S272-2011 Actions

• Jan 4, 2012: REFERRED TO JUDICIARY
• Jan 5, 2011: REFERRED TO JUDICIARY

S272-2011 Memo

BILL NUMBER:S272

TITLE OF BILL:
An act
to amend general obligations law, in relation to money deposited or
advanced for use or rental of real property

PURPOSE:
To eliminate a landlord's entitlement to one
percent of the
interest upon the security deposit money of a tenant.

SUMMARY OF PROVISIONS:
Section 1 amends subdivision 2
of section 7-103
of the general obligations law by eliminating a landlord's entitlement
to one percent of the interest upon the security money of a tenant.

Section 2 is the effective date.

JUSTIFICATION:
When this law was originally created, the prevailing
interest rate on the security deposit money was 6%, leaving the
tenants with 5%. Today, the rate is 1.1 % or lower. With a 1.1 %
interest rate, tenants are only entitled to just one-tenth of the
interest. With such a low interest rate, the tenants should be
entitled to the total interest.

BILL HISTORY:
S.2376 of 2007/2008; Referred to Judiciary.
S.3204 of 2009/2010; Referred to Judiciary

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect on the first of January
next succeeding the date on which it shall have become a law.

S272-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                          272
 2011-2012 Regular Sessions
 I N  SENATE
 (PREFILED)
 January 5, 2011
 
 Introduced  by  Sen. MAZIARZ -- read twice and ordered printed, and when
 printed to be committed to the Committee on Judiciary
 

AN ACT to amend general obligations law, in relation to money  deposited
 or advanced for use or rental of real property
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1. Subdivision 2 of section 7-103 of the  general  obligations
 law,  as  amended by chapter 402 of the laws of 1979, is amended to read
 as follows:

 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.
 LBD01602-01-1

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