Attorney General Cuomo Announces Legislation
NEW YORK, NY (December 13, 2007) – Attorney General Andrew M. Cuomo today announced new legislation in the New York State Legislature that will vastly improve the process for converting cooperatives and condominiums. The bill will increase funds for the Attorney General’s Real Estate Finance Bureau (REFB), which will speed up the processing for co-op and condominium conversions and give tenants access to the sponsor’s offering plan sooner, as well as enhance oversight and enforcement.
The new legislation is the product of the Real Estate Working Group that Attorney General Cuomo convened in 2007 to address the review process for condominium and cooperative offerings. The group included executive staff from the Attorney General’s office, as well as a broad section of real estate professionals, as well as representatives of sponsors, tenants’ organizations, and cooperative and condominium owners.
The bill is sponsored by Senator Owen H. Johnson as S.6540 in the Senate and by Assemblywoman Helene Weinstein as A.9546 in the Assembly. It is currently in committee in both chambers.
“It is critically important to have condo and co-op conversions reviewed speedily so tenants are not left in the dark about what options they have and what choices to make for their housing future,” said Attorney General Cuomo. “I would like to thank the members of the Real Estate Working Group for coming up with this solution as well as Senator Johnson and Assemblywoman Weinstein for introducing it as legislation. Thanks to their efforts, tenants will be informed of their options and their rights in a faster time frame, and owners will have their plans approved expeditiously.”
“Because of the increase in co-op and condo conversions, additional staffing at the REFB is necessary to protect the rights of tenants and existing owners,” said Assemblywoman Helene Weinstein, Chair of the Assembly Judiciary Committee.
“This legislation will provide the additional funds needed by the REFB to alleviate current staffing shortages,” said Senator Owen H. Johnson, Chair of the Senate Finance Committee.
In a memorandum of support to Senate Majority Leader Joseph Bruno and Assembly Speaker Sheldon Silver, the Real Estate Board of New York (REBNY) said, “REBNY’s support for this legislation is a good indication of just how difficult the situation has become and how necessary the increased staffing is. Dedicating the increased fees to additional staffing in the REFB ensures that the additional monies will go where they are needed.”
In letters of support to Senate Majority Leader Joseph Bruno and Assembly Speaker Sheldon Silver, the Association of Community Organizations for Reform Now (ACORN) said, “This legislation will provide greater protection for housing consumers and facilitate development of cooperatives and condominiums, by ensuring adequate funds are available for use by the Office of the Attorney General’s Real Estate Finance Bureau.”
The New York City Bar wrote in statements of support to Senate Majority Leader Joseph Bruno and Assembly Speaker Sheldon Silver, “It is commendable that, over the last several years, the REFB has been able to perform these services as well as it has in light of its being seriously understaffed. With the increase in conversions, and in particular new construction conversions, this proposed Bill will give the REFB the ability to fully fulfill its mandate and meet the needs of both developers and the purchasing and non-purchasing public.”
It is the responsibility of the REFB to review all offering plans for the conversion of rental buildings to cooperative or condominium ownership within six months. The number of offering plans submitted to the REFB has grown by more than 300% over the past five years, rising from 299 in 2002, to 929 in 2006.
Under the current ceiling, projects with a total offering price of $5 million or more pay only a $20,000 fee. This legislation raises that cap to $30,000. Increasing the ceiling for the filing fee imposes a minimal burden on sponsors because it applies only to projects with a total offering price of $5 million or more, and has no effect on smaller developments. The cap has not been raised since 1989.