S T A T E   O F   N E W   Y O R K
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                                  1465

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            January 10, 2011
                               ___________

Introduced  by  M.  of  A.  ROSENTHAL  --  read once and referred to the
  Committee on Housing

AN ACT to amend the private housing finance law, in relation to windfall
  profits on the dissolution or first sale of rental companies  and  the
  dissolution and/or reconstitution of mutual companies

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

  Section 1. Subdivision 2 of section 35 of the private housing  finance
law,  as  amended by chapter 229 of the laws of 1989, is amended to read
as follows:
  2. A company aided by a loan made after May  first,  nineteen  hundred
fifty-nine,  may  voluntarily  be  dissolved,  SOLD AND/OR RECONSTITUTED
without the consent of the commissioner or of the supervising agency, as
the case may be, not less than twenty years  after  the  occupancy  date
upon  the  payment  in  full  of  the remaining balance of principal and
interest due and unpaid upon the mortgage or mortgages [and], of any and
all expenses incurred in effecting such voluntary dissolution AND  OF  A
TRANSFER  FEE  EQUAL TO SEVENTY-FIVE PERCENT OF THE FAIR MARKET VALUE IN
THE CASE OF DISSOLUTION OR SALES PRICE ON THE FIRST  SALE  OF  A  RENTAL
PROJECT, OR, IN THE CASE OF A MUTUAL COMPANY SEVENTY-FIVE PERCENT OF THE
SALES  PRICE ON EACH FIRST SALE THEREAFTER FOR MARKET VALUE BY A SELLING
SHAREHOLDER. THE PROCEEDS OF THE TRANSFER FEES ARE TO  BE  PAID  INTO  A
FUND  HELD  BY THE NEW YORK CITY HOUSING DEVELOPMENT CORPORATION AND THE
NEW YORK STATE HOUSING FINANCE AGENCY FOR THE FOLLOWING PURPOSES:
  (A) TO CONTINUE TO SUBSIDIZE  THE  DEVELOPMENT  FOR  AS  LONG  AS  THE
PURCHASER OF A RENTAL DEVELOPMENT REMAINS IN THE MITCHELL-LAMA PROGRAM;
  (B)  FOR  THE CITY OR STATE TO PURCHASE THE LAND AND TO LEASE THE LAND
TO THE TENANTS AND CONVERT THE PROJECT TO A LIMITED PROFIT MUTUAL COMPA-
NY, WITH A NINETY-NINE YEAR LEASE;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01802-01-1

A. 1465                             2
              

  (C) FOR REPAIR LOANS AT ZERO PERCENT INTEREST TO FUND NECESSARY  CAPI-
TAL IMPROVEMENTS FOR AS LONG AS THE COMPANY REMAINS IN THE MITCHELL-LAMA
PROGRAM;
  (D)  FOR EACH YEAR THAT THE COMPANY REMAINS AS A LIMITED PROFIT COMPA-
NY, TO FORGIVE ONE-THIRTIETH OF THE PRINCIPAL OF ANY  REPAIR  LOAN  EACH
YEAR;
  (E)  FOR  THE SUBSIDIZATION OF OTHER LIMITED PROFIT HOUSING COMPANIES;
AND
  (F) FOR THE DEVELOPMENT OF OTHER AFFORDABLE HOUSING.
  S 2. This act shall take effect immediately.