Why New York’s COPA Should Be Challenged

By Francis J. Bell

Suppose you own a New York apartment building and decide to sell. You find a buyer, negotiate a price, and settle on terms you are prepared to accept. Then a city-certified nonprofit matches the deal. Under New York City’s Community Opportunity to Purchase Act, if the statutory conditions are met, you must proceed with the nonprofit as your buyer.

Mayor Zohran Mamdani signed COPA on November 10, 2026. It takes effect a year later. The law applies to certain buildings with four or more apartments, including properties with qualifying housing-code problems or affordability restrictions. Owners can choose to keep their buildings, and they can reject a nonprofit’s initial offer. But under § 26-859(a), when the first qualified bidder validly matches an outside offer the owner intends to accept, the owner must proceed with that bidder. That provision deserves a legal challenge. [1]

The right to choose whom you sell to

Private ownership includes the ability to decide whether to sell, on what terms, and to whom. A seller may favor a buyer with a strong record of closing deals, a credible plan for tenants, or a reputation for honoring commitments after the sale. Two buyers can offer identical written terms and give the seller very different reasons to trust them.

Owners routinely agree to rights of first refusal in private contracts. COPA imposes one by law for the benefit of a category of buyers the city certifies. That distinction matters to public liberty. If the government can override an owner’s choice of buyer to advance a policy goal, it should have to identify the authority for doing so and explain why the power is warranted.

Supporters have a legitimate concern. A change of ownership can leave tenants in a deteriorating building waiting for repairs or put affordable apartments at risk. An experienced nonprofit may have a credible plan to preserve those homes. The question is whether the city needs the power to substitute its preferred class of buyer to accomplish that goal. Code enforcement, rehabilitation financing, and enforceable affordability agreements can address what happens to the building and its tenants while preserving the seller’s choice of buyer. [1][2]

Who gets certified, and who benefits?

COPA requires HPD to certify nonprofits based on criteria including financial and legal capacity and a record of preserving affordable housing. It also allows joint ventures in which a certified nonprofit holds a controlling interest and is independent of the venture’s for-profit participants. Those safeguards matter. The law also requires a public roster of certified nonprofits and annual reporting on activity. [1]

A roster tells the public who is certified. It does not tell the public who can appoint directors or veto decisions, who earns fees from each acquisition, or whether the same financial interests have influence across several buyers. COPA does not expressly require HPD to publish those deal-level relationships or aggregate acquisitions by common financial backer. That is where the risk of favoritism lies. An organization can carry a nonprofit label while its lenders, managers, or joint-venture partners have substantial economic interests in what it buys. The relevant question is what powers those parties actually hold. [1][3]

Consider a hypothetical. A certified nonprofit acquires a building, and a related operator later receives a city contract to use it for shelter. COPA creates no shelter contract. But if the same property benefits from both decisions, the public should be able to establish who made each decision, whether the buyer anticipated the contract before closing, and who ultimately received the payments. NYC’s comptroller has already documented serious oversight failures in a separate emergency shelter contract. That history gives the city a concrete reason to make any overlap transparent. [4]

What a legal challenge should test

First, did the city have the authority? New York’s home-rule framework gives municipalities broad powers, subject to the state constitution and general state law. A preemption challenge would have to identify an actual conflict with state law or show that Albany intended to occupy the relevant field. The city’s Law Department raised litigation concerns about the earlier bill vetoed by Mayor Eric Adams. The Council narrowed the final version but retained the mandatory matching provision. Those earlier concerns give owners reason to examine the final text closely, while the legal merits depend on the provision and the claim. [1][5][6]

Second, what happens when the city enforces the matching right in a specific sale? An owner can test whether the buyer actually qualified and whether its offer matched the price, terms, and conditions required by the statute. An owner could also argue that a compelled transfer to a substitute buyer takes a protected property interest. The city has a substantial response. The owner chose to sell, received the same terms, and property regulation can limit how an owner disposes of an asset without necessarily creating a compensable taking. The question is how a court would treat COPA’s mandatory substitution on the facts of a particular sale. [1][7]

Third, what remedy would make an owner whole? An owner contesting a specific sale has reason to seek relief before title changes hands. After closing, repeal or invalidation would not automatically return the building or compensate the seller. A damages or compensation claim would need its own legal basis and proof. If an owner argues that COPA depressed the sale price, contemporaneous appraisals and evidence that bidders walked away or bid less would matter more than a higher resale price years later. [8]

The City Council should repeal the mandatory matching provision. Until then, an affected owner with a concrete dispute should be able to ask a court to test the city’s authority, the buyer’s eligibility, and the remedy available before the deed changes hands. New York can insist that apartment buildings are safe and that affordability commitments are honored. It should leave the decision about whom to sell to with the people who own the property.

Endnotes

1. NYC Council, Intro. 905-A, enacted text, especially §§ 26-851–853, 26-858–859 and 26-864

2. NYC Mayor’s Office, COPA signing announcement, November 10, 2026

3. IRS, Schedule R instructions on related organizations and control

4. NYC Comptroller, audit of HPD’s oversight of the DocGo contract

5. New York Court of Appeals, 2025 opinion explaining home rule and state preemption

6. amNewYork, reporting on the earlier veto, Law Department concerns, and revisions

7. U.S. Supreme Court, Andrus v. Allard, 444 U.S. 51 (1979)

8. U.S. Supreme Court, Knick v. Township of Scott (2019) and First English Evangelical Lutheran Church v. County of Los Angeles (1987)