Relates to additional information required in annual reports for limited-profit housing companies

Title of bill

An act to amend the private housing finance law, in relation to additional information required in annual reports for limited-profit housing companies

Purpose or general idea of bill

The purpose of this bill is to revise the requirements relating to the Division of Housing and Community Renewal (DHCR)'s annual report for the Mitchell-Lama program.

Summary of specific provisions

This bill would require the Division of Housing and Community Renewal (DHCR) to include in its annual report relating to the Mitchell-Lama program information regarding any limited-profit housing company that has voluntarily dissolved in the preceding calendar year, as well as any limited-profit housing company that has, in the current calendar year, filed, with the commissioner and the supervising agency, a notice of its intent to dissolve. Such information would include, but not be limited to:

*The name and address of the development;

*The number of units in the development;

*A range of amounts of rent offered in the development;

*The number of tenants in the development;

*The current vacancy rate in the development;

*Income levels served by the development;

*How long the limited-profit housing company has participated in the program; and

*Any sales or transfers that have occurred since the limited-profit housing company was created.

This bill would also require DHCR to submit the annual report to the State Comptroller and the Attorney General. Currently, DHCR only submits its annual Mitchell-Lama program report to the Legislature.

Justification

Limited-profit housing companies (LPCs) are eligible to voluntarily dissolve and withdraw from the Mitchell-Lama program upon prepayment of the mortgage after 20 years from initial occupancy; or after 35 years from initial occupancy, in the case of developments aided by loans prior to May 1, 1959. This process is often referred to as dissolution or "buying out" of the program. When developments buy-out, they are no longer subject to the Division of Housing and Community Renewal (DHCR) regulations, or in the case of City-supervised developments, the New York City Department of Housing Preservation and Development (HPD). Units which were once affordable under the Mitchell-Lama program may then return to market rate prices. To date, 93 Mitchell-Lama LPCs, representing approximately 31,700 units, have voluntarily dissolved.

In order to better understand the landscape of the current Mitchell-Lama program and the rate at which LPCs are buying out of the program, it is essential to have relevant information collected and included in DHCR's annual Mitchell-Lama program report. Considering the devastating effects that buy-outs can have on tenants and communities, with the conversion of affordable units to out-of-reach units at market rate prices, the collection of such information would aid in potential examinations of and modifications to the Mitchell-Lama program.

The State Comptroller and the Attorney General are involved in the oversight and effectiveness of the Mitchell-Lama program. For this reason, DHCR submit its annual report relating to the program to the State Comptroller and the Attorney General. Under current law, DHCR is only required to submit such report to the Legislature.

Prior legislative history

This is new legislation.

Fiscal implications

Small administrative cost to the State.