S 7745: Creates the cooperative and condominium ombudsperson program; authorizes the residential unit tax; establishes the cooperative and condominium ombudsperson program fund.

  
  STATE OF NEW YORK ________________________________________________________________________ 7745 2025-2026 Regular Sessions  IN SENATE May 2, 2025 ___________ Introduced by Sen. MAYER -- read twice and ordered printed, and when printed to be committed to the Committee on Housing, Construction and Community Development AN ACT to amend the public housing law and the real property law, in relation to creating the cooperative and condominium ombudsperson program; to amend the tax law, in relation to authorizing the residen- tial unit fee; and to amend the state finance law, in relation to establishing the cooperative and condominium ombudsperson program fund The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision 1 of section 14 of the public housing law is 2 amended by adding a new paragraph (y) to read as follows: 3 (y) administer the cooperative and condominium ombudsperson program 4 pursuant to article eleven of the real property law. 5 § 2. The real property law is amended by adding a new article 11 to 6 read as follows: 7 ARTICLE 11 8 COOPERATIVE AND CONDOMINIUM OMBUDSPERSON PROGRAM 9 Section 360. Short title. 10 360-a. Legislative declaration. 11 360-b. Definitions. 12 360-c. Cooperative and condominium ombudsperson program. 13 360-d. Services under the program. 14 360-e. Registration of cooperatives and condominiums with the 15 ombudsperson program. 16 360-f. Assistance of other state agencies. 17 360-g. Reports to the governor and the legislature. 18 360-h. Contract authority. 19 360-i. Separability. 20 § 360. Short title. This article shall be known and may be cited as 21 the "cooperative and condominium ombudsperson act". EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD11727-03-5 
 S. 7745 2 1 § 360-a. Legislative declaration. The legislature finds and determines 2 as follows: 3 Cooperative and condominium housing constitutes a significant portion 4 of New York state's residential housing stock. It is and has been the 5 public policy of this state to encourage such forms of home ownership. A 6 wide variety of laws have been enacted to provide fairness in the 7 conversion of rental properties to cooperative and condominium ownership 8 and in the regulation and taxation of cooperatives and condominiums. 9 State and local laws and regulations are also designed to ensure that 10 the residents of such housing are provided with safe and habitable 11 accommodations. 12 Unfortunately, disputes have not infrequently arisen among cooperative 13 and condominium sponsors and developers, cooperative shareholders and 14 condominium unit owners, prospective shareholders and unit owners, 15 boards of directors and boards of managers. Such disputes may result in 16 lengthy and costly litigation and uncertainty as to the rights of the 17 parties pending the outcome of litigation. Such litigation diverts 18 resources that could be better utilized to provide affordable and well- 19 maintained buildings and grounds for the common good of the owners. 20 This article is necessary to provide a neutral, informative and acces- 21 sible resource available to all parties involved in residential cooper- 22 ative and condominium ownership and governance. The ombudsperson program 23 created pursuant to this article will conduct outreach programs to 24 educate unit owners and board members as to their legal rights and 25 responsibilities. The ombudsperson program will encourage alternative 26 dispute resolution when disputes do arise. The ombudsperson will be 27 available to provide dispute resolution services on consent of the 28 parties. The ombudsperson will also provide monitoring and supervision 29 of cooperative and condominium elections. 30 § 360-b. Definitions. 1. "Cooperative" means a corporation organized 31 and operating pursuant to the general business law or the cooperative 32 corporations law for the primary purpose of providing residential hous- 33 ing to its shareholders. 34 2. "Condominium" means a homeowners association or any association 35 organized and operating pursuant to article nine-B of this chapter for 36 the primary purpose of providing residential housing to its unit owners. 37 3. "Program" means the cooperative and condominium ombudsperson 38 program created by this article. 39 4. "Ombudsperson" means the not-for-profit organization selected to 40 run the cooperative and condominium ombudsperson program. 41 5. "State agency" means any department, board, bureau, commission, 42 division, office, council or agency of the state, or a public benefit 43 corporation or authority authorized by the laws of the state. 44 6. "Local agency" means any department, board, bureau, commission, 45 division, office, council, officer or agency of a city, town or village. 46 § 360-c. Cooperative and condominium ombudsperson program. 1. There 47 shall be established within the division of housing and community 48 renewal a cooperative and condominium ombudsperson program. The commis- 49 sioner of the division of housing and community renewal shall be respon- 50 sible for oversight of the program. 51 2. Within one year of the effective date of this article, the division 52 of housing and community renewal shall establish the cooperative and 53 condominium ombudsperson program, and shall have the power to implement 54 the program by appropriate regulations. 55 3. The division of housing and community renewal shall distribute 56 monies from the cooperative and condominium ombudsperson program fund 
 S. 7745 3 1 established pursuant to section eighty-one-a of the state finance law to 2 one eligible not-for-profit entity, to be selected by a competitive 3 bidding process, to act as the cooperative and condominium ombudsperson 4 and to oversee the cooperative and condominium ombudsperson program 5 statewide. The ombudsperson shall develop a statewide infrastructure to 6 deliver services on a local or regional level and may subcontract with 7 one or more eligible not-for-profit entities to provide services under 8 the program. 9 4. The not-for-profit organization and any subcontracted organizations 10 providing services under the program shall employ at least one attorney 11 or other professional with extensive experience in real estate, cooper- 12 ative and condominium law and in conflict and alternative dispute resol- 13 ution to oversee the ombudsperson program services provided by such 14 organization. 15 5. Ombudsperson program staff shall adhere to a code of ethics in 16 order to inspire public confidence and trust in the fairness and impar- 17 tiality of the program. The division of housing and community renewal 18 shall prescribe such code of ethics. Such code shall require that the 19 ombudsperson program staff respect and comply with the law; that they 20 not use or attempt to use their positions to secure privileges or 21 exemptions for themselves or others; that they not solicit, accept or 22 agree to accept any gifts or gratuities from persons having or likely to 23 have any transaction with the office; that they not request or accept 24 any payment in addition to their regular compensation for assistance 25 given as part of their official duties; and that they shall not perform 26 any function in a manner that improperly favors any person or party. 27 6. Ombudsperson program staff shall not serve as officers or employees 28 of a political party or a club or organization related to a political 29 party, receive remuneration for activities on behalf of any candidate 30 for public office or party position or engage in soliciting votes or 31 other activities on behalf of a candidate for public office or party 32 position. 33 7. The secretary to the governor shall assure that all state agencies 34 provide the ombudsperson with assistance in advancing the purposes of 35 the office and to assure that the activities of the office are fully 36 coordinated with the activities of state agencies providing related 37 services. 38 § 360-d. Services under the program. Services provided under the 39 program shall include: 40 1. Educating and informing shareholders of cooperatives and unit 41 owners of condominiums, their boards of directors and boards of manag- 42 ers, property managers, professionals working with and for such boards 43 and other interested parties of their legal rights and responsibilities 44 under the federal, state and local laws and regulations applicable to 45 cooperative and condominium housing in the state of New York and under 46 the cooperative and condominium documents governing the respective prop- 47 erties. 48 2. Coordinating and assisting in the preparation and publication of 49 educational and reference materials about residential cooperatives and 50 condominiums, to make such resources known and available to the widest 51 possible audience. 52 3. Organizing and conducting meetings, workshops, conferences, and 53 forums and utilizing all forms of communications media to disseminate 54 accurate and timely information of interest to persons residing in, 55 owning and managing cooperative and condominium housing. 
 S. 7745 4 1 4. Providing mediation, arbitration and other forms of alternative 2 dispute resolution services to cooperative and condominium sponsors and 3 developers, cooperative shareholders, condominium owners, their boards 4 of directors and managers, prospective shareholders and unit owners and 5 other parties so as to avoid costly and lengthy litigation and reduce 6 expenses for those involved in disputes. 7 5. Referring parties for a hearing before the division of housing and 8 community renewal. 9 (a) Should mediation, arbitration, or other form of alternative 10 dispute resolution provided by or through the ombudsperson fail to 11 resolve a dispute between the parties, the ombudsperson, may, upon 12 request by either party, refer the dispute for a hearing to be held by 13 the division of housing and community renewal in accord with article 14 three of the state administrative procedure act. 15 (b) Referrals for hearing before the division of housing and community 16 renewal shall be limited to disputes regarding acts that may be contrary 17 to law or an association's governing rules; unreasonable, unfair, 18 oppressive, retaliatory, or discriminatory; based on a mistake of fact; 19 based on improper or irrelevant grounds; or otherwise erroneous. 20 (c) Upon receipt of a referral from the ombudsperson's office, if the 21 division finds that the dispute meets the criteria of paragraph (b) of 22 this subdivision, the division shall schedule a hearing and issue notice 23 to the parties of the time and place of the hearing. 24 (d) Such hearings shall be held before an administrative law judge who 25 shall receive evidence, documents, and testimony and provide the parties 26 with an opportunity to be heard. 27 (e) The administrative law judge shall have the power to subpoena and 28 enforce the attendance of witnesses, administer oaths or affirmations 29 and examine witnesses under oath, and require the production of any 30 books and papers deemed relevant or material to the resolution of any 31 dispute pending before the division. 32 (f) After conclusion of the hearing, the division shall issue a writ- 33 ten determination of its decision to both parties. In the written deter- 34 mination, the division may order any party to abide by the statutes, 35 regulations, or governing rules at issue. 36 (g) Either party may seek judicial review of such determination pursu- 37 ant to article seventy-eight of the civil practice law and rules 38 provided that such review shall be maintained against the same parties. 39 6. Engaging with housing courts, other trial courts, state and local 40 agencies and with alternative dispute resolution programs maintained by 41 the office of court administration in order to provide specialized 42 expertise in the resolution of cooperative and condominium disputes as 43 an alternative to litigation. 44 7. Offering procedures, monitors and vote counting services to assure 45 fair elections for members of cooperative boards of directors and condo- 46 minium boards of managers. Fifteen percent of the total voting inter- 47 ests in a cooperative or condominium or shareholders or owners of six 48 residential units, whichever is greater, may petition the ombudsperson 49 to attend and conduct an election of directors or managers. All costs 50 associated with the election monitoring process shall be paid by the 51 cooperative or condominium. 52 8. Referring any complaints received to the appropriate law enforce- 53 ment agency for prosecution, if deemed appropriate by the ombudsperson. 54 9. Performing any other functions that are necessary or appropriate to 55 fulfill the duties and responsibilities of the program. 
 S. 7745 5 1 § 360-e. Registration of cooperatives and condominiums with the ombud- 2 sperson program. The cooperative and condominium ombudsperson program 3 shall compile and maintain a register of cooperatives and condominiums 4 within the state which shall be updated annually, upon payment of the 5 residential unit fee pursuant to section one hundred eighty-six-h of the 6 tax law, and shall include the following information: 7 1. the name, address and telephone number of the association; 8 2. the name of the management company or managing agent, and the name 9 of any other person who is authorized to manage the property at the site 10 of the cooperative or condominium; 11 3. the names, mailing addresses and telephone numbers of the members 12 of the executive board of the cooperative or condominium; 13 4. the name of the declarant; 14 5. the number of units in the cooperative or condominium association; 15 6. the total annual assessment made by the association; 16 7. the number of foreclosures which were completed on units within the 17 cooperative or condominium, and which were based on liens for the fail- 18 ure of the shareholder or unit's owner to pay any assessments levied 19 against the shares or unit or any fines imposed against the shareholder 20 or unit's owner; and 21 8. whether a study of the reserves of the association has been 22 conducted. 23 § 360-f. Assistance of other state agencies. To effectuate the 24 purposes of this article, the division of housing and community renewal 25 may request and shall be entitled to receive from any state agency, and 26 the same are authorized to provide, such assistance, services, facili- 27 ties, and data as will enable the division to carry out the purposes of 28 the ombudsperson program. 29 § 360-g. Reports to the governor and the legislature. The division of 30 housing and community renewal shall make an annual report, to be 31 received on or before January first, to the governor and the legislature 32 concerning the activities undertaken by the ombudsperson program, recom- 33 mendations for legislative proposals, data concerning program activities 34 and other pertinent information as may be required. 35 § 360-h. Contract authority. The division of housing and community 36 renewal is hereby empowered to enter into any agreement or contract with 37 any state or local agency necessary or convenient to carry out the 38 provisions of this article. 39 § 360-i. Separability. If any clause, sentence, paragraph, section or 40 part of this article shall be adjudged by any court of competent juris- 41 diction to be invalid, such judgment shall not affect, impair or invali- 42 date the remainder thereof, but shall be confined in its operation to 43 the clause, sentence, paragraph, section or part thereof directly 44 involved in the controversy in which such judgment shall have been 45 rendered. 46 § 3. The tax law is amended by adding a new section 186-h to read as 47 follows: 48 § 186-h. Residential unit fee. A cooperative housing corporation or a 49 homeowners association, as such terms are defined in section two hundred 50 ten of this chapter, shall pay an annual fee of six dollars per year for 51 each residential unit located in a building or buildings owned or oper- 52 ated by such corporation or association. Such fee shall be payable to 53 the department. All revenue from the fee imposed pursuant to this 54 section shall be paid by the department to the state comptroller to be 55 deposited to and credited to the cooperative and condominium ombudsper- 
 S. 7745 6 1 son program fund, established pursuant to section eighty-one-a of the 2 state finance law. 3 § 4. The state finance law is amended by adding a new section 81-a to 4 read as follows: 5 § 81-a. Cooperative and condominium ombudsperson program fund. 1. 6 There is hereby established in the custody of the state comptroller a 7 special fund to be known as the "cooperative and condominium ombudsper- 8 son program fund". 9 2. The cooperative and condominium ombudsperson program fund shall 10 consist of monies appropriated thereto, funds transferred from any other 11 fund or sources, and monies deposited therein pursuant to section one 12 hundred eighty-six-h of the tax law. 13 3. The monies in the cooperative and condominium ombudsperson program 14 fund shall be kept separate from and shall not be commingled with any 15 other monies in the custody of the state comptroller. Such monies shall 16 be allocated to and expended by the division of housing and community 17 renewal solely for the staffing and administration of the cooperative 18 and condominium ombudsperson program. 19 § 5. This act shall take effect on the one hundred eightieth day after 20 it shall have become a law.