NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A1037
SPONSOR: Walker
 
TITLE OF BILL:
An act relating to protecting the rights of current and converted Mitc-
hell-Lama residents
 
PURPOSE OR GENERAL IDEA OF BILL:
This bill would require the New York City Department of Housing to
designate an independent agency or office, with no financial or working
relationship with the owners, management companies, and co-op boards
should be responsible for reviewing and investigating complaints filed
by all Mitchell-Lama residents. This independent agency or office should
be empowered to receive, investigate, mediate, hear, make findings and
recommend action, and decide on complaints against landlords, managing
agents, co-op boards. When relevant, the independent agency or office
will also adjudicate complaints filed by residents, against the units or
departments within the New York City Housing Preservation and Develop-
ment and Division of Housing and Community Renewal that currently super-
vise their Mitchell-Lama developments. Residents who allege abuse of
authority or lack of response to their complaints, should be granted a
process to have complaints and grievances heard and resolved fairly and
in an unbiased manner. An independent agency's or office's invest inves-
tigative staff should conduct their investigations in an impartial fash-
ion, make a recommendation and/or decision regarding the resident
complaint. Any recommendation or decision in the resident's favor should
also provide guidance to the resident directing them how to enforce the
independent agency's or office's decision. That independent agency or
office should then forward their official findings and decisions to the
NYS DHCR Commissioner, who has jurisdiction over all Mitchell-Lama hous-
ing companies in New York City and New York State.
 
JUSTIFICATION:
The Mitchell-Lama program provides affordable rental and cooperative
housing to moderate-and middle-income families. The program was spon-
sored by New York State Senator MacNeil Mitchell and Assemblyman Alfred
Lama, and was signed into law in 1955, and is regulated by Article 2 and
Article 4 of the Private Housing Finance Laws of New York State. There
are both New York City supervised Mitchell-Lama developments (HPD), and
New York State supervised Mitchell-Lama developments (DHCR). In New York
City, there are 97 HPD-supervised Mitchell-Lama .rental and limited-eq-
uity cooperative developments, with more than 45,300 total units, Each
development is administered by either a Board of Directors (cooper-
atives) or a Managing Agent (rental and cooperatives).
When filing a complaint against a landlord, co-op board or management
agent, residents in city supervised Mitchell-Lamas are left with no
alternative than to contact HPD's Mitchell-Lama Unit, who has no estab-
lished procedures for resident complaints, official reviews, determi-
nations, findings and appeals process of HPD's decisions. Even if a
process was to be implemented, the agency would be hard pressed to
decide against a landlord, co-op board or management agency because of
the co-dependent, financial relationship that exists between HPD, and
the owners/managing agents.
In state supervised Mitchell-Lamas developments under the jurisdiction
of the NYS Division of Housing & Community Renewal (DHCR), residents can
file complaints against a landlord, co-op board or managing agent via a
toll-free hotline. DHCR's Office of Housing Management is the department
selected to respond to those complaints. According to established proce-
dures, those residents can register complaints about their rents, their
apartments, building, or complex twenty-four hours per day. Although the
New York State DHCR has a process to accept or solicit a complaint from
a resident, there are no procedures established for findings, recommen-
dations, decisions and appeals. As a result, the DHCR "complaint proc-
ess" is useless to the residents.
Because HPD and DHCR representatives often work directly with develop-
ers, owners and managing agents on a variety of development projects,
this relationship creates a conflict of interest when reviewing
complaints against landlords, managing agents and co-op boards.
 
PRIOR LEGISLATIVE HISTORY:
2017-2018: A7366 - Referred to Housing
2019-2020: A6217 - Referred to Housing
2021-2022: A4491 - Referred to Housing.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
 
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
1037
2023-2024 Regular Sessions
IN ASSEMBLY
January 13, 2023
___________
Introduced by M. of A. WALKER, DE LOS SANTOS, LUCAS, SIMON, TAYLOR --
read once and referred to the Committee on Housing
AN ACT relating to protecting the rights of current and converted Mitc-
hell-Lama residents
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Protecting the rights of current and converted Mitchell-
2 Lama residents. 1. New York State Homes and Community Renewal, in
3 consultation with the New York City Department of Housing Preservation,
4 shall appoint an independent agency or office, which will solicit resi-
5 dent complaints and will provide unbiased grievance and complaint proce-
6 dures that are consistent with the administrative procedures act. The
7 independent agency or office will handle all Mitchell-Lama complaints
8 including, but not limited to, the following:
9 a. owner/management company/co-op board harassment and abuse;
10 b. enjoying the benefit of unnecessarily and financially unsupported
11 rent/carrying charge increases;
12 c. failure to adequately reconcile tenant rent/carrying charge
13 records;
14 d. failure to provide essential services on a consistent basis;
15 e. failure to provide a decent, sanitary and safe living environment;
16 f. failure to hold open and transparent co-op board elections;
17 g. failure to notify and include all residents of building/development
18 conversions; and
19 h. failure to lower rents/carrying charges for eligible residents,
20 when a subsidy program that is already in development will lower that
21 resident's rent/carrying charges.
22 2. The practice of approving refinancing and/or conversion "windfall"
23 deals shall be eliminated unless the ownership, managing agents, co-ops
24 boards, the New York city supervised Mitchell-Lama developments (HPD)
25 and the New York state supervised Mitchell-Lama developments (DHCR) can
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04606-01-3
A. 1037 2
1 produce verified financial documentation from the comptroller which
2 accounts for every dollar spent during the ten year period prior to the
3 application for refinancing and/or conversion.
4 3. All rent and carrying charge increases approved by HPD and DHCR
5 shall receive final approval from the respective New York city or New
6 York state comptroller and he or she shall have certified that the
7 increase is financially necessary and supported by a comptroller-veri-
8 fied financial review of expenses, assets and income.
9 4. Unless the comptroller with the jurisdiction officially agrees to
10 monitor and confirm the validity and accuracy of future expenses or
11 losses, owners and co-op boards shall not be permitted to continue to
12 receive rent/carrying charge increases based on those projections.
13 5. Unless a resident's household income confirms that he or she is
14 subject to a surcharge, there shall be no audit surcharges.
15 6. Legal representation and adequate pro se litigant support shall be
16 provided by the state of New York for litigants in landlord/tenant
17 cases.
18 7. A comprehensive help desk shall be provided by the supreme courts
19 of the state of New York to support pro se litigants.
20 8. Judges and court staff with knowledge and experience with the Mitc-
21 hell-Lama law and regulations shall oversee all Mitchell-Lama related
22 cases.
23 § 2. This act shall take effect immediately.