Bill > A00629

This bill establishes a comprehensive tenancy deposit protection program administered by the Division of Housing and Community Renewal that fundamentally changes how security deposits are handled in rental agreements. The program requires landlords to place tenant security deposits with a third-party custodian, creating a system that includes mandatory deposit tracking, interest accrual, and a structured process for deposit return. Specifically, landlords must place security deposits in a designated system, and if they wish to withhold any portion of the deposit, they must provide a written agreement with the tenant specifying the exact amount and reasons for withholding. The bill introduces a free dispute resolution service that both parties must agree is legally binding, with potential civil penalties of up to 15% of annual rent for landlords who fail to comply with the new deposit handling requirements. The goal appears to be increasing transparency and protecting tenants' financial interests by creating a standardized, neutral process for managing security deposits, with the program becoming effective 120 days after the bill becomes law. This represents a significant shift from the previous system, where landlords had more discretion in handling security deposits.

Housing and Urban Affairs

https://www.nysenate.gov/legislation/bills/2025/A629