STATE OF NEW YORK ________________________________________________________________________ 4024 2025-2026 Regular Sessions IN SENATE January 31, 2025 ___________ Introduced by Sen. PARKER -- read twice and ordered printed, and when printed to be committed to the Committee on Finance AN ACT to amend the state finance law and the real property tax law, in relation to creating the New York state home ownership savings plan and creating a property tax exemption relating thereto The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "New York state home ownership savings plan". 3 § 2. The state finance law is amended by adding a new section 97-n to 4 read as follows: 5 § 97-n. New York state home ownership savings plan. 1. The purpose of 6 the New York state home ownership savings plan is to attract individuals 7 to reside and remain in the state by authorizing the establishment of 8 home ownership savings accounts and providing guidelines for the mainte- 9 nance of such accounts in order to enable individuals and couples to 10 receive a refundable tax credit to help them save toward the purchase of 11 a first home in New York state. 12 2. As used in this section: 13 (a) "Assets of the plan" means all contributions made into the plan, 14 any transfers made into the plan under this section and all income 15 earned therefrom and on assets substituted therefor, whether or not the 16 assets of the plan are in the form of qualified investments. 17 (b) "Couple" means individuals who have cohabited for a period of at 18 least five years in a conjugal relationship regardless of whether they 19 are married. 20 (c) "Comptroller" means the comptroller of the state of New York. 21 (d) "Contribution" means the amount of money paid by an individual to 22 a financial organization as a payment into a home ownership savings 23 plan. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD07598-01-5
S. 4024 2 1 (e) "Financial organization" means a financial institution authorized 2 to do business in the state of New York and (i) which is an authorized 3 fiduciary to act as a trustee pursuant to the provisions of an act of 4 congress entitled "Employee Retirement Income Security Act of 1974" as 5 such provisions may be amended from time to time, or an insurance compa- 6 ny; and 7 (ii) (1) is licensed or chartered by the department of financial 8 services; 9 (2) is chartered by an agency of the federal government; 10 (3) is subject to the jurisdiction and regulation of the securities 11 and exchange commission of the federal government; or 12 (4) is any other entity otherwise authorized to act in this state as a 13 trustee pursuant to the provisions of an act of congress entitled 14 "Employee Retirement Income Security Act of 1974" as such provisions may 15 be amended from time to time. 16 (f) "Homeownership savings plan" means an arrangement entered into by 17 an individual and a financial organization under which payment is made 18 by the individual to the financial organization of an amount of money as 19 a payment under the arrangement to be used, invested or otherwise 20 applied by the financial organization for the purpose of providing to 21 the individual as the planholder under the arrangement an amount of 22 money to be used by the individual for the purchase by them of a quali- 23 fying eligible home. 24 (g) "Individual" means a person other than a trust or corporation as 25 defined by the tax law. 26 (h) "Planholder" means an individual eighteen years of age or over to 27 whom, under the plan, a single payment is agreed to be paid. Planholder 28 does not include an individual to whom under a plan a single payment is 29 agreed to be paid as a consequence of the death of another individual. 30 (i) "Eligible home" means: 31 (i) a detached house; 32 (ii) a semi-detached house; 33 (iii) a townhouse; 34 (iv) a share or shares of the capital stock of a co-operative corpo- 35 ration if the share or shares are acquired for the purpose of acquiring 36 the right to inhabit a housing unit owned by the corporation; 37 (v) a condominium unit; 38 (vi) a residential dwelling that is a duplex, triplex or a fourplex; 39 (vii) a mobile home that complies with the prescribed standards and is 40 suitable for year round permanent residential occupation; 41 (viii) a partial ownership interest as a tenant in common of real 42 property, if the ownership interest was acquired for the purpose of 43 acquiring the right to inhabit a housing unit forming part of the real 44 property; or 45 (ix) any other residential property as may be prescribed. 46 (j) "Ownership of an eligible home" means: 47 (i) in the case of an eligible home as prescribed in subparagraphs 48 (i), (ii), (iii) or (vi) of paragraph (i) of this subdivision, the indi- 49 vidual has an ownership interest in the eligible home and owns a free- 50 hold estate in the land subjacent to the eligible home other than as a 51 mortgagee or is a lessee of the land subjacent to the eligible home; 52 (ii) in the case of an eligible home that is a condominium unit, the 53 individual is an owner of the unit and common elements within the mean- 54 ing of New York state law; 55 (iii) in the case of an eligible home in the form of a share or shares 56 of the capital stock of a co-operative corporation the individual has
S. 4024 3 1 acquired, jointly with another person or otherwise, the share or shares 2 to enable the individual to acquire a right to occupy a housing unit 3 owned by the co-operative corporation, the individual and the co-opera- 4 tive corporation have entered into an enforceable occupancy agreement in 5 respect of the housing unit, and the individual is entitled to vacant 6 possession of the housing unit under the terms of the occupancy agree- 7 ment; 8 (iv) in the case of an eligible home that is a mobile home suitable 9 for year-round permanent residential occupation, the individual, either 10 alone or jointly with another person, has completed the purchase of the 11 mobile home, the mobile home is situated on a foundation, which meets 12 the prescribed standards, on the land where it is to be inhabited, and 13 the land is owned by the individual, jointly with another person or 14 otherwise, or is occupied by the individual under a license or lease 15 that permits the individual to locate the mobile home on the land and to 16 occupy it as a year-round residence; 17 (v) in the case of an eligible home referred to in subparagraph (vii) 18 of paragraph (i) of this subdivision, the individual has acquired a 19 freehold estate in the real property, other than as a mortgagee, and is 20 entitled to vacant possession of said housing unit; 21 (vi) in the case of an eligible home of a prescribed class or nature, 22 or owned by a member of a prescribed class of persons, the prescribed 23 terms and conditions are met; 24 (vii) in the case of a gift or inheritance, a person who acquires an 25 ownership interest in an eligible home by gift from the owner of the 26 interest or by reason of the death of the owner of the interest shall be 27 deemed to own the eligible home for the purposes of this section on the 28 earliest date on or after the date of the gift or the death on which the 29 person resides in the eligible home is entitled to possession of the 30 eligible home or acquires the ownership interest in the eligible home. 31 This definition does not include an ownership interest acquired under 32 the terms of an agreement enforceable by or against the person legally 33 or beneficially entitled to the interest immediately following the death 34 of the owner of the interest; 35 (viii) in the case of a deemed owner of an eligible home, the comp- 36 troller may deem an individual to have owned an eligible home at a 37 particular time if ownership was at that time vested in a person under 38 the terms of an express or implied trust by which the person held the 39 property for the benefit of the individual, either alone or with one or 40 more other persons, and the comptroller is of the opinion that the indi- 41 vidual exercised effective control, either alone or with one or more 42 other persons, over the eligible home. 43 3. (a) The comptroller shall implement the plan under the terms and 44 conditions established by this section and a memorandum of understanding 45 relating to any terms or conditions not otherwise expressly provided for 46 in this section. 47 (b) In furtherance of such implementation the memorandum of under- 48 standing shall address the authority and responsibility of the comp- 49 troller and the corporation to: 50 (i) develop and implement the plan in a manner consistent with the 51 provisions of this section through rules and regulations established in 52 accordance with the state administrative procedure act; 53 (ii) engage the services of consultants on a contract basis for 54 rendering professional and technical assistance and advice;
S. 4024 4 1 (iii) make changes to the plan required for the participants in the 2 plan to obtain any eligible federal or state benefits or treatment under 3 any legislation; 4 (iv) charge, impose, and collect administrative fees and service 5 charges in connection with any agreement, contract or transaction relat- 6 ing to the plan; 7 (v) develop marketing plans and promotion material; 8 (vi) establish the methods by which the funds held in such accounts be 9 disbursed; 10 (vii) establish the method by which funds shall be allocated to pay 11 for administrative costs; and 12 (viii) do all things necessary and proper to carry out the purposes of 13 this section. 14 4. (a) The comptroller shall implement the program through use of 15 financial organizations as account depositories and managers. Under the 16 program, individuals may establish accounts directly with an account 17 depository. 18 (b) The comptroller may solicit proposals from financial organizations 19 to act as depositories and managers of the program. Financial organiza- 20 tions submitting proposals shall describe the investment instrument 21 which will be held in accounts. The comptroller shall select as program 22 depositories and managers the financial organization, from among the 23 bidding financial organizations that demonstrates the most advantageous 24 combination, both to potential program participants and this state, of 25 the following factors: 26 (i) financial stability and integrity of the financial organization; 27 (ii) the safety of the investment instrument being offered; 28 (iii) the ability of the investment instrument to track increasing 29 costs of the housing market; 30 (iv) the ability of the financial organization to satisfy recordkeep- 31 ing and reporting requirements; 32 (v) the financial organization's plan for promoting the program and 33 the investment it is willing to make to promote the program; 34 (vi) the fees, if any, proposed to be charged to persons for opening 35 accounts; 36 (vii) the minimum initial deposit and minimum contributions that the 37 financial organization will require; 38 (viii) the ability of banking organizations to accept electronic with- 39 drawals, including payroll deduction plans; and 40 (ix) other benefits to the state or its residents included in the 41 proposal, including fees payable to the state to cover expenses of oper- 42 ation of the program. 43 (c) The comptroller may enter into a contract with a financial organ- 44 ization. Such financial organization management may provide one or more 45 types of investment instrument. 46 (d) The comptroller may select more than one financial organization 47 for the program. 48 (e) A management contract shall include, at a minimum, terms requiring 49 the financial organization to: 50 (i) take any action required to keep the program in compliance with 51 requirements of this section and any actions not contrary to its 52 contract to manage the program to qualify as a qualified "homeownership 53 savings plan" as defined by this section; 54 (ii) keep adequate records of each account, keep each account segre- 55 gated from each other account, and provide the comptroller with the
S. 4024 5 1 information necessary to prepare the statements required by this 2 section; 3 (iii) compile and total information contained in statements required 4 to be prepared under this section and provide such compilations to the 5 comptroller; 6 (iv) if there is more than one program manager, provide the comp- 7 troller with such information necessary to determine compliance with 8 this section; 9 (v) provide the comptroller or such comptroller's designee access to 10 the books and records of the program manager to the extent needed to 11 determine compliance with the contract; 12 (vi) hold all accounts for the benefit of the account owner; 13 (vii) be audited at least annually by a firm of certified public 14 accountants selected by the program manager and that the results of such 15 audit be provided to the comptroller; 16 (viii) provide the comptroller with copies of all regulatory filings 17 and reports made by it during the term of the management contract or 18 while it is holding any accounts, other than confidential filings or 19 reports that will not become part of the program. The program manager 20 shall make available for review by the comptroller the results of any 21 periodic examination of such manager by any state or federal banking, 22 insurance, or securities commission, except to the extent that such 23 report or reports may not be disclosed under applicable law or the rules 24 of such commission; and 25 (ix) ensure that any description of the program, whether in writing or 26 through the use of any media, is consistent with the marketing plan 27 developed in compliance with this section. 28 (f) The comptroller may provide that an audit shall be conducted of 29 the operations and financial position of the program depository and 30 manager at any time if the comptroller has any reason to be concerned 31 about the financial position, the recordkeeping practices, or the status 32 of accounts of such program depository and manager. 33 (g) During the term of any contract with a program manager, the comp- 34 troller shall conduct an examination of such manager and its handling of 35 accounts. Such examination shall be conducted at least biennially if 36 such manager is not otherwise subject to periodic examination by the 37 superintendent of financial services, the federal deposit insurance 38 corporation or other similar entity. 39 (h) (i) If selection of a financial organization as a program manager 40 or depository is not renewed, after the end of its term: 41 (1) accounts previously established and held in investment instruments 42 at such financial organization may be terminated; 43 (2) additional contributions may be made to such accounts; 44 (3) no new accounts may be placed with such financial organization; 45 and 46 (4) existing accounts held by such depository shall remain subject to 47 all oversight and reporting requirements established by the comptroller. 48 (ii) If the comptroller terminates a financial organization as a 49 program manager or depository, such comptroller shall take custody of 50 accounts held by such financial organization and shall seek to promptly 51 transfer such accounts to another financial organization that is 52 selected as a program manager or depository and into investment instru- 53 ments as similar to the original instruments as possible. 54 (i) The comptroller may enter into such contracts as it deems neces- 55 sary and proper for the implementation of the program.
S. 4024 6 1 5. (a) The terms of the plan do not permit any payment to the plan- 2 holder of any asset of the plan except by way of: 3 (i) a single payment of all of the assets of the plan to the commis- 4 sioner of housing to hold the assets of the plan as trust property in 5 trust for the planholder and the state jointly and to legally represent 6 the planholder in the purchase by the planholder of a qualifying eligi- 7 ble home, or 8 (ii) a single payment of all the assets of the plan, less the amount 9 to be withheld by the financial organization or the amount, if any, 10 directed by the comptroller to the planholder or to the legal personal 11 representative of the planholder upon the death of the planholder. 12 (b) The terms of the plan require the financial organization to with- 13 hold and remit to the comptroller any amount required under this section 14 on any payment of assets of the plan to the planholder or to the legal 15 personal representative of the planholder on the death of the planhold- 16 er. 17 (c) The terms of the plan provide that the financial organization will 18 accept repayment of assets into the plan from a commissioner of housing 19 to whom assets of the plan were paid. 20 (d) The terms of the plan provide that the payment to the planholder 21 is not capable in whole or in part of surrender, assignment or transfer 22 except as permitted by an election under this section. 23 (e) The planholder is at least eighteen years of age and a resident of 24 New York at the time of entering into the plan. 25 (f) The planholder shall be eligible for this program if they are a 26 first time homebuyer as defined under the federal SONYMA program and (i) 27 has not had any ownership interest in their primary residence at any 28 time during the three years prior to the date of making an application, 29 and (ii) at the time of making the application does not own a vacation 30 or investment home. This definition includes residences owned in the 31 United States and abroad. 32 (g) The terms of the plan prohibit any amendment to the terms of the 33 plan: 34 (i) that would result in the terms of the plan as amended failing to 35 comply with this section; 36 (ii) that would permit or require any person to do anything contrary 37 to this section; or 38 (iii) that would prevent or prohibit any person from doing anything 39 required by this section to be done. 40 (h) The terms of the plan provide that on the death of the planholder, 41 the financial organization shall transfer or distribute all assets of 42 the plan, less any amount required by this section to be withheld and 43 remitted to the comptroller, in accordance with this section. 44 (i) The terms of the plan prohibit the holding of the assets of the 45 plan in any form other than qualified investments. 46 (j) The plan includes a provision denying the financial organization 47 any right of set-off as regards the assets of the plan in connection 48 with any debt or obligation to the financial organization that the plan- 49 holder under the plan owes or may thereafter owe. 50 (k) The terms of the plan include the acknowledgment by the planholder 51 that such planholder understands that the amount of a tax credit, if 52 any, available with respect to contributions made to the plan in any 53 year depend on the planholder's level of income for that year and that 54 the provisions of this section apply even if the planholder may not be 55 entitled to a tax credit in any year.
S. 4024 7 1 (l) The terms of the plan contain the consent of the planholder to the 2 release to the comptroller of all information obtained by the financial 3 organization with respect to the plan, the planholder and the 4 planholder's spouse or common-law partner, if any, for the purposes of 5 this section and the operation of the plan. 6 6. No tax credit shall be issued to individuals or couples whose 7 income exceeds the maximum income limits established by the state of New 8 York mortgage agency. 9 7. (a) Nothing in this section shall be construed to: 10 (i) give any designated beneficiary any rights or legal interest with 11 respect to an account unless the designated beneficiary is the account 12 owner; 13 (ii) guarantee that a designated beneficiary will be qualified for a 14 home loan; 15 (iii) create state residency for an individual merely because the 16 individual is a designated beneficiary; or 17 (iv) guarantee that amounts saved pursuant to the program will be 18 sufficient to cover the qualified home ownership expenses of a desig- 19 nated beneficiary. 20 (b) (i) Nothing in this section shall create or be construed to create 21 any obligation of the comptroller, the state, or any agency or instru- 22 mentality of the state to guarantee for the benefit of any account owner 23 or designated beneficiary with respect to: 24 (1) the rate of interest or other return on any account; and 25 (2) the payment of interest or other return on any account. 26 (ii) The comptroller and the corporation by rule or regulation shall 27 provide that every contract, application, deposit slip, or other similar 28 document that may be used in connection with a contribution to an 29 account clearly indicate that the account is not insured by the state 30 and neither the principal deposited nor the investment return is guaran- 31 teed by the state. 32 § 3. The real property tax law is amended by adding a new section 33 421-r to read as follows: 34 § 421-r. Exemption for properties purchased in target areas with a New 35 York state home ownership savings plan. 1. Residential properties which 36 have been purchased in target areas through a New York state home owner- 37 ship savings plan pursuant to section ninety-seven-n of the state 38 finance law shall be exempt from all local and municipal taxes. 39 2. For the purposes of this section "target areas" shall have the same 40 meaning as defined by the state of New York mortgage agency. 41 3. (a) Applications for exemption under this section shall be filed 42 with the assessors between February first and March fifteenth of the 43 calendar year and the assessors shall certify to the collecting officer 44 the amount of exemption from local and municipal taxes. 45 (b) The assessor and local housing agency may promulgate rules and 46 regulations to carry out the provisions of this section and may require 47 payment of a reasonable filing fee. 48 § 4. This act shall take effect immediately.