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History
- Referred to housing, construction and community development
- Referred to housing, construction and community development
Full text
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Sponsor's memo
Title of bill
An act to amend the private housing finance law, in relation to voluntary dissolution of a limited-profit housing company
Purpose
To safeguard residents of limited profit housing projects by providing that voluntary dissolution may occur only when the full term of the mortgage has expired.
Summary of provisions
Subdivision 2 of Section 35 of the Private Housing Finance Law is amended to prohibit a mortgage buyout or dissolution of the company before the full term of the mortgage has expired.
Justification
In enacting the Mitchell-Lama program, the Legislature attempted to remedy a serious shortage of decent housing by providing affordable rental or cooperative housing for persons in the state whose incomes were too high for public housing but not high enough to afford housing developed through private enterprise.
Currently, there are many Mitchell-Lama buildings, with several thousand apartments where the owners claim the right to "buyout" their mortgages, dissolve the Mitchell-Lama company and remove the buildings from Mitchell-Lama and its regulations -- this under a current provision of law which allows mortgage "buyouts" after 20 years of occupancy. The tenants in these buildings fear that if such events were to occur, the landlords might try to raise the rents to insupportable levels. As a result, thousands of tenants may be forced to either pay the price demanded for the apartment or seek new homes outside their neighborhoods. Should this situation occur, the original purpose of the Mitchell-Lama housing would be defeated. This legislation is necessary to protect and maintain the program's original purpose to create decent homes and stable neighborhoods. Prohibiting the mortgage buyout or dissolution of the company before the full term of the mortgage (usually 40 years) would certainly provide security for Mitchell-Lama residents.
Legislative history
2006: Referred to Housing, Construction and Community Development 2007: Referred to Housing, Construction and Community Development 2008: Referred to Housing, Construction and Community Development
Fiscal implications
None.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.