Use Security Deposits For Rent Missed From Coronavirus: Officials

NEW YORK, NEW YORK — New York City renters out-of-work because of the new coronavirus soon could receive a lifeline on April's rent.

A slew of city officials on Tuesday unveiled a proposal to apply renters' cash security deposits toward next month's rent. They said it will offer immediate relief for renters at risk of missing a payment after the new coronavirus affected their livelihoods.

Brooklyn and Manhattan Borough Presidents Eric Adams and Gale Brewer, respectively, along with Councilmembers Robert Cornegy, of Bed-Stuy, and Keith Power, of Upper East Side, held a teleconference on their plan.

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"In New York City alone, we're talking about $8 billion that is currently inside our banks," Adams said. "We need that money in our community, we need it in our businesses, we need it as an infusion of cash in the city."

In broad strokes, they propose telling landlords to give all renters the option of applying their deposits toward April's rent.

Adams said that money is currently held in escrow, meaning renters and landlords alike currently can't touch it.

The proposal is that renters who use the program will have 30 days to replace their deposits. The program will also give them the option to replace their deposits with low-cost insurance for a few dollars a month, according to a release.

Ankur Jain, CEO of Kairos, developed similar insurance plans and appeared in the teleconference. He said too many New Yorkers have lost jobs since the coronavirus crisis struck.

They not only have to grapple with student loan payments and other debt, but also how to pay for their immediate needs, Jain said.

"This will be the single largest stimulus — $8 billion — that will go back into people’s pockets today," he said.

Brewer said the plan has the potential to help at least 2.5 million renters in the city. She noted that it may depend on state approval and likely not cover rent controlled apartment where tenants didn't put down deposits.

But she said it's important offer the city, state and federal government to step up during the crisis.

"I’m very supportive even as the city looks to federal and state government for support," she said.

The officials hope to gain Mayor Bill de Blasio's backing and enact the bill as soon as this week.

Several officials, including Adams, have floated some type of moratorium or freeze on rent since the coronavirus crisis altered everyday life in the city. Most recently, Queens state Sen. Michael Gianaris proposed a 90-day rent freeze for tenants who lost their jobs and small business owners forced to close because of government-mandated restrictions.

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