Relates to renewal of a lease under the stabilization code promulgated by the real estate industry stabilization association; defines demolish.

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S3176-2013 Actions

• Jan 31, 2013: REFERRED TO HOUSING, CONSTRUCTION AND COMMUNITY DEVELOPMENT

S3176-2013 Memo

BILL NUMBER:S3176

TITLE  OF BILL:   An act to amend the administrative code of the city of
New York, in relation to renewal of a lease under the stabilization code

PURPOSE OR GENERAL IDEA OF BILL:  The purpose of this bill is to clarify
the original intent of the Rent Stabilization Law and to prohibit  land-
lords  from  circumventing the demolition provision included in the Rent
Stabilization Law.  Landlords are attempting to circumvent rent stabili-
zation by applying for a demolition permit in order to move tenants out;
when their real purpose is to do a gut  rehab  so  they  can  lease  the
apartments for higher rents.

SUMMARY OF SPECIFIC PROVISIONS:

Section  1  of  this  bill  constitutes  a provision where the owner has
established to the satisfaction of the division of housing and community
renewal after a hearing that he or she intends in good faith to demolish
the building and has obtained a permit thereof from  the  department  of
buildings.

Section 2 provides for an immediate effective date with qualifications.

EFFECTS  OF  PRESENT  LAW  WHICH THIS BILL WOULD ALTER:  This bill would
amend Subparagraph (a) of paragraph 9 of subdivision c of section 26-511
of the administrative code of the  city  of  New  York,  constituting  a
provision of the rent stabilization law of nineteen hundred sixty-nine.

JUSTIFICATION:    It is in the State's economic and social interest that
an adequate supply of affordable housing be available. But  as  develop-
ment  pressures  continue to drive the competitive real estate market in
New York City and surrounding counties, there  has  been  an  increasing
loss  of  affordable  housing  units.  Eager to increase profits on rent
stabilized housing units in particular, building owners have utilized  a
variety of means to turn these units into more profitable luxury housing
or  commercial  units.  The result has been that each year, thousands of
rent-stabilized units are permanently removed from  the  housing  stock.
This  trend  continues  as owners seek new ways to manipulate the letter
and spirit of the law in order to more expeditiously eliminate the  rent
stabilized  units in a building. This bill addresses one method by which
owners axe increasingly attempting to get rid of  rent-stabilized  hous-
ing. While the Legislature intended that the demolition provision of the
Rent Stabilization law allow room for owners to demolish old, dilapidat-
ed  and dangerous housing in order to replace it with new, safe housing,
some owners are attempting to redefine demolition as simple  renovations
where entire floors are left intact, outer walls are untouched, or major
structural  elements remain in place. Such uses of the term "demolition"
are inconsistent with both its common meaning and the meaning  that  was
intended  by  the  Legislature. This bill will clarify the definition of
"demolition", making it consistent with its common  and  intended  defi-
nitions.  Accordingly, it will be clear that owners shall not be permit-

ted to eliminate rent-stabilized housing units by manipulating the demo-
lition provision in this manner.

FISCAL IMPLICATIONS: To be determined.

EFFECTIVE  DATE:  This act shall take effect immediately and shall apply
to any action or proceeding pending in any court and to any application,
complaint, or proceeding pending before an administrative agency on such
effective date, as well as to any action or proceeding commenced  there-
after;  provided,  however  that  the  amendments to subparagraph (a) of
paragraph 9 of subdivision c of section 26-511 of the rent stabilization
law of nineteen hundred sixty-nine made by section one of this act shall
expire of such law as provided under section 26-520 of  the  administra-
tive code of the city of New York.

S3176-2013 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

                                    3176

                         2013-2014 Regular Sessions

                              I N  SENATE

                              January 31, 2013
                                 ___________

  Introduced  by  Sens. KRUEGER, AVELLA -- read twice and ordered printed,
    and when  printed  to  be  committed  to  the  Committee  on  Housing,
    Construction and Community Development

  AN  ACT  to  amend  the  administrative code of the city of New York, in
    relation to renewal of a lease under the stabilization code

    THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section 1. Subparagraph (a) of paragraph 9 of subdivision c of section
  26-511  of the administrative code of the city of New York is amended to
  read as follows:

    (a) (1) where [he or she] THE OWNER HAS ESTABLISHED TO  THE  SATISFAC-
  TION  OF  THE DIVISION OF HOUSING AND COMMUNITY RENEWAL, AFTER A HEARING
  AT WHICH ALL PARTIES MAY PRESENT EVIDENCE THAT THE SUBJECT  BUILDING  IS
  IN A SUBSTANDARD OR SERIOUSLY DETERIORATED CONDITION, AND THAT THE OWNER
  intends  in  good  faith  to  demolish  the building and [has obtained a
  permit therefor from the department of buildings] SUBMITS PROOF PRIOR TO
  FILING THE APPLICATION  WITH  THE  DIVISION  OF  HOUSING  AND  COMMUNITY
  RENEWAL  THAT  PLANS  AND  IF  POSSIBLE,  THE NECESSARY PERMITS, FOR THE
  UNDERTAKING HAVE BEEN APPROVED BY AND OBTAINED FROM  THE  DEPARTMENT  OF
  BUILDINGS.    SUCH APPLICATION SHALL BE FILED AT LEAST NINETY DAYS PRIOR
  TO THE EXPIRATION OF THE LEASE TERM; FOR THE PURPOSE  OF  THIS  SUBPARA-
  GRAPH,  "DEMOLISH"  MEANS  THE  COMPLETE  RAZING OF THE ENTIRE BUILDING,
  INCLUDING ALL EXTERIOR WALLS, IN ORDER TO CONSTRUCT A NEW BUILDING  WITH
  THE SAME OR GREATER NUMBER OF RENTAL HOUSING UNITS;
    (2)  THE  ORDER  GRANTING  THE  OWNER'S  DEMOLITION  APPLICATION SHALL
  PROVIDE THAT THE OWNER MUST, AT THE TENANT'S OPTION, EITHER:  (I)  RELO-
  CATE  THE  TENANT  TO  AN EQUIVALENT OR SUPERIOR RENT STABILIZED HOUSING
  ACCOMMODATION IN A CLOSELY PROXIMATE  AREA,  OR  IF  A  NEW  RESIDENTIAL
  BUILDING  IS BEING CONSTRUCTED ON THE SITE PROVIDE THE TENANT WITH SUIT-
  ABLE INTERIM HOUSING AT NO ADDITIONAL COST UNTIL A UNIT IS AVAILABLE  IN
  THE  NEW  BUILDING; PROVIDE THAT THE AMOUNT OF RENT CHARGED FOR THE UNIT

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD00870-01-3

 S. 3176                             2

  SHALL BE AT THE SAME OR LOWER LEGAL  REGULATED  RENT;  AND  PROVIDE  THE
  TENANT,  IN  ADDITION  TO  REASONABLE MOVING EXPENSES, PAYMENT OF A FIVE
  THOUSAND DOLLAR STIPEND, PROVIDED THE TENANT VACATES ON  OR  BEFORE  THE
  VACATE  DATE  REQUIRED BY THE FINAL ORDER; OR (II) PROVIDE RELOCATION OF
  THE TENANT TO A SUITABLE HOUSING ACCOMMODATION AT A RENT  IN  EXCESS  OF
  THAT FOR THE SUBJECT HOUSING ACCOMMODATION; PROVIDE THE TENANT, IN ADDI-
  TION TO REASONABLE MOVING EXPENSES, A STIPEND EQUAL TO THE DIFFERENCE OF
  THE RENT CHARGED AT THE HOUSING ACCOMMODATION BEING VACATED AND THE RENT
  CHARGED FOR THE HOUSING ACCOMMODATION TO WHICH THE TENANT IS RELOCATING,
  MULTIPLIED  BY  SEVENTY-TWO  MONTHS,  PROVIDED  THE TENANT VACATES ON OR
  BEFORE THE VACATE DATE REQUIRED BY THE FINAL ORDER;  OR  (III)  PAY  THE
  TENANT  A  STIPEND  WHICH  SHALL  BE THE DIFFERENCE BETWEEN THE TENANT'S
  CURRENT RENT AND AN AMOUNT TO BE CALCULATED USING THE DEMOLITION STIPEND
  CHART, CREATED BY THE DIVISION OF HOUSING AND COMMUNITY RENEWAL,  MULTI-
  PLIED BY SEVENTY-TWO MONTHS; or
    S  2.  This  act  shall take effect immediately and shall apply to any
  tenant in possession on or after such effective date and to  any  action
  or proceeding pending in any court and to any application, complaint, or
  proceeding  pending  before  an  administrative agency on such effective
  date, as well as to  any  action  or  proceeding  commenced  thereafter;
  provided, however that the amendments to subparagraph (a) of paragraph 9
  of  subdivision  c  of  section  26-511  of chapter 4 of title 26 of the
  administrative code of the city of New York made by section one of  this
  act  shall  expire  on  the  same date as such law expires and shall not
  affect the expiration of such law as provided under  section  26-520  of
  such law.