What's happening
This bill requires new owners of limited-profit housing projects to use reserve and surplus funds for capital improvements before raising rents.
Why it matters
Protects tenants from immediate rent hikes. by ensuring that new owners must use existing reserve and surplus funds for necessary capital improvements before passing those costs onto residents through higher rents.
Promotes responsible stewardship of affordable housing assets. , as it requires new owners to prioritize reinvestment in the property’s infrastructure over extracting profits or using funds for unrelated purposes.
Increases transparency and accountability. by mandating that transferred reserve and surplus funds be held in escrow and used exclusively for major capital improvements, reducing the risk of mismanagement or diversion of these resources.
Aims to preserve long-term housing affordability and project quality. by making sure that maintenance and upgrades are funded through existing resources, rather than relying on rent increases that could displace low- and moderate-income tenants.
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Who cares
Tenants in transferred limited-profit housing projects
The bill would bar new owners from raising rents or other charges to cover major capital improvements until transferred reserve and surplus funds are exhausted for those improvements.
Buyers outside the limited-profit housing company framework
Buyers would have to hold transferred reserve and surplus funds in escrow and use them solely for major capital improvements to the project.
Limited-profit housing companies selling projects
Sales or other conveyances to entities that are not such companies would trigger restrictions on the new owner's use of transferred reserves and surplus funds.
Headline styles
Escrow Housing Sale Funds
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to housing
- Referred to housing
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.
Escrow Funds for Building Repairs
In Senate Committee · Housing, Construction And Community Development · Sponsor Liz Krueger
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4178
2019-2020 Regular Sessions
IN ASSEMBLY
February 1, 2019
Introduced by M. of A. CYMBROWITZ -- read once and referred to the Committee on Housing
AN ACT to amend the private housing finance law, in relation to the sale of limited-profit housing projects
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The private housing finance law is amended by adding a new section 36-b to read as follows:
§ 36-b. Sale or other conveyance of project. Notwithstanding any inconsistent provision of law, upon the sale or other conveyance of a project by a company to any entity other than a company, the following requirements shall apply.
1. All reserve and surplus funds transferred by the company to the new owner must be held by such new owner in escrow accounts and may be used by such new owner solely for the purpose of making major capital improvements to the project.
2. No rental or other charge may be increased by the new owner to defray the cost of any major capital improvement unless and until all of such reserve and surplus funds have been expended to defray the cost of major capital improvements.
§ 2. This act shall take effect on the first of January next succeeding the date on which it shall have become a law.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06407-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.