[HISTORY: Adopted by the Board of Trustees of the Village
of Russell Gardens 9-6-1988 as L.L. No. 3-1988. Amendments noted where
applicable.]
The provisions of this chapter shall apply to conversions from
rental to cooperative or condominium ownership in buildings or in
a group of buildings or a development for which a plan must be filed
with the New York State Department of Law, pursuant to General Business
Law § 352-eee.
As used in this chapter, the following terms shall have the
meanings indicated:
Any building, group of buildings or development.
A major structural replacement or a general replacement within
the building of any major component, including but not limited to
the elevator; the heating, ventilation or air-conditioning systems;
the plumbing systems; electrical systems and wiring; and windows,
doors and the like. Nothing herein contained shall pertain to replacements
required to cure code violations of record.
The Condominium Board of Directors or Board of Managers,
as the case may be.
The offeror, his nominees, assignees and successors.
The total number of all shares, whether sold or unsold, in
a cooperative conversion offering multiplied by the last and final
price per share offered to tenants in occupancy prior to the effective
date of the plan, or the sum of the cost of all units of a condominium
conversion offering at the last and final price offered to tenants
in occupancy prior to the effective date of the plan.
A.Â
Within
30 days after the closing of a conversion pursuant to an offering
plan, the offeror shall establish and shall transfer to the cooperative
corporation or Condominium Board a reserve fund to be used exclusively
for making capital repairs, replacements and improvements necessary
for the health and safety of the residents of such buildings. Such
reserve fund shall be exclusive of any other funds required to be
reserved under the plan or applicable law or regulation of the State
Attorney General, except a fund for capital repairs, replacements
and improvements substantially similar in purpose to and in an amount
not less than the reserve fund mandated by this section. Such reserve
fund also shall be exclusive of any working capital fund and shall
not be subject to reduction for closing apportionments.
B.Â
Amount
of fund.
(2)Â
If the amount of the actual sales price of all cooperative shares
or condominium units sold is less than 1% of the total price, then
the fund shall be established at 1% of the total price, with supplemental
contributions made by the offeror of 3% of the actual sales price
of such shares or units for each share of stock or unit held by offeror
and sold to bona fide purchasers after the effective date of the plan
and within five years of the closing of the conversion pursuant to
such plan.
(3)Â
If, after five years have passed from the 30 days after the closing
of the conversion, the total contributions to the fund by the offeror
shall be less than 3% of the total price, the offeror shall pay into
the fund the difference between the amount contributed and 3% of the
total price.
(4)Â
All supplemental contributions shall be made within 30 days of each
sale.
C.Â
Contributions
made pursuant to this section may be made earlier or in an amount
greater than herein provided. An offeror may claim and receive credits
against the mandatory initial contributions to the reserve fund for
the actual cost of capital replacements which were commenced after
the plan is submitted to the New York Department of Law for filing
and prior to the plan being declared effective if such replacements
are set forth in the plan, together with the actual or estimated cost
and if such credit shall not exceed the lesser of the actual cost
of the capital replacements or 1% of the total price.
D.Â
Buildings
constructed within three years prior to the closing of a conversion
pursuant to an offering plan shall be exempt from the requirements
of this section.
The cooperative corporation or Condominium Board shall report
to shareholders and unit owners semiannually respecting the status
of deposits into and withdrawals from the reserve fund.
The offeror, not later than the 30th day following the acceptance
of a plan for filing by the New York State Department of Law pursuant
to General Business Law § 352-eee, and until the closing
of the conversion pursuant to such plan, shall post and maintain in
a prominent place, accessible to all tenants in each building covered
by the plan, a listing of all violations of record against such buildings
as determined by the village. All newly issued violations shall be
posted with 48 hours after issuance.
Whenever an offeror is required to file a report with the New
York State Department of Law describing the physical aspects of the
premises to be converted and the surrounding neighborhood, a copy
of such report shall be filed simultaneously with the village.
Any provision purporting to waive the provisions of this chapter
contained in any contract to purchase or other agreement between the
offeror and any other party shall be void as against public policy.
B.Â
In addition to the penalties provided in Subsection A hereof, and except as provided in Subsection C hereof, any person who violates any provision of this chapter shall, in addition to any criminal penalty, be subject to a civil penalty of no less than $100 per day per unit for each day that the building is not in compliance with the provisions of this chapter, and no more than $1,000 per unit.
C.Â
Any person who violates any provision of § 16-3 of this chapter shall, in addition to any criminal penalty, be subject to a civil penalty of no less than $1,000 per day for each day that there is a failure to comply with the reserve fund provisions hereof, but in no event shall such civil penalty exceed the amount required to be reserved hereunder.
D.Â
Nothing
herein contained shall impair any rights, remedies or causes of action
accrued or accruing to purchasers of cooperative shares or condominium
units or to the village for the enforcement of this chapter in any
court of competent jurisdiction, including the securing of injunctive
relief and the like.
