Senate Bill S4579A

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4579--A
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             February 7, 2025
                                ___________
 
 Introduced  by  Sens.  HOYLMAN-SIGAL,  JACKSON -- read twice and ordered
   printed, and when printed to be committed to the Committee on Banks --
   committee discharged, bill amended, ordered reprinted as  amended  and
   recommitted to said committee
 
 AN ACT to amend the banking law, in relation to prohibiting bank invest-
   ments in bad faith landlords

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The banking law is amended by adding a new  section  13  to
 read as follows:
   §  13.  INVESTMENTS  IN BAD FAITH LANDLORDS BY STATE CHARTERED BANKING
 INSTITUTIONS. 1.  NO  STATE  CHARTERED  BANKING  INSTITUTION  OR  ENTITY
 LICENSED  PURSUANT TO THIS CHAPTER SHALL KNOWINGLY PROVIDE FINANCING FOR
 OR INVEST IN THE STOCKS, SECURITIES, OR OTHER OBLIGATIONS OF ANY  LIMIT-
 ED-LIABILITY  COMPANY, PARTNERSHIP, CORPORATION OR ANY OTHER ENTITY THAT
 ACQUIRES, OWNS, SELLS, OR MANAGES REAL  PROPERTY,  WHICH  ITSELF,  OR  A
 MEMBER, OFFICER, PARTNER, SHAREHOLDER, OR DIRECTOR OF WHICH:
   (A)  IN  THE PAST YEAR HAS GRANTED A TENANT AN ABATEMENT OF RENT BASED
 ON VIOLATIONS OF THE HOUSING MAINTENANCE CODE, APPLICABLE HOUSING STAND-
 ARDS, BUILDING CODE, HEALTH CODE OR SECTION TWO HUNDRED THIRTY-FIVE-B OF
 THE REAL PROPERTY LAW;
   (B) IN THE PAST YEAR HAS VIOLATED SECTIONS 2525.4 OR 2505.4 OF TITLE 9
 OF THE NEW YORK CODES, RULES AND REGULATIONS OR SECTIONS 7-105 OR  7-108
 OF THE GENERAL OBLIGATIONS LAW;
   (C) IN THE PAST FIVE YEARS HAS ENGAGED IN REPEATED FRAUDULENT OR ILLE-
 GAL  ACTS  UNDER SUBDIVISION TWELVE OF SECTION SIXTY-THREE OF THE EXECU-
 TIVE LAW;
   (D) IN THE PAST FIVE YEARS HAS ENGAGED IN DECEPTIVE ACTS OR  PRACTICES
 UNDER SECTION THREE HUNDRED FORTY-NINE OF THE GENERAL BUSINESS LAW;

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD04008-02-5
 S. 4579--A                          2
 
              

   (E)  IN  THE  PAST  FIVE  YEARS  HAS VIOLATED SECTIONS 2525.5, 2505.6,
 2205.1, OR 2505.1 OF TITLE 9 OF THE NEW  YORK  CODES,  RULES  AND  REGU-
 LATIONS;
   (F)  OWNS  A PROPERTY WITH MORE THAN ONE OPEN HAZARDOUS OR IMMEDIATELY
 HAZARDOUS VIOLATION PER DWELLING UNIT WITHIN THE  PAST  FIVE  YEARS,  AS
 DETERMINED BY THE LOCAL HOUSING STANDARDS DEPARTMENT;
   (G)  OWNS  A  PROPERTY  SUBJECT TO THE ALTERNATIVE ENFORCEMENT PROGRAM
 UNDER SECTION 27-2153 OF THE ADMINISTRATIVE CODE  OF  THE  CITY  OF  NEW
 YORK;
   (H)  IN  THE  PAST  FIVE YEARS HAS ENGAGED IN HARASSMENT AS DEFINED IN
 SECTION 27-2004 OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK; OR
   (I) IN THE PAST FIVE YEARS HAS ENGAGED IN  RETALIATION  UNDER  SECTION
 TWO HUNDRED TWENTY-THREE-B OF THE REAL PROPERTY LAW;
   (J)  IN  THE  PAST FIVE YEARS HAS VIOLATED SECTION TWO HUNDRED TWENTY-
 SEVEN-F OF THE REAL PROPERTY LAW; OR
   (K) IN THE PAST FIVE YEARS HAS VIOLATED  PARAGRAPH  A  OF  SUBDIVISION
 FIVE OF SECTION TWO HUNDRED NINETY-SIX OF THE EXECUTIVE LAW.
   2. SUBDIVISION ONE OF THIS SECTION SHALL NOT APPLY WHEN ANY FINANCING,
 LOAN, OR INVESTMENT WILL BE USED SOLELY TO CURE AN IMMEDIATELY HAZARDOUS
 VIOLATION  OF  THE  UNIFORM  FIRE PREVENTION AND BUILDING CODE, NEW YORK
 CITY FIRE CODE, OR NEW YORK CITY BUILDING AND HOUSING MAINTENANCE CODES,
 IF APPLICABLE, OR TO  PREVENT  A  FORSEEABLE  AND  IMMINENT  IMMEDIATELY
 HAZARDOUS VIOLATION OF SAID CODES.
   3.  (A) A STATE-CHARTERED BANKING INSTITUTION OR OTHER ENTITY LICENSED
 PURSUANT TO THIS CHAPTER SHALL REQUIRE AN  APPLICANT  FOR  FINANCING  TO
 SELF-CERTIFY THAT THEY ARE NOT COVERED BY ACTS LISTED IN SUBDIVISION ONE
 OF  THIS  SECTION  OR, IF THEY ARE COVERED BY ACTS LISTED IN SUBDIVISION
 ONE OF THIS SECTION, THAT THE APPLICANT WILL USE  THE  FINANCING  SOLELY
 FOR THE PURPOSES DEFINED IN SUBDIVISION TWO OF THIS SECTION.
   (B)  IF AN APPLICANT WISHES TO QUALIFY FOR AN EXEMPTION UNDER SUBDIVI-
 SION TWO OF THIS SECTION, AN APPLICANT MUST:
   (I) FURNISH RECORDS OR REPORTS TO THE CREDITOR TESTIFYING TO THE IMME-
 DIATELY HAZARDOUS CONDITION TO BE CURED OR PREVENTED; AND
   (II) FURNISH PLANS OR STATEMENTS TO THE  CREDITOR  TESTIFYING  TO  THE
 SCOPE AND COST OF WORK TO BE PERFORMED.
   4.  AN  APPLICANT  WHO  MAKES A FALSE CERTIFICATION OR FURNISHES FALSE
 RECORDS, REPORTS, PLANS, STATEMENTS, OR ANY OTHER DOCUMENTS OR  EVIDENCE
 TO  RECEIVE  FINANCING  UNDER  THIS  SECTION SHALL BE SUBJECT TO A CIVIL
 PENALTY NOT LESS THAN TEN THOUSAND DOLLARS NOR MORE THAN FIFTY  THOUSAND
 DOLLARS.
   5. THE SUPERINTENDENT SHALL PROMULGATE REGULATIONS NECESSARY TO EFFEC-
 TUATE THE PROVISIONS OF THIS SECTION, INCLUDING:
   (A)  REGULATIONS SPECIFYING THE EVIDENCE APPLICANTS MUST FURNISH UNDER
 PARAGRAPH (B) OF SUBDIVISION THREE OF THIS SECTION  PRIOR  TO  AND  UPON
 COMPLETION  OF  WORK  UNDERTAKEN TO CORRECT OR TO PREVENT AN IMMEDIATELY
 HAZARDOUS CONDITION;
   (B) A SAMPLE CERTIFICATION FORM CREDITORS MAY USE TO COMPLY  WITH  THE
 REQUIREMENTS OF THIS SECTION.
   6. FOR PURPOSES OF THIS SECTION, "STATE CHARTERED BANKING INSTITUTION"
 SHALL  HAVE  THE  SAME  MEANING AS DEFINED IN SUBDIVISION ONE OF SECTION
 TWELVE-A OF THIS ARTICLE.
   § 2. This act shall take effect on the ninetieth day after the depart-
 ment of financial services shall have promulgated regulations to  effec-
 tuate  the  provisions  of  this  act  and  shall apply to all contracts
 entered into, renewed, modified or amended on or  after  such  effective
 date.