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Legal & Legislative Roundup Looking at the Past Year in Law

As the nation starts to regain a semblance of normalcy with COVID-19 vaccinations on the rise and restrictions beginning to ease, legislative dockets have filled with bills and proposals that have ramifications for the co-op, condo, and HOA sector. Here are some of the biggies that boards, managers, and residents should be aware of.

HSTPA Corrections

Back in July 2019, New York legislators passed the Housing Stability and Tenant Protection Act (HSTPA), providing a range of protections to residential renters, and enacting certain limitations on landlords and other types of housing providers. But as with certain other legislation geared toward tenant protections, the language in the HSTPA “inadvertently” wraps co-op corporations in with “landlords” and co-op shareholders in with “renters,” since both categories of housing operate under a leasehold agreement—or so think proponents of Assembly Bill 350/Senate Bill 5105.

The difference is that rental tenants and landlords are two separate entities, whereas cooperatives are run by and for the mutual interest of their shareholder-occupants. As such, HSTPA has had undesirable effects on cooperatives throughout the state, prompting lawmakers to propose new legislation that would “correct” the inadvertent inclusion of co-ops. However, that new legislation got held up at the onset of COVID, leaving co-ops without the ability to, for example, hold more than a month’s worth of carrying charges in escrow, as a co-op board might propose for a prospective shareholder whose finances were on the margin, but who would otherwise be deemed a positive addition to the community. 

The bill is currently in committee. Co-op lawyers and others throughout the state who live in, work with, or support co-ops are eager for it to be taken back up, with legal experts arguing that its passage would clear up a lot of unintended harm in an otherwise benevolent law.

Good Cause Eviction

Also in New York State, the Good-Cause Eviction Bill, as it is commonly known, is yet another example of tenant protection legislation that inadvertently includes co-ops—to their disadvantage. 

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