S T A T E O F N E W Y O R K
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3874--A
2017-2018 Regular Sessions
I N S E N A T E
January 27, 2017
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Introduced by Sen. ALCANTARA -- 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 the administrative code of the city of New York and the
emergency tenant protection act of nineteen seventy-four, in relation
to inspection of major capital improvements for which rent increases
are requested and in relation to extending the provisions of the rent
stabilization law
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
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
section 31 of part A of chapter 20 of the laws of 2015, is amended to
read as follows:
(g) There has been since July first, nineteen hundred seventy, a major
capital improvement required for the operation, preservation or mainte-
nance of the structure. An adjustment under this subparagraph [(g)] for
any order of the commissioner issued after the effective date of the
rent act of 2015 shall be in an amount sufficient to amortize the cost
of the improvements pursuant to this subparagraph [(g)] over an eight-
year period for buildings with thirty-five or fewer units or a nine year
period for buildings with more than [thiry-five] THIRTY-FIVE units. NO
LANDLORD SHALL DENY ACCESS TO A PROFESSIONAL ENGINEER LICENSED TO PRAC-
TICE IN THE STATE OF NEW YORK OR A REGISTERED ARCHITECT LICENSED TO
PRACTICE IN THE STATE OF NEW YORK HIRED BY ANY TENANT, TENANTS OR TENANT
ASSOCIATION REPRESENTING TENANTS OF A MULTIPLE DWELLING OF SIX UNITS OR
MORE FOR THE PURPOSE OF CONDUCTING AN INSPECTION OF A MAJOR CAPITAL
IMPROVEMENT FOR WHICH AN APPLICATION FOR ADJUSTMENT OF MAXIMUM RENT HAS
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05901-03-8
S. 3874--A 2
BEEN FILED. SUCH INSPECTION SHALL BE CONDUCTED AFTER NOTICE TO THE LAND-
LORD AND DURING NORMAL BUSINESS HOURS. SUCH TENANT MAY FILE THE REPORT
OF THE INSPECTION WITH THE CITY RENT AGENCY FOR CONSIDERATION IN THE
DETERMINATION OF SUCH APPLICATION, or
§ 2. Paragraph 6 of subdivision c of section 26-511 of the administra-
tive code of the city of New York, as amended by section 29 of part A of
chapter 20 of the laws of 2015, 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 an eight-year period for a building with thir-
ty-five or fewer housing accommodations, or a nine-year period for a
building with more than thirty-five housing accommodations, for any
determination issued by the division of housing and community renewal
after the effective date of the rent act of 2015, based upon cash
purchase price exclusive of interest or service charges. Notwithstand-
ing 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
determined by the commissioner, (iii) actual annual mortgage debt
service (interest and amortization) on its indebtedness to a lending
institution, 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. NO LANDLORD SHALL DENY ACCESS TO A PROFESSIONAL ENGINEER LICENSED
TO PRACTICE IN THE STATE OF NEW YORK OR A REGISTERED ARCHITECT LICENSED
TO PRACTICE IN THE STATE OF NEW YORK HIRED BY ANY TENANT, TENANTS OR
TENANT ASSOCIATION REPRESENTING TENANTS OF A MULTIPLE DWELLING OF SIX
UNITS OR MORE FOR THE PURPOSE OF CONDUCTING AN INSPECTION OF A MAJOR
S. 3874--A 3
CAPITAL IMPROVEMENT FOR WHICH AN APPLICATION FOR ADJUSTMENT OF MAXIMUM
RENT HAS BEEN FILED. SUCH INSPECTION SHALL BE CONDUCTED AFTER NOTICE TO
THE LANDLORD AND DURING NORMAL BUSINESS HOURS. SUCH TENANT MAY FILE THE
REPORT OF THE INSPECTION WITH THE CITY RENT AGENCY FOR CONSIDERATION IN
THE DETERMINATION OF SUCH APPLICATION. The collection of any increase in
the stabilized rent for any apartment 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 stabilized rent as
established or set in future years;
§ 3. 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 section 30 of part A of
chapter 20 of the laws of 2015, is amended to read as follows:
(3) 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 an eight-year period for a building with
thirty-five or fewer housing accommodations, or a nine-year period for a
building with more than thirty-five housing accommodations, for any
determination issued by the division of housing and community renewal
after the effective date of the rent act of 2015. NO LANDLORD SHALL DENY
ACCESS TO A PROFESSIONAL ENGINEER LICENSED TO PRACTICE IN THE STATE OF
NEW YORK OR A REGISTERED ARCHITECT LICENSED TO PRACTICE IN THE STATE OF
NEW YORK HIRED BY ANY TENANT, TENANTS OR TENANT ASSOCIATION REPRESENTING
TENANTS OF A MULTIPLE DWELLING OF SIX UNITS OR MORE FOR THE PURPOSE OF
CONDUCTING AN INSPECTION OF A MAJOR CAPITAL IMPROVEMENT FOR WHICH AN
APPLICATION FOR ADJUSTMENT OF MAXIMUM RENT HAS BEEN FILED. SUCH
INSPECTION SHALL BE CONDUCTED AFTER NOTICE TO THE LANDLORD AND DURING
NORMAL BUSINESS HOURS. SUCH TENANT MAY FILE THE REPORT OF THE INSPECTION
WITH THE CITY RENT AGENCY FOR CONSIDERATION IN THE DETERMINATION OF SUCH
APPLICATION, or
§ 4. Section 26-520 of the administrative code of the city of New
York, as amended by local law number 26 of the city of New York for the
year 2015, is amended to read as follows:
§ 26-520 Expiration date. This chapter shall expire on April first,
two thousand [eighteen] TWENTY-TWO unless rent control shall sooner
terminate as provided in subdivision three of section one of the local
emergency housing rent control law.
§ 5. This act shall take effect on the one hundred twentieth day after
it shall have become a law, except that any rules and regulations neces-
sary for the timely implementation of this act on its effective date
shall be promulgated on or before such date; provided that the amendment
to section 26-405 of the city rent and rehabilitation law 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 and
provided further that the amendment 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 and provided further that the amendment to section 6 of the
emergency tenant protection act of nineteen seventy-four made by section
S. 3874--A 4
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, as amended.