Councilman Montserrat’s bill on disclosure of co-op application rejections.
WHEREAS, Council Member Montserrat has introduced Bill Int. # 119 entitled the “Fair and Prompt Co-op Disclosure Law;” and
WHEREAS, Such law would require co-operative apartment corporations to provide a reason for rejection, in writing, to any prospective co-operative apartment purchaser to whom such corporation withholds its consent for such purchase; and
WHEREAS, Such law would greatly expand the opportunities for, and likelihood that, litigation would be brought on by any prospective purchaser of a co-operative apartment whose desire to purchase an apartment is denied; and
WHEREAS, Such law would subject individual board members to potential personal liability in any such lawsuits; and
WHEREAS, Most co-op boards are made up of residents of such co-ops who perform such duties on a voluntary basis without remuneration; and
WHEREAS, It is believed that the prospect of potential personal liability under this law would result in tenants being unwilling to volunteer as members of their co-op boards; and
WHEREAS, It is believed that compliance with the proposed law would lead to greatly increased legal and insurance fees for many or most co-operative apartment corporations; and
WHEREAS, It appears to this Board that the law can be circumvented by providing written reasons that fail to convey any substantive information; and
WHEREAS, Community Board Five is on record as being, and continues to be, opposed to discriminatory practices of all kinds in housing, whether on the basis of race, sex or sexual orientation, and
WHEREAS, No information has been presented to the Board concerning the prevalence or scope of co-op boards using discriminatory practices in approving prospective buyers for co-op ownership; and
WHEREAS, It is believed that the proposed law would fail to have any significant impact on any existing discriminatory practices in approving prospective buyers for co-op ownership; and
WHEREAS, It is believed that the proposed law would have an immediate and significant detrimental effect on both the economic health and stability of governance of co-operative corporations throughout this Community Board district and this city; and
WHEREAS, While Community Board Five understands that the intent of the proposed bill is to prevent discriminatory practices, it is not believed that this is the appropriate means of addressing such concerns, and Community Board Five is desirous of exploring other ways to address such issue; therefore, be it
RESOLVED, That Community Board Five opposes the passage of Intro No. 119, the Fair and Prompt Co-op Disclosure Law, and urges its City Council members to vote against such bill should it come before them for a vote.
The abovel resolution passed with a vote of 28 in favor, 3 opposed, 1 abstention.