S 4579 New York Senate · 2025 Regular Session

Prohibits bank investments in bad faith landlords

Bill S 4579 aims to prohibit state-chartered banking institutions from providing financing or investments to landlords who have engaged in specific "bad faith" practices. These practices include, for instance, granting rent abatements due to housing code violations, repeated fraudulent acts, or tenant harassment within the past one to five years. An exception allows financing if the funds are used solely to cure or prevent immediately hazardous building or fire code violations. Landlords applying for financing must self-certify their eligibility, and false certifications can result in civil penalties. The bill directs the Superintendent to promulgate regulations and create a sample certification form to implement these requirements.

Issues: ✓ Housing

Bill status in committee 1 of 4 stages cleared

Introduction

Feb 2025

Committee Review

Floor Vote

Governor

Introduced Feb 7, 2025 Last action May 19, 2025

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What changed between versions

S4579 → S4579A · 5 edits

MODERATE

This bill was amended to significantly expand its scope and strengthen its provisions regarding which landlords state-chartered banks can invest in. The original version only prohibited investments in landlords with specific convictions or consent decrees, while the amended version now prohibits financing for any entity that has violated housing codes, engaged in harassment or retaliation, or has multiple hazardous violations. The amendment also added new exemptions for financing used to fix immediate hazards and established a self-certification process with penalties for false statements.

Scope change

The bill's scope expanded from targeting landlords with specific legal convictions to covering any entity with housing code violations, harassment, retaliation, or hazardous property conditions within the past five years.

ELIGIBILITY

Changed the definition of prohibited landlords from those convicted of illegal conduct or with consent decrees to include any entity with housing code violations, harassment, retaliation, or multiple hazardous violations in the past five years.

EXEMPTIONS

Added an exemption allowing financing when used solely to cure or prevent immediately hazardous violations of building and housing codes.

REQUIREMENT

Added a self-certification requirement for applicants to confirm they are not covered by prohibited acts or will use financing only for exempt purposes.

ENFORCEMENT

Added civil penalties of $10,000 to $50,000 for false certifications and required the Superintendent to promulgate regulations and sample certification forms.

TIMELINE

Changed the effective date from immediate to 90 days after the Department of Financial Services promulgates necessary regulations.

Floor votes

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Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

May 19, 2025

Upper · Passed

PRINT NUMBER 4579A

upper

May 19, 2025

Upper · Passed

AMEND AND RECOMMIT TO BANKS

upper

Feb 7, 2025

Committee

REFERRED TO BANKS

upper

1 primary · 2 co-sponsors