Legislative Memorandum Re: Tenant Harassment

INTRODUCTION

The Real Estate Board of New York (REBNY), representing more than 17,000 owners, developers, managers and brokers of real property in New York City, appreciates the opportunity to provide testimony regarding the New York City Council’s anti-tenant harassment legislation.

REBNY recognizes the importance of protecting tenants from improper owner behavior designed to force vacancies.  However, legislation to discourage and penalize such behavior must be narrowly tailored so that only the “bad actors” are isolated and affected. 

The 14 bills to be considered by the Committee on Housing and Buildings can be sorted into five categories: Definitions of Harassment, Penalties and Violations, Tenant Protection Plans and Notices, Private Dwellings, and Reporting Requirements.  Below REBNY outlines our position as follows:

DEFINITIONS OF HARASSMENT

Intro No: 1530

Summary: Creates a rebuttable presumption where an owner commits one of a list of harassing acts or omissions, such act or omission constitutes harassment.

Sponsors: Mark-Viverito, Rosenthal, Dromm, Levine, Menchaca

REBNY OPPOSES INTRO 1530.  Legal precedence squarely places the burden of proving harassment upon the tenant.  The Housing Maintenance Code, as codified by New York City Administrative Code §27-2002(48), is an exhaustive list of owner acts, omissions and patterns of behavior that could be construed as harassment.  It is up to the finder of fact to determine whether the tenant has presented enough evidence to show whether that owner engaged in harassment.  There is no finding whatsoever provided by the sponsors of this bill or any other source that shows that the predominance of tenant harassment cases result in a favorable finding for the tenant to reverse this long-standing legal precedent. 

To create a rebuttable presumption in favor of the tenant will result in many claims of harassment against all owners – “good” and “bad” – because the bar will be set low.  All a tenant needs to do is to assert owner acts or omissions that could loosely make out a harassment case under the Housing Maintenance Code, no matter how tenuous the evidence may be.  It will be the owner that will need to prove otherwise.  New York City Housing Court, already backed-logged and under-resourced, will become mired in tenant harassment cases.  A cottage industry of tenant-side lawyers could base entire practices with harassment cases as their staple.  Under this bill, the tenant could conceivably initiate such harassment suits as retribution to the owner.  In no way should REBNY’s opposition be construed as minimizing legitimate cases of tenant harassment but this bill would turn the most basic American concept of justice - “innocent until proven guilty” - on its head. 

Intro No: 1548

Summary: Expands the definition of harassment to include contacting or visiting a person at unusual hours.

Sponsors: Levine, Rosenthal, Richards, Menchaca

REBNY OPPOSES INTRO 1548.  This bill, in addition to Intro Nos. 1549 and 1551, aims to expand the Administrative Code’s definition of harassment.  However, the bill’s definitions are too broad and would do little to expand New York City’s current protection of tenants. Under New York State Law [1], owners are already required to protect a tenant’s right to peace and quiet.  Intro 1548 fails to distinguish between acceptable and unacceptable hours of contact, and most importantly, what constitutes unusual hours.  This bill is overly broad and could be readily challenged for vagueness. 

Intro No: 1549

Summary: Allow owner's prior conduct to be considered as repeated even if the prior act(s) were directed toward a different tenant.

Sponsors: Menchaca, Rosenthal, Levine, Richards

REBNY OPPOSES INTRO 1549.  Additionally, Intro No. 1549 would protect tenants from significant disruption of essential services which is already provided for under current City law.  However, this bill would penalize building owners for separate and unrelated instances of essential service disruption, provided there is an established history. In short, this bill would do little to target actual cases of tenant harassment, but would succeed in its broad classification of unrelated instances as harassment.

Intro No: 1551

Summary: Defines placing non-rent fees on bill as harassment where such fees have not been (i) approved by DHCR or; (ii) agreed to in the lease.

Sponsors: Torres, Rosenthal, Levine, Richards, Menchaca

REBNY OPPOSES INTRO 1551.  Similar to Intro 1548, this bill contains a broad definition of non-rent fees. While most non-rent fees may already be negotiated within the terms of a lease, there may be other small fees, such as bicycle storage and use of personal washing machines or other large appliances that are not.  These non-rent fees are not necessarily indicative of harassment.

_________________________________________

PENALTIES & VIOLATIONS

Intro No: 3

Summary: Allows the Department of Housing Preservation and Development (HPD) to bring action against the owner of a building in order to recover relocation expenses following a vacate order. Under such an order, the owner would be required to create an escrow account (naming HPD as escrowee) for an amount equal to at least ten percent of the building’s rent roll for the five years preceding the vacate order.

Sponsors: Chin, Koslowitz, Rosenthal, Lancman, Richards, Johnson, Levine, Reynoso, Mendez, Maisel, Van Bramer, Rodriguez, Menchaca

REBNY OPPOSES INTRO 3.  This bill would adversely affect smaller owners without the financial resources to create the escrow account. 

Intro No: 347-A

Summary: Allows New York City Civil Court to award any or all of the following resulting from an owner’s breach of duty to refrain from tenant harassment actions: (i) statutory damages; (ii) compensatory and punitive damages; and (iii) attorneys' fees and costs.

Sponsors: Rosenthal, Williams, Chin, Johnson, Levine, Reynoso, Torres, Rodriguez, Dromm, Kallos, Lander, Rose, Menchaca, Richards

REBNY OPPOSES INTRO 347-A. Coupled with the creation of the rebuttable presumption of owner harassment, recovery of attorney costs and damages beyond the statutory awards might only further encourage the filing of specious claims.  If attorneys’ fees and costs are to be awarded, the English rule should be applied that provides recovery for either successful party.[2]

Intro No: 931

Summary: Allows tax liens to be issued against owners with unpaid Environmental Control Board (ECB) violations, which would subject the building to foreclosure if the judgment remains unpaid.  Threshold amounts are $20,000 in outstanding violations for buildings with 20 units or more, and $15,000 for buildings with six to 19 units.

Sponsors: Kallos, Chin, Johnson, Levin, Levine, Menchaca, Mendez, Reynoso, Rosenthal, Rose, Lander, Lancman, Rodriguez, Richards, Van Bramer

REBNY OPPOSES INTRO 931. This bill would likely expose smaller owners to financial hardship who may be struggling to pay their ECB infractions.  While the City might recoup lost revenues from the sale of tax liens, low-middle income housing units may be at risk.  Housing advocates and local elected officials point out buildings acquired through tax lien sales are often neglected.[3]  With the relatively low thresholds outlined in this bill, it is conceivable that a building could fall into tax lien status with a relatively small amount of violations.  A better practice might be to create a fund to help struggling owners correct violations. 

Intro No: 1556

Summary: Would increase the minimum fine for tenant harassment from $1,000 to $2,000, and from $2,000 to $4,000 for a second violation within five years.

Sponsors: Williams, Cumbo, Rosenthal, Dromm, Menchaca

REBNY takes no position on Intro 1556.

_________________________________________

TENANT PROTECTION PLANS & NOTICES

Intro No: 936

Summary: Amends the information that must be included in tenant protection plans to include information on mold compliance and contact information for site safety managers, coordinators or superintendents. There must also be a notice detailing the location and availability of the tenant protection plan.

Sponsors: Levine, Mendez, Chin, Johnson, Kallos, Levin, Menchaca, Reynoso, Rosenthal, King, Rose, Lander, Lancman, Rodriguez, Miller, Richards, Garodnick, Van Bramer, Cumbo

REBNY takes no position on Intro 936. Though this bill addresses important information that would certainly benefit tenants, we question the ability of Department of Buildings (DoB) to enforce this bill in light of the agency’s already limited inspection resources. Additionally, this bill calls for the immediate inspection of tenant protection plans. Would work fail to proceed if DoB is unable to send an inspector within the 7 day deadline?

Intro No: 960

Summary: Requires that a detailed notice be posted for occupants of a multiple dwelling when the owner seeks to conduct any construction work requiring a permit from DoB.

Sponsors: Mendez, Chin, Lander, Espinal, Johnson, Kallos, Levin, Levine, Menchaca, Reynoso, Rosenthal, Cumbo, Gentile, Koo, Palma, Rodriguez, Rose, Richards, Garodnick, Van Bramer

REBNY takes no position on Intro 960. Intro 960 fails to account for maintenance work occurring as a result of emergency situations. In such a case, it may be difficult for an owner to give notice when the priority is given to remedying the service interruption itself. Would these instances also be exempt from the filing of the tenant protection plan?

_________________________________________

PRIVATE DWELLINGS

Intro No: 1550

Summary: Would make harassment laws applicable to private dwellings. This law would not apply to those lawfully residing in a dwelling, such as a shareholder on a proprietary lease or unit owner of a condominium.

Sponsors: Rosenthal, Levine, Menchaca

REBNY takes no position on Intro 1550.  The bill seems to address border situations or room rentals in private dwellings.  However, most of the tenant-owner agreements are not formalized through a written lease.  How will courts interpret these relationships and what kinds of evidence will be allowed to attest the parameters of these agreements?

_________________________________________

REPORTING REQUIREMENTS

Intro No: 926

Summary: Creates a task force comprised of DoB, HPD, DHMH, DEP, City Council and the Mayor to evaluate and make recommendations on issues tenants face during construction and renovation in residential buildings.

Sponsors: Garodnick, Chin, Espinal, Johnson, Kallos, Levin, Levine, Menchaca, Reynoso, Rosenthal, Constantinides, Koo, Rose, Lander, Rodriguez, Richards, Mendez, Van Bramer

REBNY takes no position on Intro 926.

Intro No: 1523

Summary: Establishes an office of the tenant advocate within DoB whose primary responsibility would be to approve tenant protection plans and site safety plans. Office would also be required to report its findings to the Mayor and speaker of the Council.

Sponsors: Rosenthal, Levin, Salamanca

REBNY OPPOSES INTRO 1523.  The creation of the Office of the Tenant Advocate within DoB might be a worthy endeavor if the Office is devoted not only to protecting the interests of the tenant during construction, but also to assisting tenants with their responsibilities during such times.  The bill also outlines responsibilities that are already absorbed by other units with DoB, such as the approval of site safety plans.  The Building Code calls for the creation and approval of site safety plans for major projects of 10 stories or more, or projects of over 100k SF.  Moreover, site safety plans are technical documents requiring high-level expertise and developed to safeguard the general public and workers on-site, not specifically tenants.  An amended bill should remove any reference to site safety plans.

Intro No: 938

Summary: Requires DoB to compile and maintain a watch list of contractors performing work without a required permit in the preceding two years. It would also require the agency to increase its oversight of any flagged contractors.

Sponsors: Reynoso, Chin, Johnson, Kallos, Levin, Levine, Menchaca, Mendez, Rosenthal, Gentile, Koo, Koslowitz, Lander, Rodriguez, Rose, Richards, Van Bramer

REBNY supports Intro 938.  REBNY supports the Council’s intent to monitor high-risk contractors who have previously violated the Department of Building’s permit requirements. Permits help to ensure that work performed in construction sites adheres to the building code and the City’s outlined safety requirements. REBNY encourages a robust analysis of such a list to ensure it accurately reflects the City’s most recent high-risk contractors and not contractors who have taken the necessary steps to remedy any infractions. 

_________________________________________

[1] Section 235-b of New York State Real Property Law.

[2] See, Huskins, Priya Cherian.  (24 July 2014)  The English Rule: Loser Pays.  Inside Counsel.  Retrieved April 18, 2017 from http://www.insidecounsel.com/2014/07/24/the-english-rule-loser-pays

[3] Silver-Greenberg, Jessica and Barker, Kim.  (6 October 2016) New York City Sells Landlords’ Debts, but Buildings Fall into Limbo, Critics Say.  New York Times.  Retrieved April 18, 2017 from https://www.nytimes.com/2016/10/07/nyregion/new-york-city-sells-landlords-debts-but-buildings-fall-into-limbo-critics-say.html