Proposed Bill to Cancel Rent Payments for Individuals and Small Businesses
New York State Senate Bill S8125A is back in the headlines after 60,000 New Yorkers reportedly requested for the bill to be passed via the New York Senate’s website. Support for the bill is growing rapidly, earning the backing of Presidential Candidate Bernie Sanders, who tweeted his support over the weekend.
The bill seeks to provide relief to individuals and small businesses who have lost income and/or closed their businesses as a result of COVID-19. Calls for this type of relief have exploded on thousands of social media accounts, marked by hashtags like #cancelrent and #rentfreeze.
As currently drafted, the bill:
- completely waives rents for 90 days, with qualifying tenants having no obligation to make up the payments
- automatically renews leases at the same rent rate that would have otherwise expired during the 90 days
- prohibits imposition of late fees
- includes a corresponding waiver of mortgage payments by landlords who would suffer from the rent relief provisions in the bill, with no obligation to make up those payments
The bill is currently being challenged as an unconstitutional taking, and alleged to be plagued with fatal ambiguities. It has been reported that Governor Cuomo is not currently supporting the bill, believing his existing prohibition on evictions will provide the relief tenants need.
As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.
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