION INCOME THRESHOLD in each of the
two preceding calendar years. Such income certification form shall state
that the income level certified to by  the  tenant  may  be  subject  to
verification  by  the  department  of  taxation  and finance pursuant to
section one hundred seventy-one-b of the tax law and shall  not  require
disclosure  of  any  income information other than whether the aforemen-
tioned threshold has been exceeded. Such income certification form shall
clearly state that: (i) only tenants residing in housing  accommodations

S. 2783--A                         35

which  have  a  legal regulated MONTHLY rent [of two thousand dollars or
more per month], THAT EQUALS OR EXCEEDS THE DEREGULATION RENT  THRESHOLD
are  required to complete the certification form; (ii) that tenants have
protections  available to them which are designed to prevent harassment;
(iii) that tenants are not required to provide any information regarding
their income except that which is requested on the form and may  contain
such  other  information  the  division deems appropriate. The tenant or
tenants shall return the completed certification  to  the  owner  within
thirty  days after service upon the tenant or tenants. In the event that
the total annual income as certified is in excess of [one hundred seven-
ty-five thousand dollars] THE DEREGULATION INCOME THRESHOLD in each such
year, the owner may file the certification with the  state  division  of
housing  and community renewal on or before June thirtieth of such year.
Upon filing such certification with the division,  the  division  shall,
within  thirty days after the filing, issue an order providing that such
housing accommodation shall not be subject to the provisions of this act
upon the expiration of the existing lease. A copy of such order shall be
mailed by regular and certified mail, return receipt requested,  to  the
tenant or tenants and a copy thereof shall be mailed to the owner.
  (c)  1.  In the event that the tenant or tenants either fail to return
the completed certification to the owner on or before the date  required
by  subdivision  (b)  of  this section or the owner disputes the certif-
ication returned by the tenant or tenants, the owner may, on  or  before
June  thirtieth of such year, petition the state division of housing and
community renewal to verify, pursuant to section  one  hundred  seventy-
one-b  of  the  tax  law,  whether  the total annual income exceeds [one
hundred seventy-five thousand dollars] THE DEREGULATION INCOME THRESHOLD
in each of the two preceding calendar years. Within  twenty  days  after
the  filing of such request with the division, the division shall notify
the tenant or tenants named on the lease that  such  tenant  or  tenants
must  provide the division with such information as the division and the
department of taxation and finance shall require to verify  whether  the
total  annual income exceeds [one hundred seventy-five thousand dollars]
THE DEREGULATION INCOME THRESHOLD in  each  such  year.  The  division's
notification shall require the tenant or tenants to provide the informa-
tion  to  the  division within sixty days of service upon such tenant or
tenants and shall include a warning in bold faced type that  failure  to
respond  will  result in an order being issued by the division providing
that such housing accommodation shall not be subject to  the  provisions
of this law.
  2. If the department of taxation and finance determines that the total
annual  income  is  in  excess  of  [one  hundred  seventy-five thousand
dollars] THE DEREGULATION INCOME THRESHOLD in each of the two  preceding
calendar  years,  the division shall, on or before November fifteenth of
such year, notify the owner and tenants of the results of such verifica-
tion. Both the owner and the tenants shall have thirty days within which
to comment on such verification results.  Within forty-five  days  after
the  expiration  of the comment period, the division shall, where appro-
priate, issue an order providing that such housing  accommodation  shall
not  be subject to the provisions of this law upon the expiration of the
existing lease. A copy of such order shall  be  mailed  by  regular  and
certified mail, return receipt requested, to the tenant or tenants and a
copy thereof shall be sent to the owner.
  3.  In the event the tenant or tenants fail to provide the information
required pursuant to paragraph one of  this  subdivision,  the  division
shall  issue, on or before December first of such year, an order provid-

S. 2783--A                         36

ing that  such  housing  accommodation  shall  not  be  subject  to  the
provisions  of this law upon the expiration of the current lease. A copy
of such order shall be mailed by  regular  and  certified  mail,  return
receipt  requested, to the tenant or tenants and a copy thereof shall be
sent to the owner.
  4. The provisions of the state freedom of information  act  shall  not
apply  to  any  income  information obtained by the division pursuant to
this section.
  (d) This section shall apply only to section 26-504.1 of  this  [code]
CHAPTER.
  (e) Upon receipt of such order of [decontrol] DEREGULATION pursuant to
this  section, an owner shall offer the housing accommodation subject to
such order to the tenant at a rent not in excess  of  the  market  rent,
which  for  the  purposes  of this section means a rent obtainable in an
arm's length transaction. Such rental offer shall be made by  the  owner
in  writing to the tenant by certified and regular mail and shall inform
the tenant that such offer must be accepted in writing within  ten  days
of  receipt.   The tenant shall respond within ten days after receipt of
such offer. If the tenant declines the offer or fails to respond  within
such  period,  the  owner  may  commence an action or proceeding for the
eviction of such tenant.
  S 9. Paragraph (b) of subdivision 3 of section 171-b of the  tax  law,
as  amended  by  chapter  116 of the laws of 1997, is amended to read as
follows:
  (b) The department, when requested by  the  division  of  housing  and
community  renewal,  shall verify the total annual income of all persons
residing in housing accommodations as their primary residence subject to
rent regulation and shall notify the commissioner  of  the  division  of
housing  and  community  renewal as may be appropriate whether the total
annual income exceeds [one hundred  seventy-five  thousand  dollars  per
annum]  THE  APPLICABLE DEREGULATION INCOME THRESHOLD in each of the two
preceding calendar years. No  other  information  regarding  the  annual
income of such persons shall be provided.
  S 10. This act shall take effect immediately, provided, however, that:
  (a)  the  amendments to paragraph 12 of subdivision a of section 5 and
section 5-a of section 4 of the emergency tenant protection act of nine-
teen seventy-four made by sections one and two of this act,  respective-
ly,  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;
  (b)  the amendments to paragraph (m) of subdivision 2 of section 2 and
section 2-a of the emergency housing rent control law made  by  sections
three  and four of this act, respectively, 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;
  (c) the amendments to sections 26-403 and 26-403.1 of  the  city  rent
and  rehabilitation  law  made  by  sections  five  and six of this act,
respectively, 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; and
  (d) the amendments to sections 26-504.1 and 26-504.3 of chapter  4  of
title  26  of  the  administrative  code of the city of New York made by
sections seven and eight of this act, respectively, shall expire on  the

S. 2783--A                         37

same  date  as  such  law expires and shall not affect the expiration of
such law as provided under section 26-520 of such law.
  S 2. Severability clause. If any clause, sentence, paragraph, subdivi-
sion,  section  or  part  of  this act shall be adjudged by any court of
competent jurisdiction to be invalid, such judgment  shall  not  affect,
impair,  or  invalidate  the remainder thereof, but shall be confined in
its operation to the clause, sentence, paragraph,  subdivision,  section
or part thereof directly involved in the controversy in which such judg-
ment  shall have been rendered.  It is  hereby declared to be the intent
of the legislature that this act would have been enacted  even  if  such
invalid provisions had not been included herein.
  S  3.  This  act shall take effect immediately provided, however, that
the applicable effective date of Parts A through L of this act shall  be
as specifically set forth in the last section of such Parts.