Requires cooperative housing corporations provide a prospective purchaser with a written statement of reasons when withholding consent to a purchase

Title of bill

An act to amend the civil rights law, in relation to discrimination in the ownership of cooperative housing

Purpose

Many prospective cooperators are arbitrarily and discriminatorily rejected. By requiring cooperative apartment corporations to provide a statement of reasons, this bill will serve to reduce the incidence of such rejections.

Summary of provisions

This bill amends Civil Rights Law § 19-a to require a cooperative apartment corporation to provide a prospective purchaser with a written statement of reasons whenever the corporation withholds its consent to the sale of the corporation's stock.

Existing law

Cooperative apartment corporations currently are not required to inform prospective purchasers of the reasons for their rejection.

Justification

Cooperative ownership in multi-family dwellings is becoming an extremely popular form of home ownership in New York State. In 1971, the Legislature enacted section 19-a of the Civil Rights Law, which prohibits cooperative apartment corporations from discriminating against prospective purchasers on the basis of race, religion, national origin or sex. Such discrimination nevertheless remains a widespread problem. See, e.g., BACHMAN V. STATE DIVISION OF HUMAN RIGHTS, 104 A.D. 2d 111 (1st Dept. 1984); ROBINSON V. 12 LOFTS REALTY, INC., 610 F. 2d 1032 (2d Cir. 1979); ROGERS V. 66-36 YELLOWSTONE BLVD. COOPERATIVE OWNERS, INC., 599 F. Supp. 79 (E.D.N.Y. 1984); see also SANDERS V. WINSHIP, 57 N.Y. 2d 391 (1982).

As the Court of Appeals has declared, "discrimination is rarely so obvious or its practices so overt that recognition of it is instant and conclusive, it being accomplished usually by devious and subtle means." 300 GRAMATAN AVENUE ASSOCIATES V. STATE DIVISION OF HUMAN RIGHTS, 45 N.Y. 2d 176 (1978). At present, proving discrimination by cooperative apartment corporations is even more difficult than proving housing discrimination in other contexts.

First, because the decision to reject a prospective cooperator generally is made by an admissions committee, and the individuals on the committee may purport to have acted for different reasons, it is difficult to determine whether the motivating factor for the rejection was discriminatory.

Second, "testing" for cooperative discrimination by the use of paired minority and non-minority apartment seekers is harder than "testing" for discrimination in rental housing because the process of purchasing a cooperative apartment is much more complicated than the process of renting an apartment. Requiring cooperative apartment corporations to state reasons for rejecting prospective tenant shareholders has been recognized as an effective means of reducing the ability of such corporations to mask discriminatory conduct. In ROGERS V. 66-36 YELLOWSTONE BLVD. COOPERATIVE OWNERS, a federal court required a New York City cooperative apartment corporation which had violated federal fair housing laws to provide a statement of reasons to rejected minority applicants. If this bill is enacted, a cooperative apartment corporation will not be able to create after-the-fact justifications when a rejected purchaser challenges as pretextual the corporation's reasons for refusing to permit a sale. The legislation thus will help prevent discriminatory rejections, and will further the goal of equal housing opportunity.

Legislative history

2013-14: A6109 Referred to Governmental Operations 2011-12: A8347 Referred to Governmental Operations

Fiscal implications

None

Local fiscal implications

None

Effective date

This act shall take effect on the ninetieth day after it shall have become a law.