N.Y. Real Property Tax Law § 488-a: Rehabilitation of certain class B multiple dwellings and class A multiple dwellings used for single room occupancy

§ 488-a. Rehabilitation of certain class B multiple dwellings and

class A multiple dwellings used for single room occupancy. 1.

Definitions. For the purposes of this section the following terms shall

have the meaning specified in this subdivision:

a. "Eligible real property" shall mean:

(i) any class B multiple dwelling;

(ii) any class A multiple dwelling used for single room occupancy

pursuant to section two hundred forty-eight of the multiple dwelling law

which contains no more than twenty-five percent class A dwelling units

which contain lawful sanitary and kitchen facilities within the dwelling

unit, provided that in the case of a multiple dwelling containing ten

dwelling units or less, up to forty percent of the dwelling units may be

class A units.

Notwithstanding the foregoing, eligible real property shall not

include college and school dormitories, club houses, or residences whose

occupancy is restricted to an institutional use such as housing intended

for use primarily or exclusively by the employees of a single company or

institution. A building is an eligible real property only if it

qualifies as such after completion of the eligible improvements, but

need not have been an eligible real property prior to the eligible

improvements.

(iii) not-for-profit institutions with sleeping accommodations.

b. "Eligible improvements" shall be limited to the following

catogories of work, provided further that such work shall be in

conformity with all applicable laws:

(i) replacement of a boiler or burner or installation of an entire new

heating system;

(ii) replacement or upgrading of electrical system;

(iii) replacement or upgrading of elevators;

(iv) installation or replacement or upgrading of the plumbing system,

including water main and risers;

(v) replacement or installation of walls, ceilings, floors or trim

where necessary;

(vi) replacement or upgrading of doors, installation of security

devices and systems;

(vii) installation, replacement or upgrading of smoke detectors, fire

alarms, fire escapes, or sprinkler systems;

(viii) replacement or repair of roof, leaders and gutters;

(ix) replacement or installation of bathroom facilities;

(x) installation of wall and pipe insulation;

(xi) replacement or upgrading of street connections for water or sewer

services;

(xii) replacement or installation of windows, or installation of

window gates or guards;

(xiii) installation or replacement of boiler smoke stack;

(xiv) pointing, waterproofing and cleaning of entire building exterior

surface;

(xv) improvements designed to conserve the use of fuel, electricity or

other energy sources;

(xvi) improvements unique to congregate living facilities, as defined

by rules and regulations promulgated by the local housing agency,

pursuant to subdivision seven of this section; and

(xvii) work necessary to effect compliance with all applicable laws

including but not limited to the multiple dwelling law, the New York

city housing maintenance code and the New York city building code.

c. "Local housing agency". Local housing agency shall have the same

meaning as the term "agency" under section five hundred two of the

general municipal law, except that in cities of over one million in

population the term shall mean the department of housing preservation

and development.

d. "Permanent resident". Permanent resident shall mean a person who

has resided in eligible real property for six months or more, has a

lease with a term of six or more months, or has requested a lease

pursuant to the provisions of the rent stabilization code for housing

accommodations located in hotels.

2. Local legislative action. Any city to which the multiple dwelling

law is applicable, acting through its local legislative body or other

governing agency, is hereby authorized and empowered to adopt and amend

local laws or ordinances up to and including December thirty-first, two

thousand nineteen, to provide that any increase in assessed valuation of

eligible real property shall be exempt from taxation for local purposes

and to provide for the abatement of taxes on eligible real property,

including the land, in accordance with this section.

3. Tax exemption. Any increase in assessed valuation of eligible real

property resulting from eligible improvements shall be exempt from

taxation for local purposes for a period of thirty-two years, provided

that:

(i) the eligible improvements are commenced after July first, nineteen

hundred eighty, but prior to December thirty-first, two thousand

nineteen, and are completed within thirty-six months of commencement;

(ii) the eligible improvements are approved by the local housing

agency with respect to their cost and their qualifications for the

benefits of this section;

(iii) the exemption may commence no sooner than the July first

following the filing with the local agency responsible for real property

tax assessment of a certification of eligibility issued by the local

housing agency for such exemption; provided, however, that if the

rehabilitation is carried out with substantial government assistance as

part of a program for affordable housing, the exemption may commence no

sooner than the July first following the commencement of construction of

eligible improvements;

(iv) immediately prior to, and during, the construction of the

eligible improvements, fifty or more percent of the dwelling units in

such eligible real property are occupied by permanent residents;

provided that such occupancy requirement shall not apply to a vacant,

governmentally owned, multiple dwelling, nor to a privately owned

multiple dwelling which had been vacant for not less than two years

prior to the commencement of construction of eligible improvements, nor

to a vacant multiple dwelling where the eligible improvements are

carried out with the substantial assistance of grants, loans or

subsidies from any federal, state or local agency or instrumentality or

any not-for-profit philantropic organization one of whose primary

purposes is providing low or moderate income housing;

(v) there shall be no outstanding real estate taxes, water and sewer

charges, payments in lieu of taxes or other municipal charges due and

owing as of the tax quarter prior to commencement of tax exemption to

this section;

(vi) except in the case of eligible real property which is receiving

or has received assistance pursuant to a governmental rent subsidy

program, or which is owned by a not-for-profit corporation or by a

wholly owned subsidiary of a not-for-profit corporation and which is

receiving or has received assistance pursuant to a governmental loan

subsidy program, as defined by the rules and regulations promulgated by

the local housing agency, pursuant to subdivision seven of this section,

for the construction of eligible improvements, the initial rent, after

completion of eligible improvements, for ninety percent of the total

number of dwelling units occupied by permanent residents in a class A or

class B multiple dwelling other than apartments shall not exceed the

greater of either the amount of any governmental rental assistance

received by an occupant or seventy-five percent of the rent which is

permitted to be charged for zero-bedroom units on the moderate

rehabilitation fair market rent schedule as determined by the United

States department of housing and urban development for the housing

assistance payments program under section eight of the national housing

act;

(vii) no person who lives in the eligible real property shall be

required by the owner to vacate the eligible real property in order to

perform the eligible improvements or any related work.

4. Tax abatement. Eligible real property which qualifies for exemption

from taxation for local purposes for eligible improvements shall also be

eligible for an abatement of real property taxes in an amount no greater

than twelve and one-half percent of the reasonable cost of eligible

improvements certified by the local housing agency, which abatement may

commence on the first day of the first tax quarter following the filing

with the local agency responsible for real property tax assessment of a

certification of eligibility issued by the local housing agency for such

abatement; provided, however that if the rehabilitation is carried out

with substantial government assistance as part of a program for

affordable housing the abatement may commence no sooner than the first

day of the first tax quarter following the commencement of construction

of eligible improvements, provided that:

(i) the annual abatement shall not exceed the amount of taxes

otherwise payable in the corresponding tax year;

(ii) the period during which such abatement is effective shall not

exceed twenty consecutive years from the date such abatement first

becomes effective; and

(iii) the total abatement shall not exceed the lesser of one hundred

fifty percent of the certified reasonable costs of eligible improvements

or the actual costs as determined by the local housing agency pursuant

to its rules and regulations.

5. Continuing requirements. During the period of tax exemption or

abatement pursuant to this section, exemption and abatement shall be

conditional upon continuing compliance with the following requirements:

(i) compliance with all applicable provisions of law, including but

not limited to the multiple dwelling law, the local building code and

the local housing maintenance code;

(ii) all dwelling units, except owner occupied units, shall be subject

to the emergency housing rent control law or the local emergency housing

rent control act, or the emergency tenant protection act of nineteen

seventy-four, or any local laws enacted pursuant thereto, or the rent

stabilization law of nineteen hundred sixty-nine; provided, however that

the department of housing preservation and development may exempt from

this requirement dwelling units that are not occupied by permanent

residents in those buildings owned by a not-for-profit corporation or by

a wholly owned subsidiary of a not-for-profit corporation and which are

improved with the aid of a rehabilitation loan from any governmental

agency or instrumentality or operated pursuant to a contract with a

governmental entity;

(iii) it shall not receive tax exemption or tax abatement for

rehabilitation or new construction under any other provision of law; and

(iv) the eligible improvements shall not be used as the basis for any

application for rent increases and the owner shall file a statement to

such effect with the local housing agency and with any applicable rent

agency, provided, however, that rents of units improved with the aid of

a rehabilitation loan from any governmental agency or instrumentality

may within the limitations established by this section be increased

pursuant to the rules and regulations of the local housing agency; and

(v) a minimum of seventy-five percent of the dwelling units shall be

rental units occupied by permanent residents, provided, however, that

the local housing agency may exempt from this requirement those

buildings improved with the aid of a rehabilitation loan from any

government agency or instrumentality or operated pursuant to a contract

with a governmental entity.

6. Revocation. The benefits of this section may be revoked or reduced

upon a finding by the local housing agency or local finance agency that:

(i) the application for benefits hereunder or the annual certification

required hereunder contains a false statement or false information as to

a material matter or omits a material matter;

(ii) real estate taxes, water and sewer charges, payments in lieu of

taxes or other municipal charges are due and owing for more than one

year; or

(iii) the eligible real property fails to comply with one or more of

the provisions or requirements of this section.

7. Rules and regulations. The local agencies of government charged

with the administration of this section may promulgate rules and

regulations to carry out the provisions of this section.

8. Annual certification. During the period of tax exemption or

abatement pursuant to this section, the owner shall submit an annual

certification to the local housing agency in a form to be prescribed by

such agency. Failure to submit such certification may result in

revocation of benefits. Such certification shall include the following:

(i) the total number of dwelling units within the eligible real

property and the number of dwelling units occupied by permanent

residents;

(ii) the number of dwelling units subject to the provisions of the

emergency housing rent control act, the emergency tenant protection act

of nineteen seventy-four or any local laws enacted pursuant thereto, the

emergency housing rent control law or the rent stabilization law of

nineteen hundred sixty-nine; and

(iii) all such other information required by the local housing agency.