Bill Text: NJ A4396 | 2016-2017 | Regular Session | Introduced
Bill Title: Prohibits landlords from requiring residential tenants pay rent and other related charges through electronic funds transfer, including automatic debit payments.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2016-12-12 - Introduced, Referred to Assembly Housing and Community Development Committee [A4396 Detail]
Download: New_Jersey-2016-A4396-Introduced.html
Sponsored by:
Assemblywoman ANNETTE QUIJANO
District 20 (Union)
SYNOPSIS
Prohibits landlords from requiring residential tenants pay rent and other related charges through electronic funds transfer, including automatic debit payments.
CURRENT VERSION OF TEXT
As introduced.
An Act prohibiting landlords from requiring residential tenants to remit rent and certain other payments through electronic funds transfer, and amending and supplementing P.L.1975, c.310.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 2 of P.L.1975, c.310 (C.46:8-44) is amended to read as follows:
2. As used in this act:
a. "Landlord" means any person who rents or leases or offers to rent or lease, for a term of at least [1] one month, dwelling units, except dwelling units in rental premises containing not more than two such units, or in owner-occupied premises of not more than three dwelling units, or in hotels, motels or other guest houses serving transient or seasonal guests.
b. "Department" means the Department of Community Affairs.
c. "Commissioner" means the Commissioner [of the Department] of Community Affairs.
d. "Electronic funds transfer" means a transfer of funds, other than a transaction originated by check, draft, or similar paper instrument, that is initiated through an electronic terminal, telephone, computer, or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer's account, including, but not limited to, through the use of an automated clearinghouse (ACH) system.
(cf: P.L.1975, c.310, s.2)
2. (New section) No landlord shall require a tenant or prospective tenant to remit any amount due to the landlord pursuant to a residential lease, renewal, or extension agreement by means of electronic funds transfer, including but not limited to an electronic funds transfer system that automatically transfers funds on a regular, periodic, and recurring basis. A landlord who violates this section shall be subject to the penalty provisions of section 5 of P.L.1975, c.310 (C.46:8-47).
3. This act shall take
effect immediately, and section 2 shall be applicable to a lease, renewal, or
extension agreement executed on or after the date of enactment of this act.
STATEMENT
This bill prohibits a landlord from requiring that a tenant or prospective tenant pay any rent, security deposit, utilities, parking fees, or other lease-related payments owed to the landlord, by means of electronic funds transfer, including automatic debit payments that transfer funds from a tenant's bank account on a regular, periodic, and recurring basis. The term "electronic funds transfer" includes payment made through an automated debit or credit system, or through an automated clearing house (ACH).
This bill is limited in scope in that its provisions would only apply to residential lease agreements, including residential lease renewal and lease extension agreements. The bill would apply to agreements executed by all parties on or after the date the bill is signed into law. Nothing in this bill would prohibit a landlord and tenant (or prospective tenant) from mutually and willingly agreeing to allow for such electronic funds transfer.
A landlord who violates the provisions of this bill may be liable for a penalty of up to $100 for each offense.
Tenants face hardship when a landlord requires that rental and other payments be made through electronic means, as some individuals do not have access to banking or other financial accounts. Issues may likewise arise when a landlord, as a precondition to entering into a lease agreement or to renewing an existing lease, requires the tenant to agree to authorize automatic debit payments each month. This practice is harmful to renters as it limits the ability of individuals to retain control over their finances. It furthermore may be used as a means to discriminate against low-income and disadvantaged tenants, thereby limiting access to affordable rental housing. This bill, by giving tenants the option to agree to such practices instead of having it forced upon them, would ensure tenants are afforded control over their own financial and housing decisions.
