Legislative Update 2010 Comings and Goings in City Hall and Albany

Legislative Update 2010

 As the legislature in Albany and the New York City Council are in full swing,  legislation of every type is being proposed, debated, and considered. As one  might expect, the budget is front and center in these recessionary times, but  housing-related bills—both those specifically targeting condos and co-ops and those dealing with  multifamily housing—are also a hot topic, as always. Keeping up with pending legislation and court  cases can be a lot of work, but it’s incumbent upon boards and managing agents to stay abreast of changes in the  law in order to administer their building communities.  

 Up in Albany

 In the state Assembly, bills dealing with housing usually go through the Housing  Committee, but often go through others, such as the Ways and Means, Judiciary  and Government Operations committees.  

 Large numbers of housing-related bills are introduced in Albany every year.  Melissa Mansfield, spokeswoman for Assembly Speaker Sheldon Silver, provided us  with a list of 18 current bills dealing with housing cooperatives. They range  from Assembly Bill A03553, which would require co-op boards to act on  applications from prospective buyers within 45 days, to A00871, which would  create a separate part in Housing Court to deal with condos and co-ops; to  A01211, a version of the controversial “written rejection bill” that would require co-op boards to give applicants reasons in writing for why  their application is rejected; to A08636, which would provide an income tax  deduction for “monies deposited into a house, townhouse, condominium or unit in a cooperative  housing corporation account.”  

 One bill, A05252, relating to provisions dealing with the conversion of rental  buildings to condos or co-ops, seems somewhat pre-recession in its thinking;  nowadays, it’s often the other way around. Also, some bills deal mainly with specific  locations, such as the city of Yonkers, or specific classes of people, such as  seniors.  

 Among the key players in the Assembly as far as housing is concerned, by the  way, are, of course, Speaker Silver and Housing Chair Vito Lopez. In addition  to these two, Assemblywoman Linda Rosenthal chairs the subcommittee on  Mitchell-Lama, and Assemblyman Marc Alessi has been active on bills to protect  mobile home park tenants. Assemblymen Keith Wright and Jonathan Bing previously  chaired the subcommittee on Mitchell-Lama.  

 Housing-related language figures largely in the Assembly’s 2010-11 budget proposal. Most of the material has little relation to co-ops or  condos. However, one of the items that is proposed is the “elimination of the foreclosure prevention program,” a measure some feel may be rather unpopular with many people throughout the  state.  

 Another idea that has been talked about for quite some time is that of a condo  or co-op owners’ “Bill of Rights.” Assemblyman Lopez has introduced such a bill A04946, and the bill has also been  introduced in the state Senate under the title S05088. While these measures  have a certain amount of support, many in co-op/condo organizations disagree,  arguing that condos and co-ops are regulated by their own bylaws, that each  building’s bylaws are different, and that these bylaws often change, making overarching  regulation impractical and unenforceable.  

 The City Council

 According to Anthony Hogrebe, spokesman for City Council Speaker Christine  Quinn, recent legislation that has gone through the Council’s Housing and Buildings Committee includes a package of legislation governing  building demolition, and a bill that helps incentivize owners of stalled  construction sites to prevent them from falling into disrepair.  

 The latter, which has been covered in the past by The Cooperator, definitely  applies to new condos, since so many stalled construction projects are condo  buildings.  

 Still, a search of the City Council’s website for “housing” doesn’t reveal that many bills dealing with condos and co-ops. One, resolution  0009-2010, recommends a new “Mitchell Lama-type program” to construct buildings on vacant lots, but doesn’t specify whether these buildings would be rentals, co-ops or condos.  

 Councilman Lew Fidler, D-46, representing Southeast Brooklyn, has introduced a  bill that is similar in some respects to then-Councilman Hiram Monserrate’s 2006 “written rejection bill,” which would have obligated co-op boards to give applicants concrete reasons for  rejection, in writing. Fidler, who sits on the Housing Committee, points out  that even though buildings are already forbidden to discriminate on the basis  of race, ethnicity, religion or disability, “There has long been a suspicion that some co-op boards do discriminate, so I  have a bill that will formalize the application process for co-ops [with the  same form] so that a person of one ethnic background doesn’t get one application, and a person of another background doesn’t get a different application. The board must certify that any denial was not  done for a discriminatory reason.”  

 “Suffolk County,” he continues, “passed a bill that was similar and actually specified that the board give the  reason for denial, but I think that was unnecessarily personal.”  

 Al Pennisi, president of the Federation of New York Housing Cooperatives & Condominiums (FNYHC), comments, “We have civil rights laws in New York, and have had them for many years. If an  applicant is turned down and feels he is discriminated against, he can file a  complaint with the Civil Rights Commission and they will have to explain why  they did so, if you’re talking about race, creed, color, national origin, marital status or  disability.Co-ops feel they have the right to make a decision about who shares their  building, shares their elevators, shares their common areas. The statutes do  protect the buyers.”  

 As for other city legislation, Fidler says, “There are always people who introduced bills that pets be [always] allowed for  certain groups of people. I don’t see it going anywhere.” Such bills have often tried to specify seniors with pets as a “protected” group. Of course, some developments approve pets, others prohibit them.  

 EPA Lead Paint Rule

 One of the matters currently vexing many property managers and boards is neither  state nor city in origin, but federal. Beginning in April, EPA regulations have  required that contractors who perform renovation, repair and painting projects “that disturb more than six square feet of paint in homes, child care facilities  and schools built before 1978” must be certified and specially trained. “Rule 40 CFR, Part 745” is designed to deal with lead paint.  

 The Federation believes that many managers and boards were totally unaware of  the new regulation, which is characterized as dealing more with lead dust  (since the paint turns to dust during construction and renovation) than paint  per se. So, many contractors are scrambling to get the proper training.  

 Margie Russell, executive director of the New York Association of Realty  Managers (NYARM) adds that the city already has its own tough rules about  working in buildings with lead paint (the Lead Paint Hazard Reduction Law), so  that contractors will now have to be familiar with, and certified for, both, as  well as OSHA laws.  

 Making Their Wishes Known

 Organizations such as FNYHC, NYARM, the Real Estate Board of New York (REBNY)  and the Council of New York Cooperatives & Condominiums (CNYC), being membership organizations, all make their wishes  known in Albany and in the New York City Council, though each group advocates  in different ways.  

 FNYHC, for example, says that it doesn’t lobby—but it does advocate. On the other hand, REBNY does lobby, according to Mike  Slattery, its senior vice president.  

 What’s the difference? According to the New York State Lobbying Act, actively trying  to influence the vote of an elected official is considered lobbying, while  preparing newspaper or magazine articles, responding to requests for comments,  or participating as a witness in a public proceeding is not lobbying. The act  further specifies that a lobbyist is “every person or organization retained, employed or designated by any client to  engage in lobbying” and that spends, or even anticipates spending, $5,000 during the year for  lobbying activities.  

 What are some legislative items that the organizations concerned about?  Slattery, for example, is opposed to an item in Governor David Paterson’s initial budget that would make co-ops subject to taxes on mortgages. In the  past, they, unlike condos, have been exempt from such a tax. Opponents of such  a provision point out that cooperators don’t own real estate, they own shares, and that this would further tax cooperators  in a time of economic recession.  

 Slattery would like a renewal of the 421-a exemption program, which grants a  partial tax exemption to developers of new construction for a period of 10, 15  or 25 years. Although the exemption is for new construction, unit owners in  buildings with such an exemption could see their maintenance or common charges  zoom up when the exemption ends.  

 NYARM also is not a lobbyist, says Russell. Rather, its efforts are toward  training managers how to deal with new laws and regulations that have already  been passed.  

 However, one item that has been introduced from time to time—to establish licensing for property managers—has been actively supported by NYARM, both in the City Council and in Albany.  Such a bill, she said, would not only improve the reputation and  professionalism of property managers, but would contribute to public safety by  making sure that managers recognize unsafe conditions when they see them.  

 What about lobbying in the City Council? Hogrebe says that “over the past few years, the Council has passed landmark legislation severely  limiting the influence of lobbyists in New York City.” One of these bills, for example, mandates that lobbyists’ fundraising or consulting activities be made available to the public in  electronic form.  

 For his part, Councilman Fidler says, “I deal with them respectfully, recognizing that they have a job to do but also  that they have an axe to grind. Sometimes they give me helpful information,  sometimes biased information that requires people to ask more.”  

 Attitude of Upstate Legislators

 What is the attitude among state legislators in Albany toward co-op and condo  legislation? After all, single-family homes are the predominant form of housing  in the state. Co-ops are basically a New York City phenomenon. And although  condos are more and more widespread, in many parts of the state, condo  residents are presumed to be either retirees or young families waiting for the  time they can buy a single-family home.  

 But even when you’re dealing with legislators from, say, Onondaga or Broome County, their  colleagues from downstate make sure to inform them about the issues. Also, they  may defer to their colleagues on local issues as long as these downstate  colleagues vote with them on their issues.  

 Pennisi comments, “We meet with legislators who represents communities where there are not too many  cooperatives through the Federation. They listen if we have something to say.”  

 Impact of the Recession

 One factor that is influencing housing-related legislation today, whether it’s in the state legislature or the City Council, is, of course, the economic  recession.  

 Many co-ops and condos are running into problems simply because some of their  shareholders or owners are in arrears, whether because they lost their jobs or  for other reason. Also, says Pennisi, boards are very sensitive on spending  money on projects because they don’t want to spend down their reserve funds.  

 Slattery adds that in his estimation, controlling spending in Albany, reducing  the state budget and reducing taxes are the most important items on the agenda.  “We have to create a climate that would encourage sales, encourage buyers to  purchase homes.”  

 Mansfield, a spokesperson for Speaker Silver, says, “Especially during these difficult economic times, the Assembly majority has  continued to fight to protect tenants and homeowners throughout the state.  While the financial downturn has been especially hard on working families, we  remain committed to helping all New Yorkers access safe, affordable housing.”  

 Speaking about the city, Fidler said that in today’s economic climate, “the city is very careful not to take actions that unnecessarily cost money. That’s the first thing that people ask about. In the area of housing, we are making  sure that affordability is emphasized whenever a benefit is being provided.”  

 One recent program proposed by Speaker Quinn, says Hogrebe, is the Housing Asset  Renewal Program, or HARP. Through this program, HPD is currently evaluating proposals from developers and  property owners who have had a difficult time filling units or finishing  construction after the burst of the housing bubble. In exchange for agreeing to make a percentage of units affordable for working  New Yorkers, the city can offer moderate subsidies that will help make these  price corrections more financially viable.     

 Ranaan Geberer is an editor and freelance writer living in New York City.  

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