COOPERATORNEWS:  Welcome, Hal. Please tell us a little about this new regulation.  What is the official designation or name for the new law governing co-op applications?  When was it passed?

COOPERSMITH:  “The law is known as Intro 1120-B.  It was originally on the agenda on November 21, 2024, and was enacted into law on January 29, 2026. Mayor Adams vetoed the bill on his last day in office, but his veto was subsequently overridden by the City Council.”

CN:  What was the impetus for the new law?  Why was it drafted and passed?  Was there an inciting incident or legal case behind its inception?

COOPERSMITH:  “The City Council thought that more accountability was required in the cooperative apartment purchase and sale process. As the situation stood prior to this law, buyers could be left without any response at all, creating uncertainty, financial strain, and the potential for discrimination claims.”

CN:  Tell us about the new law and how it differs from old requirements and why?

COOPERSMITH:  “Prior to the enactment of 1120-B, the co-op approval process was governed by the governing documents of the specific co-op, and by applicable case law. The legislation enacted states that co-op boards must acknowledge receipt of a purchaser’s application materials within 15 days, and if [the application package] is not complete, they must state the deficiency. If a co-op fails to acknowledge an application within that 15 day period, the application shall be deemed complete. 

“Further, no later than 45 days following the acknowledgement of an application, the co-op must state whether the sale is granted unconditionally, granted subject to conditions, or denied. The time period may be extended up to 14 days with agreement and upon advance written notice to the purchaser. The co-op may also extend the time to approve during the months of July and August, provided it has adopted a summer recess notice. Failure to timely issue an approval is subject to a civil penalty of $1,000 for a first violation, $1,500 for a second violation, and $2,000 for a third or subsequent violation.”

CN:  Is the new law beneficial to co-op owners? Buyer, sellers or boards? Does it make life easier or more complicated for those involved?

COOPERSMITH: “The law is beneficial to anyone who is purchasing or selling a co-op apartment. Prior to the law, there was a lack of clarity as to how long the co-op approval would take. The new law does, however, put an additional burden on boards to quickly review applications and interview candidates.”

CN:  What’s your advice to your co-op clients with regards to compliance with the law?

COOPERSMITH:  “The best policy is to be clear about your policies for transfers from the outset.”  

CN:  Does the law apply to condominium applications as well?

COOPERSMITH:  “No.” 

CN:  Is there anything else you’d like to add?

COOPERSMITH: “To sum up; there was a trio of legislation proposed by the City Council in 2023 to reshape the co-op approval process. This included a requirement that the co-op issue a mandatory statement for withholding consent to a transfer and disclosure of financial information among and a prior version of Intro 1120-B which was ultimately adopted.  In this regard, the New York City legislature has had its eye towards re-shaping the co-op approval process and was finally able to adopt legislation to change it.”

CN:  Thanks for spending some time with us today, Hal. This has been very illuminating. 

COOPERSMITH:  “Thanks for having me.”