Prohibits the collection of administration expenses by a landlord and provides for the tenant to collect all interest paid by the banking organization on a security deposit or advance when such is deposited into an interest bearing account.
TITLE OF BILL:
An act to amend the general obligations law, in relation to tenant security deposits
Prohibits the collection of administration expenses by a landlord and provides for the tenant to collect all interest paid on a security deposit or advance.
SUMMARY OF PROVISIONS:
Section 1 of the bill amends section 7-103 of the general obligations law to remove the ability of a landlord to collect administration expenses on a tenant's security deposit and allows for a tenant to collect on all interest paid on the security deposit.
Currently a landlord is allowed to collect, as "administration expenses" a sum equivalent to one per cent per annum upon a tenant's security deposit.
It is unjust for a landlord to have the ability to take one percent of the interest compounded by a tenant's security deposit. The security deposit is the tenant's money. Therefore it is only just that the tenant be allowed to keep all of his or her interest from that deposit.
2007: S.3556 (Duane), Died in Judiciary 2008: S.3556 (Duane), Died in Judiciary 2009: S.3338 (Duane), Died in Judiciary 2010: S.3338 (Duane), Died in Judiciary
LOCAL FISCAL IMPLICATIONS:
EFFECTIVE DATE: This act shall take effect on the first of January next succeeding the date on which it shall have become law.
STATE OF NEW YORK ________________________________________________________________________ 1281 2011-2012 Regular Sessions IN SENATE January 6, 2011 ___________Introduced by Sen. DUANE -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary AN ACT to amend the general obligations law, in relation to tenant secu- rity deposits THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. The section heading and subdivision 2 of section 7-103 of the general obligations law, the section heading as amended by chapter 1009 of the laws of 1970 and subdivision 2 as amended by chapter 402 of the laws of 1979, are amended to read as follows: Money deposited or advanced for use or rental of real property; waiver void
[; administration expenses]. 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 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. S 2. This act shall take effect on the first of January next succeed- ing the date on which it shall have become a law.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD01190-01-1