Bill S1425-2013

Requires day care providers to escrow security deposits exceeding the value of two weeks of provided services

Requires day care providers to escrow security deposits in excess of the value of two weeks of provided services.

Details

Actions

  • Jan 8, 2014: REFERRED TO CHILDREN AND FAMILIES
  • Jun 21, 2013: COMMITTED TO RULES
  • Jun 3, 2013: ADVANCED TO THIRD READING
  • May 30, 2013: 2ND REPORT CAL.
  • May 29, 2013: 1ST REPORT CAL.784
  • Jan 9, 2013: REFERRED TO CHILDREN AND FAMILIES

Votes

VOTE: COMMITTEE VOTE: - Children and Families - May 29, 2013
Ayes (6): Felder, Bonacic, Savino, Young, Montgomery, Tkaczyk

Memo

BILL NUMBER:S1425

TITLE OF BILL: An act to amend the social services law, in relation to security deposits collected by child day care providers

PURPOSE: Requires day care providers to escrow security deposits in excess of the value of two weeks of provided services.

SUMMARY OF PROVISIONS: Amends the social services law to require child day care providers to escrow security deposits of an amount in excess of, but not equal to, the fee for two weeks of child care services into an escrow account which shall not be mingled with the personal monies or become an asset of the day care provider. The child day care provider must comply with this requirement and, prior to termination of services by the child's parent or guardian, must: a) provide child care services equal to the amount of time covered by the total amount of the security deposit; or b) return the excess security deposit plus accrued interest; or c) return the total amount of the security deposit plus accrued interest on the excess security deposit.

JUSTIFICATION: Before agreeing to provide child day care services, providers commonly request a deposit from a child's parent or guardian equal to the fee for two weeks of service. The deposit helps provide fiscal stability for the center in the event that parents discontinue service without providing the requested two weeks of notice. This request for a deposit is reasonable.

Occasionally, parents are required to deposit a sum larger than the fee for two weeks of service. In one instance this year, a parent provided a deposit of over $800 to her child day care provider. The provider later declared bankruptcy and closed without providing the services covered by the deposit and without returning any of the deposit to the parent. The provider claimed the money had already been used to cover business expenses.

The law should protect parents or guardians who are required to give deposits larger than the typical amount required equal to the fee for two weeks of service. This legislation would require the child day care provider to deposit the difference between the fee for two weeks of services and the total amount of the required security deposit into an escrow account which shall not be mingled with the personal monies or become an asset of the day care provider.

For example, if a center charges $250 per week of child day care services but requires a deposit of $1,000, then the difference of $500 between the total deposit and the fee for two weeks of service would be deposited into an escrow account, similar to that required for apartment rentals. The center would be required to a) provide child care services equal to the amount of time covered by the total amount of the security deposit;

or b) return the excess security deposit plus accrued interest; or c) return the total amount of the security deposit plus accrued interest on the excess security deposit.

LEGISLATIVE HISTORY: First introduced in 2009-10 2011-2012: S.2355 - Died in Committee

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This act shall take effect 60 days after becoming law.


Text

STATE OF NEW YORK ________________________________________________________________________ 1425 2013-2014 Regular Sessions IN SENATE (PREFILED) January 9, 2013 ___________
Introduced by Sen. MONTGOMERY -- read twice and ordered printed, and when printed to be committed to the Committee on Children and Families AN ACT to amend the social services law, in relation to security depos- its collected by child day care providers THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. The social services law is amended by adding a new section 390-i to read as follows: S 390-I. REQUIRING CHILD DAY CARE PROVIDERS TO ESCROW CERTAIN SECURITY DEPOSITS. 1. CHILD DAY CARE PROVIDERS, LICENSED OR REGISTERED PURSUANT TO THIS TITLE, THAT COLLECT ADVANCE SECURITY DEPOSITS OF AN AMOUNT IN EXCESS OF, BUT NOT EQUAL TO, THE FEE FOR TWO WEEKS OF CHILD CARE SERVICES ARE REQUIRED TO DEPOSIT THE DIFFERENCE BETWEEN THE FEE FOR TWO WEEKS OF SERVICES AND THE TOTAL AMOUNT OF THE REQUIRED SECURITY DEPOSIT INTO AN ESCROW ACCOUNT WHICH SHALL NOT BE MINGLED WITH THE PERSONAL MONIES OR BECOME AN ASSET OF THE DAY CARE PROVIDER. 2. THE CHILD DAY CARE PROVIDER MUST COMPLY WITH THE REQUIREMENTS OF SUBDIVISION ONE OF THIS SECTION AND, PRIOR TO TERMINATION OF SERVICES BY THE CHILD'S PARENT OR GUARDIAN MUST: (A) PROVIDE CHILD CARE SERVICES EQUAL TO THE AMOUNT OF TIME COVERED BY THE TOTAL AMOUNT OF THE SECURITY DEPOSIT; OR (B) RETURN THE EXCESS SECURITY DEPOSIT PLUS ACCRUED INTEREST; OR (C) RETURN THE TOTAL AMOUNT OF THE SECURITY DEPOSIT PLUS ACCRUED INTEREST ON THE EXCESS SECURITY DEPOSIT. S 2. This act shall take effect on the sixtieth day after it shall have become a law.

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