S T A T E   O F   N E W   Y O R K
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                                 3557--A

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                            February 12, 2015
                               ___________

Introduced by Sen. ESPAILLAT -- read twice and ordered printed, and when
  printed  to be committed to the Committee on Housing, Construction and
  Community Development -- recommitted  to  the  Committee  on  Housing,
  Construction  and Community Development in accordance with Senate Rule
  6, sec. 8 -- committee discharged, bill amended, ordered reprinted  as
  amended and recommitted to said committee

AN  ACT  to amend chapter 576 of the laws of 1974 constituting the emer-
  gency tenant protection act of nineteen seventy-four, the  administra-
  tive  code  of  the  city  of  New York and the emergency housing rent
  control law, in relation to prohibiting the collection of rent arrear-
  ages accruing prior to the date of approval of an application  for  an
  adjustment  in  the  legal  regulated  rent based upon a major capital
  improvement

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

  Section  1.  Section 6 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 h to read as follows:
  H.  NOTWITHSTANDING  ANY PROVISION OF LAW OR RULE OR REGULATION TO THE
CONTRARY, ANY ADJUSTMENT IN THE LEGAL REGULATED RENT BASED UPON A  MAJOR
CAPITAL  IMPROVEMENT SHALL BE EFFECTIVE UPON APPROVAL OF THE APPLICATION
THEREFOR. NO INCREASE MAY BE COLLECTED FOR THE PERIOD OF TIME  PRIOR  TO
THE DATE OF APPROVAL OF THE APPLICATION.
  S 2. Section 26-512 of the administrative code of the city of New York
is amended by adding a new subdivision g to read as follows:
  G.  NOTWITHSTANDING  ANY PROVISION OF LAW OR RULE OR REGULATION TO THE
CONTRARY, ANY ADJUSTMENT IN THE LEGAL REGULATED RENT BASED UPON A  MAJOR
CAPITAL  IMPROVEMENT SHALL BE EFFECTIVE UPON APPROVAL OF THE APPLICATION
THEREFOR. NO INCREASE MAY BE COLLECTED FOR THE PERIOD OF TIME  PRIOR  TO
THE DATE OF APPROVAL OF THE APPLICATION.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00298-10-6

              

S. 3557--A                          2

  S  3.   The second undesignated paragraph of paragraph (a) of subdivi-
sion 4 of section 4 of chapter 274 of the laws of 1946, constituting the
emergency housing rent control law, as amended by section 25 of  part  B
of chapter 97 of the laws of 2011, 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
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

S. 3557--A                          3

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,
in the case of a building with thirty-five  or  fewer  housing  accommo-
dations, or one-sixtieth, in the case of a building with more than thir-
ty-five  housing  accommodations  where  such  permanent  increase takes
effect on or after September twenty-fourth, two thousand eleven, of  the
total  cost  incurred  by the landlord in providing such modification or
increase in dwelling space, services, furniture, furnishings  or  equip-
ment,  including the cost of installation, but excluding finance charges
provided further that an owner who is entitled to a rent increase pursu-
ant 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  furni-
ture  or furnishings. The owner shall give written notice to the commis-
sion 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)
there  has been since March first, nineteen hundred fifty, a major capi-
tal improvement required for the operation, preservation or  maintenance
of  the  structure;  or  (8)  there has been since March first, nineteen
hundred fifty, in structures containing more than four housing  accommo-
dations, other improvements made with the express consent of the tenants
in  occupancy of at least seventy-five per  centum of the housing accom-
modations, provided, however, that no adjustment granted hereunder shall
exceed fifteen per centum unless the tenants have  agreed  to  a  higher
percentage  of  increase,  as  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 occu-
pants who are not members of the immediate family of the tenant, and the
landlord has not been compensated 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; OR (11) NOTWITHSTAND-
ING ANY PROVISION OF LAW OR RULE OR  REGULATION  TO  THE  CONTRARY,  ANY
ADJUSTMENT  IN  THE  LEGAL  REGULATED  RENT  BASED  UPON A MAJOR CAPITAL
IMPROVEMENT SHALL BE EFFECTIVE UPON APPROVAL OF THE  APPLICATION  THERE-
FOR.  NO  INCREASE  MAY BE COLLECTED FOR THE PERIOD OF TIME PRIOR TO THE
DATE OF APPROVAL OF THE APPLICATION.
  S 4. Paragraph 1 of subdivision g of section 26-405 of the administra-
tive code of the city of New York is amended by adding  a  new  subpara-
graph (p) to read as follows:
  (P)  NOTWITHSTANDING ANY PROVISION OF LAW OR RULE OR REGULATION TO THE
CONTRARY, ANY ADJUSTMENT IN THE LEGAL REGULATED RENT BASED UPON A  MAJOR
CAPITAL  IMPROVEMENT SHALL BE EFFECTIVE UPON APPROVAL OF THE APPLICATION
THEREFOR. NO INCREASE MAY BE COLLECTED FOR THE PERIOD OF TIME  PRIOR  TO
THE DATE OF APPROVAL OF THE APPLICATION.
  S 5. This act shall take effect immediately; provided that:

S. 3557--A                          4

  a.  the amendments to section 4 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;
  b.  the  amendments  to section 26-512 of chapter 4 of title 26 of the
administrative code of the city of New York 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;
  c.  the  amendments to section 4 of the emergency housing rent control
law made by section 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 in subdivision 2 of section 1 of chapter 274  of  the  laws  of
1946; and
  d.  the  amendments  to  section 26-405 of the city rent and rehabili-
tation law made by section four 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.