NY State Senate Bill 2021-S4785

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to housing, construction and community development
Feb 12, 2021	referred to housing, construction and community development

2021-S4785 (ACTIVE) - Details

Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Public Housing Law
Laws Affected:: Amd §14, add §223-c, Pub Hous L; amd §7-103, Gen Ob L; add §99-ii, St Fin L

2021-S4785 (ACTIVE) - Summary

Relates to establishing the New York state emergency rent supplement program; requires the commissioner of housing and community renewal to establish a program to hold security deposits and create a dispute resolution process regarding the withholding of security deposits.

2021-S4785 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S4785

SPONSOR: RAMOS
 
TITLE OF BILL:

An act to amend the public housing law, the general obligations law, and
the state finance law, in relation to establishing the New York state
emergency rent supplement program

 
PURPOSE:

This bill requires security deposits in residential leases to be held by
a third party and only withheld by a landlord when an agreement has been
reached with the lessor.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section one amends subdivision 1 of section 14 of the public housing law
to administer the New York state emergency rental supplement program.

Section two amends section 7-103 of the general obligations law to

create the New York State emergency rental supplement program which
shall include:

a) a system where tenant security deposits are held by "third-party
custodians and arbiters;

b) require landlords to place a tenant's security deposit within this
system;

c) include a process for returning security deposits to tenants and to
transfer the remaining balance of their security deposit to a new lease
agreement;

d) if landlord wishes to withhold security deposit the landlord shall
make an agree with the tenant specifying the amount withheld and the
reasons for while holding;

e) estable a dispute resolution service for disagreements arising over
the withholding of a security deposit;

f) require that both parties agree prior to the decision made by the
dispute resolution service is binding;

g) include any other regulations determined necessary by HCR.  Any
person who violates the requirement is subject to a fine of up to
fifteen percent of annual rent.

Section three adds a new section 2230c to public housing law to create a
tenant security deposit fund. All security deposits will be placed in
this fund with all interest from the fund being spent on the "New York
state emergency rent supplement program".

Section four states the Tenant Security Deposit Fund will be controlled
New York State Comptroller. The comptroller will be tasked with invest-
ing in US treasury bonds. Moneys of the fund shall be available for
distribution to the New York state emergency rent supplement program.

Section five sets the effective date at 120 days after it comes to law.
 
JUSTIFICATION:

A security deposit is an upfront payment demanded by a landlord from a
prospective tenant to insure against any damages made to a unit by an
outgoing tenant. In theory, security deposits should be returned in full
if no damages are made, and the landlord should retain no more than the
amount necessary to cover any expenses associated with needed repairs.

In practice, security deposits are poorly regulated and the result is an
arbitrary process that usually benefits the landlord and leaves the
tenant with no formal recourse to recover lost money. Landlords require
one months rent in security, and in a city as unaffordable as New York,
many prospective tenants struggle to gather the security, and other fees
required at an initial lease signing.

New York State residents already struggle to find affordable housing,
especially residents living in New York City. According to a report from
the office of New York City Comptroller Scott Stringer, New York City
tenants spent $507 million on security deposits in 2016. When landlords
withhold security deposits for illegal and capricious reasons, tenants
are left holding the bag for thousands of dollars.

This legislation would protect tenants by establishing a tenancy deposit
protection program and requiring security deposits to be held by a
third-party, instead of the landlord It would also require the landlord
and tenant-to come to an agreement before any portion of the security
deposit is withheld for damages, unpaid rent or other fees.  Such tenan-
cy deposit protection program would include a dispute resolution service
to ensure a security deposit is not arbitrarily withheld.

Also, this legislation mandates that all security deposits are placed in
a newly created "tenant security deposit fund". The fund would be
invested in US treasury bonds and all interest therein would be used to
fund a new housing voucher program called the "New York state rental
supplement program". In New York State, we estimate that there are over
4 billion dollars in security deposits. Currently Landlords can collect
1% of interest gains on a security deposit. This bill would eliminate
that 1% interest fee of landlords.

 
LEGISLATIVE HISTORY:

2020: S3805 (Ramos)

 
FISCAL IMPLICATIONS:

Undetermined.

 
EFFECTIVE DATE:
This act shall take effect in 120 days.

2021-S4785 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4785
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 12, 2021
                                ___________
 
 Introduced  by  Sen.  RAMOS  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Housing, Construction  and
   Community Development
 
 AN ACT to amend the public housing law, the general obligations law, and
   the  state finance law, in relation to establishing the New York state
   emergency rent supplement program

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subdivision  1 of section 14 of the public housing law is
 amended by adding a new paragraph (x) to read as follows:
   (X) ADMINISTER THE NEW YORK STATE EMERGENCY  RENT  SUPPLEMENT  PROGRAM
 PURSUANT TO SECTION 7-103 OF THE GENERAL OBLIGATIONS LAW.
   § 2. Section 7-103 of the general obligations law, as amended by chap-
 ter 1009 of the laws of 1970, subdivisions 2 and 2-a as amended by chap-
 ter 402 of the laws of 1979, is amended to read as follows:
   § 7-103. Money deposited or advanced for use or rental of real proper-
 ty; [waiver void; administration expenses] NEW YORK STATE EMERGENCY RENT
 SUPPLEMENT PROGRAM. 1. [Whenever money shall be deposited or advanced on
 a  contract  or license agreement for the use or rental of real property
 as security for performance of  the  contract  or  agreement  or  to  be
 applied  to  payments  upon  such  contract  or agreement when due, such
 money, with interest accruing  thereon,  if  any,  until  repaid  or  so
 applied, shall continue to be the money of the person making such depos-
 it  or  advance  and shall be held in trust by the person with whom such
 deposit or advance shall be made and  shall  not  be  mingled  with  the
 personal moneys or become an asset of the person receiving the same, but
 may  be disposed of as provided in section 7-105 of this chapter.] THERE
 SHALL BE ESTABLISHED  WITHIN  THE  DIVISION  OF  HOUSING  AND  COMMUNITY
 RENEWAL A NEW YORK STATE EMERGENCY RENT SUPPLEMENT PROGRAM.
   2. [Whenever the person receiving money so deposited or advanced shall
 deposit such money in a banking organization, such person shall thereup-
 on notify in writing each of the persons making such security deposit or
 advance,  giving  the  name  and  address of the banking organization in
 which the deposit of security money is made,  and  the  amount  of  such

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD07381-01-1

 S. 4785                             2

 deposit.  Deposits  in a banking organization pursuant to the provisions
 of this subdivision shall be made in a  banking  organization  having  a
 place  of business within the state. If the person depositing such secu-
 rity  money  in a banking organization shall deposit same in an interest
 bearing account, he shall be  entitled  to  receive,  as  administration
 expenses,  a  sum equivalent to one per cent per annum upon the security
 money so deposited, which shall be in lieu of all  other  administrative
 and  custodial expenses. The balance of the interest paid by the banking
 organization shall be the money of the  person  making  the  deposit  or
 advance  and  shall either be held in trust by the person with whom such
 deposit or advance shall be made, until repaid or applied for the use or
 rental of the leased premises, or annually paid to the person making the
 deposit of security money.
   2-a. Whenever the money so deposited or advanced is for the rental  of
 property  containing  six  or  more  family  dwelling  units, the person
 receiving such money shall, subject to the provisions of  this  section,
 deposit  it  in  an  interest  bearing account in a banking organization
 within the state which account shall earn interest at a rate which shall
 be the prevailing rate earned by other such deposits made  with  banking
 organizations in such area.
   2-b.  In the event that a lease terminates other than at the time that
 a banking organization in such area regularly pays interest, the  person
 depositing  such security money shall pay over to his tenant such inter-
 est as he is able to collect at the date  of  such  lease  termination.]
 SUCH PROGRAM SHALL:
   (A)  INCLUDE  A SYSTEM WHERE TENANT SECURITY DEPOSITS OR ADVANCES ON A
 CONTRACT OR AGREEMENT FOR THE USE OR RENTAL OF REAL PROPERTY ARE HELD BY
 A THIRD-PARTY CUSTODIAN AND ARBITER, WITH INTEREST ACCRUING THEREON;
   (B) REQUIRE LANDLORDS TO PLACE A TENANT'S SECURITY DEPOSIT OR  ADVANCE
 IN SUCH SYSTEM IF A SECURITY DEPOSIT OR ADVANCE IS RECEIVED;
   (C) INCLUDE A PROCESS FOR RETURNING THE SECURITY DEPOSIT OR ADVANCE TO
 THE  TENANT,  INCLUDING  A  METHOD FOR TENANTS TO TRANSFER THE REMAINING
 BALANCE OF THEIR SECURITY DEPOSIT TO APPLY TO A NEW LEASE AGREEMENT;
   (D) REQUIRE THAT IF A LANDLORD WISHES TO WITHHOLD SUCH SECURITY DEPOS-
 IT OR ADVANCE, THE LANDLORD SHALL MAKE  AN  AGREEMENT  WITH  THE  TENANT
 SPECIFYING  THE  AMOUNT OF MONEY TO BE WITHHELD AND THE REASONS FOR SUCH
 WITHHOLDING;
   (E) ESTABLISH A DISPUTE RESOLUTION SERVICE FOR  DISAGREEMENTS  ARISING
 OVER  THE WITHHOLDING OF A SECURITY DEPOSIT OR ADVANCE TO BE PROVIDED AT
 NO COST TO THE LANDLORD AND TENANT;
   (F) REQUIRE THAT BOTH PARTIES AGREE PRIOR TO USING THE DISPUTE  RESOL-
 UTION SERVICE THAT THE DECISION OF SUCH SERVICE IS BINDING; AND
   (G)  INCLUDE  ANY  OTHER  REGULATIONS  AS  DETERMINED NECESSARY BY THE
 COMMISSIONER OF HOUSING AND COMMUNITY RENEWAL.
   2-A. ANY PERSON WHO VIOLATES THE REQUIREMENT  SPECIFIED  IN  PARAGRAPH
 (B) OF SUBDIVISION TWO OF THIS SECTION SHALL BE PUNISHED BY A CIVIL FINE
 OF UP TO FIFTEEN PERCENT OF THE ANNUAL RENT UNDER SUCH CONTRACT.
   3.  Any provision of such a contract or agreement whereby a person who
 so deposits or advances money waives any provision of  this  section  is
 absolutely void.
   4. The term "real property" as used in this section is co-extensive in
 meaning with lands, tenements and hereditaments.
   §  3.  The public housing law is amended by adding a new section 223-c
 to read as follows:
   § 223-C. NEW YORK STATE EMERGENCY  RENT  SUPPLEMENT  PROGRAM.  1.  THE
 DIVISION  SHALL  ESTABLISH  A  FUND  TO  BE KNOWN AS THE TENANT SECURITY

 S. 4785                             3
 
 DEPOSIT FUND FOR THE PURPOSES OF OPERATING  AND  ADMINISTERING  THE  NEW
 YORK  STATE EMERGENCY RENT SUPPLEMENT PROGRAM.  MONIES OF THE FUND SHALL
 BE KEPT SEPARATE FROM AND SHALL NOT BE COMMINGLED WITH ANY OTHER  MONIES
 OF  THE  DIVISION.  THE FUND SHALL CONSIST OF ALL MONIES RECEIVED BY THE
 DIVISION PURSUANT TO SECTION 7-103 OF THE GENERAL  OBLIGATIONS  LAW  AND
 FUNDS  APPROPRIATED  FROM  THE  TENANT SECURITY DEPOSIT FUND ESTABLISHED
 PURSUANT TO SECTION NINETY-NINE-II OF THE STATE FINANCE LAW.
   2. NOTWITHSTANDING ANY OTHER PROVISION OF LAW  TO  THE  CONTRARY,  THE
 DIVISION SHALL PROVIDE AN EMERGENCY RENT SUPPLEMENT TO ELIGIBLE INDIVID-
 UALS AND FAMILIES IN ACCORDANCE WITH THIS SECTION.
   3.  (A)  THE  DIVISION  SHALL  PROVIDE AN EMERGENCY RENT SUPPLEMENT TO
 ELIGIBLE TENANTS AS DEFINED IN SUBDIVISION FOUR OF THIS SECTION  IN  ONE
 MONTH  INTERVALS  FOR UP TO THREE MONTHS OVER A THIRTY-SIX MONTH PERIOD.
 THE EMERGENCY RENT SUPPLEMENT SHALL BE ISSUED BY THE  DIVISION  DIRECTLY
 TO THE LANDLORD OR VENDOR.
   (B)  A  TENANT SHALL RECEIVE NO MORE THAN THREE EMERGENCY RENT SUPPLE-
 MENTS OVER A PERIOD OF THIRTY-SIX MONTHS, REGARDLESS OF THE PREMISES FOR
 WHICH SUCH SUPPLEMENT IS PROVIDED.  SUPPLEMENTS  SHALL  BE  PROVIDED  ON
 BEHALF  OF  TENANTS  AND  SHALL NOT BE BASED UPON THE PREMISES WHICH THE
 TENANT IS LEASING.
   4. A TENANT SHALL BE ELIGIBLE TO RECEIVE AN EMERGENCY RENT  SUPPLEMENT
 IF:
   (A)  THE  TENANT'S  HOUSEHOLD IS AT OR BELOW SIXTY PERCENT OF THE AREA
 MEDIAN INCOME BASED ON THE FAMILY HOUSEHOLD SIZE AS  CALCULATED  BY  THE
 UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT IN ORDER TO BE
 ELIGIBLE FOR AN EMERGENCY RENT SUPPLEMENT;
   (B) THE TENANT PROVIDES PROOF OF AT LEAST NINETY DAYS EMPLOYMENT;
   (C)  THE  TENANT PROVIDES PROOF OF NEED AS DETERMINED BY THE DIVISION.
 FOR THE PURPOSES OF THIS SECTION, PROOF OF NEED INCLUDES, BUT  NEED  NOT
 BE LIMITED TO, NEED DUE TO OUTSTANDING MEDICAL BILLS, DOMESTIC VIOLENCE,
 NOTICE  OF  LATE  RENTAL  PAYMENT,  DELAYED  PAYMENT  DUE TO JOB STATUS,
 STUDENT LOANS, AND MEDICAL LEAVE FROM WORK.   PROOF  OF  NEED  DOES  NOT
 INCLUDE NEED DUE TO LOSS OF A JOB.
   § 4. The state finance law is amended by adding a new section 99-ii to
 read as follows:
   §  99-II.  TENANT SECURITY DEPOSIT FUND. 1. ESTABLISHMENT OF THE FUND.
 THERE IS  HEREBY  ESTABLISHED IN THE JOINT CUSTODY OF  THE  STATE  COMP-
 TROLLER  AND THE COMMISSIONER OF HOUSING AND COMMUNITY RENEWAL A SPECIAL
 FUND TO BE KNOWN AS THE TENANT SECURITY DEPOSIT   FUND. MONEYS  IN  THIS
 ACCOUNT  SHALL BE KEPT SEPARATE AND NOT COMMINGLED WITH ANY OTHER MONEYS
 IN THE CUSTODY OF THE COMPTROLLER.
   2. SOURCES OF FUNDS. THE SOURCES OF FUNDS SHALL CONSIST OF ALL  MONEYS
 DEPOSITED  PURSUANT  TO  SECTION  7-103  OF THE GENERAL OBLIGATIONS LAW.
 MONEYS OF THE FUND SHALL BE INVESTED IN UNITED  STATES  TREASURY  BONDS.
 ANY  INTEREST  RECEIVED BY THE COMPTROLLER ON MONEYS ON DEPOSIT SHALL BE
 RETAINED AND BECOME PART OF THE FUND, UNLESS OTHERWISE DIRECTED BY LAW.
   3. USES OF FUNDS. MONEYS OF THE FUND SHALL BE AVAILABLE  FOR  DISTRIB-
 UTION  TO  THE  NEW  YORK STATE EMERGENCY RENT SUPPLEMENT PROGRAM ESTAB-
 LISHED PURSUANT TO SECTION TWO  HUNDRED  TWENTY-THREE-C  OF  THE  PUBLIC
 HOUSING LAW.
   §  5.    This  act  shall take effect on the one hundred twentieth day
 after it shall have become a law. Effective immediately,  the  addition,
 amendment  and/or  repeal  of  any  rule or regulation necessary for the
 implementation of this act on its effective date are  authorized  to  be
 made and completed on or before such effective date.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Senate Bill S4785

Sponsored By

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

2021-S4785 (ACTIVE) - Details

2021-S4785 (ACTIVE) - Summary

2021-S4785 (ACTIVE) - Sponsor Memo

2021-S4785 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S4785

Share this bill

Sponsored By

Jessica Ramos

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

2021-S4785 (ACTIVE) - Details

2021-S4785 (ACTIVE) - Summary

2021-S4785 (ACTIVE) - Sponsor Memo

2021-S4785 (ACTIVE) - Bill Text download pdf

Comments