Memorandum of Opposition to Intro 1551-A

M E M O R A N D U M  O F  O P P O S I T I O N

INTRO NO:      1551-A

SUBJECT:          A Local Law to amend the administrative code of the city of New York, in relation to disclosure of fees in residential leases.

SPONSORS:    Torres, Rosenthal, Levine, Richards, Menchaca, Levin

DATE:             October 10, 2017

 

The Real Estate Board of New York (REBNY), representing over 17,000 owners, developers, managers and brokers of real property in New York City, thanks you for the opportunity to provide additional comments on Intro No. 1551-A. While REBNY supports the overall goals of this legislation to bring transparency to the landlord-tenant relationship, the current bill creates unrealistic expectations upon owners that make it exceedingly difficult for them to comply. 

 

REBNY OPPOSES INTRO NO. 1551-A. Requiring owners to disclose a list of all current and potential future fees poses a considerable administrative burden upon owners. Disclosing fees for electric amenities such as air conditioning and/or washer and dryer use, for example, would require that fees be updated on an annual basis to accurately reflect City rates. This provision would effectively prevent tenants from being able to sign on to two-year leases to ensure full accuracy of these fees or it may make it difficult for owners to be fairly compensated if electricity rates increase after each lease singing.

Section 26-1301 (iv), which requires that owners apply any payments made first to contract rent before non-rent fees, makes it difficult for owners to recover any unpaid non-rent fees. The only way for owners to recover these fees if a tenant refused payment would be to bring them to small claims court—an overly burdensome process to recover contracted fees clearly disclosed within the lease agreement. The bill should be amended to allow owners to collect on contracted and unpaid non-rent fees. Additionally, most accounting systems apply payments to the earliest open balance and cannot distinguish between contract rent, late fees and non-rent fees. This provision poses an extreme administrative hardship for these owners since they would have to go back and manually adjust each monthly bill for each tenant if they did not pay in full.

Lastly, requiring owners to implement a three month delay before s/he may begin charging for the non-rent fee may cause unintended disruptions to amenity services. Although this provision allows for un-contracted services to be incorporated post-lease signing, the bill should allow for exclusions if the tenant agrees they want immediate access to the amenity. Though most of these services are contracted for at the time of the lease signing, a tenant may decide later on to include additional amenity services. This provision would only penalize tenants in these situations.

Thank you again for the opportunity to comment. We look forward to continuing our conversations with the Council to continue improve this legislation.