§ 573 — Incorporation and organization of non-profit housing corporations

§ 573. Incorporation and organization of non-profit housing\ncorporations. 1. A housing development fund company shall be\nincorporated pursuant to the provisions of this article and the\nprovisions of either (a) the business corporations law, (b) the\nnot-for-profit corporation law, or (c) the not-for-profit corporation\nlaw and article two of this chapter.\n 2. The term "housing development fund corporation" or "housing\ndevelopment fund company" shall be included as a part of the corporate\nname as set forth in the certificate of incorporation.\n 3. The certificate of incorporation of any such corporation shall, in\naddition to any other requirements of law, provide:\n a. that the company has been organized exclusively to develop a\nhousing project for persons of low income;\n b. that all income and earnings of the corporation shall be used\nexclusively for corporate purposes, and that no part of the net income\nor net earnings of the corporation shall inure to the benefit or profit\nof any private individual, firm, corporation or association;\n c. that if the corporation receives a temporary loan or advance from\nthe housing development fund or a municipal housing development fund, as\nestablished by or pursuant to article eleven of the private housing\nfinance law, it shall be authorized to enter into an agreement with the\ncommissioner of housing and community renewal of the state of New York\nor the supervising agency, as the case may be, providing for regulation\nwith respect to rents, profits, dividends and disposition of property or\nfranchises;\n d. that if the corporation receives a temporary loan or advance from\nthe housing development fund or a municipal housing development fund, as\nestablished by or pursuant to article eleven of the private housing\nfinance law, the commissioner of housing and community renewal of the\nstate of New York or the supervising agency, as the case may be, shall\nhave the power, if, in his or its discretion, he or it determines either\nthat any such temporary loan or advance is in jeopardy of not being\nrepaid, or that the proposed housing project for which such temporary\nloan or advance was made is in jeopardy of not being constructed, to\nappoint to the board of directors of such corporation a number of new\ndirectors, which number shall be sufficient to constitute a majority of\nsuch board, notwithstanding any other provision of such certificate of\nincorporation or of any other provision of law.\n 4. The certificate of incorporation of any such corporation organized\npursuant to the business corporation law and this article shall, in\naddition, provide that each housing project of such corporation shall be\noperated exclusively for the benefit of the persons or families who are\nentitled to occupancy in such housing project by reason of ownership of\nshares in such corporation, and that such corporation may issue shares\nfor home owners purchase notes if the purchase transaction has received\nthe written endorsement of the commissioner in accordance with\nsupplementary rules and regulations of the commissioner made therefor\nand if at least two hundred dollars in money or property is received by\nsuch corporation toward the issuance of such shares.\n 5. The secretary of state shall not file the certificate of\nincorporation of any such corporation or any amendment thereto unless\nthe consent or approval of the commissioner or the supervising agency,\nas the case may be, is affixed thereon or attached thereto. Consent to\nthe filing of such certificate of incorporation shall be based upon\nfindings by the commissioner or supervising agency as to the character\nand competence of the sponsor.\n