Title 9 Part 1750

The purpose of these regulations is to assure full disclosure to all residents and the public of plans proposed by the housing company to leave the jurisdiction of the division pursuant to either article 2 or article 4 of the Private Housing Finance Law, to effect a smooth transition of the management of a housing development and to assure that all actions required to be taken by the housing company have been performed prior to the dissolution thereof and to ensure that projects are in sound physical condition to protect the residents thereof and their long term viability.

These regulations shall apply to State-assisted limited profit rental or mutual housing companies formed pursuant to article 2 of the Private Housing Finance Law, and to limited-dividend rental or mutual housing companies formed pursuant to article 4 of the Private Housing Finance Law, which elect under section 35(2) or 96(1) of the Private Housing Finance Law, respectively, of such law, to voluntarily dissolve. As used in this Part, the term dissolution shall include reconstitution where the housing company elects to reconstitute upon dissolution of the housing company.

The notice of intent shall contain the following information and supporting documents:

Upon satisfactory completion of the requirements in sections 1750.3 through 1750.5 of this Part, the housing company shall submit to the division a list of the requirements of the mortgagee(s) to prepay the mortgage(s), to be obtained by the housing company from the mortgagee(s). Such list shall contain the anticipated date of compliance with each of the mortgagee's requirements for the prepayment of the mortgage(s), including any fees, charges or special assessments required to be made.

In addition to the other requirements set forth in this Part, each mutual company shall also submit to the division, upon completion of the public informational meeting required under section 1750.5 of this Part, satisfactory evidence of (a) acceptance by the office of the Attorney General of the State of New York of the filing of the offering plan pertaining to the proposed transfer from the mutual company to a private cooperative or condominium corporation; and (b) approval by two thirds of the shareholders of record of the counted on the basis of one vote per dwelling unit.

Upon submission to the Deputy Commissioner of Housing Operations of the material as specified in section 1750.3(a)(14) of this Part, the division shall compare the housing company's draft initial registrations with the information on file with the division. Upon approval of the information by the division and return of the draft registration forms, the housing company shall comply with the initial rent registration requirements as set forth in the rent stabilization code, Part 2520 et seq. of this Title or the tenant protection regulations, Part 2500 of this Title.

The housing company must submit its detailed payment schedule and arrangement for the payment of any and all outstanding operating expenses, taxes and indebtedness. Such schedule shall list each item of indebtedness, the amount thereof, the source of payment thereof, and the anticipated date of payment. For each item of indebtedness, the housing company must also submit an invoice or other evidence of the current amount due.

Upon review of the physical condition survey submitted by the housing company pursuant to section 1750.3(a)(15) of this Part, the division shall determine if the survey is sufficient and properly addresses the needs of the property which must be resolved prior to the dissolution, and if the plans submitted by the housing company are sufficient to meet the needs of the housing project. The housing company shall specify its plans to correct any defective conditions and to replace any and all items and equipment which are obsolete or have reached the end of their useful life or are projected to end their useful life within the next five years, and the amounts to be expended therefor. Upon the approval by the division of the corrective work plan and costs thereof, appropriate funds shall be released upon dissolution from the operating and replacement reserve escrow accounts and deposited into a special escrow account under the exclusive jurisdiction of a fiduciary agent, to be used exclusively to effectuate the corrective work plan. Additionally, the division may order that work be performed and that monies be escrowed therefor. None of the corrective work performed pursuant hereto shall qualify for an increase in rent pursuant to section 2502.4 of the Emergency Tenant Protection Regulations or section 2522.4 of the Rent Stabilization Code.

The housing company must submit evidence of specific arrangements that have been made with the appropriate municipal agencies and compliance with all filing procedures with respect to senior citizens' rent increase exemptions or similar programs.

Upon receipt of the documentation required hereunder and the payment of the fees as set forth in section 1750.13 of this Part, and upon receipt of a conformed copy of the proposed certificate of dissolution, the division shall issue a certification to the Secretary of State stating that the requirements of the Private Housing Finance Law have been complied with and that the division has no objection to the filing by the housing company of the certificate of dissolution.

Upon receipt of the division certification as provided in section 1750.14 of this Part, the housing company shall thereupon notify the municipality in which the housing development is located, by written document, of the impending dissolution of the housing company and the attendant ineligibility for tax exemption under the Private Housing Finance Law. A copy of such notification shall thereupon be sent to the division.

At least 7 but not more than 10 days before the effective date of the dissolution of the housing company, or closing date, the housing company shall send a notice, to the parties specified in section 1750.4(a) of this Part, of the anticipated date of such dissolution and the name and address of the transferee, if any.

The provisions of this Part, as amended, shall apply top any pending or future dissolution proceeding; provided, however, that where a housing company has taken certain acts prior to the effective date of the amended provisions, the provisions of this Part in effect at the time the acts were taken shall apply with respect to those acts.