N.Y. Real Property Tax Law § 421-pp: Exemption of newly converted or constructed fully income restricted rental multiple dwellings

§ 421-pp. Exemption of newly converted or constructed fully income

restricted rental multiple dwellings. 1. (a) A city, town or village

may, by local law, provide for the exemption of rental multiple

dwellings constructed or converted in a benefit area designated in such

local law from taxation and special ad valorem levies, as provided in

this section. Subsequent to the adoption of such a local law, any other

municipal corporation in which the designated benefit area is located

may likewise exempt such property from its taxation and special ad

valorem levies by local law, or in the case of a school district, by

resolution.

(b) As used in this section, the term "benefit area" means the area

within a city, town or village, designated by local law, to which an

exemption, established pursuant to this section, applies.

(c) As used in this section, the term "rental multiple dwelling" means

a structure, other than a hotel, consisting of ten or more dwelling

units, where all but a maximum of two of the units are rented for

residential purposes, and all of such units, upon initial rental and

upon each subsequent rental following a vacancy during the restriction

period or extended restriction period, as applicable, is affordable to

and restricted to occupancy by individuals or families whose household

income does not exceed a weighted average of no less than sixty percent

of the area median income and no more than eighty percent of the area

median income, adjusted for family size, at the time that such

households initially occupy such dwelling units, provided further that

all of the income restricted units upon initial rental and upon each

subsequent rental following a vacancy during the restriction period or

extended restriction period, as applicable, shall be affordable to and

restricted to occupancy by individuals or families whose household

income does not exceed one hundred percent of the area median income,

adjusted for family size, at the time that such households initially

occupy such dwelling units. The two residential units that are not

income restricted must be occupied by superintendents, caretakers,

managers or other employees to whom the space is provided as part or all

of their compensation without payment of rent and who are employed for

the purpose of rendering services in connection with the premises of

which the housing accommodation is a part. In the event no unit is

provided or rented to such an employee, all units in the building must

be income restricted pursuant to this paragraph. Provided further that

any local law authorizing an exemption pursuant to this section may

provide for the area median income weighted average within the amounts

set forth in this paragraph. Such restriction period shall be in effect

coterminous with the benefit period, provided, however, that the tenant

or tenants in an income restricted dwelling unit at the time such

restriction period ends shall have the right to lease renewals at the

income restricted level until such time as such tenant or tenants

permanently vacate the dwelling unit.

2. Eligible newly-constructed or converted rental multiple dwellings

in a designated benefit area shall be wholly exempt from taxation while

under construction, subject to a maximum of three years. Such property

shall then be exempt for an additional period of thirty years. Provided,

however:

(a) Taxes shall be paid during the exemption period in an amount to be

determined by the local law providing the exception pursuant to this

section, provided, however, that amount shall be no greater than ten per

centum of the shelter rent of the eligible rental multiple dwelling

exempted pursuant to this section.

(b) No other exemption may be granted concurrently to the same

improvements under any other section of law.

3. To be eligible for exemption under this section, any new

construction shall take place on vacant, predominantly vacant or

underutilized land, or on land improved with a non-conforming use or on

land containing one or more substandard or structurally unsound

dwellings, or a dwelling that has been certified as unsanitary by the

local health agency. The provisions of this subdivision shall not apply

to any new conversions undertaken pursuant to this section.

4. Application for exemption under this section shall be made on a

form prescribed by the commissioner and filed with the assessor on or

before the applicable taxable status date.

5. In the case of newly constructed property which is used partially

as a rental multiple dwelling and partially for commercial or other

purposes, the portion of the newly constructed property that is used as

a rental multiple dwelling shall be eligible for the exemption

authorized by this section if:

(a) the square footage of the portion used as a rental multiple

dwelling represents at least fifty percent of the square footage of the

entire property;

(b) the rental units are affordable to individuals or families as

determined according to the criteria set forth in paragraph (c) of

subdivision one of this section; and

(c) the requirements of this section are otherwise satisfied with

respect to the portion of the property used as a rental multiple

dwelling.

6. The exemption authorized by this section shall not be available in

a city with a population of one million or more.

7. Any recipient of the exemption authorized by this section or their

designee shall certify compliance with the provisions of this section

under penalty of perjury, at such time or times and in such manner as

may be prescribed in the local law adopted by the city, town or village

pursuant to paragraph (a) of subdivision one of this section, or by a

subsequent local law. Such city, town or village may establish such

procedures as it deems necessary for monitoring and enforcing compliance

of an eligible building with the provisions of this section.