NY Priv Hous Fin L § 452 (2021)
2021 New York Laws PVH - Private Housing Finance Article 8-A - Small Loans to Owners of Multiple Dwellings to Remove Substandard or Insanitary Conditions 452 - Loans to Owners.

§  452.  Loans  to  owners.  1.  Notwithstanding the provisions of any   general, special or local law, a municipality is  hereby  authorized  to   make  or  contract  to  make  loans  to  the owners of existing multiple   dwellings within its territorial limits, subject to the  limitations  in   subdivision  two of this section, for the elimination of any substandard   or insanitary condition or  conditions  in  violation  of  the  multiple   dwelling  law  or  local  housing  code,  or  for  such  replacement and   rehabilitation of the heating, plumbing, electrical and related  systems   or  other  improvements  as shall be reasonably necessary to prolong the   useful life of such dwellings, and may  make  temporary  loans  to  such   owners  in  anticipation  of  the  permanent  municipal  loans  for such   purposes.2. Each loan shall be evidenced by a note executed by the owner of the   existing multiple dwelling. The supervising agency in its discretion may   require one or more of the shareholders of a corporate owner to  co-sign   such note or to otherwise guarantee or pledge security for the repayment   of  the  loan.  The  amount of any such loan shall not exceed the sum of   thirty-five thousand dollars ($35,000) per dwelling unit, or the cost of   eliminating such substandard or insanitary condition or  conditions,  or   effecting  such  rehabilitation  or improvement, whichever is less. Each   such note shall be repaid within a period of the probable  life  of  the   existing  multiple  dwelling  which  is  hereby  determined to be thirty   years, or such shorter period as the supervising agency shall determine.   The repayment shall be made in such manner as may be  provided  in  such   note  and  contract,  if  any,  in  connection  with  such  loan and may   authorize such owner, with the consent of  the  supervising  agency,  to   prepay the principal of the loan subject to such terms and conditions as   therein  provided.  Such  note and contract may contain such other terms   and provisions not inconsistent with the provisions of this  article  as   the  local  legislative body or supervising agency may deem necessary or   desirable to secure repayment of the  loan,  the  interest  thereon  and   other  charges in connection therewith and to carry out the purposes and   provisions of this article, including  but  not  limited  to  provisions   ensuring availability of rents for such repayment.3. The supervising agency in its discretion may require that the owner   execute  a  financing  statement  for real property improvement to be in   such form as the agency shall  specify  and  to  contain  the  following   information:  the  name and mailing address of the owner, the address of   the real property, a  statement  that  a  loan  has  been  made  by  the   municipality under this article, the amount and duration thereof and the   applicable  interest  rate.  Said  financing  statement  shall  be filed   without charge in the office for recording mortgages  of  real  property   and  from  the  date  of  such filing the municipality shall have a lien   against said real property for the amount advanced or so much thereof as   remains unpaid and interest thereon. If a financing statement  is  filed   as  herein provided, the rights and remedies of the municipality and the   priority of its lien shall be the same as those of a holder  of  a  lien   for  the  materials  furnished  or labor performed in the improvement of   real property pursuant to articles two and three of the lien law, except   that the lien shall be valid for one year after the maturity date of the   final installment payable under said note and thereafter as provided  in   section  seventeen of the lien law. Upon payment of all sums advanced by   the municipality and interest thereon and upon demand of the then record   owner of the real property, the agency shall deliver to him  a  copy  of   the  financing  statement  with  an endorsement thereon that the lien is   satisfied; upon filing of such copy in the office  where  the  financing   statement  was  filed  and  upon payment of the proper fee therefor, the   lien of such financing statement shall be discharged. 4. The supervising agency may require the owner to execute a  mortgage   as  security  for a loan in lieu of a financing statement as provided in   the foregoing subsection three. Such mortgage shall contain  such  terms   and  provisions  not inconsistent with the provisions of this article as   the  supervising  agency  shall  deem  necessary  or desirable to secure   repayment of the loan under this article.5. The supervising agency  may  charge  the  owner  of  such  existing   multiple dwelling reasonable fees for financing, regulation, supervision   and  audit.  Such  fees  shall be kept by the municipality in a separate   fund to be known as the article VIII-A housing rehabilitation  fund  and   shall  be  used  to  help  meet  the  expenses  of  the  municipality in   administering and carrying out the provisions of this article.6. In  the  case  of  a  loan  made  pursuant  to  this  article,  the   supervising  agency  may pay any liens and charges the priority of which   is superior to its mortgage and may pay such other expenses  as  may  be   appropriate  to  protect its loan or to protect the lien of the mortgage   relating thereto, provided that such expenditures shall not  exceed  the   total amount of such loan.* 7.  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 a multiple dwelling which  is  aided   by  a loan made pursuant to this article, the supervising agency, may as   an alternative to permissible rental adjustments  under  such  laws  and   regulations,  adjust  the  rent for each rental dwelling unit within the   multiple  dwelling.  The  initial  rental  adjustment,  if  set  by  the   supervising  agency,  shall  be  established  based  solely  on the debt   service attributable to the loan, provided, that the supervising  agency   may  establish  rental adjustments less than such debt service, provided   further  that  the  supervising  agency  may  establish  greater  rental   adjustments  for vacant dwelling units than for occupied dwelling units.   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   contemplated   rehabilitation.  Such  notification  shall  advise  such  tenants of the   approximate expected rent increase. 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 rental   adjustment.* NB Expires July 1, 2024* 8. 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 a class B multiple dwelling, class A   multiple dwelling used for single room occupancy purposes, lodging house   or   a   substantially   vacant  building  intended  to  be  used  after   rehabilitation for single room occupancy purposes and which is aided  by   a  loan  pursuant  to  this article made by the municipality on or after   September  first,  nineteen  hundred  eighty-five,  the   agency   shall   establish  the  initial  rent  for  each rental dwelling unit within the   multiple dwelling. All  dwelling  units  within  the  multiple  dwelling   subsequent  to  establishment  of  initial  rents by the agency shall be   subject to the rent stabilization law of  nineteen  hundred  sixty-nine.   The  occupant  in  possession  of  such  a dwelling unit when it is made   subject to the rent stabilization law  of  nineteen  hundred  sixty-nine   shall  be  offered  a  choice  of a one or two year lease at the initial    rents established by the 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 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.* NB Expires July 1, 20249.  The  note  or  note  and  contract issued by the owner of any such   multiple dwelling to secure such loan may provide that the loan shall be   reduced to zero commencing on the fifteenth year after the execution  of   the  note  or  note  and contract, provided that, as of the date of such   reduction, the multiple dwelling has been and continues to be owned  and   operated  in  a  manner  consistent with a regulatory agreement with the   municipality. Notwithstanding such provision as contained in the note or   note and contract, the loan shall be reduced to zero only if,  prior  to   or  simultaneously  with delivery of such note or note and contract, the   agency made  a  written  determination  that  such  reduction  would  be   necessary to ensure the continued affordability or economic viability of   the  multiple  dwelling.  Such  written determination shall document the   basis upon which the loan was determined to be eligible for evaporation.