NY Priv Hous Fin L § 576-C (2021)
2021 New York Laws PVH - Private Housing Finance Article 11 - Housing Development Fund Companies 576-C - Loans to Housing Development Companies by a Municipality.

* §  576-c.  Loans to housing development companies by a municipality.   1.  In addition to the powers granted to municipalities pursuant to this   article, a municipality, acting by  its  supervising  agency,  may  make   loans for the purposes of acquisition, rehabilitation or construction of   dwelling   accommodations  to  a  non-profit  housing  development  fund   company, a wholly-owned subsidiary of such company,  a  partnership  the   controlling  interest  of  which  is  held by such company and which has   agreed to limit profits or rate of return  of  investors  in  accordance   with  a  formula  established  or  approved by the company, or a private   developer which has agreed  to  limit  profits  or  rate  of  return  of   investors  in  accordance  with a formula established or approved by the   company, which agrees to provide housing accommodations exclusively  for   persons  and families of low income, at least thirty percent of whom are   referred to it by  a  municipality  and  have  prior  to  their  initial   occupancy in such accommodations resided in emergency shelter facilities   operated  by  or  on  behalf of the municipality or who are otherwise in   need of emergency shelter as determined by the municipality,  providing,   however,  that  in  the  case  of a building acquired by such a company,   subsidiary, partnership, or developer the obligation to provide  housing   accommodations  for  such  persons  shall be applicable only to dwelling   accommodations which are or become vacant after the date of acquisition.   Such loans may be made for such period of  time  and  pursuant  to  such   terms  and  conditions  as  may be required by the municipality, and the   supervising agency of such municipality may provide that the  amount  of   the  note  and  mortgage  shall automatically be reduced to zero in five   equal  decrements  commencing  on  the  tenth  year  after  the  initial   occupancy  date,  provided  that, as of the date of such reduction, such   accommodations have been and continue to be  owned  and  operated  in  a   manner  consistent  with an agreement with the municipality contained in   such  note  and  mortgage  to  provide   housing   for   such   persons.   Notwithstanding  such  provision  as contained in the note and mortgage,   the loan shall be reduced to zero only if, prior  to  or  simultaneously   with  delivery  of such note and mortgage, the supervising agency made a   written determination that such reduction would be necessary  to  ensure   the  continued  affordability  or  economic  viability  of  such housing   project. Such written determination shall document the basis upon  which   the loan was determined to be eligible for evaporation.2.  Notwithstanding  the  provisions of, or any regulation promulgated   pursuant to, the emergency housing rent control law, the local emergency   housing rent  control  act,  the  emergency  tenant  protection  act  of   nineteen  seventy-four,  or any local law enacted pursuant thereto, upon   completion of the rehabilitation of  any  building  used  primarily  for   residential  purposes,  in  a  jurisdiction in which rents are regulated   pursuant to any of the above laws and which is aided by a loan  pursuant   to  this  section made by the municipality, the supervising agency shall   establish the initial rent for each  rental  dwelling  unit  within  the   building.   All   dwelling  units  within  the  building  subsequent  to   establishment of initial  rents  by  the  supervising  agency  shall  be   subject  to  either  the  rent  stabilization  law  of  nineteen hundred   sixty-nine  or  the  emergency  tenant  protection   act   of   nineteen   seventy-four,  or  both,  if  applicable to the locality. The tenants in   occupancy of such a dwelling unit regulated pursuant to any of the above   laws shall be offered a choice of a one or two year lease at the initial   rents established by the supervising agency notwithstanding any contrary   provisions  of,  or  regulations   adopted   pursuant   to,   the   rent   stabilization  law  of  nineteen  hundred  sixty-nine  and the emergency   tenant protection act of nineteen seventy-four. The  supervising  agency   shall  cause  all tenants in occupancy of each dwelling unit affected by    the provisions of this  subdivision  to  be  notified  of  and  have  an   opportunity   to   comment  on  the  contemplated  rehabilitation.  Such   notification shall advise such tenants of the approximate expected  rent   increase  and  the  subsequent  availability of a one or two year lease.   Such notification and opportunity to comment shall  be  provided  before   the  rehabilitation  and  again  after the construction is completed and   before the establishment of the initial rents.3. The supervising agency shall use its best efforts  to  ensure  that   activities  carried out pursuant to this article are structured so as to   minimize the likelihood of  any  involuntary  economic  displacement  of   tenants  who  reside in multiple dwellings which are the subject of such   activities. However, if temporary physical displacement is required as a   direct result of rehabilitation work which is performed in such multiple   dwelling receiving a loan pursuant to this article,  suitable  temporary   relocation arrangements shall be provided.* NB Effective until July 1, 2024* §  576-c.  Loans to housing development companies by a municipality.   In addition to the powers granted to  municipalities  pursuant  to  this   article,  a  municipality,  acting  by  its supervising agency, may make   loans for the purposes of acquisition, rehabilitation or construction of   dwelling  accommodations  to  a  non-profit  housing  development   fund   company,  a  wholly-owned  subsidiary of such company, a partnership the   controlling interest of which is held by  such  company  and  which  has   agreed  to  limit  profits  or rate of return of investors in accordance   with a formula established or approved by  the  company,  or  a  private   developer  which  has  agreed  to  limit  profits  or  rate of return of   investors in accordance with a formula established or  approved  by  the   company,  which agrees to provide housing accommodations exclusively for   persons and families of low income, at least thirty percent of whom  are   referred  to  it  by  a  municipality  and  have  prior to their initial   occupancy in such accommodations resided in emergency shelter facilities   operated by or on behalf of the municipality or  who  are  otherwise  in   need  of emergency shelter as determined by the municipality, providing,   however, that in the case of a building  acquired  by  such  a  company,   subsidiary,  partnership, or developer the obligation to provide housing   accommodations for such persons shall be  applicable  only  to  dwelling   accommodations which are or become vacant after the date of acquisition.   Such  loans  may  be  made  for such period of time and pursuant to such   terms and conditions as may be required by  the  municipality,  and  the   supervising  agency  of such municipality may provide that the amount of   the note and mortgage shall automatically be reduced  to  zero  in  five   equal  decrements  commencing  on  the  tenth  year  after  the  initial   occupancy date, provided that, as of the date of  such  reduction,  such   accommodations  have  been  and  continues to be owned and operated in a   manner consistent with an agreement with the municipality  contained  in   such   note   and   mortgage   to  provide  housing  for  such  persons.   Notwithstanding such provision as contained in the  note  and  mortgage,   the  loan  shall  be reduced to zero only if, prior to or simultaneously   with delivery of such note and mortgage, the supervising agency  made  a   written  determination  that such reduction would be necessary to ensure   the continued  affordability  or  economic  viability  of  such  housing   project.  Such written determination shall document the basis upon which   the loan was determined to be eligible for evaporation.* NB Effective July 1, 2024