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New York State Assembly Assembly Standing NEW YORK STATE ASSEMBLY ASSEMBLY STANDING COMMITTEE ON HOUSING PUBLIC HEARING ILLEGAL HOTELS Assembly Hearing Room Room 1923, 19th Floor, 250 Broadway New York, New York Friday, April 27, 2012 11:50 a.m. to 3:18 p.m. Page 2 Committee on Housing, 4-27-2012 ASSEMBLY MEMBERS PRESENT: ASSEMBLY MEMBER VITO LOPEZ, Chair, Assembly Standing Committee on Housing ASSEMBLY MEMBER BRIAN P. KAVANAGH ASSEMBLY MEMBER RICHARD N. GOTTFRIED ASSEMBLY MEMBER LINDA B. ROSENTHAL ASSEMBLY MEMBER ALEC BROOK-KRASNY Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 3 Committee on Housing, 4-27-2012 INDEX Page KATHLEEN MCGEE 8 DIRECTOR MAYOR’S OFFICE OF SPECIAL ENFORCEMENT GAIL BREWER 34 COUNCILMEMBER NEW YORK CITY COUNCIL JOSEPH E. SPINNATO 42 PRESIDENT AND CEO NEW YORK CITY HOTEL ASSOCIATION JOHN FITZPATRICK 54 CHAIRMAN OF THE BOARD NEW YORK CITY HOTEL ASSOCIATION JOSH GOLD 57 POLITICAL DIRECTOR HOTEL TRADES COUNCIL ELLEN DAVIDSON 62 STAFF ATTORNEY THE LEGAL AID SOCIETY EVAN FRANK 70 VICE PRESIDENT, INTERNATIONAL ONEFINESTAY TOM CAYLER 87 CHAIR WEST SIDE NEIGHBORHOOD ALLIANCE ILLEGAL HOTEL COMMITTEE EVELYN B. 94 HOST AIRBNB SHELL M. 101 HOST AIRBNB Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 4 Committee on Housing, 4-27-2012 JAY KAREN 102 PRESIDENT PROFESSIONAL ASSOCIATION OF INNKEEPERS INTERNATIONAL VINESSA MILANDO 110 PRESIDENT STAYNYC MARIE-REINE JEZEQUEL 123 CHIEF EXECUTIVE OFFICER NEW YORK HABITAT SANDRA PARK 126 TENANT ORGANIZER GODDARD RIVERSIDE COMMUNITY CENTER SRO LAW PROJECT CHARLES NASSIF 135 307 W. 79TH STREET MATT KLEIN 139 DIRECTOR OF ORGANIZING HOUSING CONSERVATION COORDINATORS ANNE CUNNINGHAM 148 TENANT WEST SIDE NEIGHBORHOOD ALLIANCE PETE DEROSA 153 PRESIDENT JOST FINANCIAL MANAGEMENT CORPORATION JOHN TEPPER MARLIN 157 PRINCIPAL CITY ECONOMIST ERIC ABRAMS 171 TENANT WEST SRO LAW PROJECT JONATHAN BARON 174 CONDOMINIUM OWNER MARY DIONYSATOS 180 HOMEOWNER OPAL LINTON 183 HOMEOWNER Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 5 Committee on Housing, 4-27-2012 MEL WYMORE 191 MEMBER COMMUNITY BOARD 7 Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 6 1 Committee on Housing, 4-27-2012 2 (The public hearing commenced at 11:50 3 a.m.) 4 ASSEMBLY MEMBER VITO LOPEZ, CHAIR, 5 ASSEMBLY STANDING COMMITTEE ON HOUSING: You're 6 going to hear a lot more from the other members. 7 I have two teeth taken out so I have some 8 difficulty in speaking. Do you want to introduce 9 yourselves? 10 ASSEMBLY MEMBER RICHARD N. GOTTFRIED, 11 MEMBER: Okay. I'm Assembly Member Richard 12 Gottfried and I represent Chelsea, Hell's 13 Kitchen, Midtown, a little of the Upper West 14 Side, and as a result, have been involved in the 15 illegal hotel issue for many years now. I'm 16 delighted that we're having this hearing because 17 I think it's going to show that the law was and 18 is the right thing to have on the books and I 19 think the city has been doing a superb job in 20 working to enforce the law, as they did a superb 21 job in helping us find our way through the 22 intricacies of the multiple dwelling law to get 23 it drafted. And the next step of course is for 24 the city council to pass legislation Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 7 1 Committee on Housing, 4-27-2012 2 strengthening the penalties and we're looking 3 forward to that as well. 4 ASSEMBLY MEMBER LINDA B. ROSENTHAL, 5 MEMBER: Hi. I'm Assembly Member Linda 6 Rosenthal. I represent the Upper West Side and 7 parts of Hell's Kitchen. I have many illegal 8 hotels in my district including some that have 9 been shut down because of the new law and the 10 mayor's enforcement of the law and you know, I 11 think this is a good opportunity to hear from all 12 sides but especially from people who live in 13 illegal hotels and what misery their lives are 14 like when a building's operated unsafely and 15 illegally as a hotel, so I look forward to 16 hearing from all of you. 17 ASSEMBLY MEMBER BRIAN P. KAVANAGH, 18 MEMBER: Brian Kavanagh, assembly member from the 19 East Side of Manhattan, district runs from 20 Delancey up to the UN, and I want to thank the 21 chair for hosting this hearing on this important 22 issue and look forward to all of your testimony. 23 ASSEMBLY MEMBER LOPEZ: I'm going to 24 call - -. Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 8 1 Committee on Housing, 4-27-2012 2 MS. JESSICA DEMARCO, LEGISLATIVE 3 ASSISTANT TO ASSEMBLY MEMBER VITO LOPEZ: Okay, 4 first to testify, Kathleen McGee, Director of the 5 Mayor's Office of Special Enforcement. 6 MS. KATHLEEN MCGEE, DIRECTOR, MAYOR’S 7 OFFICE OF SPECIAL ENFORCEMENT: Good morning. 8 Good morning Chairman Lopez and members of the 9 Assembly Housing Committee. My name is Kathleen 10 McGee and I am the Director of the Mayor's Office 11 of Special Enforcement. Thank you very much for 12 the opportunity to be heard today. In November 13 of 2006, the mayor created the Office of Special 14 Enforcement known as OSE by expanding the former 15 Office of Midtown Enforcement. OSE was given 16 expanded citywide jurisdiction to enhance and 17 coordinate enforcement efforts across city 18 agencies in order to address quality of life 19 issues in all five boroughs including the illegal 20 conversion of residential buildings into hotels. 21 The proliferation of these illegal hotels as they 22 are colloquially known was first brought to the 23 attention of the administration in April of 2006 24 by the illegal hotels working group whose members Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 9 1 Committee on Housing, 4-27-2012 2 include several of the state assembly members 3 here today--Assembly Members Gottfried and 4 Rosenthal, as well as Assembly Member Glick, 5 State Senators Krueger and Duane, and New York 6 City Council Member Brewer and Mendez, Garodnick- 7 - 8 ASSEMBLY MEMBER LOPEZ: I'm sorry to 9 interrupt you, but I just want to acknowledge 10 that we have Liz Krueger here. She's just 11 watching and listening. Thank you for coming. 12 MS. MCGEE: Dickens and Garodnick. 13 Beginning in the fall of 2006, OSE began handling 14 complaints regarding illegal hotels as part of 15 the city's enhanced enforcement strategy in an 16 effort to facilitate an effective response to 17 this emerging problem. OSE works in partnership 18 with the Department of Buildings, DOB, by 19 investigating complaints of illegal hotels. 20 Those complaints can come from many sources 21 including calls to 311, letters and emails from 22 members of the public and communications from 23 elected officials and community groups. 24 Regardless of the source, OSE arranges for an Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 10 1 Committee on Housing, 4-27-2012 2 inspection team to visit the premises and 3 attempts to determine whether a violation exists. 4 If it is determined that a violation exists, the 5 appropriate enforcement is taken which can 6 include issuing DOB violations, Environmental 7 Control Board--known as ECB--notices of 8 violation--that's NOVs--and vacate orders, where 9 appropriate. OSE also issues fire department and 10 department of health violations where 11 appropriate. When an ECB NOV is issued, we refer 12 these cases to the DOB administrative enforcement 13 unit for prosecution. The problem of residential 14 buildings being improperly used as illegal hotels 15 is of significant concern to the administration 16 and we have taken an aggressive stance against 17 them. Converting residential units designated 18 for permanent occupancy for use by transient 19 guests creates serious problems for permanent 20 residents. It limits the supply of available 21 housing, particularly rent-regulated and low- 22 income housing, creates unsafe conditions, 23 diverts services intended for permanent residents 24 to transient guests, and harms the character of Ubiqus/Nation-Wide Reporting & Convention Coverage 22 Cortlandt Street – Suite 802, New York, NY 10007 Phone: 212-227-7440 * 800-221-7242 * Fax: 212-227-7524 Page 11 1 Committee on Housing, 4-27-2012 2 residential neighborhoods. In addition to the 3 on-ground investigation and enforcement of 4 illegal hotel complaints, OSE has worked over 5 several years with DOB, the law department, city 6 planning and housing preservation and development 7 to craft legislation that clarified the terms of 8 transient occupancy for more effective 9 enforcement against illegal hotels. This 10 legislation was signed by Governor Patterson in 11 July of 2010, and went into effect on May 1st of 12 last year, 2011.
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