senate Bill S7231A

2019-2020 Legislative Session

Relates to requiring the recording of mezzanine debt and preferred equity investments and including mezzanine debt in the mortgage recording tax

download bill text pdf

Sponsored By

Current Bill Status - In Senate Committee Judiciary Committee


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

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Actions

view actions (3)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Aug 24, 2020 print number 7231a
Aug 24, 2020 amend (t) and recommit to judiciary
Jan 13, 2020 referred to judiciary

Co-Sponsors

view additional co-sponsors

S7231 - Details

See Assembly Version of this Bill:
A9041
Current Committee:
Senate Judiciary
Law Section:
Real Property Law
Laws Affected:
Add §291-k, RP L; amd §§250, 253, 253-a, 255, 257 & 258, Tax L; amd §9-601, UCC

S7231 - Summary

Relates to requiring the recording of mezzanine debt and preferred equity investments and including mezzanine debt in the mortgage recording tax; defines mezzanine debt.

S7231 - Sponsor Memo

S7231 - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7231
 
                             I N  S E N A T E
 
                             January 13, 2020
                                ___________
 
 Introduced  by  Sen. SALAZAR -- read twice and ordered printed, and when
   printed to be committed to the Committee on Judiciary
 
 AN ACT to amend the real property law,  in  relation  to  requiring  the
   recording  of  mezzanine  debt;  and amend the tax law, in relation to
   including mezzanine debt in the mortgage recording tax
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  The  real property law is amended by adding a new section
 291-k to read as follows:
   § 291-K. RECORDING OF MEZZANINE DEBT. WHENEVER A  MORTGAGE  INSTRUMENT
 IS  RECORDED  IN  THE OFFICE OF THE RECORDING OFFICER OF ANY COUNTY, ANY
 MEZZANINE DEBT RELATED TO THE REAL  PROPERTY  UPON  WHICH  THE  MORTGAGE
 INSTRUMENT  IS  FILED  SHALL ALSO BE RECORDED WITH SUCH MORTGAGE INSTRU-
 MENT. FOR THE PURPOSES OF THIS SECTION, "MEZZANINE DEBT" SHALL MEAN DEBT
 CARRIED BY A BORROWER THAT MAY BE SUBORDINATE TO THE PRIMARY LIEN AND/OR
 COMMON SHARES AND REPORTED AS ASSETS FOR THE PURPOSES OF FINANCING  SUCH
 PRIMARY LIEN.
   § 2. Section 250 of the tax law is amended by adding a new subdivision
 4 to read as follows:
   4.  THE  TERM "MEZZANINE DEBT" SHALL HAVE THE SAME MEANING AS PROVIDED
 IN SECTION TWO HUNDRED NINETY-ONE-K OF THE REAL PROPERTY LAW.
   § 3. Section 253 of the tax law, as amended by chapter 350 of the laws
 of 1969, subdivision 1-a as added by chapter 788 of the  laws  of  1978,
 paragraph  (a)  of subdivision 1-a as amended by chapter 522 of the laws
 of 2008, subdivision 2 as amended by chapter 151 of the  laws  of  1971,
 paragraph  (a) of subdivision 2 as amended by chapter 394 of the laws of
 2016 and subdivision 3 as amended by chapter 527 of the laws of 2007, is
 amended to read as follows:
   § 253. Recording tax. 1. A tax of fifty cents  for  each  one  hundred
 dollars  and  each remaining major fraction thereof of THE TOTAL SUM OF:
 (A) THE principal debt or obligation which is, or under any  contingency
 may be secured at the date of the execution thereof or at any time ther-
 eafter by a mortgage on real property situated within the state recorded
 on or after the first day of July, nineteen hundred and six, AND (B) ANY
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

Co-Sponsors

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S7231A (ACTIVE) - Details

See Assembly Version of this Bill:
A9041
Current Committee:
Senate Judiciary
Law Section:
Real Property Law
Laws Affected:
Add §291-k, RP L; amd §§250, 253, 253-a, 255, 257 & 258, Tax L; amd §9-601, UCC

S7231A (ACTIVE) - Summary

Relates to requiring the recording of mezzanine debt and preferred equity investments and including mezzanine debt in the mortgage recording tax; defines mezzanine debt.

S7231A (ACTIVE) - Sponsor Memo

S7231A (ACTIVE) - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  7231--A
 
                             I N  S E N A T E
 
                             January 13, 2020
                                ___________
 
 Introduced  by Sens. SALAZAR, BIAGGI, HOYLMAN, JACKSON, MYRIE, RIVERA --
   read twice and ordered printed, and when printed to  be  committed  to
   the  Committee  on  Judiciary  --  committee discharged, bill amended,
   ordered reprinted as amended and recommitted to said committee
 
 AN ACT to amend the real property law and the uniform  commercial  code,
   in relation to requiring the recording of mezzanine debt and preferred
   equity investments; and to amend the tax law, in relation to including
   mezzanine debt in the mortgage recording tax
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The real property law is amended by adding  a  new  section
 291-k to read as follows:
   § 291-K. RECORDING OF MEZZANINE DEBT AND PREFERRED EQUITY INVESTMENTS.
 1.  WHENEVER  A  MORTGAGE  INSTRUMENT  IS  RECORDED IN THE OFFICE OF THE
 RECORDING OFFICER OF ANY COUNTY, ANY MEZZANINE DEBT OR PREFERRED  EQUITY
 INVESTMENT  RELATED TO THE REAL PROPERTY UPON WHICH THE MORTGAGE INSTRU-
 MENT IS FILED SHALL ALSO BE RECORDED WITH SUCH MORTGAGE INSTRUMENT.  FOR
 THE  PURPOSES  OF  THIS  SECTION, "MEZZANINE DEBT" AND "PREFERRED EQUITY
 INVESTMENTS" SHALL MEAN DEBT CARRIED BY A BORROWER THAT MAY BE  SUBORDI-
 NATE TO THE PRIMARY LIEN AND IS SENIOR TO THE COMMON SHARES OF AN ENTITY
 OR  THE  BORROWER'S  EQUITY  AND  REPORTED AS ASSETS FOR THE PURPOSES OF
 FINANCING SUCH PRIMARY LIEN.  THIS SHALL INCLUDE NON-TRADITIONAL FINANC-
 ING TECHNIQUES SUCH AS A DIRECT OR INDIRECT INVESTMENT  BY  A  FINANCING
 SOURCE  IN  AN ENTITY THAT OWNS THE EQUALITY INTERESTS OF THE UNDERLYING
 MORTGAGE WHERE THE FINANCING SOURCE  HAS  SPECIAL  RIGHTS  OR  PREFERRED
 RIGHTS  SUCH AS: (I) THE RIGHT TO RECEIVE A SPECIAL OR PREFERRED RATE OF
 RETURN ON ITS CAPITAL INVESTMENT; AND (II) THE RIGHT TO  AN  ACCELERATED
 REPAYMENT OF THE INVESTORS CAPITAL CONTRIBUTION.
   2. THIS SECTION SHALL APPLY TO BOTH MEZZANINE DEBT AND PREFERRED EQUI-
 TY  INVESTMENTS  IF  BOTH  USED  BY THE BORROWER OR MORTGAGOR, OR EITHER
 MEZZANINE DEBT OR PREFERRED DEBT, IF EITHER IS USED BY THE  BORROWER  OR
 MORTGAGOR.
   3. FOR PURPOSES OF THIS SECTION, "MEZZANINE DEBT" AND "PREFERRED EQUI-
 TY  INVESTMENTS"  SHALL NOT INCLUDE DEBT ON COOPERATIVE OR COMMON SHARES
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

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