senate Bill S7696

2013-2014 Legislative Session

Precludes owners from collecting further rent increases if they fail to pay their housing unit fee

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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May 30, 2014 referred to housing, construction and community development

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S7696 - Bill Details

Current Committee:
Law Section:
New York City Administrative Code
Laws Affected:
Amd §26-517.1, NYC Ad Cd; amd §8, Emerg Ten Prot Act of 1974

S7696 - Bill Texts

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Precludes owners from collecting further rent increases if they fail to pay their housing unit fee.

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BILL NUMBER:S7696

TITLE OF BILL: An act to amend the administrative code of the city of
New York and the emergency tenant protection act of nineteen
seventy-four, in relation to housing unit fees

PURPOSE: The bill would ensure that the New York State Division of
Housing and Community Renewal (DHCR) has sufficient resources to
administer and enforce the rent regulation laws. This legislation
would increase the annual fee paid by owners of rent stabilized
apartments in New York City from $10 per unit to $30 per unit, and
dedicate all increased revenues to the DHCR's Office of Rent
Administration (ORA) and Tenant Protection Unit (TPU).

SUMMARY OF PROVISIONS:

Section 1 amends section 26-517.1 of the Administrative Code of the
City of New York by increasing the annual fee collected by the New
York City Department of Finance for each registered rent stabilized
unit from $10 to $30.

Section 2 amends subdivisions c of section 8 of the Emergency Tenant
Protection Act of 1974 by increasing the annual fee collected by the
New York City Department of Finance for each registered rent
stabilized unit from $10 to $30. All revenues collected by the City
Department of Finance are transferred to the DHCR to cover the costs
of administering the rent regulation laws. Subdivision d of Section 8
of the Emergency Tenant Protection Act of 1974 is amended to authorize
the City of New York to commence collection action against any
building owner that fails to pay the $30 per unit annual assessment.

Section 3 establishes that all increased revenues transferred each
year to the Commissioner of the DHCR shall be equally divided between
the DHCR's ORA and TPU, and includes a maintenance of effort
requirement for existing funding of the ORA and TPU.

Section 4 provides for the effective date.

JUSTIFICATION: The DHCR has sole responsibility for administering and
enforcing New York's rent regulation laws which enable almost two
million people to live in safe, stable, and affordable housing. The
agency requires significant additional resources to effectively
fulfill its statutory responsibilities. Due to substantial staff
reductions and repeated budget cuts over the last two decades, the
DHCR simply does not have the capacity it needs respond to complaints
within reasonable timeframes, prevent fraud, or proactively
investigate the majority of potential violations.

Tenant advocates, building owners, and attorneys all regularly express
great frustration with the time periods they are forced to wait for
DHCR to respond to applications and complaints. Tenants and building
owners are frequently forced to wait a minimum of a year for the ORA
to process even the most basic cases, and complex cases frequently
take five years or longer to be concluded. Many report that they do
not even attempt to file cases with the agency because they know they
will have to wait years to receive a determination. Affordable housing
advocates and tenant attorneys have repeatedly documented that


thousands of desperately needed rent regulated apartments are
illegally deregulated each year, and countless tenants are
overcharged, because of DHCR's limited resources.

In recent years, the leadership of DHCR undertaken a number of
important reforms to improve its administration of the rent laws. The
most significant of these reforms was the establishment of the TPU in
2011 which is exclusively focused on protecting tenants' rights and
proactively enforcing compliance. In its first two years, the TPU
reregistered more than 28,000 rent stabilized apartments, initiated
comprehensive investigations of building owners suspected of
systematically overcharging tenants, and reached major settlements
with landlords who violated harassment and discrimination laws. In
order to build on these accomplishments, the TPU must have increased
and dependable resources. The TPU has less than two dozen employees to
and is currently funded solely with agency reappropriations. Due to
its limited staff, the TPU has only been able to investigate a small
fraction of the cases brought to its attention. It is simply
impossible for even the most dedicated employees to expeditiously and
fairly enforce laws impacting the lives of almost two million
residents with such severe limitations.

Historically, the cost of administering and enforcing the rent laws
has been funded almost exclusively by the revenue generated by the
annual per unit fee paid by owners of rent stabilized apartments in
New York City. An annual fee is collected by the New York City
Department of Finance from building owners for each rent stabilized
apartment and then transferred to the State DHCR. However, the annual
unit fee of $10 has not increased since 1984 when administration of
all rent controlled and rent stabilized units was transferred to the
state. Simply increasing the annual fee from $10 per apartment to $30
per apartment generate almost $20 million each year for the ORA and
TPU without placing an onerous burden on building owners or tenants.
The higher unit fee would be factored into building owners' costs each
year when the New York City Rent Guidelines Board considers rent
increases, and any small rent increase that resulted would be far
outweighed by the benefits of significantly enhanced and efficient
services from the ORA and TPU.

LEGISLATIVE HISTORY: This is a new bill.

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This act shall take effect immediately.

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

                                  7696

                            I N  S E N A T E

                              May 30, 2014
                               ___________

Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Housing, Construction  and
  Community Development

AN  ACT to amend the administrative code of the city of New York and the
  emergency tenant protection act of nineteen seventy-four, in  relation
  to housing unit fees

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

  Section 1.  Subdivision a of section 26-517.1  of  the  administrative
code  of  the  city  of New York, as added by local law number 95 of the
city of New York for the year 1985, is amended to read as follows:
  a. The [Department] DEPARTMENT of [Finance] FINANCE shall collect from
the owner of each housing accommodation registered pursuant to [Section]
SECTION 26-517 of this [law] CHAPTER an annual  fee  in  the  amount  of
[ten]  THIRTY  dollars  per  year  for each unit subject to this law, in
order to defray costs incurred by the city pursuant to subdivision c  of
section eight of the emergency tenant protection act of nineteen hundred
seventy-four.
  S  2. Subdivisions c and d of section 8 of section 4 of chapter 576 of
the laws of 1974 constituting the emergency  tenant  protection  act  of
nineteen  seventy-four,  subdivision c as amended by section 5 of part Z
of chapter 56 of the laws of 2010 and subdivision d as amended by  chap-
ter 116 of the laws of 1997, are amended to read as follows:
  c.  Whenever  a  city  having  a population of one million or more has
determined the existence of an emergency pursuant to  section  three  of
this act, the provisions of this act and the New York city rent stabili-
zation  law  of nineteen hundred sixty-nine shall be administered by the
state division of housing and community renewal as provided in  the  New
York  city  rent  stabilization  law  of nineteen hundred sixty-nine, as
amended, or as otherwise provided by law.  The  costs  incurred  by  the
state  division  of  housing and community renewal in administering such
regulation shall be paid by such city. All payments  for  such  adminis-
tration shall be transmitted to the state division of housing and commu-
nity renewal as follows: on or after April first of each year commencing

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13922-03-4

S. 7696                             2

with  April,  nineteen  hundred eighty-four, the commissioner of housing
and community renewal shall determine an amount necessary to defray  the
division's anticipated annual cost, and one-quarter of such amount shall
be  paid  by such city on or before July first of such year, one-quarter
of such amount on or before October first of such year,  one-quarter  of
such  amount  on  or before January first of the following year and one-
quarter of such amount on or before March thirty-first of the  following
year.  After the close of the fiscal year of the state, the commissioner
shall determine the amount of all actual costs incurred in  such  fiscal
year  and  shall  certify  such  amount  to such city. If such certified
amount shall differ from the amount paid by the  city  for  such  fiscal
year,  appropriate  adjustments  shall  be  made  in  the next quarterly
payment to be made by such city. In the event that the amount thereof is
not paid to the commissioner  as  herein  prescribed,  the  commissioner
shall  certify the unpaid amount to the comptroller, and the comptroller
shall, to the extent not otherwise  prohibited  by  law,  withhold  such
amount  from  any  state aid payable to such city. In no event shall the
amount imposed on the owners exceed [ten] THIRTY dollars  per  unit  per
year.
  d.  The  failure  to pay the prescribed assessment not to exceed [ten]
THIRTY dollars per unit for any housing accommodation  subject  to  this
act  or  the  New  York  city rent stabilization law of nineteen hundred
sixty-nine shall constitute a charge due and owing such  city,  town  or
village  which has imposed an annual charge for each such housing accom-
modation pursuant to subdivision b of this section. Any such city,  town
or  village  shall  be  authorized to provide for the enforcement of the
collection of such charges by commencing an action or proceeding for the
recovery of such fees or by the filing of a lien upon the  building  and
lot.  Such methods for the enforcement of the collection of such charges
shall be the sole remedy for the enforcement of this section.
  S 3. The increased revenues payable each year to the  commissioner  of
the state division of housing and community renewal pursuant to this act
shall  be divided equally by the commissioner between the office of rent
administration and the office of the tenant protection unit  within  the
division  of  housing and the community renewal and shall be utilized by
the commissioner in addition to and not in substitution for  the  levels
of  funding  from  all  sources  provided to the office of rent adminis-
tration and the office of the tenant protection unit  on  the  effective
date of this act.
  S  4. This act shall take effect immediately; provided that the amend-
ments to section 26-517.1 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 further that the amendments  to  section  8  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.

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