BILL NUMBER: S9626
SPONSOR: BRESLIN
 
TITLE OF BILL:
An act to amend the general business law, in relation to the definition
of construction contracts
 
PURPOSE OF THE BILL:
The bill would amend the definition of "construction contract" in the
General Business Law Article 35-E to exclude any residential project
that includes or will include residential dwelling units that must be
affordable to residents at a specific income level pursuant to a stat-
ute, regulation, restrictive declaration or pursuant to a regulatory
agreement with a federal, state, or local government entity.
 
SUMMARY OF PROVISIONS:
Section 1 of the bill amends the definition of "construction contract"
in General Business Law Section 756 to exclude any residential project
that includes affordable housing.
Section 2 of the bill provides for an immediate effective date.
 
JUSTIFICATION:
Article 35-E of the General Business Law is the section of law related
to obligations of construction contracts. The law entitles a contractor
to submit a final invoice for full payment upon reaching "substantial
completion" of a project. In addition, a contractor or subcontractor is
entitled to retain no more than five percent of the contract sum as
retainage.
Section 756 of the General Business Law is the definitions section of
the article. Certain types of contracts related to construction are
already excepted from this article, such as any contract awarded by the
state, one-to-three family home construction, and certain small afforda-
ble residential projects designed for households earning 125% of the
area median income. This change will streamline the latter category,
exempting all affordable housing from these requirements. This bill is
necessary to prevent an increase in construction costs and delays in the
production of affordable housing, at a time when more affordable housing
is desperately needed across the state.
 
PRIOR LEGISLATIVE HISTORY:
None.
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
All provisions of the bill shall be effective immediately.

Statutes affected:
S9626: 756 general business law, 756(1) general business law