In December 2022 the New York State Private Housing Finance Law (PHFL) was amended to allow owners of affordable housing properties to collect rents above the Legal Regulated Rent so long as a Regulatory Agreement is in place with a State or Municipal Agency, Public Benefit Corporation, or a Political Subdivision of the State and where a federal, state, or local program provides rental assistance for the housing accommodation. The newly enacted PHFL Section 610 allows owners to collect rents up to the maximum payment standard or contract rent that the public rental assistance program may provide for the housing accommodation, if permitted under the applicable Regulatory Agreement. PHFL Section 610 allows for this collection above the Legal Regulated Rent even if the property is subject to rent stabilization, but such higher rent does not become the Legal Regulated Rent.
We believe this addition to the PHFL will provide a major boost to certain properties containing tax credit units and Low Income Housing units.
Rosenberg & Estis, P.C. is monitoring how implementation of PHFL Section 610 will occur. Our open questions about implementation include how the addition to the PHFL will be implemented short of amending all current Regulatory Agreements, applicability beyond project-based rental assistance and whether implementation will be done on an ad hoc basis or will only affect the language of future Regulatory Agreements. We are in communication with governmental agencies and industry groups regarding these implementation questions, will be following this process carefully and we look forward to sharing further information about PHFL Section 610 as it becomes available. In the meantime please feel free to contact me with any questions or concerns you may have in the interim.
Daniel M. Bernstein
Member and Head of the Tax Incentives & Affordable Housing Department