NYS Assembly
Committee on
  Housing
2003 Legislative Update

Sheldon Silver, Speaker · Vito J. Lopez, Chair · November 2003

A Message From the Chairman

Dear Friend,

With Speaker Silver’s leadership, we were able to make significant accomplishments in the 2003 legislative session in the face of massive budget shortfalls.

Among its accomplishments, the Assembly Standing Committee on Housing fought the governor’s proposed fifty percent cut to the Neighborhood and Rural Preservation Programs. The Assembly increased funding to the programs; the increase may be used for any operational expense and represents continued Assembly support for these community groups throughout New York State. In addition, the Housing Committee, in conjunction with the entire Assembly, fought for tenants’ rights. A package of bills was passed in support of tenants in existing Mitchell-Lama developments and also extended rent protections (Chapter 82 of 2003) for over one million rent controlled and rent stabilized tenants for an additional eight years.

As Chair of the Housing Committee, I also lent my support to the Environmental Conservation Committee for the passage of the historic Brownfield Cleanup Program. The Assembly has fought for many years to develop an equitable balance between the need for strict cleanup standards that protect the health of our citizens and the need to enable communities to put back into use the hundreds of Superfund and brownfield sites across the state. Further, by allowing community-based organizations to plan for and develop much-needed housing on sites that will be made safe and habitable, I am hopeful that this provision of the new law will help address the state’s affordable housing crisis.

In 2002 I sponsored a bill enacted into law (Chapter 315 of 2002) designed to provide relief to housing development fund companies (HDFCs) that own buildings sold to them through the New York City Department of Housing Preservation and Development’s Division of Alternative Management Program (DAMP). The law provides tax forgiveness to those cooperatives that fell into arrears for real estate taxes and therefore allows these units to remain affordable for existing and future tenants. In the upcoming session I will introduce legislation to expand this law to provide similar relief to tenant-owned cooperatives that utilized City funding programs but were not sold through DAMP.

While the successes of this past session remind us of what we can accomplish by working collectively, New York State’s affordable housing crisis continues. I look forward to working with you in the coming months to continue advancing an agenda that will provide a long-term solution to this crisis and ensure that all New Yorkers have access to safe, affordable housing.

Assemblyman Vito J. Lopez
Chairman, Assembly Standing Committee on Housing

Neighborhood and Rural Preservation Program

NPP and RPP provide grants to cover the administrative costs of not-for-profits engaged in a variety of affordable housing activities. According to the Division of Housing and Community Renewal, as of 2000, for every dollar the State invests in NPP and RPP, between $13 and $18 is leveraged for affordable housing from other sources. This fiscal year was particularly difficult given the budget shortfall. In his proposed budget, the executive sought to cut these invaluable programs by 50% - $5.465 million for NPP and $2.355 million for RPP. In addition, the governor proposed terminating all company contracts and issuing a new Notice of Funding Availability. The termination of contracts in addition to cuts to the program would have effectively decimated the program and reduced the number of groups serving the state by half. The Housing Committee successfully fought to reject the governor’s proposal to terminate all company contracts and restored $4,966,500 for NPP and $2,745,000 for RPP. In addition, the Assembly was successful in overriding the governor’s vetoes of these important budget restorations.

Mitchell-Lama Legislation

Since the 1950s, the Mitchell-Lama program has provided affordable housing to moderate-income New Yorkers. More than 400 Mitchell-Lama developments, housing approximately 150,000 families, are scattered throughout the State. The continued viability of this housing remains a critical part of New York State’s effort to ensure the availability of affordable housing for each of its citizens.

Despite this, owners of several Mitchell-Lama housing complexes have completed or started the process of pre-paying or "buying-out" their government-subsidized mortgages. "Buy-outs" can have a devastating impact on the families living in these buildings as rents may double or triple when existing leases expire. To try to combat the potential loss of this affordable housing, the Assembly passed a package of bills to protect existing Mitchell-Lama tenants. Such legislation includes: A.2367 (Lopez), which would extend from 20 years to 50 years the period of time before limited-profit housing companies may dissolve and leave the Mitchell-Lama Program; and A.943 (Lopez) which would require landlords provide notice at least twelve months in advance of an intended buy-out. Finally, a provision included within A.2716-A (Silver) would subject all tenants in post-1974 developments which faced a buy-out to rent stabilization.

While the Senate did not take up these important pieces of legislation, agreement was reached on A.8028-A Rules (Lopez). Signed as Chapter 389 of the Laws of 2003, this chapter provides municipalities with the option to grant an additional period of real property tax exemption to Mitchell-Lama housing companies upon the expiration of the existing period. The additional period continues as long as the project is operated under the restrictions and for the purposes of the Mitchell-Lama program for a maximum of fifty years.


Comprehensive Brownfield Site Cleanup Program

One of the most important pieces of legislation to come out of the 2003 session was the refinancing of the Superfund and establishment of the Brownfield Cleanup Program (Chapter 1 of 2003). Brownfields are a drag on local economies across New York State and can pose a public health risk if not cleaned up. The new Brownfield Cleanup Program establishes a preference for permanent clean up of contaminated sites and a framework to remediate these sites utilizing the nation’s toughest cleanup standards while providing developers, municipalities and community-based organizations with a more predictable and speedy process, financial incentives and liability relief.

Brownfield Opportunity Area (BOA) grants are a potential benefit to housing developers looking to take advantage of the new legislation with development on a designated site. These grants will be available to community based organizations for neighborhood pre-planning, planning, and site assessment activities. These grants will come from the $15 million in funding to support brownfields programs. Once BOA plans are adopted, cleanups and redevelopment in conformance with such plans would be given highest priority for funding under the Bond Act.


Low Income Cooperatives Receive Real Estate Tax Relief

In 2002, a tax forgiveness program was developed to provide stability and security to buildings whose existence had been threatened due to the accumulation of significant back taxes. Chapter 315 of 2002 authorized the City of New York to offer distressed Low Income Cooperatives — known as Housing Development Fund Companies (HDFCs) — that own buildings sold to them through the New York City Department of Housing Preservation and Development’s Division of Alternative Management Program (DAMP) forgiveness of all real property taxes owed. In exchange, these buildings will enter into an agreement with the City to remain current on taxes and water and sewer charges and institute sound business practices. In the 2004 session the committee will again work with the City to introduce legislation expanding this law to provide similar relief to tenant-owned cooperatives that utilized City funding programs but were not sold through DAMP. This will ensure that even more low-income owners can preserve their buildings as safe, decent and affordable housing for themselves as well as future cooperative owners.

Additional Tax Exemption for State Administered Housing Authorities

In order to provide municipalities with the flexibility to keep its state-administered public housing authorities, the Assembly passed A.8030 (Wright), which was signed as Chapter 449 of 2003. This chapter authorizes municipalities to grant additional real property tax exemptions to state administered public housing authorities for an additional 50 year period upon the expiration of the prior tax exemption period. An additional tax exemption period will help housing authorities keep their units affordable for low income tenants.

Assisted Living and Special Needs Task Force

A task force has been convened to explore what can be done to make the development of assisted living facilities and special needs housing units less costly for those in need of this type of housing. If you would like more information about this task force or would like to become a part of it, please contact my office at (718) 963-7029.
Assemblyman Lopez meets with members of the NYS Association of Affordable Housing to discuss solutions for building affordable housing.
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