THE COUNCIL OF THE CITY OF NEW YORK
PRECONSIDERED RES. NO. 629
Resolution approving an exemption from real property taxes for property located at (Block 934, Lot 15) Manhattan, pursuant to Section 125(1)(a-3) of the Private Housing Finance Law (Preconsidered L.U. No. 204).
By Council Member Brannan
WHEREAS, The New York City Department of Housing Preservation and Development (“HPD”) submitted to the Council its request dated May 2, 2023 that the Council take the following action regarding a housing project located at (Block 934, Lot 15) Manhattan (“Exemption Area”):
Approve an exemption of the Project from real property taxes pursuant to Section 125(1)(a-3) of the Private Housing Finance Law (the “Tax Exemption”);
WHEREAS, The project description that HPD provided to the Council states that the purchaser of the Project (the “Owner”) is a duly organized housing development fund company under Article V of the Private Housing Finance Law;
WHEREAS, the Council has considered the financial implications relating to the Tax Exemption;
RESOLVED:
The Council hereby grants an exemption from real property taxes as follows
1. For the purposes hereof, the following terms shall have the following meanings:
a. “Company” shall mean Site 10 Community Alliance Associates, L.P.
b. “Effective Date” shall mean July 1, 2021.
c. “Exemption” shall mean the exemption from real property taxation provided hereunder.
d. “Exemption Area” shall mean the real property located in the Borough of Manhattan, City and State of New York, identified as Block 934, Lot 15 on the Tax Map of the City of New York.
e. “Expiration Date” shall mean the earlier to occur of (i) a date which is forty (40) years from the Effective Date, (ii) the date of the expiration or termination of the Regulatory Agreement, (iii) the date upon which the Exemption Area ceases to be owned by the Owner, (iv) the date upon which the City terminates the partial tax exemption pursuant to the terms of the Regulatory Agreement, or (v) the date of the expiration or termination of the Exemption Area’s Section 8 Housing Assistance Payments Contract.
f. “HPD” shall mean the Department of Housing Preservation and Development of the City of New York.
g. “Contract Rent Deadline” shall mean three hundred and sixty-five (365) days from the date of the HPD letter requesting the information that HPD needs to calculate the Contract Rent Differential Tax for the applicable tax year.
h. “Contract Rent Differential” shall mean the amount by which the total contract rents applicable to the Exemption Area for such tax year (as adjusted and established pursuant to Section 8 of the United States Housing Act of 1937, as amended) exceed the total contract rents which are authorized as of the Effective Date.
i. “Contract Rent Differential Tax” shall mean the sum of (i) $1,236,396, plus (ii) twenty-five percent (25%) of the Contract Rent Differential; provided, however, that the total annual real property tax payment by the Owner shall not at any time exceed the lesser of (A) seventeen percent (17%) of the contract rents in the applicable tax year, or (B) the amount of real property taxes that would otherwise be due in the absence of any form of exemption from or abatement of real property taxation provided by an existing or future local, state, or federal law, rule, or regulation. Notwithstanding the foregoing, if the Owner fails to provide the contract rents on or before the Contract Rent Deadline, Contract Rent Differential Tax shall mean an amount equal to real property taxes that would otherwise be due in such tax year in the absence of any form of exemption from or abatement of real property taxation.
j. “Owner” shall mean the Company or, with the prior written approval of HPD, any future owner of the Exemption Area that is a redevelopment company organized pursuant to Article V of the Private Housing Finance Law.
k. “Regulatory Agreement” shall mean the Land Disposition Agreement dated May 26, 1977 between the City of New York and the Owner, establishing certain controls upon the operation of the Exemption Area in accordance with Private Housing Finance Law Section 114 and recorded on reel 428, page 1567, in the office of the City Register of the City of New York.
l. “Restrictive Agreement” shall mean an agreement between HPD and the Owner that is entered into on or after May 1, 2023 and that requires the Exemption Area to remain a redevelopment company development organized under and operated pursuant to Article V of the Private Housing Finance Law for a period of five years from the date of execution.
2. All of the value of the property in the Exemption Area, including both the land and any improvements, shall be exempt from real property taxation, other than assessments for local improvements, for a period commencing upon the Effective Date and terminating upon the Expiration Date.
3. Commencing upon the Effective Date, the Owner shall make real property tax payments in the sum of $1,518,780 for each year until June 30, 2023, and during each year thereafter until the Expiration Date, the Owner shall make real property tax payments in the sum of the Contract Rent Differential Tax.
4. Notwithstanding any provision hereof to the contrary:
a. The Exemption shall terminate if HPD determines at any time that (i) the Exemption Area is not being operated in accordance with the requirements of Article V of the Private Housing Finance Law, (ii) the Exemption Area is not being operated in accordance with the requirements of the Regulatory Agreement, (iii) the Exemption Area is not being operated in accordance with the requirements of the Restrictive Agreement; (iv) the Exemption Area is not being operated in accordance with the requirements of any other agreement with, or for the benefit of, the City of New York, (v) any interest in the Exemption Area is conveyed or transferred to a new owner without the prior written approval of HPD, (vi) the owner of the Exemption Area did not apply for and receive a new Section 8 Housing Assistance Payments contract on or before August 1, 2040, or (vii) the construction or demolition of any private or multiple dwelling on the Exemption Area has commenced without the prior written consent of HPD. HPD shall deliver written notice of any such determination to Owner and all mortgagees of record, which notice shall provide for an opportunity to cure of not less than sixty (60) days. If the noncompliance specified in such notice is not cured within the time period specified therein, the Exemption shall prospectively terminate.
b. The Exemption shall apply to all land in the Exemption Area but shall only apply to a building on the Exemption Area that exists on the Effective Date.
c. Nothing herein shall entitle the Company, the Owner or any other person or entity to a refund of any real property taxes which accrued and were paid with respect to the Exemption Area prior to the Effective Date.
d. All previous resolutions, if any, providing an exemption from or abatement of real property taxation with respect to the Exemption Area are hereby revoked as of the Effective Date.
5. In consideration of the Exemption, the owner of the Exemption Area, for so long as the Exemption shall remain in effect, shall waive the benefits of any additional or concurrent exemption from or abatement of real property taxation which may be authorized under any existing or future local, state, or federal law, rule, or regulation. Notwithstanding the foregoing, nothing herein shall prohibit the granting of any real property tax abatement pursuant to Sections 467-b or 467-c of the Real Property Tax Law to real property occupied by senior citizens or persons with disabilities.
Office of the City Clerk, }
The City of New York } ss.:
I hereby certify that the foregoing is a true copy of a Resolution passed by The Council of the City of New York on May 11, 2023, on file in this office.
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City Clerk, Clerk of Council