BILL NUMBER: S7600
SPONSOR: BYNOE
 
TITLE OF BILL:
An act to amend the real property law, in relation to directing condo-
minium and cooperative housing associations to complete capital reserve
studies
 
PURPOSE OR GENERAL IDEA OF BILL:
To require condominium and cooperative housing associations to complete
capital reserve studies as to prepare a sustainable funding plan to
complete any repairs or maintenance to any assets the association is
obligated to maintain.
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1 creates a new section within the Condominium Law within the
real property law to create a requirement that any condominium or coop-
erative housing association conduct a capital reserve study in order to
ensure the association has proper funding to make any repairs. This
section outlines the procedures required to conduct a capital reserve
study and sets requirements for what information shall be included in
the study, including:
a. The association's current fund reserve balance.
b. The association's income and expenses.
c. An analysis of the physical status and of the common area components
of the building or property overseen by the association.
d. The anticipated costs of maintenance.
e. An estimate of the cost of any future reserve studies, updates, or
engineering reports.
f. An estimate of the costs of corrective maintenance.
g. The proposed thirty-year funding plan.
h. Any other information necessary to perform an analysis.
Unless an association had a reserve capital study completed in the past
five years, all associations would be required to conduct a survey with-
in one year of this law's effective date, while new associations would
have to complete a study within two years. Property management compa-
nies would have to ensure that any capital reserve study is conducted by
a licensed architect, engineer or credentialed reserve specialist.
This would only apply to an association with more than $25,000 in total
assets, and based on the results of the capital reserve study, any asso-
ciation would be required to bring their reserves in line with the esti-
mated balance set for a particular year in the capital reserve study.
Any capital reserve studies completed under this act, would have to be
filed with the Office of the Attorney General who would have jurisdic-
tion to review and audit any such documents and compel any association
to complete a study if they have not done SO.
Section 2 provides the effective date.
 
JUSTIFICATION:
On June 24th, 2021, Champlain Towers South, a 12-story condominium in
Surfside, Florida experienced a partial collapse that resulted in the
deaths of 98 residents, becoming the third-deadliest non-deliberate
structural engineering failure in United States history. In the wake of
this tragedy there is more awareness of the need for oversight of condo-
minium and cooperative housing associations in order to ensure they are
up to building, health, safety, and fire standards. As part of a wider
condominium and cooperative housing regulation passed last year, New
Jersey has likewise required these associations to complete a capital
reserve study.
This bill would require condominium and cooperative housing associations
to complete capital reserve studies as to determine if associations will
have the funding to complete necessary structural and mechanical repairs
to the properties which they have authority over. Capital reserve
studies are comprehensive planning tools for condominiums and cooper-
ative housing associations which provide long-range planning that can
help these associations anticipate and prepare for the repair and
replacement of the community's common assets. These studies provide an
analysis of the property's physical condition as well as a financial
analysis of the association.
By requiring capital reserve studies to be completed for any condominium
or cooperative housing association, the State of New York would be
ensuring that theses associations have plans prepared that would be able
to guide the board of managers and unit owners to make informed deci-
sions about any repairs, and give these associations the opportunity to
better plan for necessary repairs and understand the costs and expecta-
tions that may be placed on unit owners to maintain the property they
own within any association.
 
PRIOR LEGISLATIVE HISTORY:
New Legislation
 
FISCAL IMPLICATIONS:
Minimal to New York State.
 
EFFECTIVE DATE:
This act shall take effect on the one hundredth and eightieth day after
it shall have become a law.