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Memorandum of Opposition to Intros 1419-A and 1437-A
October 6, 2017
M E M O R A N D U M O F O P P O S I T I O N
SUBJECT: A Local Law to amend the New York City Charter, in relation to penalties for aggravated violations of the construction codes.
SPONSORS: Mark-Viverito, Crowley, Salamanca, Dromm, Gentile, Rosenthal, Rose, Reynoso, Levin, Espinal, Menchaca, Cornegy, Richards and Chin
SUBJECT: A Local Law to amend the New York City Charter, in relation to increasing the civil penalties for construction sites with excessive violations
SPONSORS: Menchaca, Crowley, Salamanca, Gentile, Rosenthal, Rose, Reynoso, Levin, Espinal, Cornegy, Richards and Chin
DATE: October 6, 2017
REBNY represents over 17,000 owners, developers, managers and brokers of real property in New York City. We support the overall goals of these bills to insure that owners and permit holders promote safe construction sites. However, these bills do not take into account practical considerations.
Intro 1419-A imposes penalties of $500,000 to $1,500,000 for immediately hazardous or major violation of chapter 33 of the NYC Building Code where the violation is accompanied by or results in a fatality or serious physical injury. REBNY reiterates its concern that the bill does not include any relief provision if said injury or death is the result of a worker’s negligence. Without such a relief provision, the bill would impose a de facto strict liability standard upon the owner and permit holder that could be used against them in other, related litigation. Such a relief provision should include a means of determining liability for such injury or fatality in addition to allowing the owner or permit holder to unilaterally eject any worker from the site who poses a safety threat to herself and/or other workers.
Further, REBNY reiterates the impact of such fines upon the construction insurance market. Although regulatory and punitive fines are generally not covered by insurance, fines – along with other market factors – impact upon insurance premium rate-setting. Insurance carriers have already existed the NYC market due to strict liability laws such as the Scaffold Law. The limited availability of insurance carriers in the NYC market has resulted in significant increases in insurance costs – up to 10 to 12 percent of the entire construction budget.
Intro 1437-A increases fines for construction sites that exceed 90% of construction site violation ratios. REBNY appreciates the exclusion of violations in adjudication from the ratio. However, we still express our opposition to the bill’s creation of a “worst 10 percent” subject to increased fines. The issuance of violations are driven by how often DOB inspectors visit a particular site. In order for this ratio to be applied fairly, DOB would need to insure that inspections occur on ALL construction sites throughout the city – from major buildings in midtown Manhattan to two-family homes in the outer boroughs - for an equal amount of visits. Otherwise, the ratio will be skewed, inequitable and ripe for legal challenge.