Provides that no default in the payment of rent due or judgment of possession shall be entered against a tenant who is a small business between March seventh, two thousand twenty and a date six months after the expiration of the state disaster emergency, as such term is defined in section twenty of the executive law, declared pursuant to executive order two hundred two of two thousand twenty, as amended.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10387
SPONSOR: Epstein TITLE OF BILL:
An act to amend the real property actions and proceedings law, in
relation to default of payment of rent
PURPOSE OR GENERAL IDEA OF BILL:
To protect small business and non-profit tenants impacted by the COVID-
19 pandemic from losing their businesses and organizations in a posses-
sory judgement.
SUMMARY OF PROVISIONS:
Section 1 amends subdivision 2 of section 711 of the real property
actions and proceedings law to provide that the subdivision shall not
apply where a tenant is a small business or non-profit and has defaulted
in the payment of rent due between March 7th 2020 and a date six months
after the expiration of the state disaster emergency.
Section 2 amends section 747 of the real property actions and
proceedings law to provide that no possessory judgement shall be entered
from rent owed by a small businesses or non-profit tenant between March
7th 2020 and a date six months after the expiration of the state disas-
ter emergency.
Section 3 amends the real property actions and proceedings law by adding
a new section 712 to provide that no small business or non-profit tenant
shall be removed from possession in a special proceeding maintained
under the article upon the grounds of the section.
JUSTIFICATION:
There are over 400,000 small businesses in New York. Many of these firms
are suffering losses to their bottom line as a result of the COVID-19
pandemic, jeopardizing the livelihoods of hundreds of thousands of New
Yorkers. A $349 billion aid program has been slow to reach small busi-
nesses thanks in part to banking industry that has favored large corpo-
rations over mom and pops, according to an April 22nd, 2020 report by
the New York Times. Without aid, these struggling businesses are unable
to meet their expenses, including rent. In addition to providing employ-
ment opportunities and essential goods and services, New York's small
businesses generate billions of dollars in sales tax revenue for the
state, making them an integral part of our economy.
Non-profits also play essential roles in strengthening neighborhoods by
offering a variety of services such as assistance in obtaining housing,
employment, and securing benefits. A 2016 report issued by the State
Comptroller found that non-profits provided 1.3 million jobs for New
Yorkers and nearly $62 billion in wages. Like small businesses, these
organizations resources are strained as many of their caseloads have
gone up in response to the COVID-19 pandemic and the economic fallout it
has caused. Now more than ever must we ensure that the small, community
based organizations that are serving New Yorkers in this crisis can
continue to do so.
Part of any strategy to restart New York's economy must include efforts
to preserve the hundreds of thousands of struggling small businesses and
nonprofits. This bill aims to prevent the mass eviction of hundreds of
thousands of small businesses and small non-profits that default on rent
during the COVID-19 pandemic.
PRIOR LEGISLATIVE HISTORY:
New bill.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
Unknown.
EFFECTIVE DATE:
Immediately after becoming law.
STATE OF NEW YORK
________________________________________________________________________
10387
IN ASSEMBLY
May 4, 2020
___________
Introduced by M. of A. EPSTEIN -- read once and referred to the Commit-
tee on Judiciary
AN ACT to amend the real property actions and proceedings law, in
relation to default of payment of rent
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 2 of section 711 of the real property actions
2 and proceedings law, as amended by section 12 of part M of chapter 36 of
3 the laws of 2019, is amended to read as follows:
4 2. The tenant has defaulted in the payment of rent, pursuant to the
5 agreement under which the premises are held, and a written demand of the
6 rent has been made with at least fourteen days' notice requiring, in the
7 alternative, the payment of the rent, or the possession of the premises,
8 has been served upon him or her as prescribed in section seven hundred
9 thirty-five of this article. Any person succeeding to the landlord's
10 interest in the premises may proceed under this subdivision for rent due
11 his or her predecessor in interest if he or she has a right thereto.
12 Where a tenant dies during the term of the lease and rent due has not
13 been paid and the apartment is occupied by a person with a claim to
14 possession, a proceeding may be commenced naming the occupants of the
15 apartment seeking a possessory judgment only as against the estate.
16 Entry of such a judgment shall be without prejudice to the possessory
17 claims of the occupants, and any warrant issued shall not be effective
18 as against the occupants. This subdivision shall not apply where a
19 tenant that is a small business, as defined by section one hundred thir-
20 ty-one of the economic development law, has defaulted in the payment of
21 rent due between March seventh, two thousand twenty and a date six
22 months after the expiration of the state disaster emergency, as such
23 term is defined in section twenty of the executive law, declared pursu-
24 ant to executive order two hundred two of two thousand twenty, as
25 amended.
26 § 2. Subdivision 2 of section 747 of the real property actions and
27 proceedings law, as added by chapter 312 of the laws of 1962, is amended
28 to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD16242-01-0
A. 10387 2
1 2. The judgment shall not bar an action to recover the possession of
2 real property. The judgment shall not bar an action, proceeding or coun-
3 terclaim, commenced or interposed within sixty days of entry of the
4 judgment, for affirmative equitable relief which was not sought by coun-
5 terclaim in the proceeding because of the limited jurisdiction of the
6 court. No judgment for possession shall be entered from rent owed by a
7 tenant that is a small business, as defined by section one hundred thir-
8 ty-one of the economic development law, between March seventh, two thou-
9 sand twenty and a date six months after the expiration of the state
10 disaster emergency, as such term is defined in section twenty of the
11 executive law, declared pursuant to executive order two hundred two of
12 two thousand twenty, as amended.
13 § 3. The real property actions and proceedings law is amended by
14 adding a new section 712 to read as follows:
15 § 712. Grounds where landlord-tenant relationship exists; special
16 proceedings for rent due from small businesses during the COVID-19
17 pandemic. As used in this section, a "tenant" shall mean a tenant that
18 is a small business, as defined by section one hundred thirty-one of the
19 economic development law. No tenant shall be removed from possession in
20 a special proceeding maintained under this article upon the grounds of
21 this section. A special proceeding for a judgment of rent due may be
22 maintained where the tenant has defaulted in the payment of rent, pursu-
23 ant to the agreement under which the premises are held, where such rent
24 was due between March seventh, two thousand twenty and a date six months
25 after the expiration of the state disaster emergency, as that term is
26 defined in section twenty of the executive law, declared pursuant to
27 executive order two hundred two of two thousand twenty, as amended, and
28 a written demand of the rent has been made with at least fourteen days'
29 notice requiring the payment of the rent, served upon the tenant as
30 prescribed in section seven hundred thirty-five of this article. Any
31 person succeeding to the landlord's interest in the premises may proceed
32 under this section for rent due his or her predecessor in interest for
33 the time period specified above if he or she has a right thereto.
34 § 4. This act shall take effect immediately.
