What's happening
This bill caps residential lease security deposits and move-in fees for leases of one year or longer, and sets specific limits and refund rules for additional fees.
Why it matters
Limits the total upfront costs. (including security deposit, pet fees, and move-in fees) for leases of one year or longer to one month’s rent, lowering financial barriers for tenants when signing a lease.
Caps individual additional fees. Pet deposits can’t exceed 25% of the capped total deposit, and any other move-in fees (like background or credit checks) can’t exceed 10%, ensuring landlords can’t circumvent the overall cap with add-ons.
Requires refunding most fees. All fees (except nonrefundable background/credit check fees) must be returned to the tenant, and any pet-related fee can only be kept to cover cleaning or damage directly caused by the pet, increasing protection for tenants’ money.
Imposes penalties for violations. Landlords who break these rules face civil fines of up to 15% of the annual rent, adding a tangible deterrent to overcharging or retaining deposits improperly.
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Who cares
Tenants signing residential leases of one year or longer
The bill would cap deposits or advances, including additional move-in fees, at one month's rent.
Residential landlords
They would face limits on move-in charges and a civil fine of up to 15 percent of annual rent for violations.
Tenants with common household pets
Pet deposits would be capped at 25 percent of the total deposit or advance and could be retained only for cleaning or repairs for damage directly caused by the pet.
Rental applicants paying screening fees
Background-check and credit-check fees would count toward the overall cap, with each limited to 10 percent of the total deposit or advance, but would not have to be refundable.
Headline styles
Cap Security Deposits at One Month
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Recommit, enacting clause stricken
- Referred to judiciary
- Referred to judiciary
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Cap Security Deposits
In Assembly Committee · Judiciary · Sponsor Linda Rosenthal
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3379
2019-2020 Regular Sessions
IN SENATE
February 6, 2019
Introduced by Sen. HOYLMAN -- 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 a cap on security deposits for residential leases of one year or longer
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 7-103 of the general obligations law is amended by adding a new subdivision 2-c to read as follows:
2-c. (a) For all contracts under this section of one year or longer, any deposit or advance shall not exceed the amount of one month's rent under such contract.
(b) Any additional move-in fees, including fees for common household pets, background checks or credit checks, shall be included within the dollar amount required by paragraph (a) of this subdivision. If the landlord requests a deposit for the residing of a common household pet from the tenant, such fee shall not exceed twenty-five percent of the total deposit or advance. Any other move-in fee shall not exceed ten percent of the total deposit or advance.
(c) All fees under this section, except fees for background checks and credit checks, shall be refundable to the tenant. The portion of any fee collected by the landlord for a tenant's common household pet shall only be retained by the landlord after the tenant has vacated the premises if such money is used for cleaning or to repair damages caused directly by such pet.
(d) Any person who violates the provisions of this subdivision shall be punished by a civil fine of up to fifteen percent of the annual rent under such contract.
§ 2. This act shall take effect on the sixtieth day after it shall have become a law.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00541-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the general obligations law, in relation to a cap on security deposits for residential leases of one year or longer
Purpose
This bill would prohibit security deposits and move in fees for residen- tial leases of at least one year from exceeding one month's rent.
Summary of specific provisions
Section one amends section 7-103 of the general obligations law by adding a new subdivision 2-c.
Section two sets forth the effective date.
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 often require upwards of two 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 sign- ing.
According to a report from the office of New York City Controller Scott Stringer, New York City tenants spent $507 million on security deposits in 2016. Often times, a security deposit for a residential lease can be equivalent to two months' worth of rent payments or more, creating a serious financial burden for New Yorkers already struggling with exorbi- tant housing costs. In addition to security deposits, prospective tenants may also be faced with pet deposits/fees as well as fees for background and credit checks, further increasing the cost due upfront to secure housing.
A security deposit, meant to provide security to a landlord in case of damages to a unit, and any additional fees should not prevent working- class residents from being able to obtain safe and affordable housing. A number of states, including Massachusetts, Hawaii and Delaware have enacted legislation at the state level to prohibit landlords from taking advantage of tenants through excessive security deposits. This legis- lation would protect tenants entering residential leases in New York State by not allowing security deposits and any additional move in fees to exceed more than one month's rent.
Legislative history
New bill.
Fiscal implications
None to the State.
Effective date
This act shall take effect in 60 days.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.