Relates to elections involving board members, by-law amendments, or dissolution, reconstitution or conversion of mutual housing companies

S T A T E   O F   N E W   Y O R K
        ________________________________________________________________________

                                          9576

                                    I N  S E N A T E

                                     March 25, 2026
                                       ___________

        Introduced  by  Sen.  BAILEY -- 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  private  housing  finance  law,  in relation to
          elections involving board members, by-law amendments, or  dissolution,
          reconstitution or conversion of mutual housing companies

          THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
        BLY, DO ENACT AS FOLLOWS:

     1    Section 1. Subdivisions 1 and 5 of section 13-c of the private housing
     2  finance law, as amended by chapter 167 of the laws of 2022, are  amended
     3  and a new subdivision 6 is added to read as follows:
     4    1.  Any  shareholder  vote  involving  the  election of board members,
     5  by-law amendments, or on dissolution or reconstitution or conversion  of
     6  a  mutual  housing  company including any votes for a special assessment
     7  pursuant to subdivisions one, two or three of section  thirty-five-a  of
     8  this article shall be conducted using secret ballots. Such ballots shall
     9  be  cast  ELECTRONICALLY  TO  A  NEUTRAL  THIRD PARTY NOT RUNNING FOR OR
    10  SUPPORTING A CANDIDATE RUNNING FOR A POSITION ON THE BOARD OF  DIRECTORS
    11  OR  HAVING  AN  INTEREST IN DISSOLUTION, RECONSTITUTION OR CONVERSION OF
    12  THE MUTUAL HOUSING COMPANY, OR in-person by [tenants] SHAREHOLDERS enti-
    13  tled to vote in the project; unless such [tenant] SHAREHOLDER casts such
    14  ballot using an absentee ballot issued pursuant to  subdivision  two  of
    15  this section.
    16    5.  [No]  UNLESS  OTHERWISE PROVIDED IN A BY-LAW PROVISION APPROVED BY
    17  THE MUTUAL HOUSING COMPANY'S SHAREHOLDERS AND  BY  THE  COMMISSIONER  OR
    18  SUPERVISING AGENCY, NO otherwise-eligible person shall be prevented from
    19  being a candidate for, being elected to, or serving on a board of direc-
    20  tors  based solely on that person owing or having owed any amount of any
    21  form of arrears to the mutual housing company, unless, at  the  time  of
    22  nomination, that person currently owes an amount of arrears greater than
    23  the  equivalent  of  two  months  of  that person's monthly maintenance.
    24  Nothing in this subdivision shall be construed to require or mandate any
    25  mutual housing company to adopt bylaws, rules, policies,  or  procedures
    26  restricting  any person's eligibility to be nominated, elected, or serve

         EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15340-01-6
        S. 9576                             2

     1  on a board of directors. [No grounds other than the above arrearages  in
     2  excess of two months maintenance shall be a basis in itself to deny such
     3  eligibility  to  any  person  unless  specifically incorporated in regu-
     4  lations  promulgated  by  or  procedures approved by the commissioner or
     5  supervising agency. Neither a mutual housing company nor the commission-
     6  er or the supervising agency may modify in any way the above  limitation
     7  so  as  to restrict eligibility on the basis of fewer than two months of
     8  arrears.]
     9    6. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, A QUORUM  FOR  PURPOSES
    10  OF AN ELECTION OF BOARD MEMBERS IN ANY MUTUAL HOUSING COMPANY CONSISTING
    11  OF  ONE  THOUSAND  OR MORE SHAREHOLDERS SHALL MEAN NOT LESS THAN TWENTY-
    12  FIVE PERCENT OF THE SHAREHOLDERS ELIGIBLE TO VOTE IN SUCH ELECTION.
    13    § 2. This act shall take effect immediately.