N.Y. Private Housing Finance Law § 903: Contracts with neighborhood preservation companies

§ 903. Contracts with neighborhood preservation companies. 1. The

commissioner may enter into contracts with neighborhood preservation

companies for the performance of neighborhood preservation activities.

Such contracts shall be entered into, however, only after appropriate

findings by the commissioner and shall be subject to the limitations

hereinafter set forth.

2. Prior to entering into a contract with a neighborhood preservation

company, the commissioner shall have made a finding that the

neighborhood in which the activities are proposed to be conducted

contains a significant amount of deteriorating or substandard housing

which is not being adequately repaired, renovated, upgraded, modernized

or rehabilitated under existing programs so as to provide sound housing

at costs which the residents of such neighborhoods can afford; that the

neighborhood preservation company which proposes to contract with the

commissioner is a bona fide organization which shall have been in

existence either as a corporation or as an unincorporated, organized

group and performing significant neighborhood preservation activities

for at least one full year prior to entering into any contract with the

commissioner and which shall have demonstrated by its immediate past and

current activities that it has the ability to preserve, repair,

maintain, renovate, rehabilitate, manage or operate housing

accommodations or to engage in other neighborhood preservation

activities in such neighborhood; that the neighborhood preservation

activities which are to be performed pursuant to the proposed contract

are needed by the neighborhood; and that the neighborhood preservation

company possesses or will acquire or gain access to the requisite staff,

office facilities within such neighborhood, equipment and expertise to

enable it to perform the activities which it proposes to undertake

pursuant to such contract; provided, however, that merged companies'

office facilities may be located outside such neighborhood if they are

located in a municipality wholly contained within the merged companies'

neighborhood, and provided further, however, that it shall not be a bar

to the commissioner's contracting with a neighborhood preservation

company that one or more organizations, whether pursuant to contract

with the commissioner or not, are conducting neighborhood preservation

activities wholly or partially within the same neighborhood.

3. In determining to enter into a contract with a neighborhood

preservation company pursuant to this article, the commissioner shall

investigate, to the extent which he shall deem necessary or appropriate,

and determine;

(a) that the geographic boundaries proposed by the applicant for such

a contract define a recognized or established neighborhood or area

within the municipality;

(b) that the demographic and other relevant data pertaining to such

neighborhood indicate that the neighborhood has sustained physical

deterioration, decay, neglect or disinvestment, that a substantial

proportion of the residential population that the neighborhood

preservation company proposes to assist through its activities is of low

income and that such neighborhood is in need of active intervention to

effect its preservation, stabilization or improvement;

(c) that the activities proposed to be conducted by the neighborhood

preservation company are reasonably calculated to have a positive effect

on the preservation, stabilization or improvement of the neighborhood;

(d) that the neighborhood preservation company's officers, directors

and members are fairly representative of the residents and other

legitimate interests of the neighborhood, that they will carry out such

a contract in a responsible manner and that at least thirty-three

percent of the directors of the neighborhood preservation company are

residents of the neighborhood;

(f) that the fees received or proposed to be received by the

neighborhood preservation company from the management of housing

accommodations are fair and reasonable;

(g) that the plan submitted by the neighborhood preservation company

demonstrates that such company will, to the extent possible, give

priority when hiring new employees to residents of the neighborhood who

are either unemployed or not fully employed;

(h) that the neighborhood preservation company has a plan to

facilitate, to the maximum extent feasible, the disposition of any

buildings containing housing accommodations owned by the company to

individual occupants thereof or to cooperative groups whose members

shall be occupants thereof; and

(i) that the interests of occupants of any buildings containing

housing accommodations owned by the neighborhood preservation company

are adequately represented.

4. Contracts entered into hereunder with neighborhood preservation

companies shall be limited in duration to periods of one year, but may

thereafter be renewed, extended or succeeded by new contracts from year

to year in the discretion of the commissioner; they shall define with

particularity the neighborhood or portion thereof within which the

neighborhood preservation activities shall be performed; they shall

specify the nature of the neighborhood preservation activities which

shall be performed including the approximate number of buildings,

residential dwelling units and local retail and service establishments

which shall be affected; they shall locate and describe, with as much

particularity as is reasonably possible, the buildings with respect to

which such activities shall be performed during the contract term; and

they shall specify the number of persons, salaries or rates of

compensation and a description of duties of those who shall be engaged

by the neighborhood preservation company to perform the activities

embraced by the contract together with a schedule of other anticipated

expenses.

5. Prior to renewing or extending a contract or entering a succeeding

contract with a neighborhood preservation company the division shall

determine that:

(a) the company shall have substantially completed the neighborhood

preservation activities specified in the contract to be renewed,

extended, or succeeded;

(b) the company shall have received the sums, services, and funds

specified in subdivision four of section nine hundred four of this

article; and

(c) the activities carried out by the company pursuant to its contract

shall have had a significant impact on the community's needs as

specified in the contract.

6. Prior to terminating, not renewing or not extending a contract the

division shall:

(a) determine that the company is in violation of the terms and

conditions of the contract or that funds provided pursuant to the

contract are being expended in a manner not consistent with the terms of

the contract or the provisions of this article; or

(b) determine that necessary and appropriate technical assistance has

been provided without significant improvement in the activities of the

company; and

(c) provide the company with written notice, at least forty-five days

in advance, of its intent to terminate, not renew or not extend the

contract and provide the company with an opportunity to appear and be

heard before the division with respect to the reasons for such proposed

termination, non-renewal or non-extension. At the same time that a

company is notified of the division's intent to terminate, not renew or

not extend the contract, the division shall likewise inform the senate

and assembly members who represent areas within such company's

geographic boundaries.

7. The division shall establish, for renewal of contracts, a procedure

which provides the company with at least forty-five days notice of the

company's obligations and rights in that process, informs the company of

the amount of the renewal contract, and facilitates the timely execution

of the contract and disbursement of funds.

8. The division may temporarily withhold payments and may elect not to

renew or extend a contract or enter a succeeding contract with any

neighborhood preservation company if the company is not in compliance

with its contract, has without good cause failed to submit documentation

required under its contract or requested by the division to make the

determinations required under subdivision five of this section or has

not satisfied any other conditions consistent with this article for

renewing or extending a contract or entering a succeeding contract.