Relates to establishment of initial rents in housing accommodations rehabilitated with loans to housing development companies; effective date

Title of bill

An act to amend chapter 84 of the laws of 1993, amending the private housing finance law relating to establishment of initial rents in housing accommodations rehabilitated with loans to housing development companies, in relation to the effectiveness thereof

Purpose of bill

This bill extends the existing authority of the local housing agency in the City of New York, the Department of Housing Preservation and Development ("HPD") to restructure rents for housing development fund companies that have purchased and are rehabilitating occupied multiple dwellings pursuant to Article XI of the Private Housing Finance Law ("PHFL"). Currently, the ability to restructure rents expires on June 30, 2010. This legislation extends such authority to June 30, 2014.

Justification

Many residential buildings proposed for acquisition and rehabilitation by housing development fund companies are not economically viable without a restructuring of the rents. Rent restructuring authority is essential to ensure that the rents are adequate to cover the monthly operating costs of the building and the debt service of the low interest rehabilitation loans. Rent restructuring authority exists in other statutes utilized by the City of New York's Department of Housing Preservation and Development, such as Article 8, 8-A and 15 of Private Housing Finance Law and Article 16 of the General Municipal Law. Such authority has been essential in rehabilitating existing multiple dwellings and providing affordable housing for residents of New York City.

Extending the rent restructuring authority of Article XI will significantly enhance the City of New York's ability to provide permanent housing for low income families and individuals that reside in buildings owned and rehabilitated by housing development fund companies.

Fiscal implications for state and local governments

None to the State.

Effective date

This act shall take effect immediately; provided, however, that if this act shall have become a law after June 30, 2010, this act shall take effect immediately and shall be deemed to have been in full force and effect on and after June 30, 2010.