Section 489. Exemption from taxation of alterations and improvements to multiple dwellings to eliminate fire and health hazards; abatement

1.
  (a)  Any  city  to which the multiple dwelling law is applicable, acting
  through its local legislative body or other governing agency, is  hereby
  authorized  and  empowered,  to  and  including June first, two thousand
  eleven, to adopt and amend local laws or ordinances providing  that  any
  increase  in  assessed  valuation  of real property shall be exempt from
  taxation for local purposes, as provided  herein,  to  the  extent  such
  increase results from:
    (1)  conversion of buildings or structures on such property to class A
  multiple dwellings not  used  in  whole  or  in  part  for  single  room
  occupancy,  including  conversion of residential units qualified for the
  protection of article seven-C of the multiple dwelling law in  buildings
  classified  as  interim  multiple  dwellings pursuant to such article to
  units which are in compliance with the  standards  of  safety  and  fire
  protection  set forth in article seven-B of the multiple dwelling law or
  to units which have a certificate  of  occupancy  as  class  A  multiple
  dwellings; or
    (2)  alterations  or  improvements, including as improvements asbestos
  abatement to the extent such asbestos abatement is required by  federal,
  state or local law, on such property to eliminate unhealthy or dangerous
  conditions  or  to  replace inadequate and obsolete sanitary facilities,
  any of which represent fire or health hazards, in any existing  class  A
  multiple  dwellings or buildings consisting of one or two dwelling units
  over space used for commercial occupancy, except insofar  as  the  gross
  cubic content of the building is increased thereby; or
    (3) alterations or improvements on such property which are designed to
  conserve  the  use  of fuel, electricity or other such energy sources in
  any dwellings or other buildings or structures described in  clause  one
  or two of this paragraph; or
    (4)  alterations or improvements to the exterior walls of dwellings or
  other buildings or structures on such property in order to  comply  with
  any provision of law regulating dwellings, buildings, or structures that
  are  in  an  area designated as an historic or landmark area or that are
  designated as historic or landmark buildings or structures; or
    (5) alterations or improvements constituting a moderate rehabilitation
  of a substantially occupied class A  multiple  dwelling  within  a  city
  having  a  population  of  one million or more as certified by the local
  housing agency pursuant to local law or rules and regulations; or
    (6)   alterations   or   improvements   constituting   a   substantial
  rehabilitation  of  a  class  A  multiple  dwelling or a conversion of a
  building or structure into a class A multiple  dwelling  as  part  of  a
  program  to  provide  housing  for low and moderate income households as
  defined by the local housing agency pursuant to rules  and  regulations,
  provided  that  such alterations or improvements or conversions shall be
  aided by a grant, loan or subsidy  from  any  federal,  state  or  local
  agency  or  instrumentality,  including,  in the discretion of the local
  housing agency, a subsidy in the form of a below market sale.
    Such conversion, alterations or improvements shall be completed within
  thirty-six months after the date on which same shall be  started  except
  that  such thirty-six month limitation shall not apply to conversions of
  residential units which are registered with the loft board in accordance
  with  article  seven-C  of  the  multiple  dwelling  law   pursuant   to
  subparagraph  one  of  this  paragraph. Notwithstanding the foregoing, a
  sixty month period for completion shall be available for alterations  or
  improvements  undertaken by a housing development fund company organized
  pursuant to article eleven of the private housing finance law, which are
  carried  out  with  the  substantial  assistance  of  grants,  loans  or

  subsidies  from  any  federal,  state  or  local  governmental agency or
  instrumentality or which are carried out in a property transferred  from
  such  city  if  alterations  and improvements are completed within seven
  years  after the date of transfer. In addition, the local housing agency
  is hereby empowered to grant an extension of the  period  of  completion
  for  any  project carried out with the substantial assistance of grants,
  loans or subsidies from any federal, state or local governmental  agency
  or  instrumentality,  if  such alterations or improvements are completed
  within  sixty  months  from  commencement  of  construction.   Provided,
  further,  that such conversion, alterations or improvements shall in any
  event be completed prior to December thirty-first, two thousand  eleven.
  Exemption  for  conversions,  alterations  or  improvements  pursuant to
  subparagraph one, two, three or four of this  paragraph  shall  continue
  for  a  period not to exceed fourteen years and begin no sooner than the
  first quarterly tax bill immediately following the  completion  of  such
  conversion,  alterations  or  improvements. Exemption for alterations or
  improvements pursuant to this subparagraph or subparagraph five of  this
  paragraph  shall  continue  for a period not to exceed thirty-four years
  and shall begin no sooner than the first quarterly tax bill  immediately
  following  the  completion  of  such  alterations  or improvements. Such
  exemption shall be equal to the  increase  in  the  valuation  which  is
  subject  to  exemption  in full or proportionally under this subdivision
  for ten or thirty years, whichever is applicable. After such  period  of
  time,   the   amount   of  such  exempted  assessed  valuation  of  such
  improvements shall be reduced by twenty percent in each succeeding  year
  until  the  assessed  value  of  the  improvements  are  fully  taxable.
  Provided,  however,  exemption  for  any  conversion,   alterations   or
  improvements  which  are  aided  by a loan or grant under article eight,
  eight-A, eleven, twelve, fifteen or twenty-two of  the  private  housing
  finance  law,  section six hundred ninety-six-a or section ninety-nine-h
  of the general municipal law, or section three  hundred  twelve  of  the
  housing  act  of nineteen hundred sixty-four (42 U.S.C.A. 1452b), or the
  Cranston-Gonzalez national affordable housing act (42 U.S.C.A. 12701 et.
  seq.), or started after July first, nineteen hundred eighty-three  by  a
  housing development fund company organized pursuant to article eleven of
  the  private  housing  finance  law  which  are  carried  out  with  the
  substantial assistance of grants, loans or subsidies from  any  federal,
  state  or  local  governmental  agency  or  instrumentality or which are
  carried  out  in  a  property  transferred  from  any  city  and   where
  alterations  and improvements are completed within seven years after the
  date of transfer may commence  at  the  beginning  of  any  tax  quarter
  subsequent  to the start of such conversion, alterations or improvements
  and  prior  to  the  completion  of  such  conversion,  alterations   or
  improvements.
    (b)  Any  city  to  which the multiple dwelling law is not applicable,
  acting through its local legislative body or other governing agency,  is
  hereby  authorized  and empowered, to and including June first, nineteen
  hundred seventy-two,  to  adopt  and  amend  local  laws  or  ordinances
  providing  that  any  increase  in  assessed  valuation  resulting  from
  alterations and improvements to eliminate presently  existing  unhealthy
  or  dangerous  conditions in any multiple dwellings occupied, as a rule,
  for permanent residence purposes or to replace inadequate  and  obsolete
  sanitary  facilities  any  of which represent fire or health hazards, in
  such dwellings except insofar as the gross cubic content of the building
  is increased thereby, shall be exempt from taxation for  local  purposes
  for  a  period  not to exceed twelve years after the taxable status date
  immediately  following  the  completion  thereof,  provided   that   the
  alterations  or  improvements  for which the benefits of any such law or

  ordinance are claimed were started after March first,  nineteen  hundred
  sixty-two,  and  completed  within two years from the date on which they
  were started and in any event prior to December  thirty-first,  nineteen
  hundred seventy-four.
    1-a.  Notwithstanding  the  provisions  of  subdivision  one  of  this
  section, alterations, improvements or conversions  of  any  building  or
  structure  that  are  eligible for benefits pursuant to paragraph (a) of
  subdivision one of this  section  except  insofar  as  the  gross  cubic
  content  of  such  building  or  structure is increased thereby shall be
  eligible for such benefits insofar as the gross cubic  content  of  such
  building or structure is increased thereby provided that:
    (a) for all tax lots now existing or hereafter created, at least fifty
  percent  of  the  floor  area  of  the  completed  building or structure
  consists of the pre-existing building or structure that  was  converted,
  altered  or improved in accordance with paragraph (a) of subdivision one
  of this section, and
    (b) for tax lots in the city of New York  now  existing  or  hereafter
  created  within  the  following  area  in the borough of Manhattan, such
  conversions, alterations or improvements are aided by a grant,  loan  or
  subsidy  from  any  federal,  state  or local agency or instrumentality:
  beginning at the intersection of the United States pierhead line in  the
  Hudson  river  and  the  center line of Chambers street extended, thence
  easterly to the center line of Chambers street and continuing along  the
  center  line  of  Chambers  street  to the center line of Centre street,
  thence southerly along the center line of Centre street  to  the  center
  line  of  the Brooklyn Bridge to the intersection of the Brooklyn Bridge
  and the United States pierhead line in the East river, thence  northerly
  along  the  United  States  pierhead  line  in  the  East  river  to the
  intersection of the United States pierhead line in the  East  river  and
  the center line of One Hundred Tenth street extended, thence westerly to
  the  center  line  of  One Hundred Tenth street and continuing along the
  center line of One Hundred Tenth street to its westerly terminus, thence
  westerly to the intersection of the center line  of  One  Hundred  Tenth
  street extended and the United States pierhead line in the Hudson river,
  thence  southerly  along  the  United States pierhead line in the Hudson
  river to the point of  beginning.  For  purposes  of  this  subdivision,
  "floor  area"  shall  have  the  same  meaning  as  in  paragraph  b  of
  subdivision one of section four  hundred  twenty-one-a  of  this  title.
  Nothing  in  this  subdivision  shall  be  construed to provide benefits
  pursuant to subdivision two of this section for the  costs  attributable
  to the increased cubic content in any such building or structure.
    2.  (a)  With  respect  to  conversions,  alterations  or improvements
  eligible to receive the benefits of subdivision one of this section, any
  such local law or ordinance may  also  provide  that  the  duration  and
  amount  of  abatement of taxes on such property, including the land, may
  be separately established for each  of  the  categories  of  eligibility
  described  in  paragraph  a of subdivision one of this section, provided
  that:
    (1) except  as  provided  in  subparagraphs  two  and  three  of  this
  paragraph, the annual abatement of taxes on such property, including the
  land, shall not be an amount greater than eight and one-third per centum
  of  the  total  cost of such conversion, alterations or improvements nor
  shall  the  abatement  exceed  the  total  cost  of  such   conversions,
  alterations  or  improvements or be effective for more than twenty years
  and the annual abatement of taxes in any consecutive twelve-month period
  shall  in  no  event  exceed  the  amount  of  taxes  payable  in   such
  twelve-month period;

    (2)  in  the  case  of  alterations  or  improvements  (i) pursuant to
  subparagraph five of paragraph (a) of subdivision one  of  this  section
  which  are  carried out with the substantial assistance of grants, loans
  or subsidies from any federal, state or local agency or  instrumentality
  or  any  not-for-profit  philanthropic organization one of whose primary
  purposes is providing low or moderate income housing  or  financed  with
  mortgage  insurance  by the New York city residential mortgage insurance
  corporation or the state of New York mortgage agency or  pursuant  to  a
  program   established   by   the   federal  housing  administration  for
  rehabilitation of existing multiple dwellings in a neighborhood strategy
  area as defined by the United States department  of  housing  and  urban
  development,  or  (ii)  pursuant to subparagraph six of paragraph (a) of
  subdivision one of this section the abatement of taxes on such property,
  including the land, shall not exceed one hundred fifty per centum of the
  certified  reasonable  cost  of  the  alterations  or  improvements,  as
  determined  under  regulations of the local housing agency administering
  the local law, and the annual abatement of taxes shall not exceed twelve
  and one-half per centum of such certified reasonable cost, provided that
  such abatement shall not be effective for more than twenty years and the
  annual abatement of taxes in any consecutive twelve-month  period  shall
  in  no  event  exceed  the  amount of taxes payable in such twelve-month
  period; or
    (3) in the case of alterations or improvements carried  out  with  the
  substantial  assistance  of grants, loans or subsidies from any federal,
  state  or  local  agency  or  instrumentality  or   any   not-for-profit
  philanthropic  organization  one  of whose primary purposes is providing
  low or moderate income housing, or financed with mortgage  insurance  by
  the  New  York  city  residential  mortgage insurance corporation or the
  state of New York mortgage agency or pursuant to program established  by
  the  federal  housing  administration  for  rehabilitation  of  existing
  multiple dwellings in a neighborhood strategy area  as  defined  by  the
  United  States  department  of  housing and urban development where such
  alterations or improvements are  done  on  property  located  in  census
  tracts  in  which seventy-five percent or more of the population live in
  households which earn fifty percent or  less  of  the  median  household
  income  of  the  city  in  which  such  census  tracts  are located, the
  abatement of taxes on such  property,  including  the  land,  shall  not
  exceed  one hundred fifty per centum of the certified reasonable cost of
  the alterations or improvements, as determined under regulations of  the
  local  housing  agency  administering  the  local  law,  and  the annual
  abatement of taxes shall not exceed twelve and one-half  per  centum  of
  such  certified  reasonable cost, provided that such abatement shall not
  be effective for more than twenty years  and  the  annual  abatement  of
  taxes  in  any  consecutive twelve-month period shall in no event exceed
  the amount of taxes payable in such twelve month period.
    (b) Such abatement:
    (1)  shall  begin  no  sooner  than  the  first  quarterly  tax   bill
  immediately  following the completion of such conversion, alterations or
  improvements, or
    (2) in the case of any such conversion,  alterations  or  improvements
  (i) completed after December thirty-first, nineteen hundred seventy-five
  and  aided  by a loan under article eight of the private housing finance
  law, or (ii) started after July first,  nineteen  hundred  seventy-seven
  and aided by a loan under article fifteen of the private housing finance
  law,  or  (iii)  started  after  July first, nineteen hundred eighty and
  aided by a loan under article eight-A of the private housing finance law
  or (iv) started after July first, nineteen hundred eighty and aided by a
  loan under section three hundred twelve of the housing act  of  nineteen

  hundred sixty-four (42 U.S.C.A. 1452b), or (v) started after July first,
  nineteen  hundred  ninety-two and aided by a loan or grant under article
  eleven, twelve, or  twenty-two  of  the  private  housing  finance  law,
  section six hundred ninety-six-a or section ninety-nine-h of the general
  municipal  law, or the Cranston-Gonzalez national affordable housing act
  (42 U.S.C.A. 12701 et. seq.), or (vi) started after July first, nineteen
  hundred eighty-eight by or on behalf of a company not  qualifying  under
  any  of  the  above  provisions  which  is  a not-for-profit corporation
  qualified pursuant to section 501(c)(3) of the Internal Revenue Code and
  which has entered into a regulatory agreement  with  the  local  housing
  agency  requiring  operation  of  the  property  as  housing for low and
  moderate income persons and families; may be commenced at the  beginning
  of  any  tax  quarter  subsequent  to  the  start  of  such  conversion,
  alterations  or  improvements  and  prior  to  the  completion  of  such
  conversion, alterations or improvements.
    3.  Any  such  local  law or ordinance may also provide that where the
  improvements and alterations include or benefit that part of a  building
  which  is  not  occupied for dwelling purposes, the increase in assessed
  valuation and the cost of the alteration shall be  apportioned  so  that
  the  benefits  of  the  local law or ordinance shall not be provided for
  improvements or alterations made for other than dwelling purposes.
    4. Any such local law or ordinance may also provide that its  benefits
  shall  not  become  available  to  any  multiple  dwelling,  building or
  structure as provided in  paragraph  (a)  of  subdivision  one  of  this
  section  unless  and until such multiple dwelling, building or structure
  as provided in paragraph (a) of subdivision one of this section complies
  with the applicable provisions of law. Any such  law  or  ordinance  may
  make  provision  as  to the date as of which particular improvements and
  alterations  shall  be  deemed  to  have  been  completed  or  commenced
  therefor,  as  the  case  may  be, for the purpose of qualifying for the
  benefits thereof. Any such local law or  ordinance  may  make  provision
  authorizing  the adoption of rules and regulations by the local agencies
  of government for the effectuation of the purposes of this section.  Any
  such  local  law  or  ordinance  shall provide that the benefits of this
  section shall apply to any multiple dwelling, building or  structure  as
  provided  in paragraph (a) of subdivision one of this section, which (i)
  is operated exclusively for the benefit of persons or families  who  are
  entitled  to  occupancy by reason of ownership of stock or membership in
  the corporate owner, or for the benefit of such persons or families  and
  other  persons  or  families  entitled  to  occupancy  under  applicable
  provisions of law without  ownership  of  stock  or  membership  in  the
  corporate  owner,  or  (ii) is owned as a condominium and is occupied as
  the residence or home of three or more families living independently  of
  each other; provided, however, that any such law or ordinance shall make
  provision,  in  addition  to all other conditions of eligibility for the
  benefits of this section, except for multiple dwellings in  which  units
  have   been  newly  created  by  substantial  rehabilitation  of  vacant
  buildings  or  conversions  of  non-residential  buildings,   that   the
  availability of benefits under this section for such multiple dwellings,
  buildings  or  structures shall be conditioned on the following: (1) any
  items of work designated as a major capital  improvement  in  the  rules
  adopted  by the local housing agency or asbestos abatement to the extent
  such asbestos abatement is required by federal, state or local law,  and
  (2)  (i)  the assessed valuation of such multiple dwelling, building, or
  structure, including land, shall not exceed an average of forty thousand
  dollars per dwelling unit  at  the  time  of  the  commencement  of  the
  alterations or improvements, and (ii) the average per room sale price of
  the  dwelling  units or the stock allocated to such dwelling units shall

  have been no greater than thirty-five percent of  the  maximum  mortgage
  amount  for  a  single  family home eligible for purchase by the Federal
  National  Mortgage  Association  during  the  three  years   immediately
  preceding  the commencement of the alterations or improvements; provided
  that if less than ten percent of the dwelling  units  or  an  amount  of
  stock  less  than  the  amount allocable to ten percent of such dwelling
  units was not transferred  during  such  preceding  three  year  period,
  eligibility   for  benefits  shall  be  conditioned  upon  the  multiple
  dwelling, building,  or  structure  having  an  assessed  valuation  per
  dwelling  unit of no more than forty thousand dollars at the time of the
  commencement of the  alteration  or  improvements.  Notwithstanding  the
  foregoing, such local law shall also provide benefits under this section
  for  work completed in any such multiple dwelling, building or structure
  within the first  three  years  of  its  conversion  to  cooperative  or
  condominium  ownership,  as  evidenced  by  the  date on which the first
  closing in a condominium to a bona fide purchaser occurs or in the  case
  of  a  cooperative, the date on which the shares allocable to a unit are
  conveyed to a bona fide purchaser. Any such local law shall  also  limit
  the  maximum  amount  of  tax abatement which may be received in any tax
  period under this section by any such  multiple  dwelling,  building  or
  structure  for any alterations and improvements commenced three years or
  more  after  its  initial  conversion  to  cooperative  or   condominium
  ownership  to  an  amount  not  in  excess  of two thousand five hundred
  dollars per dwelling unit  of  the  certified  reasonable  cost  of  the
  alterations or improvements as determined under regulations of the local
  housing  agency administering the local law. Any such local law may also
  require such certifications and consents to access to records, including
  other tax  records,  as  may  be  deemed  appropriate  to  enforce  such
  conditions of eligibility. Any such local law or ordinance shall provide
  that  the  local  agencies  of government shall establish maximum dollar
  limits for specified items of cost for any  conversion,  alterations  or
  improvements.  No costs in excess of such maximum dollar limits shall be
  considered in determining the benefits of this section.
    4-a. Notwithstanding any contrary provision  of  subdivision  four  of
  this  section,  any  such  local law or ordinance shall provide that the
  availability of benefits under this section to  any  multiple  dwelling,
  building  or  structure  owned  and operated by a limited-profit housing
  company established pursuant to  article  two  of  the  private  housing
  finance law shall not be conditioned upon the assessed valuation of such
  multiple  dwelling, building or structure, including land, as calculated
  as an average dollar amount per  dwelling  unit,  at  the  time  of  the
  commencement of the alterations or improvements; provided, however, that
  such  limited-profit housing company (a) is organized and operating as a
  mutual company, (b) continues to be organized and operating as a  mutual
  company  and  to  own  and  operate  the  multiple dwelling, building or
  structure receiving such benefits, and (c) has entered  into  a  binding
  and  irrevocable agreement with the commissioner of housing of the state
  of  New  York,  the  supervising  agency,  the  New  York  city  housing
  development  corporation,  or  the New York state housing finance agency
  prohibiting the dissolution or  reconstitution  of  such  limited-profit
  housing  company  pursuant to section thirty-five of the private housing
  finance law for not less than fifteen years  from  the  commencement  of
  such  benefits.  For the purposes of this subdivision, the terms "mutual
  company" and "supervising agency" shall have the same  meanings  as  set
  forth in section two of the private housing finance law.
    4-a-1.  Notwithstanding  any contrary provision of subdivision four of
  this section, any such local law or ordinance  shall  provide  that  the
  availability  of  benefits  under this section to any multiple dwelling,

  building or structure owned and  operated  by  a  redevelopment  company
  established  pursuant to article five of the private housing finance law
  shall not be conditioned upon the assessed valuation  of  such  multiple
  dwelling,  building  or  structure,  including land, as calculated as an
  average dollar amount per dwelling unit, at the time of the commencement
  of  the  alterations  or  improvements:  provided,  however,  that  such
  redevelopment  company  (a)  is  organized  and  operating  as  a mutual
  redevelopment company, (b) continues to be organized and operating as  a
  mutual  redevelopment  company  and  to  own  and  operate  the multiple
  dwelling, building or structure receiving such  benefits,  and  (c)  has
  entered  into  a binding and irrevocable agreement with the commissioner
  of housing and community renewal, the supervising agency, the  New  York
  city  housing  development  corporation,  or  the New York state housing
  finance agency prohibiting the dissolution  or  reconstitution  of  such
  redevelopment  company  pursuant  to section one hundred twenty-three of
  the private housing finance law until the earlier to occur  of:  (i)  in
  fifteen  years  from  the  commencement  of  such  benefits, or (ii) the
  expiration of any tax exemption granted to  such  redevelopment  company
  pursuant  to  section  one  hundred  twenty-five  of the private housing
  finance law. For the purposes of this subdivision,  the  terms  "mutual"
  and  "supervising  agency"  shall have the same meanings as set forth in
  section one hundred two of the private housing finance law.
    4-b. Notwithstanding any contrary provision  of  the  private  housing
  finance  law, any such local law shall provide that the benefits of this
  section shall apply to any limited profit housing company as provided in
  this section. In addition to the limitations set  forth  in  subdivision
  eleven  of  this  section, such multiple dwelling, building or structure
  shall be eligible for benefits only where at  least  one  building  wide
  improvement  or  alteration  is  part  of  the application for benefits.
  Furthermore, to the extent that such  alterations  or  improvements  are
  financed  with  grants,  loans  or subsidies from any federal, state, or
  local agency or instrumentality, such  multiple  dwelling,  building  or
  structure  shall  be  eligible  for  benefits only if the limited profit
  housing company has entered into a  binding  and  irrevocable  agreement
  with  the  commissioner  of  housing  of  the  state  of  New  York, the
  supervising agency, as such term  is  defined  in  section  two  of  the
  private  housing  finance  law,  the  New  York city housing development
  corporation, or the New York state housing  finance  agency  prohibiting
  the dissolution or reconstitution of such limited profit housing company
  pursuant  to  section thirty-five of the private housing finance law for
  not less than fifteen years from the commencement of such benefits.  The
  abatement of taxes on such property, including the land, shall not be an
  amount  greater  than ninety per centum of the certified reasonable cost
  of such alterations or improvements, as determined under regulations  of
  the  local  housing agency administering the local law, nor greater than
  eight and one-third percent of such certified  reasonable  cost  in  any
  twelve  month  period,  nor be effective for more than twenty years. The
  annual abatement of taxes in any twelve month period shall in  no  event
  exceed fifty percent of the amount of taxes payable in such twelve month
  period  pursuant to the applicable exemption granted pursuant to article
  two of the private housing finance law or other applicable laws or fifty
  percent of payments made in lieu of taxes in such twelve month period.
    4-c. (a) Any such local law may also provide that a group of  multiple
  dwellings  which was developed as a planned community and which is owned
  as two separate condominiums containing a total of ten thousand or  more
  dwelling  units  shall  be  eligible  for tax exemption and abatement as
  provided in this subdivision.

    (b) Any increase in assessed valuation resulting from  alterations  or
  improvements  to  one  or more multiple dwellings in a planned community
  described in paragraph (a) of this  subdivision  shall  be  exempt  from
  taxation  for  local  purposes.  Such  exemption  shall  be equal to the
  increase  in  the  valuation  which  is  subject to exemption under this
  paragraph for thirty years. After such period of  time,  the  amount  of
  such  exempted assessed value shall be reduced by twenty percent in each
  succeeding  year  until  the  assessed  value  of  the  alterations   or
  improvements  is  fully  taxable.  Such  exemption  may  commence at the
  beginning of any tax quarter subsequent to the start of such alterations
  or improvements. In no event  shall  such  alterations  or  improvements
  directly  or  indirectly  result  in  an  equalization  increase  in the
  assessed valuation of any multiple dwelling forming part of the  planned
  community where such alterations or improvements are performed.
    (c)  The  abatement  of  taxes  on  a  planned  community described in
  paragraph (a) of this subdivision, including the land, shall not  exceed
  the  greater  of  (i)  one  hundred  fifty  per  centum of the certified
  reasonable cost of the alterations or improvements, as determined  under
  the regulations of the local housing agency administering the local law,
  and  (ii)  the  construction  cost  of  the  alterations or improvements
  identified in such regulations. Such abatement shall  not  be  effective
  for  more  than  twenty  years  and the annual abatement of taxes in any
  consecutive twelve-month period shall not be greater than ten per centum
  of the total abatement granted and shall not exceed the amount of  taxes
  payable  in  such  consecutive twelve-month period. Such abatement shall
  begin no sooner than the first quarterly tax bill immediately  following
  the  completion of such alterations or improvements. The limitations set
  forth in subdivision  four  of  this  section  for  multiple  dwellings,
  buildings  and structures owned as condominiums shall be inapplicable to
  benefits  granted  pursuant  to  this  subdivision.  Abatement  benefits
  granted  pursuant  to this subdivision shall be apportioned among all of
  the condominium tax lots within the condominium in which the alterations
  or improvements are made, although such alterations or improvements  may
  have  been  made  to  one  or  fewer  than all of the multiple dwellings
  therein.
    (d) In  the  event  that  multiple  alterations  or  improvements  are
  undertaken  in  a  planned  community described in paragraph (a) of this
  subdivision and separate applications for benefits  therefor  are  made,
  all  requirements  concerning  physical condition of and compliance with
  law by the multiple dwellings in such planned community shall apply only
  upon completion of all such alterations or improvements,  provided  that
  all such alterations or improvements are completed within six years.
    (e)  Except  as  provided in this subdivision, all of the requirements
  imposed by this section  on  projects  described  in  paragraph  (a)  of
  subdivision  one  of  this section shall be applicable to alterations or
  improvements granted benefits pursuant to this subdivision.
    (f) This subdivision  shall  be  applicable  only  to  alterations  or
  improvements  completed  prior  to  December  thirty-first, two thousand
  five.
    5. To the end that conversions, alterations, and improvements aided by
  this section shall interfere as  little  as  practicable  with  urgently
  needed   public   improvements  or  the  clearance,  rehabilitation,  or
  rebuilding of substandard and unsanitary areas, and shall be confined to
  multiple dwellings, buildings or structures as provided in paragraph (a)
  of subdivision one of this section which are  structurally  sound,  such
  local  law  or  ordinance  may  provide that exemption or abatement from
  taxation hereunder shall be restricted to multiple dwellings,  buildings
  or  structures  as  provided in paragraph (a) of subdivision one of this

  section (a) which the local planning commission in any such  city  shall
  certify  will  not  interfere  with projected public improvements or the
  clearance and rebuilding of substandard and insanitary  areas,  and  (b)
  which  the  local building department certifies to be structurally sound
  and (c) which,  if  in  an  area  approved  for  clearance,  replanning,
  reconstruction  or neighborhood rehabilitation pursuant to chapter eight
  hundred eighty-seven of the laws of nineteen hundred forty-five, as from
  time to time amended, or if in an area designated  for  studies,  tests,
  demonstrations  and  other activities for the prevention and elimination
  of slums and urban blight pursuant to chapter six hundred eight  of  the
  laws  of  nineteen hundred fifty-six as from time to time amended, or if
  in an area for which a preliminary  or  final  plan  has  been  approved
  pursuant  to  chapters  six hundred eighty-eight of the laws of nineteen
  hundred fifty-seven or nine hundred twenty-four of the laws of  nineteen
  hundred  fifty-eight,  as  from  time  to  time amended, or chapter nine
  hundred seventy-one of the laws of nineteen hundred sixty, or if  in  an
  area for which an urban renewal plan or tests, studies or demonstrations
  have  been approved pursuant to article fifteen of the general municipal
  law, is certified by the project board for the area as a dwelling  which
  is  to  be  or  has  been  improved  in conformity with such replanning,
  reconstruction, neighborhood improvement, studies, tests, demonstrations
  or plan.
    6. Notwithstanding  the  provisions  of  the  multiple  dwelling  law,
  multiple   residence   law,  and  any  local  law,  ordinance,  rule  or
  regulation, any city to which this section is applicable acting  through
  its  local  legislative  body  may  provide,  in  a manner that shall be
  uniform as to  any  particular  type  or  class  of  multiple  dwelling,
  building or structure as provided in paragraph (a) of subdivision one of
  this  section,  that,  any  multiple  dwelling, building or structure as
  provided in paragraph (a) of subdivision one of this  section  to  which
  alterations and improvements are made pursuant to this section and which
  did  not  require  a  certificate of occupancy on April second, nineteen
  hundred forty-five, and, in the case of multiple dwellings, buildings or
  structures as provided in paragraph  (a)  of  subdivision  one  of  this
  section  to  which  the  multiple  residence  law is applicable, on July
  first, nineteen hundred fifty-two, may not be  occupied  lawfully  after
  such  date  upon  the  completion  of  such alterations and improvements
  without a certificate of occupancy.
    7. Any local law or ordinance may also  provide  any  or  all  of  the
  following:
    (a)  The  benefits  of  this  section  shall not apply to any multiple
  dwelling,  building  or  structure  as  provided  in  paragraph  (a)  of
  subdivision   one   of  this  section  in  which  rents,  subsequent  to
  alterations and improvements, shall exceed such amount, if any,  as  may
  be  fixed  by  the  local  legislative  body  or by the municipal agency
  designated by the local legislative body of the  municipality  involved,
  based upon a standard formula.
    (b)  (1)  The benefits of this section shall not apply to any multiple
  dwelling,  building  or  structure  as  provided  in  paragraph  (a)  of
  subdivision  one  of this section which is not subject to the provisions
  of the emergency housing rent  control  law  or  to  local  law  enacted
  pursuant  to  the  local  emergency  housing rent control act, where the
  local legislative body or other governing  agency  of  the  municipality
  involved  shall  prescribe  that  the benefits herein provided shall not
  apply to such multiple dwelling, building or structure  as  provided  in
  paragraph  (a)  of  subdivision  one  of this section provided that such
  local legislative body or other  governing  agency  shall  not  use  the
  authority  conferred  in  this  paragraph  (b)  to  rescind any benefits

  granted under former section five-h of the tax law prior to July  first,
  nineteen  hundred  fifty-eight;  and  further  provided  that  where the
  benefits provided herein or under such former section five-h of the  tax
  law  are  granted  or  had been granted on or after July first, nineteen
  hundred fifty-eight, to any multiple  dwelling,  building  or  structure
  which  is  decontrolled subsequent to the granting of such benefits, the
  local legislative body or  other  governing  agency  may  withdraw  such
  benefits from such dwelling.
    (2)  Any  dwelling  unit  subject  to rent regulation on or before the
  effective date of this subparagraph as  a  result  of  receiving  a  tax
  exemption or abatement pursuant to this section shall be subject to such
  regulation  until the occurrence of the first vacancy of such unit after
  such benefits are no longer being received at which time such unit shall
  be deregulated or if each lease and renewal thereof for  such  unit  for
  the tenant in residence at the time of the expiration of the tax benefit
  period  has  included  a  notice in at least twelve point type informing
  such tenant that the unit shall become subject to deregulation upon  the
  expiration of such tax benefit period and states the approximate date on
  which such tax benefit period is scheduled to expire, such dwelling unit
  shall  be  deregulated  as  of the end of the tax benefit period; unless
  such  unit  would  have  been  subject  to  regulation  under  the  rent
  stabilization law of nineteen hundred sixty-nine or the emergency tenant
  protection act of nineteen seventy-four.
    (c) The benefits of this section shall apply to any multiple dwelling,
  building or structure as provided in paragraph (a) of subdivision one of
  this  section  occupied, as a rule, for permanent residence purposes and
  which is not used in whole or in part  for  single  room  occupancy  and
  which  is  not  subject  to the provisions of the emergency housing rent
  control law or to local law enacted  pursuant  to  the  local  emergency
  housing  rent  control  act,  provided that it is located within an area
  which has been designated by the local  planning  commission  under  the
  provisions  of  section  seventy-two-m of article fifteen of the general
  municipal law or where a program of local  neighborhood  improvement  or
  housing  maintenance  is being carried out under the supervision or with
  the assistance of the local government and provided that  the  rents  or
  carrying  charges, subsequent to alterations and improvements, (1) shall
  not exceed such amount, if any, as may be fixed by the local legislative
  body or by the municipal agency designated by the local legislative body
  of the municipality involved, based upon  a  standard  formula,  or  (2)
  where  the  local  legislative  body  so provides, shall not exceed such
  amount, if any, as may be fixed for such multiple dwelling, building  or
  structure  as  provided  in  paragraph  (a)  of  subdivision one of this
  section pursuant  to  any  local  law  enacted  pursuant  to  the  local
  emergency  housing  rent control act, and further provided that prior to
  such alterations and improvements, the multiple  dwelling,  building  or
  structure  as  provided  in  paragraph  (a)  of  subdivision one of this
  section,  if  a  multiple  dwelling,  was  either  a  multiple  dwelling
  occupied,  as a rule, as a temporary or transient residence or occupied,
  as a rule, for permanent residence purposes and used in whole or in part
  for single room occupancy.
    (d) The benefits of this  section  shall  apply  to  any  building  or
  structure  as  provided  in  paragraph  (a)  of  subdivision one of this
  section, provided that the  rents  or  carrying  charges  subsequent  to
  conversion  (1) shall not exceed such amount, if any, as may be fixed by
  the local legislative body or by the municipal agency designated by  the
  local  legislative  body  of  the  municipality  involved,  based upon a
  standard formula, or (2) where the local legislative body  so  provides,
  shall  not exceed such amount, if any, as may be fixed for such dwelling

  pursuant to any local  law  enacted  pursuant  to  the  local  emergency
  housing rent control act.
    8. Notwithstanding any other provision of this section the benefits of
  this  section shall not apply to any private dwelling unless it is in an
  area defined by clause (c) of subdivision five of this  section  and  is
  certified by the project board for the area as a dwelling which is to be
  or has been improved in conformity with such replanning, reconstruction,
  neighborhood   improvement,  studies,  tests,  demonstrations  or  plan.
  Notwithstanding the foregoing, for purposes  of  this  section  and  any
  local  law  enacted  pursuant  hereto a class A multiple dwelling may be
  deemed to include any garden-type maisonette dwelling project consisting
  of a series of dwelling units which together and in their aggregate were
  arranged or designed  to  provide  three  or  more  apartments  and  are
  provided  as  a  group collectively with all essential services such as,
  but not limited to, water supply, house sewers and heat, and  which  are
  in  existence  and operated as a unit under single ownership on the date
  upon which an application for the benefits of this section  is  received
  by  the  city,  even  though  certificates  of occupancy were issued for
  portions thereof as private dwellings.
    8-a. Notwithstanding the  provisions  of  subdivision  eight  of  this
  section  to  the contrary, unless excluded by local law, the benefits of
  this section may apply  to:  (i)  alterations  or  improvements  to  any
  private  dwelling; (ii) conversion of any private dwelling to a multiple
  dwelling; or (iii) conversion of any  multiple  dwelling  to  a  private
  dwelling, provided that such alterations, improvements or conversion are
  part  of  a  project  which  has  applied  for  or is receiving benefits
  pursuant to this section and shall be aided by a grant loan, or  subsidy
  from any federal, state, or local agency or instrumentality.
    9. (a) During the period of such exemptions the assessment on any such
  land  and dwelling after such alterations and improvements, exclusive of
  the increase in valuation which is  subject  to  exemption  in  full  or
  proportionally  under  subdivision one of this section, shall not exceed
  the valuation of the  previously  existing  dwelling  appearing  on  the
  assessment rolls after the taxable status date immediately preceding the
  commencement  of such alterations and improvements plus the value of the
  land, any improvements other than those made  under  the  provisions  of
  this  section and the proportion of increased assessed valuation that is
  not exempt from taxation under  this  section,  which  proportion  shall
  remain  constant  during the term of the exemption. Where the alteration
  or improvement qualifies under subparagraph  two  of  paragraph  (a)  of
  subdivision  two  of  this  section  or  under  clause  (A)  or  (B)  of
  subparagraph one of paragraph (a) of subdivision eleven of this section,
  the exemption shall also include an exemption from  taxation  for  local
  purposes  for  twelve years upon that portion of the assessment, if any,
  which exceeds the transition assessment, as defined in  subdivision  two
  of  section eighteen hundred five of this chapter, in effect at the time
  of the commencement of the exemption hereunder.
    (b)  Notwithstanding  the  provisions  of  paragraph   (a)   of   this
  subdivision, except as provided in subparagraph three of this paragraph,
  for   buildings   in  which  alterations,  improvements  or  conversions
  qualifying for an exemption under this section are commenced on or after
  the date on which this paragraph becomes a law:
    (1) The assessed value of  the  building  during  the  period  of  the
  exemption  shall be pro-rated between the exempt and taxable portions of
  the building assessment so that  throughout  the  exemption  period  the
  exempt   portion   of  the  building  assessment  shall  bear  the  same
  relationship to the non-exempt portion of the building assessment as  it
  did  on  the final tax roll on which an exemption was first available to

  such building for alterations or  improvements  made  pursuant  to  this
  section  or  on  the  last  tax  roll on which such ratio was changed by
  reason of additional improvements, whichever  results  in  the  greatest
  percentage   of  exempt  assessed  valuation;  provided,  however,  that
  increases in building value due to (i) additional improvements  that  do
  not  qualify  for an exemption under this section, (ii) increases in the
  value of non-residential portions of the building, or  (iii)  non-exempt
  additions  to  cubic  content shall not be pro-rated, but shall be fully
  taxable.
    (2) Reductions in the assessed value of the building during the period
  of the exemption shall be  pro-rated  between  the  taxable  and  exempt
  portions  of  the  building  assessment  in  the  proportion  which  was
  established pursuant to subparagraph one of this paragraph on the  final
  tax  roll  for  the first fiscal year for which an exemption was granted
  pursuant to this section, or on the last tax roll on  which  such  ratio
  was  changed  by  reason  of  additional improvements, whether exempt or
  non-exempt, or due to changes in the assessed  value  of  fully  taxable
  space.  In  no  case,  however,  shall the value of an exemption granted
  pursuant to this section be reduced during the  period  for  which  such
  exemption was granted, by reason of a reduction in the assessed value of
  the  building,  to an amount less than the amount of exemption appearing
  on the first tax roll following the grant of this exemption.
    (3) During the first three years of such exemptions, the assessment on
  any such land and  dwelling  shall  be  determined  in  accordance  with
  paragraph (a) of this subdivision.
    10. In cities with a population of one million or more, any such local
  law  or  ordinance  may  require  that, prior to application for any tax
  exemption or abatement pursuant to this section,  relocation  awards  be
  paid  to  certain  displaced  manufacturing  and other tenants under the
  terms and conditions set forth below:
    (a)  Relocation  awards  for  certain   tenants   of   non-residential
  buildings.  Such local law or ordinance shall limit eligibility for such
  a  relocation  award to former tenants and former subtenants of premises
  in a non-residential building which is the subject of an application for
  an alteration permit for conversion to a class A multiple dwelling, who:
    (1) leased and used the vacated premises to conduct  a  manufacturing,
  warehousing,  or  wholesaling business for not less than two consecutive
  years immediately prior to vacating;
    (2) vacated such premises on or after April  first,  nineteen  hundred
  eighty-one for any reason other than eviction for non-payment of rent;
    (3) vacated such premises (i) no earlier than twenty-four months prior
  to the filing date of an application for such alteration permit and (ii)
  no  later  than  the  completion  of  the conversion as evidenced by the
  issuance of a permanent certificate of occupancy for a class A  multiple
  dwelling;
    (4)  either  purchased  or leased for a term of not less than eighteen
  months other premises within such city with a floor area not  less  than
  one-third of the floor area of the vacated premises;
    (5) relocated their business to such other premises within one year of
  vacating the vacated premises; and
    (6)  paid  all  commercial  rent  or  occupancy  tax  for  the vacated
  premises.  A subtenant shall be eligible to receive a  relocation  award
  notwithstanding any lack of eligibility of its prime tenant.
    (b)  Amount of relocation award. The relocation award shall not exceed
  the greater of (1) all the base rent that accrued and was  paid  by  the
  eligible  tenant during the final twenty-four months of its occupancy of
  the vacated premises or (2) four dollars for each square foot  that  the
  eligible  tenant  occupied  in  the  vacated  premises  during the final

  twenty-four months of its occupancy of the vacated premises. As used  in
  this  subdivision,  base  rent shall be calculated in the same manner as
  base rent is calculated for purposes of commercial rent or occupancy tax
  in  the  city  of  New York, or in any such city. However, the aggregate
  award payable to a prime tenant and any subtenants of such prime  tenant
  shall  not  exceed the amount which would have been payable to the prime
  tenant had the prime tenant been eligible for  an  award  based  on  the
  entire  floor  area  it  leased  from  the owner; and if such limitation
  applies, the awards shall be prorated based upon the  total  floor  area
  used and occupied by each eligible tenant.
    (c)  Payment  of  award.  The  relocation  award  shall become due and
  payable to an eligible tenant at the time  the  eligible  tenant  either
  purchases  or  leases  other  premises  in accordance with paragraph (a)
  above within such city and certifies eligibility to and demands  payment
  of  the  award from the owner of the vacated building. If the relocation
  award is not paid within thirty days of such certification  and  demand,
  interest  shall  accrue  on  the  relocation  award  from  the  date  of
  certification and demand at the rate of twenty-four percent per annum.
    (d) Notice of claim. At any time after such certification  and  demand
  and  prior to the date of the filing of an application for tax exemption
  or abatement for the vacated  building  pursuant  to  this  section,  an
  eligible  tenant  who  has  not received a relocation award shall have a
  right to file a notice of claim. Such notice of  claim  shall  be  filed
  with  the  county  clerk  of the county in which the vacated building is
  located and shall  verify  the  claimant's  name,  its  compliance  with
  eligibility requirements, the address of the vacated premises, the floor
  area  it  occupied,  the  name  of the prime tenant if the claimant is a
  subtenant, and all the base rent  that  accrued  and  was  paid  by  the
  claimant during the final twenty-four months of its occupancy.
    (e)  Discharge of notice of claim. A notice of claim may be discharged
  by filing an undertaking with the clerk  of  the  county  in  which  the
  premises  are  located  in  an  amount  equal  to  the amount claimed in
  accordance with the procedures set forth in subdivision four of  section
  nineteen  of  the  lien  law, or by payment into court of such amount in
  accordance with the procedures set forth in section  fifty-five  of  the
  lien law.
    (f)  Affidavit  and  notice  as  a  condition  to tax benefits. No tax
  exemption or abatement shall be granted pursuant to this section  unless
  the  local  municipal  agency responsible for administering this section
  receives an affidavit from the applicant which verifies that:
    (1) the applicant has caused to be published a notice in  a  newspaper
  of  general  circulation within the city, no later than sixty days prior
  to filing of an application for tax exemption or abatement  pursuant  to
  this  section,  which  advises  former  tenants  and subtenants of their
  rights pursuant to any local law or ordinance enacted pursuant  to  this
  subdivision; and
    (2) no notice of claim has been filed or all claims have been released
  by  the claimant, secured in accordance with the provisions of paragraph
  (e) of this subdivision, or discharged as an improper claim by  a  court
  order.
    (g) Action on claim. If an eligible tenant or subtenant has duly filed
  a  notice  of  claim pursuant to this subdivision and does not receive a
  relocation award as provided herein, it may commence an  action  against
  any  applicant  who filed a false affidavit pursuant to paragraph (f) of
  this subdivision within three years  of  such  filing  or  any  security
  posted  by such applicant pursuant to paragraph (e) of this subdivision.
  In any action to enforce a claim pursuant to this  subdivision,  if  the
  court finds that the claimant has wilfully exaggerated the amount of the

  claim,  the  claimant may be held liable in damages for an amount not to
  exceed the proper relocation award. An eligible tenant in whose favor  a
  judgment is entered shall be entitled to costs and reasonable legal fees
  and disbursements provided that such judgment is in excess of the amount
  which the applicant or owner offered to pay the eligible tenant.
    (h)  Waiver.  Any  lease provision exempting, releasing or discharging
  the obligation to pay a relocation award pursuant  to  this  subdivision
  shall  be  deemed  to  be  void  as  against  public  policy  and wholly
  unenforceable.
    (i) Local zoning resolution. The provisions of  this  subdivision  ten
  shall  not  apply  if the local zoning resolution expressly provides for
  relocation  loans  and/or  grants  in  lieu  of  the  benefits  of  this
  subdivision.
    11. Limitations of benefits. (a) Applicability. The provisions of this
  subdivision apply to all conversions, alterations and improvements under
  this section. However, they shall not apply to:
    (1)  alterations or improvements under subparagraph two, three or four
  of paragraph (a) of subdivision one of this section, where carried out:
    (A) with the substantial assistance of grants, loans or subsidies from
  any  federal,  state  or  local  agency  or  instrumentality,   or   any
  not-for-profit  philanthropic organization one of whose primary purposes
  is providing low or moderate income housing; or
    (B) with mortgage insurance by the New York city residential  mortgage
  insurance corporation or the state of New York mortgage agency; or
    (C) in a neighborhood preservation area, as such areas were designated
  by  the  New  York  city  planning commission as of June first, nineteen
  hundred eighty-three, provided that such  area  or  part  of  such  area
  wherein  the property is located has been approved as provided herein by
  the city council of the city of New York. No such area or  part  thereof
  shall  be  approved by the city council until notice of the area or part
  thereof proposed to be approved is submitted to  every  community  board
  with  jurisdiction  over  the  area  or part thereof, and (i) every such
  community board has made and submitted to the city council  comments  as
  to  the  proposed  approval,  or (ii) forty-five days have elapsed since
  such notice  was  submitted  to  such  community  boards,  whichever  is
  earlier; and
    (D)   pursuant  to  a  program  established  by  the  federal  housing
  administration, federal national mortgage association, federal home loan
  mortgage corporation or government national mortgage association for the
  rehabilitation of existing multiple dwellings  for  persons  of  low  or
  moderate   income,   or   a   program  of  mortgage  insurance  for  the
  rehabilitation of existing multiple dwellings pursuant  to  section  two
  hundred  twenty-three-f  of  the  national  housing act as amended, or a
  program  of  mortgage  insurance  established  by  the  federal  housing
  administration for the rehabilitation of existing multiple dwellings for
  persons  of  low  or moderate income; provided that properties receiving
  benefits under such programs are  located  in  a  neighborhood  strategy
  area,  as  defined, by the United States department of housing and urban
  development, or a neighborhood preservation area,  as  such  areas  were
  designated  by  the New York city planning commission, as of June first,
  nineteen hundred eighty-three.
    (2) alterations or improvements under subparagraphs five  and  six  of
  paragraph (a) of subdivision one of this section; or
    (2-a)  Conversion  of  buildings  or  structures  to  class A multiple
  dwellings pursuant to subparagraph one of paragraph (a)  of  subdivision
  one  of  this  section,  where  such  conversions  are  undertaken  by a
  not-for-profit philanthropic organization or  undertaken  on  properties
  which  receive  mortgage  insurance  from  the New York city residential

  mortgage insurance corporation, or state of New  York  mortgage  agency,
  provided   that   such   property  is  (i)  located  in  a  neighborhood
  preservation area as such areas were designated  by  the  city  planning
  commission  on  June first, nineteen hundred eighty-three, and (ii) such
  property  has  been  vacant  since  January  first,   nineteen   hundred
  eighty-two,  and  (iii)  prior to becoming vacant such property was last
  utilized  for  governmental,  educational,  hospital  or  nursing   home
  purposes.
    (3)  conversions  of residential units qualified for the protection of
  article seven-C of the multiple dwelling law under subparagraph  one  of
  paragraph (a) of subdivision one of this section.
    (b)  Abatement  limitations. The amount of abatement under subdivision
  two of this section shall not exceed the certified  reasonable  cost  of
  the   conversion,   alteration   or  improvement,  as  determined  under
  regulations of the local housing agency  administering  the  local  law,
  provided  that  the  amount  of  certified  reasonable cost eligible for
  abatement under this section shall not exceed fifteen  thousand  dollars
  for  a dwelling unit of three and one-half rooms and a comparable amount
  for dwelling units of  other  sizes,  under  regulations  of  the  local
  housing  agency,  and  further  provided  that  the  amount of certified
  reasonable cost eligible for abatement under  this  section  may  exceed
  fifteen  thousand  dollars  or such comparable amount per dwelling unit,
  but  not  more  than  twenty-five  percent  above  such   amount,   upon
  application  of  the  property  owner and a determination by the housing
  agency that:
    (1) in the case of a conversion under subparagraph  one  of  paragraph
  (a)  of subdivision one of this section, the increased cost is necessary
  to comply with applicable law; or
    (2) in the case of an alteration or improvement under subparagraph two
  of paragraph (a) of subdivision one of this section, the increased  cost
  is  necessary  to  eliminate  the  unhealthy  or dangerous conditions or
  replace the inadequate and obsolete facilities in a satisfactory manner;
  or
    (3) in the case of an alteration  or  improvement  under  subparagraph
  three of paragraph (a) of subdivision one of this section, the increased
  cost is necessary to conserve energy in a satisfactory manner; or
    (4)  in  the  case  of an alteration or improvement under subparagraph
  four of paragraph (a) of subdivision one of this section, the  increased
  cost,  to  the extent such cost is not offset by any and all tax credits
  received as a result of the alteration or improvement, is  necessary  to
  comply  with  any  provision  of  law  regulating  historic  or landmark
  buildings or structures.
    (b-1) For the purpose of the abatement limitations  contained  in  the
  opening  paragraph  of  paragraph (b) of this subdivision, the number of
  rooms in a dwelling unit shall be calculated in  the  following  manner:
  Each  dwelling  unit with at least one room which either (1) contains no
  cooking facilities and measures at least one hundred fifty square  feet,
  or  (2)  contains  cooking  facilities and measures at least two hundred
  thirty square feet, shall count as two and one-half rooms.  Every  other
  room  in the dwelling unit separated by either walls or doors, including
  bedrooms, shall count as an additional  room,  provided,  however,  that
  kitchens,  cooking  facilities,  bathrooms, corridors or balconies shall
  not count as an additional room. To be included, a room  must  meet  the
  requirements  of  habitability  as  provided  in  the  relevant  housing
  maintenance code.
    (c) Exemption limitations. (1) The increase in assessed  valuation  of
  the  real  property  located  in  the  borough  of Manhattan south of or
  adjacent to the south side of one hundred tenth  street  resulting  from

  the  conversion,  alteration  or  improvement  under  paragraph  (a)  of
  subdivision one of this  section,  shall  be  exempt  from  taxation  as
  provided   in  this  section,  only  to  the  extent  provided  in  this
  subparagraph.  The  amount  of  the increased assessed valuation that is
  exempt from taxation shall depend on the amount of  the  total  assessed
  valuation  per  dwelling  unit  calculated by dividing the amount of the
  total assessed valuation of  the  property,  as  determined  under  this
  chapter,  by  the  number  of  dwelling  units  in  the  building  after
  completion of the conversion, alteration or improvement. The  amount  of
  increased  assessed  valuation  that  will  be  exempt from taxation for
  buildings with total assessed valuation per dwelling unit of  less  than
  thirty-eight  thousand  dollars  shall  be  calculated  pursuant  to the
  following formula: (A) any portion of total assessed  valuation  of  the
  property  attributable  to  the first eighteen thousand dollars of total
  assessed valuation per  dwelling  unit,  to  the  extent  it  represents
  increased  assessed  valuation, shall be one hundred percent exempt; (B)
  any portion of total assessed valuation attributable to  the  next  four
  thousand  dollars  of total assessed valuation per dwelling unit, to the
  extent it represents increased assessed valuation, shall be seventy-five
  percent exempt; (C) any portion of total assessed valuation attributable
  to the next four  thousand  dollars  of  total  assessed  valuation  per
  dwelling unit, to the extent it represents increased assessed valuation,
  shall  be  fifty  percent  exempt;  (D)  any  portion  of total assessed
  valuation attributable to  the  next  four  thousand  dollars  of  total
  assessed  valuation  per  dwelling  unit,  to  the  extent it represents
  increased assessed valuation, shall be twenty-five percent  exempt;  (E)
  any  portion  of total assessed valuation attributable to the next eight
  thousand dollars of total assessed valuation per dwelling unit,  to  the
  extent  it  represents  increased  assessed valuation per dwelling unit,
  shall be fully taxable. Property with a  total  assessed  valuation  per
  dwelling  unit  of  thirty-eight  thousand  dollars or more shall not be
  eligible for a tax exemption under this section.
    (2) In calculating the amount of  increased  assessed  valuation  that
  will be exempt from taxation pursuant to the formula in subparagraph one
  of this paragraph, the full amount of total assessed valuation that does
  not  represent  increased  assessed  valuation  shall be applied in such
  formula prior to the inclusion  of  any  amount  of  increased  assessed
  valuation.
    (3)  Where  the  real  property  is  occupied  in part for residential
  purposes  and  in  part  for  non-residential  purposes,  the   assessed
  valuation  of  the property shall be appropriately allocated between the
  residential  and  non-residential  portions.  In  computing  the   total
  assessed  valuation  per  dwelling  unit  under this paragraph, only the
  amount of valuation so allocated to the  residential  portion  shall  be
  considered.
    (4)  Commencing with the assessment roll for the year nineteen hundred
  eighty-four, where there has been a change in the  level  of  assessment
  from  the  assessment  roll  of  the  prior year of properties receiving
  exemptions  under  this  section,  the  local  agency  responsible   for
  assessment  of real property may petition the state board to certify the
  percentage of such change for the purposes  of  this  section.  In  such
  petition,  the  local  agency shall submit such information as the state
  board shall require in order to certify the percentage of  such  change.
  The  state  board  may also make such a certification on its own motion.
  Upon receipt of such certification  from  the  state  board,  the  local
  housing  agency may modify the dollar values of total assessed valuation
  per dwelling unit in subparagraph one of this paragraph to  reflect  the
  percentage   change  in  the  level  of  assessment  as  shown  in  such

  certification. As used in this subparagraph, the  term  "change  in  the
  level  of assessment" means the net increase or decrease in the assessed
  valuation of properties in the assessing unit that  received  exemptions
  under  this  section  in  the  current  year  as  compared to those that
  received exemptions under this section in the prior year as a result  of
  assessing such properties at a higher or lower ratio of full value.
    (5)  (A)  Notwithstanding  the  provisions of subparagraph one of this
  paragraph, the local housing agency may reduce or remove the limitations
  on the exemption  from  taxation  provided  in  such  subparagraph  with
  respect  to  a particular property undergoing alteration or improvement,
  upon application of the property owner and a determination by the agency
  that:
    (i) The increased benefit will increase the number of  dwelling  units
  or  improve  the  quality  of  dwelling units that will be affordable to
  persons of low or moderate income; and
    (ii) The increased benefit is necessary to  make  economically  viable
  the  increase  in  the  number  of  dwelling units or improvement in the
  quality of dwelling units that will be affordable to persons of  low  or
  moderate income.
    (B)  As used in this subparagraph, the term persons of low or moderate
  income shall be persons who would qualify for housing subsidies pursuant
  to section two hundred thirty-five  of  the  national  housing  act,  as
  amended,  at  one  hundred thirty-five percent of the income limitations
  provided herein.
    (C) Upon receiving an application under this  subparagraph  in  proper
  form,  the  local  housing  agency  shall  immediately  submit it to the
  community board for the area in which the project is located, which may,
  within forty-five days of receiving it and after a public hearing,  make
  recommendations  to  the  agency as to the application. The agency shall
  act on the application within  sixty  days  of  receiving  it  from  the
  property owner in proper form, but not before expiration of the time for
  the  community  board  to make its recommendations, unless the board has
  acted sooner.
    (d) The local housing agency may set forth preliminarily the terms  of
  a  determination under paragraph (b) or (c) of this subdivision prior to
  the commencement of the conversion, alteration or improvement. Any  such
  determination shall take effect after completion of the work.
    (e)   Publication   of   local   housing  agency  determinations.  Any
  determination of the local housing agency to increase an abatement under
  paragraph (b) of this subdivision or to reduce or remove  the  exemption
  limitations  under  paragraph  (c)  of  this subdivision shall state the
  basis for the determination and the data on which the determination  was
  based. Such determination shall be published in the official publication
  of  the  city,  or  if  no  such  publication exists in a newspaper with
  general circulation in the city, for five  consecutive  days  after  the
  determination is rendered.
    (f) Proration of assessed valuation. Notwithstanding the provisions of
  paragraph  (b)  of  subdivision  nine of this section, the provisions of
  this paragraph shall apply to  changes  in  assessments  resulting  from
  conversion,  alterations  or  improvements  which are not subject to the
  abatement or exemption limitations of paragraphs (b)  and  (c)  of  this
  subdivision.  During the period of such exemptions the assessment on any
  such  land  and  dwelling  after  such  alterations  and   improvements,
  exclusive  of the increase in valuation which is subject to exemption in
  full or proportionally under subdivision one of this section, shall  not
  exceed  the  valuation  of the previously existing dwelling appearing on
  the assessment rolls after the taxable status date immediately preceding
  the commencement of such alterations and improvements plus the value  of

  the land, any improvements other than those made under the provisions of
  this  section and the proportion of increased assessed valuation that is
  not exempt from taxation under  this  section,  which  proportion  shall
  remain  constant  during the term of the exemption. Where the alteration
  or improvement qualified under subparagraph  two  of  paragraph  (a)  of
  subdivision  two  of  this  section  or  under  clause  (A)  or  (B)  of
  subparagraph one of paragraph (a) of  this  subdivision,  the  exemption
  shall  also  include  an  exemption from taxation for local purposes for
  twelve years upon that portion of the assessment, if any, which  exceeds
  the  transition  assessment,  as  defined  in subdivision two of section
  eighteen hundred five  of  this  chapter,  in  effect  at  the  time  of
  commencement of the exemption hereunder.
    12.  Harassment.  (a)  The provisions of this subdivision apply to and
  are additional requirements for claiming or receiving:
    (1) any tax exemption under this section; or
    (2)  any  tax  abatement  under  this  section  where  the   certified
  reasonable  cost  per  dwelling  unit  of  the conversion, alteration or
  improvement  (including  the  cost  of  any  conversion,  alteration  or
  improvement  for which an abatement was approved within four years prior
  to commencement of the conversion, alteration  or  improvement)  exceeds
  seven thousand five hundred dollars.
    (b)  The owner of the property shall, not less than thirty days before
  the  commencement  of  the   conversion,   alteration   or   improvement
  (hereinafter  referred  to  as  the "cut-off date"), file with the local
  housing agency administering the local law, an affidavit or,  where  any
  information  referred  to  in subparagraph one of this paragraph changes
  prior to applying for or claiming any benefit  under  this  section,  an
  amending affidavit, setting forth the following information:
    (1)  every  owner of record and owner of a substantial interest in the
  property or entity owning the property  or  sponsoring  the  conversion,
  alteration or improvement;
    (2)  a  statement that none of such persons had, within the five years
  prior to the cut-off date, been found to  have  harassed  or  unlawfully
  evicted  tenants  by  judgment  or  determination  of  a court or agency
  (including  a   non-governmental   agency   having   appropriate   legal
  jurisdiction)  under  the  penal  law, any state or local law regulating
  rents or any state or local law relating to  harassment  of  tenants  or
  unlawful eviction; and
    (3) any change in the information required to be set forth.
    (c)   No   conversion,  alteration  or  improvement  subject  to  this
  subdivision shall be eligible for tax exemption or tax  abatement  under
  this section where:
    (1)  any affidavit required under this subdivision has not been filed;
  or
    (2)  any  such  affidavit  contains  a  willful  misrepresentation  or
  omission of any material fact; or
    (3)  any  person  referred  to in subparagraph one of paragraph (b) of
  this subdivision has been found to have harassed or  unlawfully  evicted
  tenants  as described in that paragraph, until and unless the finding is
  reversed on appeal, provided that any such  finding  after  the  cut-off
  date shall not apply to or affect any tax abatement or exemption for the
  conversion, alteration or improvement covered by the affidavit.
    (d)  The  local  housing  agency  administering this law and the local
  government agency responsible for real  property  tax  assessment  shall
  maintain  a  list  of  affidavits  as described in paragraph (b) of this
  subdivision. Each agency shall review that list  with  respect  to  each
  application or claim for benefits subject to this subdivision.

    (e)  "Substantial  interest"  as used in subparagraph one of paragraph
  (b) of this subdivision shall mean ownership of an interest of  ten  per
  centum  or  more  in  the  property  or  entity  owning  the property or
  sponsoring the conversion, alteration or improvement.
    (f)  Where  the  conversion,  alteration  or  improvement is commenced
  before August first, nineteen hundred  eighty-three,  the  cut-off  date
  shall  be  as  set  forth in this subdivision, but no affidavit shall be
  required to be filed until thirty days after the effective date of  this
  subdivision.
    13.  Additional  limitation.  The  benefits  of this section shall not
  apply to any conversion of or alteration or improvement to any  class  B
  multiple  dwelling or class A multiple dwelling used in whole or in part
  for single room occupancy, regardless  of  the  status  or  use  of  the
  building  after  the  conversion,  alteration or improvement unless such
  conversion,  alteration  or  improvement  is  carried   out   with   the
  substantial  assistance  of grants, loans or subsidies from any federal,
  state or local agency or instrumentality.
    14. Conversion of properties to residential use. The benefits of  this
  section shall not apply to any conversion of property to residential use
  where  the  conversion  was contrary to the applicable zoning resolution
  and was permitted only by virtue of a variance as  to  use,  unless  the
  local  law  is  amended  to  explicitly  provide  that benefits shall be
  available in such cases. The provisions of this subdivision do not apply
  to conversions of residential units  qualified  for  the  protection  of
  article  seven-C  of the multiple dwelling law under subparagraph one of
  paragraph (a) of subdivision one of this section.
    15. Authority of city to limit local  law.  Where  a  city  enacts  or
  amends a local law under this section, the local law may restrict, limit
  or  condition the eligibility, scope or amount of the benefits under the
  local law in any manner, provided that  the  local  law  may  not  grant
  benefits beyond those provided in this section.
    16.  Institutional lenders; cost certification. The rules of the local
  housing agency administering such local  law  or  ordinance  shall  make
  provision  for  circumstances  in which an institutional mortgage lender
  (as defined in such rules) which has provided financing for  alterations
  or improvements to a building or structure and has become a successor in
  interest  (as  defined  in  such  rules)  to  the original owner of such
  building  or  structure,  after  diligent  efforts  to  obtain  original
  contracts,  checks and other records normally reviewed by such agency to
  verify claimed costs, is unable to obtain part or all of  such  records.
  Under such circumstances the rules shall permit substitution in whole or
  in  part,  as  the case may be, of documentation certified by the lender
  showing the amounts advanced by the lender pursuant to the mortgage loan
  to finance such alterations  or  improvements,  along  with  such  other
  documentation as the agency may require.