I used to work in the corvette restoration hobby and we repainted the 1950s corvettes in nitro lacquer because that is what the factory used. We had to stop using lacquer in the early 1990s because NYS revised its environmental regulations to outlaw lacquers. So yes it is a health code type thing and it is also state wide, not just restricted to NYC. There are a few old timers on Long Island who have the connections but it is a big money fine if you get busted spraying lacquer in anything other than spray can quantities (just because a home user with a spray can is too small and hard to enforce - it is certainly still illegal for home use).
They have this substitute lacquer which is acrylic lacquer but it is not as good a paint finish (kinda plastic-y) but it is more environmentally friendly.
Surprisingly enough, NYC is probably cleaner than it has ever been. I remember the 1980s when this place really was a hellhole and you could still find hookers in major parts of town. I was a hells kitchen regular for years (I was even a bouncer in HK in a tough irish bar for a long time ) and I remember when 25 cent peep shows were a lunchtime special, now all that stuff is gone. I also remember the nasty hookers that were almost a fixture on the west side and the tough as nails, almost harder than the IRA, westies. Now it is all luxury condos....but I digress.
Few outside NY realize that NY is second only to california in terms of enviormental restrictions and policing. In many areas they are more strict than california. Then again NY water is one of the cleanest in the country and is served to the public without being purified.
