S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7370
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              April 26, 2019
                                ___________
 
 Introduced  by M. of A. EPSTEIN -- read once and referred to the Commit-
   tee on Housing
 
 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 limiting the improve-
   ments that are eligible for a major capital improvement rent increase
 
   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,
 PROVIDED, HOWEVER, A MAJOR CAPITAL IMPROVEMENT RENT INCREASE  SHALL  NOT
 BE  APPROVED  BY  THE  DIVISION OF HOUSING AND COMMUNITY RENEWAL FOR THE
 FOLLOWING IMPROVEMENTS: INSTALLATION OF ALUMINUM SIDING, ENLARGEMENT  OR
 CONSTRUCTION OF A BOILER ROOM, REPLACEMENT OF A CATWALK, INSTALLATION OR
 REPLACEMENT  OF  A  CHIMNEY, REPLACEMENT OF FIRE ESCAPES INCLUDING LAND-
 INGS, REPLACEMENT OF PARAPETS, POINTING  AND  WATERPROOFING  ON  EXPOSED
 SIDES  OF  A  BUILDING, RESURFACING OF EXTERIOR WALLS INCLUDING BRICK OR
 MASONRY WORK, INSTALLATION OF NEW SOLAR HEATING SYSTEMS, REPLACEMENT  OF
 STRUCTURAL STEEL BEAMS INCLUDING FOOTING AND FOUNDATION, INSTALLATION OF
 NEW SECURITY MONITORING SYSTEMS, INSTALLATION OF WASTE COMPACTOR SERVING
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD10535-01-9
              

 A. 7370                             2
 
 AN  ENTIRE BUILDING, CONSTRUCTION OF A WASTE COMPACTOR ROOM OR INSTALLA-
 TION OF NEW WATER TANKS; 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.  A MAJOR CAPI-
 TAL IMPROVEMENT RENT INCREASE SHALL NOT BE APPROVED BY THE  DIVISION  OF
 HOUSING  AND COMMUNITY RENEWAL FOR THE FOLLOWING IMPROVEMENTS: INSTALLA-
 TION OF ALUMINUM SIDING, ENLARGEMENT OR CONSTRUCTION OF A  BOILER  ROOM,
 REPLACEMENT  OF  A  CATWALK,  INSTALLATION  OR REPLACEMENT OF A CHIMNEY,
 REPLACEMENT OF FIRE ESCAPES INCLUDING LANDINGS, REPLACEMENT OF PARAPETS,
 POINTING AND WATERPROOFING ON EXPOSED SIDES OF A  BUILDING,  RESURFACING
 OF  EXTERIOR  WALLS INCLUDING BRICK OR MASONRY WORK, INSTALLATION OF NEW
 SOLAR HEATING SYSTEMS, REPLACEMENT OF STRUCTURAL STEEL  BEAMS  INCLUDING
 FOOTING AND FOUNDATION, INSTALLATION OF NEW SECURITY MONITORING SYSTEMS,
 INSTALLATION OF WASTE COMPACTOR SERVING AN ENTIRE BUILDING, CONSTRUCTION
 OF  A  WASTE COMPACTOR ROOM OR INSTALLATION OF NEW WATER TANKS. Notwith-
 standing 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-

 A. 7370                             3
 
 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
 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;
   § 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, PROVIDED,  HOWEVER,  A
 MAJOR  CAPITAL  IMPROVEMENT  RENT  INCREASE SHALL NOT BE APPROVED BY THE
 DIVISION OF HOUSING AND COMMUNITY RENEWAL  FOR  THE  FOLLOWING  IMPROVE-
 MENTS: INSTALLATION OF ALUMINUM SIDING, ENLARGEMENT OR CONSTRUCTION OF A
 BOILER  ROOM, REPLACEMENT OF A CATWALK, INSTALLATION OR REPLACEMENT OF A
 CHIMNEY, REPLACEMENT OF FIRE ESCAPES INCLUDING LANDINGS, REPLACEMENT  OF
 PARAPETS,  POINTING  AND  WATERPROOFING  ON EXPOSED SIDES OF A BUILDING,
 RESURFACING OF EXTERIOR WALLS INCLUDING BRICK OR MASONRY WORK, INSTALLA-
 TION OF NEW SOLAR HEATING SYSTEMS, REPLACEMENT OF STRUCTURAL STEEL BEAMS
 INCLUDING FOOTING AND FOUNDATION, INSTALLATION OF NEW SECURITY  MONITOR-
 ING SYSTEMS, INSTALLATION OF WASTE COMPACTOR SERVING AN ENTIRE BUILDING,
 CONSTRUCTION  OF  A  WASTE  COMPACTOR  ROOM OR INSTALLATION OF NEW WATER
 TANKS, or
   § 4. Subparagraph 7 of 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
 section  32  of  part A of chapter 20 of the laws of 2015, is amended to
 read as follows:
   (7) there has been since March first, nineteen hundred fifty, a  major
 capital  improvement required for the operation, preservation or mainte-
 nance of the structure; which for any order of the  commissioner  issued
 after  the  effective  date  of  the  rent  act of 2015 the cost of such
 improvement shall be amortized 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, PROVIDED, HOWEVER, A MAJOR
 CAPITAL IMPROVEMENT RENT INCREASE SHALL NOT BE APPROVED BY THE  DIVISION
 OF HOUSING AND COMMUNITY RENEWAL FOR THE FOLLOWING IMPROVEMENTS: INSTAL-
 LATION OF ALUMINUM SIDING, ENLARGEMENT OR CONSTRUCTION OF A BOILER ROOM,
 REPLACEMENT  OF  A  CATWALK,  INSTALLATION  OR REPLACEMENT OF A CHIMNEY,
 REPLACEMENT OF FIRE ESCAPES INCLUDING LANDINGS, REPLACEMENT OF PARAPETS,
 POINTING AND WATERPROOFING ON EXPOSED SIDES OF A  BUILDING,  RESURFACING
 OF  EXTERIOR  WALLS INCLUDING BRICK OR MASONRY WORK, INSTALLATION OF NEW
 SOLAR HEATING SYSTEMS, REPLACEMENT OF STRUCTURAL STEEL  BEAMS  INCLUDING

 A. 7370                             4
 
 FOOTING AND FOUNDATION, INSTALLATION OF NEW SECURITY MONITORING SYSTEMS,
 INSTALLATION OF WASTE COMPACTOR SERVING AN ENTIRE BUILDING, CONSTRUCTION
 OF A WASTE COMPACTOR ROOM OR INSTALLATION OF NEW WATER TANKS, or
   § 5. This act shall take effect immediately; 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 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, as from time
 to time amended;
   (c) the amendments to section 6 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, as from time to time amended; and
   (d) the amendments to section 4 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.