S T A T E O F N E W Y O R K
________________________________________________________________________
4680
2023-2024 Regular Sessions
I N A S S E M B L Y
February 22, 2023
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Introduced by M. of A. FITZPATRICK, TAGUE -- Multi-Sponsored by -- M. of
A. MANKTELOW -- read once and referred to the Committee on Housing
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 providing an alternative hardship allowance
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The opening paragraph of subparagraph (a) of paragraph 1 of
subdivision g of section 26-405 of the administrative code of the city
of New York is amended to read as follows:
The rental income from a property yields a net annual return of less
than [six] EIGHT AND ONE-HALF per centum of the valuation of the proper-
ty.
§ 2. Subdivision c of section 26-511 of the administrative code of the
city of New York is amended by adding a new paragraph 6-b to read as
follows:
(6-B) PROVIDES CRITERIA WHEREBY AS AN ALTERNATIVE TO THE HARDSHIP
APPLICATION PROVIDED UNDER PARAGRAPH SIX OR PARAGRAPH SIX-A OF THIS
SUBDIVISION OWNERS OF BUILDINGS ACQUIRED BY THE SAME OWNER OR A RELATED
ENTITY OWNED BY THE SAME PRINCIPALS THREE YEARS PRIOR TO THE DATE OF
APPLICATION MAY APPLY TO THE STATE DIVISION OF HOUSING AND COMMUNITY
RENEWAL FOR INCREASES IN EXCESS OF THE LEVEL OF APPLICABLE GUIDELINE
INCREASES ESTABLISHED UNDER THIS LAW BASED ON A FINDING BY THE COMMIS-
SIONER OF HOUSING AND COMMUNITY RENEWAL THAT SUCH GUIDELINE INCREASES
ARE NOT SUFFICIENT TO ENABLE THE OWNER TO MAINTAIN A NET ANNUAL RETURN
OF EIGHT AND ONE-HALF PER CENTUM OF THE VALUATION OF THE PROPERTY. SUCH
VALUATION SHALL BE THE CURRENT ASSESSED VALUATION, WHICH IS IN EFFECT AT
THE TIME OF THE FILING OF THE APPLICATION FOR AN ADJUSTMENT UNDER THIS
PARAGRAPH PROPERLY ADJUSTED BY APPLYING THERETO THE RATIO WHICH SUCH
ASSESSED VALUATION BEARS TO THE FULL VALUATION AS DETERMINED BY THE
COMMISSIONER OF TAXATION AND FINANCE. NET ANNUAL RETURN SHALL BE THE
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD08516-01-3
A. 4680 2
AMOUNT BY WHICH THE EARNED INCOME EXCEEDS THE OPERATING EXPENSES OF THE
PROPERTY, EXCLUDING MORTGAGE INTEREST AND AMORTIZATION, AND EXCLUDING
ALLOWANCES 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 NO ALLOWANCE FOR DEPRECIATION OF THE BUILDINGS
SHALL BE INCLUDED WHERE THE BUILDINGS HAVE BEEN FULLY DEPRECIATED FOR
FEDERAL INCOME TAX PURPOSES OR ON THE BOOKS OF THE OWNER.
§ 3. Subdivision d of section 6 of section 4 of chapter 576 of the
laws of 1974, constituting the emergency tenant protection act of nine-
teen seventy-four, is amended by adding a new paragraph 6 to read as
follows:
(6) AS AN ALTERNATIVE TO THE HARDSHIP APPLICATION PROVIDED UNDER PARA-
GRAPH FOUR OR FIVE OF THIS SUBDIVISION OWNERS OF BUILDINGS ACQUIRED BY
THE SAME OWNER OR A RELATED ENTITY OWNED BY THE SAME PRINCIPALS THREE
YEARS PRIOR TO THE DATE OF APPLICATION MAY APPLY TO THE STATE DIVISION
OF HOUSING AND COMMUNITY RENEWAL FOR INCREASES IN EXCESS OF THE LEVEL OF
APPLICABLE GUIDELINE INCREASES ESTABLISHED UNDER THIS ACT BASED ON A
FINDING BY THE COMMISSIONER OF HOUSING AND COMMUNITY RENEWAL THAT SUCH
GUIDELINE INCREASES ARE NOT SUFFICIENT TO ENABLE THE OWNER TO MAINTAIN A
NET ANNUAL RETURN OF EIGHT AND ONE-HALF PER CENTUM OF THE VALUATION OF
THE PROPERTY. SUCH VALUATION SHALL BE THE CURRENT ASSESSED VALUATION
ESTABLISHED BY A CITY, TOWN OR VILLAGE, WHICH IS IN EFFECT AT THE TIME
OF THE FILING OF THE APPLICATION FOR AN ADJUSTMENT UNDER THIS PARAGRAPH
PROPERLY ADJUSTED BY APPLYING THERETO THE RATIO WHICH SUCH ASSESSED
VALUATION BEARS TO THE FULL VALUATION AS DETERMINED BY THE COMMISSIONER
OF TAXATION AND FINANCE. NET ANNUAL RETURN SHALL BE THE AMOUNT BY WHICH
THE EARNED INCOME EXCEEDS THE OPERATING EXPENSES OF THE PROPERTY,
EXCLUDING MORTGAGE INTEREST AND AMORTIZATION, AND EXCLUDING ALLOWANCES
FOR OBSOLESCENCE AND RESERVES, BUT INCLUDING AN ALLOWANCE FOR DEPRECI-
ATION 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 NO ALLOWANCE FOR DEPRECIATION OF THE BUILDINGS SHALL BE
INCLUDED WHERE THE BUILDINGS HAVE BEEN FULLY DEPRECIATED FOR FEDERAL
INCOME TAX PURPOSES OR ON THE BOOKS OF THE OWNER.
§ 4. This act shall take effect immediately, provided that the amend-
ment 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 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; 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 the administrative code of the city of New York.