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Who cares
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Sponsors
1 Co-sponsor
History
- Substituted by A11322
- Advanced to third reading
- 2nd report cal.
- 1st report cal.796
- Reported and committed to finance
- Referred to corporations, authorities and commissions
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Extends the effective date of chapter 172 of the laws of 2002 amending the public authorities law relating to the powers of the New York mortgage agency
Signed by Governor · Sponsor Albert A. Stirpe
Full text
The text isn't available here yet. Check nysenate.gov.
Sponsor's memo
Title of bill
An act to amend chapter 172 of the laws of 2002 amending the public authorities law relating to the powers of the state of New York mortgage agency, in relation to extending the provisions thereof
Purpose
This bill would extend the sunset provision for the statutory definition of a rehabilitation loan for a period of two years, from July 23, 2010 to July 23, 2012.
Summary of provisions
Section 1 of the bill would extend, until July 23, 2012, the present sunset date of July 23, 2010 for the requirement that at least 20% of a rehabilitation loan given by the State of New York Mortgage Agency ("SONYMA") be used for rehabilitation or construction of improvements.
Section 2 of the bill provides for an immediate effective date.
Existing law
SONYMA is authorized through July 23, 2010 to insure rehabilitation loans, which are defined in Public Authorities Law §2426 (12) as loans wherein at least 20% of the mortgage loan amount is attributable to the cost of rehabilitation or construction of improvements.
Legislative history
The sunset of this provision has been extended multiple times. See Chapter 172 of the Laws of 2002; Chapter 309 of the Laws of 2005; Chapter 137 of the Laws of 2006; Chapter 150 of the Laws of 2008.
Statement in support
SONYMA's primary tool for promoting new construction and rehabilitation of affordable housing is its authority to insure rehabilitation loans. The statutory authority that reduced the percentage of a rehabilitation loan that must be attributable by SONYMA to the cost of rehabilitation or new improvements from 25% to 20% of the mortgage loan is set to expire on July 23, 2010.
The 25% requirement is inconsistent with the provisions of the Internal Revenue Code (the "Code") concerning the issuance of tax-exempt bonds for multi-family housing. Under the Code a minimum of 15% of such bonds must fund construction or rehabilitation costs. Several of the most important users of SONYMA's mortgage insurance are public benefit corporations, such as the New York State Housing Finance Agency, that issue tax-exempt bonds subject to the standards set by the Code.
The 25% requirement also encourages lenders and borrowers to pad prospective loans with additional improvement not otherwise necessary for the project so that they are eligible under the current definition of Rehabilitation Loan.
The reduction of the percentage requirement from 25% to 20% has resulted in SONYMA's insurance product matching more closely the needs of some of its primary users without in any way negatively affecting the programmatic or financial integrity of the Mortgage Insurance Fund.
Fiscal impact
None.
Effective date
This bill would become effective immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.