N.Y. Private Housing Finance Law § 82: Limitations

§ 82. Limitations. No housing company shall:

1. Acquire any real property or interest therein unless it shall first

have obtained approval of the project from the commissioner, and a

certificate that such acquisition is necessary or convenient for the

public purpose defined in this article, and unless any deed, lease or

other instrument by which such real property or interest therein is

acquired contains a statement that the conveyance is to a housing

company organized pursuant to article four of the private housing

finance law.

2. Sell, exchange, transfer or assign any real property except (a) to

a municipality wherein a project is to be located, for public purposes

only and upon such terms and conditions, with or without compensation,

as the commissioner may approve, or with the written consent of the

commissioner to another housing company formed under this chapter, and

(b) for a price not in excess of the cost of the said property less any

amounts paid in amortization of the mortgage indebtedness and the

retirement of capital, plus so much of the distribution on capital of

the said housing company as shall have been unpaid, and accrued interest

on the mortgage indebtedness and income debenture certificates. Real

property surplus to the needs of the housing company may be sold,

exchanged, transferred or assigned to any person, partnership, trust,

firm or corporation upon such terms and conditions as the commissioner

may approve.

3. Encumber or lease all or any part of its real property to any other

person, partnership, trust, firm, or public or private corporation,

without the written consent of the commissioner, provided, however, that

leases conforming to the regulations and rules of the commissioner and

for actual occupancy by the lessees may be made without the consent of

the commissioner. Any conveyance, encumbrance, lease or sub-lease made

in violation of the provisions of this section and any transfer or

assignment thereof shall be void.

4. Pay interest returns on its mortgage indebtedness at a higher rate

than six per centum per annum, or at the rates of interest of mortgages

or mortgage bonds insured by the federal housing administration or any

other instrumentality of the federal government applicable at the time

the housing company incurs the mortgage indebtedness, or at such higher

rates as may be approved by the commissioner, or pay interest upon its

income debenture certificates at a rate higher than six per centum per

annum.

5. Issue its shares, in the case of a housing company which is a

corporation, credit sums to partners on capital account, in the case of

a housing company which is a partnership, subject amounts to the trust,

in the case of a housing company which is a trust, and no housing

company shall issue debentures and bonds covering any project undertaken

by it in an amount greater in the aggregate than the total actual final

cost of such project, including the lands, improvements, charges for

financing and supervision approved by the commissioner and interest and

other carrying charges during construction, and an allowance for working

capital to be approved by the commissioner but not exceeding three per

centum of the estimated cost or of the total actual final cost of the

project if that shall be greater than the estimated cost.

6. Mortgage any real property without first having obtained the

consent of the commissioner.

7. Issue any securities or evidences of indebtedness without first

having obtained the approval of the commissioner.

8. Use any building erected or acquired by it for other than housing

purposes, except that when permitted by law the story of the building

above the cellar or basement and the space below such story may be used

for stores, co-operative or community purposes, and when permitted by

law the roof may be used for co-operative or community purposes.

9. Charge or accept any rental for housing accommodations in any

project constructed, acquired, operated or managed by it in excess of

the prices approved by the commissioner.

10. Enter into contracts for the payment of salaries to officers,

employees, directors, partners, trustees or beneficiaries except subject

to the approval of the commissioner and under such regulations as the

commissioner may from time to time prescribe.

11. Enter into contracts for the construction or for the substantial

repair, improvement or operation of projects except subject to the

approval of the commissioner and under such regulations as the

commissioner may from time to time prescribe.

12. Voluntarily dissolve, or in the case of a trust, terminate,

without first having obtained the consent of the commissioner.

13. Make any guaranty without the approval of the commissioner.

14. Without the prior approval of the commissioner as to the terms and

conditions thereof, sell, lease, or otherwise convey all or any part of

a project to an authority.

The commissioner may declare that any of the limitations set forth in

this section shall be inapplicable, in whole or in part, to mutual

housing companies after the period of municipal tax exemption granted to

such mutual housing company projects pursuant to this article has

expired.