Prohibits the use of an algorithmic device by a landlord for the purpose of determining the amount of rent to charge a residential tenant; declares that such use is an unfair or deceptive trade practice.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9473
SPONSOR: Bichotte Hermelyn TITLE OF BILL:
An act to amend the real property law, in relation to prohibiting the
use of an algorithmic device by a landlord for the purpose of determin-
ing the amount of rent to charge a residential tenant
PURPOSE:
The bill prohibits landlords from using an algorithmic device to set the
amount of rent charged to a tenant for occupancy of a residential prem-
ises, or to determine any change in rent for the renewed occupancy of a
residential premises. This bill would also classify violations of this
prohibition as a deceptive act or practice.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Legislative Intent
Section 2: Adds a new section 222-a to the real property law prohibits
the use of an algorithmic device by a landlord for the purpose of deter-
mining the amount of rent to charge a residential tenant, and classify-
ing violations as a deceptive act or practice as provided in section
three hundred forty-nine of the general business law.
Section 3: Sets effective date.
JUSTIFICATION:
Across the United States there have been many documented instances of
landlords and property owners causing artificially increased rents
through the use of technological means. The use of these means has the
potential to continue exacerbating New York's acute housing crisis.
By prohibiting landlords from using algorithms to artificially inflate
rents or reduce housing supply, this bill aims to ensure fairness and
transparency in the rental housing market. It sets clear boundaries
against behaviors that may lead to anti-competitive practices and price-
fixing.
Given concerns over rising rents and homelessness, it is imperative that
we take action. This bill provides a framework for enforcement, enhanc-
ing protections for tenants while preserving the integrity of the rental
housing sector and ensuring property owners are accountable and trans-
parent.
LEGISLATIVE HISTORY:
New Bill.
FISCAL IMPACT:
Minimal impact.
EFFECTIVE DATE:
This act shall take effect on the ninetieth day after it shall have
become law.
STATE OF NEW YORK
________________________________________________________________________
9473
IN ASSEMBLY
March 14, 2024
___________
Introduced by M. of A. BICHOTTE HERMELYN -- read once and referred to
the Committee on Housing
AN ACT to amend the real property law, in relation to prohibiting the
use of an algorithmic device by a landlord for the purpose of deter-
mining the amount of rent to charge a residential tenant
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Legislative declaration. The legislature finds that the use
2 of algorithmic devices has been the subject of lawsuits that allege such
3 products pose a heightened risk of anticompetitive conduct, price
4 fixing, and collusion, all of which allegedly result in higher rents for
5 residential tenants, and allegedly poses the risk that landlords will
6 outsource pricing decisions, which the legislature determines should
7 always be made by the landlord.
8 Therefore, the legislature declares that, with certain exceptions, the
9 use of an algorithmic device by a landlord to set the amount of a resi-
10 dential tenant's rent is prohibited.
11 § 2. The real property law is amended by adding a new section 222-a to
12 read as follows:
13 § 222-a. Determination of rent amount; use of an algorithmic device in
14 setting rent amount prohibited. 1. In setting the amount of rent to be
15 charged to a tenant for the occupancy of a residential premises, includ-
16 ing determining any change in the amount of rent to be charged for the
17 renewed occupancy of a residential premises, a landlord shall not
18 employ, use, or rely upon, or cause another person to employ, use, or
19 rely upon, an algorithmic device that uses, incorporates, or was trained
20 with nonpublic competitor data.
21 2. A violation of subdivision one of this section is a deceptive act
22 or practice as provided in section three hundred forty-nine of the
23 general business law, and a person who commits a violation is subject to
24 all penalties and remedies described in article twenty-two-A of the
25 general business law.
26 3. As used in this section:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14800-01-4
A. 9473 2
1 a. "algorithmic device" means a device that uses one or more algo-
2 rithms to perform calculations of data, including data concerning local
3 or statewide rent amounts being charged to tenants by landlords, for the
4 purpose of advising a landlord concerning the amount of rent that the
5 landlord may consider charging a tenant. "Algorithmic device":
6 (i) includes a product that incorporates an algorithmic device; and
7 (ii) does not include:
8 (A) any report published periodically, but no more frequently than
9 monthly, by a trade association that receives renter data and publishes
10 it in an aggregated and anonymous manner; or
11 (B) a product used for the purpose of establishing rent or income
12 limits in accordance with the affordable housing program guidelines of a
13 local government, the state, the federal government, or other political
14 subdivision.
15 b. "Nonpublic competitor data" means information that is not widely
16 available or easily accessible to the public, including information
17 about actual rent prices, occupancy rates, lease start and end dates,
18 and similar data, regardless of whether the data are attributable to a
19 specific competitor or anonymized, and that is derived from or otherwise
20 provided by another person that competes in the same market as a person,
21 or a related market.
22 c. "Rent" means the total amount of rent, including concessions and
23 fees, that a residential tenant is required to pay pursuant to a rental
24 agreement.
25 § 3. This act shall take effect on the ninetieth day after it shall
26 have become a law and shall apply to a landlord's calculation of the
27 amount of rent that the landlord charges for the occupancy of a residen-
28 tial premises pursuant to any rental agreement that is executed on or
29 after the effective date of this act.
