3. THE TERM "TENANT" MEANS AN INDIVIDUAL TO WHOM AN INHABITED BASEMENT
OR CELLAR DWELLING UNIT IS RENTED.
§ 289. BASEMENT AND CELLAR LOCAL LAWS AND REGULATIONS. 1. NOTWITH-
STANDING ANY OTHER PROVISION OF STATE OR LOCAL LAW TO THE CONTRARY, IN A
CITY WITH A POPULATION OF ONE MILLION OR MORE, THE LOCAL LEGISLATIVE
BODY MAY, BY LOCAL LAW, ESTABLISH A PROGRAM TO ADDRESS, PROVIDED THAT
HEALTH AND SAFETY ARE PROTECTED, (A) THE LEGALIZATION OF SPECIFIED
INHABITED BASEMENTS AND CELLARS IN EXISTENCE PRIOR TO THE EFFECTIVE DATE
OF THIS ARTICLE THROUGH CONVERSION TO LEGAL DWELLING UNITS, AND (B) THE
CONVERSION OF OTHER SPECIFIED BASEMENTS AND CELLARS IN EXISTENCE PRIOR
TO THE EFFECTIVE DATE OF THIS ARTICLE TO LEGAL DWELLING UNITS. THE LOCAL
LAW AUTHORIZED BY THIS SECTION, AND ANY RULES OR REGULATIONS PROMULGATED
THEREUNDER, SHALL NOT BE SUBJECT TO ENVIRONMENTAL REVIEW, INCLUDING, BUT
NOT LIMITED TO, ENVIRONMENTAL REVIEW CONDUCTED PURSUANT TO ARTICLE EIGHT
OF THE ENVIRONMENTAL CONSERVATION LAW AND ANY STATE AND LOCAL REGU-
LATIONS PROMULGATED THEREUNDER.
2. THE PROGRAM ESTABLISHED BY SUCH LOCAL LAW MAY PROVIDE TO AN OWNER
WHO CONVERTS A BASEMENT OR CELLAR IN ACCORDANCE WITH A LOCAL LAW AUTHOR-
IZED BY THIS ARTICLE OR WHO OTHERWISE ABATES THE ILLEGAL OCCUPANCY OF A
BASEMENT OR CELLAR: (A) AMNESTY FROM ANY CIVIL OR ADMINISTRATIVE LIABIL-
ITY, CITATIONS, FINES, PENALTIES OR ANY OTHER ENFORCEMENT OF OR PROSE-
CUTION FOR CIVIL VIOLATIONS OF THIS CHAPTER, OTHER STATE LAW OR LOCAL
LAW OR RULES, AND THE ZONING RESOLUTION OF SUCH CITY, AND (B) RELIEF
FROM ANY OUTSTANDING CIVIL JUDGMENTS ISSUED IN CONNECTION WITH ANY SUCH
VIOLATION OF SUCH LAWS, RULES OR ZONING RESOLUTION ISSUED BEFORE THE
EFFECTIVE DATE OF THIS ARTICLE; PROVIDED, HOWEVER, THAT SUCH LOCAL LAW
SHALL REQUIRE THAT SUCH AMNESTY OR RELIEF SHALL BE AVAILABLE ONLY TO AN
OWNER THAT HAS SUBMITTED AN APPLICATION FOR A CONVERSION BY A DATE
CERTAIN SUBSEQUENT TO THE EFFECTIVE DATE OF SUCH LOCAL LAW AND THAT SUCH
DATE SHALL NOT BE LATER THAN TEN YEARS AFTER THE EFFECTIVE DATE OF SUCH
LOCAL LAW.
3. (A) SUCH LOCAL LAW MAY SUPERCEDE ANY PROVISION OF LOCAL LAW OR RULE
TO FACILITATE THE CONVERSION OF A SPECIFIED INHABITED BASEMENT OR CELLAR
OR OTHER SPECIFIED BASEMENT OR CELLAR IN EXISTENCE PRIOR TO THE EFFEC-
TIVE DATE OF THIS ARTICLE INTO A LAWFUL DWELLING UNIT. FOR THE PURPOSES
OF THIS PROGRAM, THE LOCAL LAW ADOPTED BY THE LEGISLATIVE BODY OF SUCH
MUNICIPALITY SHALL BE NO LESS STRINGENT THAN THE RELEVANT STANDARDS OR
SPECIFICATIONS OF THE UNIFORM FIRE PREVENTION AND BUILDING CODE AND
STATE ENERGY CONSERVATION CONSTRUCTION CODE APPLICABLE TO THE CONVERSION
OF BASEMENTS AND CELLARS TO HABITABLE DWELLING UNITS IN MUNICIPALITIES
OTHER THAN A CITY WITH A POPULATION OF ONE MILLION OR MORE, UNLESS SUCH
LEGISLATIVE BODY DETERMINES THAT THE APPLICATION OF SUCH STANDARDS OR
SPECIFICATIONS WOULD PRESENT PRACTICAL DIFFICULTIES THAT IMPEDE THE
PURPOSES OF THIS ARTICLE AND INCLUDES IN SUCH LOCAL LAW AN ALTERNATIVE
STANDARD OR SPECIFICATION THAT SUCH LEGISLATIVE BODY DETERMINES TO BE
SUFFICIENT TO PROTECT PUBLIC SAFETY.
(B) SUCH LOCAL LAW MAY SUPERSEDE THE FOLLOWING PROVISIONS OF THIS
CHAPTER: SECTIONS TWENTY-SIX, TWENTY-EIGHT, THIRTY, THIRTY-ONE, THIRTY-
TWO, THIRTY-THREE, THIRTY-FOUR, THIRTY-FIVE, THIRTY-SIX, THIRTY-SEVEN,
FIFTY, FIFTY-A, FIFTY-ONE, FIFTY-TWO, FIFTY-FOUR, FIFTY-SIX, SIXTY-ONE,
SIXTY-TWO, SIXTY-THREE, SIXTY-FOUR, SIXTY-FIVE, SIXTY-EIGHT, AND SEVEN-
TY-SIX, AND ARTICLES FOUR, FIVE AND SIX.
(C) ANY AMENDMENT OF THE ZONING RESOLUTION NECESSARY TO ENACT SUCH
PROGRAM SHALL BE SUBJECT TO A PUBLIC HEARING AT THE PLANNING COMMISSION
OF SUCH LOCALITY, AND APPROVAL BY SUCH COMMISSION AND THE LEGISLATIVE
BODY OF SUCH LOCAL GOVERNMENT, PROVIDED, HOWEVER, THAT IT SHALL NOT
S. 2276--A 3
REQUIRE ENVIRONMENTAL REVIEW, INCLUDING, NOT LIMITED TO, ENVIRONMENTAL
REVIEW CONDUCTED PURSUANT TO ARTICLE EIGHT OF THE ENVIRONMENTAL CONSER-
VATION LAW AND ANY STATE AND LOCAL REGULATIONS PROMULGATED THEREUNDER,
OR ANY ADDITIONAL LAND USE REVIEW.
§ 290. TENANT PROTECTIONS IN INHABITED BASEMENTS AND CELLARS. 1. THE
PROGRAM AUTHORIZED BY THIS ARTICLE SHALL REQUIRE AN APPLICATION TO MAKE
ALTERATIONS TO LEGALIZE AN INHABITED BASEMENT OR CELLAR BE ACCOMPANIED
BY A CERTIFICATION INDICATING WHETHER SUCH UNIT WAS RENTED TO A TENANT
ON THE EFFECTIVE DATE OF THIS ARTICLE, NOTWITHSTANDING WHETHER THE OCCU-
PANCY OF SUCH UNIT WAS AUTHORIZED BY LAW. AN AGENCY OR OFFICE OF A CITY
WHERE THE PROGRAM HAS BEEN ESTABLISHED MAY NOT USE SUCH CERTIFICATION AS
THE BASIS FOR AN ENFORCEMENT ACTION FOR ILLEGAL OCCUPANCY OF SUCH UNIT,
PROVIDED THAT NOTHING CONTAINED IN THIS ARTICLE SHALL BE CONSTRUED TO
LIMIT ANY AGENCY OR OFFICE FROM ISSUING A VACATE ORDER FOR HAZARDOUS
CONDITIONS.
2. THE LOCAL LAW AUTHORIZED BY THIS ARTICLE SHALL PROVIDE THAT A
TENANT IN OCCUPANCY AT THE TIME OF THE EFFECTIVE DATE OF THIS ARTICLE
WHO IS EVICTED OR OTHERWISE REMOVED FROM SUCH UNIT AS A RESULT OF AN
ALTERATION NECESSARY TO BRING AN INHABITED BASEMENT OR CELLAR INTO
COMPLIANCE WITH THE STANDARDS ESTABLISHED BY THE LOCAL LAW AUTHORIZED BY
THIS ARTICLE, SHALL HAVE A RIGHT OF FIRST REFUSAL TO RETURN TO SUCH UNIT
AS A TENANT UPON ITS FIRST LAWFUL OCCUPANCY AS A LEGAL DWELLING UNIT,
NOTWITHSTANDING WHETHER THE OCCUPANCY AT THE TIME OF THE EFFECTIVE DATE
OF THIS ARTICLE WAS AUTHORIZED BY LAW. SUCH LOCAL LAW SHALL SPECIFY HOW
TO DETERMINE PRIORITY WHEN MULTIPLE TENANTS MAY CLAIM SUCH RIGHT.
3. A TENANT UNLAWFULLY DENIED A RIGHT OF FIRST REFUSAL TO RETURN TO A
LEGAL DWELLING UNIT, AS PROVIDED PURSUANT TO THE LOCAL LAW AUTHORIZED BY
THIS ARTICLE, SHALL HAVE A CAUSE OF ACTION AGAINST THE OWNER OF SUCH
DWELLING UNIT IN ANY COURT OF COMPETENT JURISDICTION FOR COMPENSATORY
DAMAGES OR DECLARATORY AND INJUNCTIVE RELIEF AS THE COURT DEEMS NECES-
SARY IN THE INTERESTS OF JUSTICE, PROVIDED THAT SUCH COMPENSATORY RELIEF
SHALL NOT EXCEED THE ANNUAL RENTAL CHARGES FOR SUCH LEGAL DWELLING UNIT.
4. NOTWITHSTANDING THE LOCAL EMERGENCY HOUSING RENT CONTROL ACT OF
1962 AS AMENDED, THE LOCAL LAW AUTHORIZED BY THIS ARTICLE SHALL INCLUDE
PROTECTIONS AGAINST EVICTION AND LIMITATIONS ON RENT INCREASES FOR BASE-
MENT OR CELLAR DWELLING UNITS THAT UNDERGO LEGALIZATION, INCLUDING LIMI-
TATIONS ON RENT INCREASES FOR TENANTS RETURNING TO SUCH UNITS PURSUANT
TO THE PROVISIONS OF SUBDIVISION TWO OF THIS SECTION.
§ 2. The private housing finance law is amended by adding a new arti-
cle 8-C to read as follows:
ARTICLE VIII-C
LOANS TO OWNERS OF ONE TO FOUR UNIT PRIVATE AND MULTIPLE DWELLINGS
SECTION 480. POLICY AND PURPOSES OF ARTICLE.
481. DEFINITIONS.
482. LOANS TO OWNERS.
483. CONDITIONS PRECEDENT TO MAKING LOANS TO OWNERS.
484. SERVICING OF LOANS BY BANKING INSTITUTIONS AND LOAN SERVIC-
ING COMPANIES.
485. INTEREST REDUCTION SUBSIDIES.
486. MORTGAGE RECORDING TAX EXEMPTION.
487. RULES AND REGULATIONS.
488. SOURCE OF FUNDS.
§ 480. POLICY AND PURPOSES OF ARTICLE. IT IS HEREBY DECLARED AND FOUND
THAT THERE EXISTS IN CITIES WITH A POPULATION OF ONE MILLION OR MORE A
SERIOUSLY INADEQUATE SUPPLY OF SAFE AND SANITARY DWELLING UNITS, PARTIC-
ULARLY FOR PERSONS OF LOW AND MODERATE INCOME. IT FURTHER IS FOUND THAT
S. 2276--A 4
THERE EXISTS IN SUCH CITIES MANY BASEMENTS AND CELLARS IN ONE TO FOUR
UNIT DWELLINGS, SOME OF WHICH ARE INHABITED UNLAWFULLY, THAT COULD BE
CONVERTED INTO SAFE AND SANITARY LAWFUL DWELLING UNITS. IT FURTHER IS
FOUND THAT SUCH CONVERSION AND ANY ASSOCIATED REHABILITATION OR IMPROVE-
MENT OF SUCH DWELLINGS CANNOT BE READILY ACCOMPLISHED WITHOUT PUBLIC AID
IN THE FORM OF LOW INTEREST LOANS OR GRANTS TO OWNERS OF SUCH DWELLINGS.
THE CREATION OF LAWFUL AND HABITABLE DWELLING UNITS IN BASEMENTS AND
CELLARS OF ONE TO FOUR UNIT DWELLINGS IS HEREBY DECLARED A PUBLIC
PURPOSE AND A MUNICIPAL PURPOSE FOR WHICH PUBLIC MONIES MAY BE LOANED OR
GRANTED. IN ORDER TO FURTHER SUCH PURPOSE, IT IS HEREBY DECLARED THAT
ADDITIONAL PROVISIONS SHOULD BE MADE TO PROVIDE PUBLIC MONIES FOR INTER-
EST REDUCTION SUBSIDIES FOR PRIVATE LOANS MADE BY PRIVATE INVESTORS FOR
SUCH REHABILITATION. THE NECESSITY IN THE PUBLIC INTEREST FOR THE
PROVISIONS OF THIS ARTICLE IS HEREBY DECLARED AS A MATTER OF LEGISLATIVE
DETERMINATION.
§ 481. DEFINITIONS. 1. "AGENCY" SHALL MEAN THE DEPARTMENT OF HOUSING
PRESERVATION AND DEVELOPMENT OF THE CITY OF NEW YORK OR ANY SUCCESSOR
THERETO.
2. "BANKING ORGANIZATION" SHALL MEAN ANY CORPORATION, ASSOCIATION OR
ORGANIZATION ORGANIZED UNDER THE BANKING LAWS OF NEW YORK STATE OR THE
UNITED STATES WHICH IS AUTHORIZED TO TRANSACT BUSINESS IN THIS STATE.
3. "BASEMENT" SHALL HAVE THE SAME MEANING AS PROVIDED IN SUBDIVISION
THIRTY-EIGHT OF SECTION FOUR OF THE MULTIPLE DWELLING LAW.
4. "CELLAR" SHALL HAVE THE SAME MEANING AS PROVIDED IN SUBDIVISION
THIRTY-SEVEN OF SECTION FOUR OF THE MULTIPLE DWELLING LAW.
5. "CITY" SHALL MEAN A CITY WITH A POPULATION OF ONE MILLION OR MORE.
6. "CLIMATE RESILIENCY IMPROVEMENTS" SHALL MEAN IMPROVEMENTS FOR THE
PURPOSE OF PROTECTING LAND OR ANY STRUCTURES THEREON FROM DAMAGE RESULT-
ING FROM OR WHICH MAY RESULT FROM CHANGES IN CLIMATE, INCLUDING, BUT NOT
LIMITED TO, EXTREME WEATHER EVENTS, ABNORMAL TEMPERATURES, AND SEA LEVEL
RISE, OR OF REDUCING THE IMPACT OF THE OPERATION OF SUCH STRUCTURES ON
CLIMATE CHANGE, INCLUDING, BUT NOT LIMITED TO, IMPROVEMENTS THAT REDUCE
ENERGY CONSUMPTION OR PROMOTE THE EFFICIENT USE OF NATURAL RESOURCES.
7. "EXISTING MULTIPLE DWELLING" SHALL MEAN A MULTIPLE DWELLING AS
DEFINED IN SECTION FOUR OF THE MULTIPLE DWELLING LAW THAT IS IN EXIST-
ENCE ON THE DATE UPON WHICH AN APPLICATION FOR A LOAN PURSUANT TO THIS
ARTICLE IS RECEIVED BY THE AGENCY.
8. "EXISTING PRIVATE DWELLING" SHALL MEAN A PRIVATE DWELLING AS
DEFINED IN SECTION FOUR OF THE MULTIPLE DWELLING LAW THAT IS IN EXIST-
ENCE ON THE DATE UPON WHICH AN APPLICATION FOR A LOAN PURSUANT TO THIS
ARTICLE IS RECEIVED BY THE AGENCY.
9. "FEDERAL GRANT FUNDS" SHALL MEAN ANY GRANTS RECEIVED FROM THE
FEDERAL GOVERNMENT FOR COMMUNITY DEVELOPMENT ACTIVITIES OR FOR THE REHA-
BILITATION OR CONSERVATION OF PRIVATE OR MULTIPLE DWELLINGS.
10. "LOAN" SHALL MEAN A LOAN OR A GRANT MADE BY THE CITY PURSUANT TO
SECTION FOUR HUNDRED EIGHTY-TWO OF THIS ARTICLE, PROVIDED, HOWEVER, THAT
PROVISIONS OF THIS ARTICLE CONCERNING THE REPAYMENT OR FORGIVENESS OF,
OR SECURITY FOR, A LOAN SHALL NOT APPLY TO ANY GRANT MADE PURSUANT TO
THIS ARTICLE.
11. "OWNER" SHALL MEAN AN INDIVIDUAL, A PARTNERSHIP, A CORPORATION OR
OTHER ENTITY, INCLUDING, BUT NOT LIMITED TO, A TRUST, OR A JOINT TENAN-
CY, TENANCY IN COMMON OR TENANCY BY THE ENTIRETY HOLDING RECORD OR BENE-
FICIAL TITLE IN FEE SIMPLE TO AN EXISTING PRIVATE OR MULTIPLE DWELLING
AND THE REAL PROPERTY UPON WHICH IT IS SITUATED, OR THE LESSEE THEREOF
UNDER A LEASE HAVING AN UNEXPIRED TERM OF AT LEAST THIRTY YEARS. "OWNER"
S. 2276--A 5
SHALL BE DEEMED TO ALSO INCLUDE A COOPERATIVE CORPORATION OR A CONDOMIN-
IUM ASSOCIATION.
12. "PRIVATE INVESTOR" SHALL MEAN A BANKING ORGANIZATION, FOUNDATION,
PUBLIC BENEFIT CORPORATION, LABOR UNION, CREDIT UNION, EMPLOYERS' ASSO-
CIATION, VETERANS' ORGANIZATION, COLLEGE, UNIVERSITY, EDUCATIONAL INSTI-
TUTION, CHILD CARE INSTITUTION, HOSPITAL, MEDICAL RESEARCH INSTITUTE,
INSURANCE COMPANY, TRUSTEE OR FIDUCIARY, TRUSTEES OF A PENSION AND
RETIREMENT FUND OR SYSTEM, CORPORATION, PARTNERSHIP, INDIVIDUAL OR OTHER
ENTITY OR ANY COMBINATION OF THE FOREGOING, AND SHALL INCLUDE THE UNITED
STATES OF AMERICA AND ANY OF ITS AGENCIES AND DEPARTMENTS.
13. "REHABILITATION" SHALL MEAN THE INSTALLATION, REPLACEMENT, OR
REPAIR OF HEATING, PLUMBING, ELECTRICAL AND RELATED SYSTEMS OR THE ELIM-
INATION OF CONDITIONS DANGEROUS TO HUMAN LIFE OR DETRIMENTAL TO HEALTH,
INCLUDING NUISANCES AS DEFINED IN LOCAL HOUSING OR HEALTH CODES OR AS
DEFINED IN SECTION THREE HUNDRED NINE OF THE MULTIPLE DWELLING LAW, OR
OTHER REHABILITATION OR GENERAL PROPERTY AND ENERGY CONSERVATION
IMPROVEMENTS.
14. "STATE GRANT FUNDS" SHALL MEAN ANY GRANT RECEIVED FROM THE STATE
OR ANY PUBLIC BENEFIT CORPORATION FOR COMMUNITY DEVELOPMENT ACTIVITIES
OR FOR THE REHABILITATION OR CONSERVATION OF PRIVATE OR MULTIPLE DWELL-
INGS.
§ 482. LOANS TO OWNERS. 1. NOTWITHSTANDING THE PROVISIONS OF ANY
GENERAL, SPECIAL OR LOCAL LAW, THE CITY, ACTING THROUGH THE AGENCY, IS
AUTHORIZED:
(A) TO MAKE, OR CONTRACT TO MAKE, LOANS TO OWNERS OF ONE TO FOUR UNIT
EXISTING PRIVATE OR MULTIPLE DWELLINGS, SUBJECT TO THE LIMITATION OF
SUBDIVISIONS TWO THROUGH SEVEN OF THIS SECTION, IN SUCH AMOUNTS AS SHALL
BE REQUIRED FOR THE CONVERSION OF A BASEMENT OR CELLAR IN A ONE TO FOUR
UNIT PRIVATE OR MULTIPLE DWELLING TO A SAFE AND SANITARY LAWFUL DWELLING
UNIT AND OTHER REHABILITATION OF OR IMPROVEMENTS TO SUCH PRIVATE OR
MULTIPLE DWELLING, INCLUDING, BUT NOT LIMITED TO, CLIMATE RESILIENCY
IMPROVEMENTS, THAT THE AGENCY MAY DETERMINE ARE NEEDED IN SUCH DWELLING;
(B) TO MAKE TEMPORARY LOANS OR ADVANCES TO OWNERS OF ONE TO FOUR UNIT
EXISTING PRIVATE OR MULTIPLE DWELLINGS IN ANTICIPATION OF PERMANENT
LOANS TO SUCH OWNERS FOR THE PURPOSES DESCRIBED IN PARAGRAPH (A) OF THIS
SUBDIVISION; AND
(C) TO MAKE OR CONTRACT TO MAKE GRANTS TO ANY OWNER DESCRIBED IN PARA-
GRAPH (A) OF THIS SUBDIVISION, ON THE SAME TERMS AS PERMITTED UNDER SUCH
PARAGRAPH FOR A LOAN.
2. EACH LOAN SHALL BE EVIDENCED BY A NOTE EXECUTED BY THE OWNER OF THE
EXISTING DWELLING. REPAYMENT OF EACH SUCH NOTE SHALL BE WITHIN A PERIOD
OF FORTY YEARS, PROVIDED THAT SUCH PERIOD MAY BE EXTENDED AS THE AGENCY
MAY DETERMINE NECESSARY TO ENSURE THE CONTINUED AFFORDABILITY OR ECONOM-
IC VIABILITY OF THE EXISTING DWELLING. THE REPAYMENT SHALL BE MADE IN
SUCH MANNER AS MAY BE PROVIDED IN SUCH NOTE AND CONTRACT, IF ANY, IN
CONNECTION WITH SUCH LOAN, AND MAY AUTHORIZE SUCH OWNER, WITH THE
CONSENT OF THE AGENCY, TO PREPAY THE PRINCIPAL OF THE LOAN SUBJECT TO
SUCH TERMS AND CONDITIONS AS THEREIN PROVIDED. IN ORDER TO MAKE ANY SUCH
LOAN AFFORDABLE TO THE OWNER, THE AGENCY MAY PROVIDE IN SUCH NOTE AND
CONTRACT THAT ALL OF THE OUTSTANDING PRINCIPAL OF SAID LOAN MAY BE SELF-
LIQUIDATED OVER A PERIOD OF NOT LESS THAN FIFTEEN YEARS OF CONTINUOUS
COMPLIANCE BY THE OWNER WITH A REGULATORY AGREEMENT OR RESTRICTIVE
COVENANT WITH OR APPROVED BY THE AGENCY AND UPON THE SATISFACTION OF ANY
ADDITIONAL CONDITIONS SPECIFIED THEREIN. SUCH NOTE AND CONTRACT MAY
CONTAIN SUCH OTHER TERMS AND PROVISIONS NOT INCONSISTENT WITH THE
PROVISIONS OF THIS ARTICLE AS THE AGENCY MAY DEEM NECESSARY OR DESIRABLE
S. 2276--A 6
TO SECURE REPAYMENT OF THE LOAN, THE INTEREST THEREON, IF ANY, AND OTHER
CHARGES IN CONNECTION THEREWITH, AND TO CARRY OUT THE PURPOSES AND
PROVISIONS OF THIS ARTICLE, INCLUDING, BUT NOT LIMITED TO, PROVIDING
THAT THE LIEN CREATED BY THE NOTE AND MORTGAGE, AND, IF APPLICABLE, ANY
REGULATORY AGREEMENT EXECUTED BY SUCH OWNER AND AGENCY OR RESTRICTIVE
COVENANT APPROVED BY SUCH AGENCY, MAY BE RECORDED IN AN EQUAL OR SUBOR-
DINATE POSITION, OR SUBSEQUENTLY MADE EQUAL OR SUBORDINATE, TO A LIEN
RECORDED BY ANY PRIVATE INVESTOR AGAINST SUCH EXISTING DWELLING.
3. THE AGENCY IN ITS DISCRETION MAY REQUIRE THAT THE OWNER EXECUTE,
ACKNOWLEDGE AND DELIVER A UNIFORM COMMERCIAL CODE FINANCING STATEMENT
FOR THE REAL PROPERTY IMPROVEMENT TO BE IN SUCH FORM AS THE AGENCY SHALL
SPECIFY AND IN ACCORDANCE WITH THE REQUIREMENTS OF SECTION 9--502 OF THE
UNIFORM COMMERCIAL CODE OF THE STATE OF NEW YORK. SAID FINANCING STATE-
MENT SHALL BE FILED OR RECORDED WITHOUT CHARGE IN ACCORDANCE WITH THE
PROVISIONS OF PARAGRAPH ONE OF SUBSECTION (A) OF SECTION 9--501 OF THE
UNIFORM COMMERCIAL CODE, AND FROM THE DATE OF SUCH FILING THE CITY SHALL
HAVE A LIEN AGAINST SAID REAL PROPERTY IMPROVEMENT FOR THE AMOUNT
ADVANCED OR SO MUCH THEREOF AS REMAINS UNPAID TOGETHER WITH THE INTEREST
THEREON. UPON PAYMENT OF ALL SUMS ADVANCED BY THE CITY AND INTEREST
THEREON, AND UPON DEMAND OF THE THEN RECORD OWNER OF THE REAL PROPERTY,
THE AGENCY SHALL DELIVER A COPY OF THE FINANCING STATEMENT WITH AN
ENDORSEMENT THEREON THAT THE LIEN IS SATISFIED. UPON FILING OF SUCH COPY
IN THE OFFICE WHERE THE FINANCING STATEMENT WAS FILED AND UPON PAYMENT
OF THE PROPER FEE THEREFOR, THE LIEN OF SUCH FINANCING STATEMENT SHALL
BE DISCHARGED.
4. THE AGENCY MAY REQUIRE THE OWNER TO EXECUTE A MORTGAGE AS SECURITY
FOR A LOAN IN LIEU OF OR IN ADDITION TO A FINANCING STATEMENT AS
PROVIDED IN SUBDIVISION THREE OF THIS SECTION. SUCH MORTGAGE SHALL
CONTAIN SUCH TERMS AND PROVISIONS NOT INCONSISTENT WITH THE PROVISIONS
OF THIS ARTICLE AS THE AGENCY SHALL DEEM NECESSARY OR DESIRABLE TO
SECURE REPAYMENT OF THE LOAN.
5. LOANS MAY BE MADE WITH RESPECT TO A ONE TO FOUR UNIT PRIVATE OR
MULTIPLE DWELLING ENCUMBERED BY MORTGAGES, PROVIDED NO MORTGAGE IS IN
DEFAULT, EXCEPT IF SUCH DEFAULT SHALL BE REMEDIED BY THE PROPOSED REHA-
BILITATION OR IMPROVEMENT.
6. THE AGENCY MAY REQUIRE THE PAYMENT OF CHARGES BY AN OWNER OF SUCH
EXISTING PRIVATE OR MULTIPLE DWELLING IN CONSIDERATION FOR THE FINANC-
ING, REGULATION, SUPERVISION AND AUDIT OF SUCH LOAN. SUCH CHARGES SHALL
BE PAID INTO THE TREASURY OF THE CITY REQUIRING THE CHARGES AND SHALL BE
PAID AND DEPOSITED IN THE GENERAL FUND OF SUCH CITY.
7. IN MAKING A LOAN UNDER THIS ARTICLE, THE AGENCY SHALL HAVE THE
POWER TO PARTICIPATE IN A LOAN MADE BY ANY PRIVATE INVESTOR. THE AGENCY
MAY ENTER INTO AN AGREEMENT WITH A PRIVATE INVESTOR TO DEPOSIT FUNDS
WITH SUCH PRIVATE INVESTOR TO COVER THE AGENCY'S PARTICIPATION IN LOANS
TO OWNERS OF ONE TO FOUR UNIT EXISTING PRIVATE AND MULTIPLE DWELLINGS
WITH SUCH FUNDS ADVANCED BY SUCH PRIVATE INVESTOR TO OWNERS OF SUCH
EXISTING DWELLINGS. THE PORTION OF THE LOAN FUNDED BY THE AGENCY MAY BE
EQUAL TO OR SUBORDINATE IN LIEN TO THE PORTION OF THE LOAN FUNDED BY THE
PRIVATE INVESTOR AND THE NOTE AND CONTRACT MAY CONTAIN SUCH TERMS WITH
RESPECT TO INTEREST RATE, IF ANY, AND TIME OF PAYMENT OF PRINCIPAL AND
INTEREST AS DETERMINED BY THE AGENCY. THE AGENCY MAY MAKE PROVISION,
EITHER IN THE MORTGAGE OR MORTGAGES OR BY SEPARATE AGREEMENT, FOR THE
PERFORMANCE BY THE PRIVATE INVESTOR OF SUCH SERVICES AS ARE GENERALLY
PERFORMED BY A BANKING INSTITUTION WHICH ITSELF HOLDS A MORTGAGE,
INCLUDING, WITHOUT LIMITATION, CONSTRUCTION LOAN ADVANCES, CONSTRUCTION
SUPERVISION, INITIATION OF FORECLOSURE PROCEEDINGS, PROCUREMENT OF
S. 2276--A 7
INSURANCE, AND ALL OTHER MATTERS IN CONNECTION WITH THE FINANCING,
SUPERVISION, REGULATION AND AUDIT OF ANY SUCH LOAN. IN ORDER TO MAKE THE
LOAN AFFORDABLE TO THE OWNER, THE AGENCY MAY PROVIDE AN INTEREST
REDUCTION SUBSIDY PURSUANT TO SECTION FOUR HUNDRED EIGHTY-FIVE OF THIS
ARTICLE, OR MAY PROVIDE THAT ALL OR PART OF THE AGENCY'S PORTION OF THE
OUTSTANDING PRINCIPAL OF ANY SUCH PARTICIPATION LOAN MAY BE SELF-LIQUI-
DATED OVER A PERIOD OF NOT LESS THAN FIFTEEN YEARS OF CONTINUOUS COMPLI-
ANCE BY THE OWNER WITH A REGULATORY AGREEMENT OR RESTRICTIVE COVENANT
WITH OR APPROVED BY THE AGENCY AND UPON THE SATISFACTION OF ANY ADDI-
TIONAL CONDITIONS SPECIFIED THEREIN.
§ 483. CONDITIONS PRECEDENT TO MAKING LOANS TO OWNERS. 1. NO SUCH LOAN
SHALL BE MADE TO AN OWNER OF AN EXISTING PRIVATE OR MULTIPLE DWELLING
UNLESS SUCH OWNER SHALL COVENANT IN WRITING THAT SO LONG AS ANY PART OF
SUCH LOAN SHALL REMAIN UNPAID OR ANY REQUIREMENT IMPOSED AS A CONDITION
FOR MAKING SUCH LOAN THAT SURVIVES THE REPAYMENT OF SUCH LOAN, INCLUD-
ING, BUT NOT LIMITED TO, IN A REGULATORY AGREEMENT EXECUTED PURSUANT TO
SUBDIVISION TWO OF THIS SECTION OR A RESTRICTIVE COVENANT APPROVED BY
SUCH AGENCY, REMAINS IN EFFECT: (A) THE OWNER OR MANAGING AGENT OR OPER-
ATOR OF SUCH DWELLING SHALL PERMIT THE DULY AUTHORIZED OFFICERS, EMPLOY-
EES, AGENTS OR INSPECTORS OF THE AGENCY TO ENTER IN OR UPON AND INSPECT
SUCH DWELLING AT ALL REASONABLE HOURS; (B) THE AGENCY BY SUCH DULY
AUTHORIZED REPRESENTATIVES AS AFORESAID SHALL HAVE FULL POWER TO INVES-
TIGATE INTO AND ORDER THE OWNER OF SUCH DWELLING TO FURNISH SUCH REPORTS
AND INFORMATION AS IT MAY REQUIRE CONCERNING THE CONVERSION OF THE BASE-
MENT OR CELLAR IN SUCH DWELLING AND ALL OTHER REHABILITATION OR IMPROVE-
MENTS FUNDED WITH SUCH LOAN AND SHALL HAVE FULL POWER TO AUDIT THE BOOKS
OF SAID OWNER WITH RESPECT TO SUCH MATTERS; AND (C) IF THE BASEMENT OR
CELLAR TO BE CONVERTED IS IN A MULTIPLE DWELLING, THE OWNER WILL SUBMIT
TO THE AGENCY ANNUALLY A STATEMENT OF INCOME AND EXPENSES OF SUCH DWELL-
ING, IN SUCH FORM AS SHALL BE APPROVED BY THE AGENCY.
2. NO SUCH LOAN SHALL BE MADE TO AN OWNER OF AN EXISTING PRIVATE OR
MULTIPLE DWELLING UNLESS THE AGENCY AND SUCH OWNER SHALL HAVE EXECUTED A
REGULATORY AGREEMENT THAT INCLUDES PROTECTIONS AGAINST EVICTION AND
LIMITATIONS ON RENT INCREASES APPLICABLE TO EACH BASEMENT OR CELLAR
DWELLING UNIT FOR WHICH THE LOAN IS TO BE MADE.
3. THE AGENCY SHALL HAVE THE POWER TO IMPOSE ADDITIONAL TERMS AND
CONDITIONS PRECEDENT TO MAKE SUCH LOANS.
§ 484. SERVICING OF LOANS BY BANKING INSTITUTIONS AND LOAN SERVICING
COMPANIES. 1. THE AGENCY MAY MAKE PROVISION IN THE NOTE AND LOAN AGREE-
MENT OR BY SEPARATE AGREEMENT FOR THE PERFORMANCE BY ONE OR MORE BANKING
INSTITUTIONS OF SUCH SERVICES AS ARE GENERALLY PERFORMED BY ANY SUCH
BANK ITSELF OWNING AND HOLDING SUCH A LOAN AND AS MAY BE APPROVED BY THE
SUPERINTENDENT OF FINANCIAL SERVICES FOR WHICH SERVICES A BANK MAY MAKE
AND COLLECT SUCH SERVICE CHARGES AS THE SUPERINTENDENT SHALL PRESCRIBE
OR APPROVE.
2. THE AGENCY MAY MAKE PROVISION IN THE NOTE AND LOAN AGREEMENT OR BY
SEPARATE AGREEMENT FOR THE SERVICING OF SUCH LOANS BY A LOAN SERVICING
COMPANY OR OTHER QUALIFIED ENTITY, AS DETERMINED BY THE AGENCY, AND SUCH
SERVICES MAY INCLUDE, BUT NOT BE LIMITED TO, THE COLLECTION OF THE DEBT
SERVICES ON SUCH LOANS AND THE ESTABLISHMENT, ADMINISTRATION, AND
DISTRIBUTION OF AN ESCROW ACCOUNT FOR THE PAYMENT OF THE OWNER'S REAL
ESTATE TAXES, SEWER AND WATER RENTS AND FIRE INSURANCE.
§ 485. INTEREST REDUCTION SUBSIDIES. NOTWITHSTANDING THE PROVISIONS OF
ANY GENERAL, SPECIAL OR LOCAL LAW, THE CITY, ACTING THROUGH THE AGENCY,
IS AUTHORIZED TO PROVIDE, OR CONTRACT TO PROVIDE, INTEREST REDUCTION
SUBSIDIES FOR LOANS MADE BY PRIVATE INVESTORS TO OWNERS OF ONE TO FOUR
S. 2276--A 8
UNIT EXISTING PRIVATE OR MULTIPLE DWELLINGS PURSUANT TO PARAGRAPH (A) OF
SUBDIVISION ONE OF SECTION FOUR HUNDRED EIGHTY-TWO OF THIS ARTICLE, IF
SUCH OWNERS WOULD HAVE BEEN ELIGIBLE UNDER THE PROVISIONS OF THIS ARTI-
CLE FOR A LOAN MADE BY THE CITY PURSUANT TO THIS ARTICLE.
§ 486. MORTGAGE RECORDING TAX EXEMPTION. NOTWITHSTANDING ANY INCON-
SISTENT PROVISION OF LAW, MORTGAGES TO SECURE A LOAN MADE PURSUANT TO
THE PROVISIONS OF THIS ARTICLE SHALL BE EXEMPT FROM THE MORTGAGE RECORD-
ING TAXES IMPOSED BY ARTICLE ELEVEN OF THE TAX LAW.
§ 487. RULES AND REGULATIONS. THE AGENCY MAY PROMULGATE RULES AND
REGULATIONS TO CARRY OUT THE PROVISIONS OF THIS ARTICLE.
§ 488. SOURCE OF FUNDS. THE CITY MAY UTILIZE FEDERAL GRANT FUNDS,
STATE GRANT FUNDS OR ANY MUNICIPAL FUNDS TO MAKE LOANS AND TO PROVIDE
INTEREST REDUCTION SUBSIDIES PURSUANT TO THIS ARTICLE.
§ 3. This act shall take effect immediately.
