Enables a current tenant-cooperator of certain housing companies, entitled to occupancy by reason of ownership of shares in such housing company, to apply all or a portion of the value of his or her holdings and equity in the housing company toward any consideration required to be paid for shares which would entitle the resident to the occupancy of another unit owned and operated by the housing company.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A7671
SPONSOR: Pheffer Amato TITLE OF BILL:
An act to amend the private housing finance law, in relation to the
application of tenant-cooperator shares of mutual company holdings
PURPOSE OR GENERAL IDEA OF BILL:
To improve the ability of a tenant-shareholder of a Mitchell-Lama coop-
erative to understand and access the current value of his or her shares
and equity when relocating to another unit in the housing company.
SUMMARY OF PROVISIONS:
This legislation amends the Private Housing Finance Law to require
limited-profit housing companies, commonly known as Mitchell-Lama hous-
ing companies, to provide a written statement of the current value of a
tenant-cooperator's shares and equity in the housing company upon
request of the tenant-cooperator.
The bill would also require a Mitchell-Lama housing company to allow a
current tenant-cooperator who intends to relocate to another unit in the
same housing company to apply the value of his or her current equity and
shares in the housing company toward any consideration required to be
paid for shares associated with the other unit before requiring use of
cash, a loan or a mortgage.
In addition, the bill would require New York State Homes and Community
Renewal and New York City Housing, Preservation and Development to,
within 180 days of the effective date of the bill, promulgate regu-
lations authorizing such application of a current tenant-cooperator's
shares.
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE):
JUSTIFICATION:
Limited-profit cooperative housing companies, or Mitchell-Lama co-ops,
give their tenant-cooperators the opportunity for affordable homeowner-
ship and to grow their wealth and equity in the company over time.
However, many long-term shareholders are unaware of the dollar value of
their holdings and equity in the company or, in turn, how that value
compares to the value associated with other units in the company. For
growing families and empty-nesters in particular, this can cause
confusion and make it difficult to relocate to a "right-sized" unit in
the same company when desired.
This bill will help improve transparency and financial literacy for
Mitchell-Lama shareholders by ensuring a written statement of equity is
available upon shareholder request, and that shareholders interested in
transferring to a different unit in the same company have the opportu-
nity to do so by transferring their assets with the company before
paying out of pocket.
PRIOR LEGISLATIVE HISTORY:
New bill.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
EFFECTIVE DATE:
Immediate.
STATE OF NEW YORK
________________________________________________________________________
7671
2021-2022 Regular Sessions
IN ASSEMBLY
May 19, 2021
___________
Introduced by M. of A. PHEFFER AMATO -- read once and referred to the
Committee on Housing
AN ACT to amend the private housing finance law, in relation to the
application of tenant-cooperator shares of mutual company holdings
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 31-a of the private housing finance law is amended
2 by adding a new subdivision (f) to read as follows:
3 (f) a mutual company shall provide, upon request of a tenant-coopera-
4 tor, a written statement providing the current value of such tenant-
5 cooperator's shares and equity in such mutual company;
6 § 2. The private housing finance law is amended by adding a new
7 section 31-c to read as follows:
8 § 31-c. Tenant-cooperators; application of shares. 1. No mutual
9 company shall require a current tenant-cooperator to use cash, loan or
10 mortgage to make an initial payment for shares that would entitle the
11 tenant-cooperator to occupancy upon transfer to another dwelling unit
12 within the mutual company's facilities, but instead, subject to subdivi-
13 sion two of this section, shall first allow the tenant-cooperator the
14 option to apply the value of his or her shares and equity in the mutual
15 company toward any consideration required to be paid for such shares.
16 2. Within one hundred eighty days of the effective date of this
17 section, the commissioner and the supervising agency, as the case may
18 be, shall each promulgate regulations authorizing a current tenant-coop-
19 erator, entitled to occupancy by reason of ownership of shares in such
20 mutual company, to apply all or a portion of the value of his or her
21 shares and equity in the mutual company toward any consideration
22 required to be paid for shares which would entitle the tenant-cooperator
23 to occupancy of another unit owned and operated by the mutual company,
24 regardless of the sale of the tenant-cooperator's current shares in such
25 mutual company, but subject to such other charges due and owing to the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD11168-03-1
A. 7671 2
1 mutual company for which such tenant-cooperator may be liable. Any
2 dispute thereof may be determined by a court of appropriate jurisdiction
3 and any requirement to waive such right as a condition of ownership or
4 transfer shall be void as against public policy.
5 § 3. This act shall take effect immediately.
