Exclusive: Westchester County Executive Latimer Signs Bill into Law Requiring Co-Op Boards Disclose Reason for Applicant’s Denial
John Jordan | June 29, 2021
WHITE PLAINS—The Westchester County Board of Legislators in a 15-2 vote last night approved an amendment to the existing Co-Op Disclosure Law that now requires a cooperative Board of Directors to provide a reason for a denial of an applicant seeking to purchase a unit at their property. The measure went into effect immediately as Westchester County Executive George Latimer told Real Estate In-Depth exclusively that later Monday evening he signed the bill into law.
The legislative victory ends more than 30 years of advocacy by the Hudson Gateway Association of Realtors and its predecessor organizations to advance full transparency in cooperative real estate transactions in Westchester County in order to prevent possible discrimination against consumers they represent.
In 2018 the Westchester County Board of Legislators approved a bill (Local Law 2018-11) that provided for specific time frames on acknowledging receipt of an individual’s application (15 days) and informing the applicant of its decision to accept or reject its application (60 days). However, that legislation did not include a requirement for the cooperative board to provide the applicant with a reason for a denial.
The amendment to the existing law sponsored by Legislator Catherine Borgia calls for the cooperative board of directors to provide notice of a rejection to the Westchester County Human Rights Commission and it also requires the disclosure of minimum financial requirements to applicants by the cooperative board before they apply.
The cooperative board at a minimum is now required to divulge, in addition to its reason for denial, the following: the full legal name and address of the Cooperative Housing Corporation; the full address and unit number of the unit that had been applied for; the full names, addresses, telephone numbers, and e-mail addresses (if available) for the denied applicant(s) and seller(s); the full names, addresses, telephone numbers and e-mail addresses (if available) for all legal counsel and real estate brokers involved in the rejected transaction; the date of receipt of the initial application; the date of receipt of the completed application and the date of rejection.
The amendment also requires the completed notice of rejection form to be transmitted to the Human Rights Commission within 15 days of the notice being provided to the prospective purchaser.
Other key changes to the existing Co-Op Disclosure law include all members of cooperative housing corporations are required to undertake fair housing training. The provision, which was advanced by the Building and Realty Institute of Westchester & Mid-Hudson Region and its affiliate Cooperative and Condominium Advisory Council, requires that any new member of a cooperative governing board have a minimum of two hours of fair housing training within 60 days of becoming a member of the board. All members of a governing board are required to have a minimum of two hours of fair housing training every two years.
Legislator Borgia in a speech prior to the vote, noted that the late Westchester County Legislator Lois Bronz first introduced co-op reform legislation in 1990 and since then notable legislators including now New York State Senate Majority Leader Andrea Stewart Cousins and now New York State Senator Peter Harckham also championed co-op reform bills during their tenures as a county legislator.
“I think the time is now to pass this law in Westchester County,” Borgia, who is also a Realtor with Keller Williams NY Realty in White Plains, said. “Frankly, I am hoping that this will trigger a re-look in New York State.” Attempts to pass legislation requiring cooperative boards across New York State to cite a reason for an applicant’s denial have failed to secure approval from the New York State Legislature to date.
Borgia, as well as Westchester County Board of Legislators Chairman Ben Boykin are hopeful that their action last night will help advance similar legislation in Albany. Boykin, who voted in favor of the bill, noted that legislators took out a provision calling for boards to provide an applicant a reason for a denial back in 2018 to see if there was indeed a problem that existed. He noted that since the bill was passed, there have been 553 rejections by co-op boards advanced to the Westchester County Human Rights Commission.
“Something is going on,” he noted. Boykin added that he is hopeful that state legislators will follow Westchester’s lead and bring further transparency to the co-op purchasing process statewide.
Prior to the vote, a host of HGAR officials and members asked lawmakers to approve the co-op disclosure amendment.
HGAR Government Affairs Director Philip Weiden told lawmakers that charges made by opponents of the bill that litigation against co-op boards would increase as would their operating costs due to the new requirements were simply unfounded. Westchester now joins Suffolk County in requiring co-op boards to disclose the reason for a denial of an applicant.
HGAR CEO Richard Haggerty related that he has resided in a cooperative for the past 30 years and has served on co-op boards, including a stint as president. “I support the efforts of the Westchester County Board of Legislators to bring about meaningful change to the co-op purchase process. Change can be difficult and is sometimes resisted, however, in this instance change is necessary to create more transparency and structure for co-op transactions,” he said.
Former HGAR President Barry Kramer, a longtime advocate for co-op disclosure reform in Westchester and throughout New York State, praised the bill for its transparency requirements, as well as the fair housing training provision. Kramer, who has specialized in co-op transactions, said that most co-op boards say that they reject applicants for financial reasons. “Well, now we will be able to better understand on each and every co-op transaction, why those rejections occurred,” he related.
Other Realtors speaking at the Board of Legislators session on Monday evening in favor of the co-op disclosure amendment were: HGAR President-elect Anthony Domathoti and Realtor John Crittenden.
Westchester County Executive Latimer said that the bill was advanced by Westchester County legislators and sparked debate between Realtor interests and the building industry, which had concerns over its impact on cooperative operations.
“I understand the rationale for it, which is there needs to be a rational process that a potential seller of a unit and the buyer of the unit can look at and understand. Otherwise they are trapped in a unit they want to get rid of or they are unable to get into a unit they want to get into,” he said.