General Assembly Raised Bill No. 235
February Session, 2010 LCO No. 1171
*01171_______BA_*
Referred to Committee on Banks
Introduced by:
(BA)
General Assembly
Raised Bill No. 235
February Session, 2010
LCO No. 1171
*01171_______BA_*
Referred to Committee on Banks
Introduced by:
(BA)
AN ACT REDUCING THE INTEREST RATE ON SECURITY DEPOSITS.
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Subsection (i) of section 47a-21 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
(i) (1) On and after July 1, 1993, each landlord other than a landlord of a residential unit in any building owned or controlled by any educational institution and used by such institution for the purpose of housing students of such institution and their families, and each landlord or owner of a mobile manufactured home or of a mobile manufactured home space or lot or park, as such terms are defined in subdivisions (1), (2) and (3) of section 21-64, shall pay interest on each security deposit received by him at a rate of not less than the average rate paid, as of December 30, 1992, on savings deposits by insured commercial banks as published in the Federal Reserve Board Bulletin rounded to the nearest one-tenth of one percentage point, except in no event shall the rate be less than one and one-half per cent. On and after January 1, 1994, the rate for each calendar year shall be not less than the deposit index, as defined in subdivision (2) of this subsection, for that year. [, except in no event shall the rate be less than one and one-half per cent.] On the anniversary date of the tenancy and annually thereafter, such interest shall be paid to the tenant or resident or credited toward the next rental payment due from the tenant or resident, as the landlord or owner shall determine. If the tenancy is terminated before the anniversary date of such tenancy, or if the landlord or owner returns all or part of a security deposit prior to termination of the tenancy, the landlord or owner shall pay the accrued interest to the tenant or resident within thirty days of such termination or return. In any case where a tenant or resident has been delinquent for more than ten days in the payment of any monthly rent, he shall forfeit any interest which would otherwise be payable to him for that month, except that there shall be no such forfeiture if, pursuant to a provision of the rental agreement, a late charge is imposed for failure to pay such rent within the time period provided by section 47a-15a. No landlord or owner shall increase the rent due on any quarters or property subject to the provisions of this section because of the requirement that interest be paid on any security deposit made with respect to such quarters or property.
(2) The commissioner shall publish the rate that takes effect July 1, 1993, in the Department of Banking news bulletin no later than July 15, 1993. The deposit index for each calendar year shall be equal to the average rate paid on savings deposits by insured commercial banks as last published in the Federal Reserve Board Bulletin in November of the prior year. The commissioner shall determine the deposit index for each calendar year and publish such deposit index in the Department of Banking news bulletin no later than December fifteenth of the prior year. The commissioner shall also cause such rates to be disseminated in a manner designed to come to the attention of landlords and tenants including, but not limited to, the issuance of press releases and public service announcements, the encouragement of news stories in the mass media and the posting of conspicuous notices at financial institutions. For purposes of this subsection, "Federal Reserve Board Bulletin" means the monthly survey of selected deposits published as a special supplement to the Federal Reserve Statistical Release Publication H.6 published by the Board of Governors of the Federal Reserve System or, if such bulletin is superseded or becomes unavailable, a substantially similar index or publication.
This act shall take effect as follows and shall amend the following sections:
Section 1 October 1, 2010 47a-21(i)
This act shall take effect as follows and shall amend the following sections:
Section 1
October 1, 2010
47a-21(i)
Statement of Purpose:
To eliminate the unfair burden placed on landlords who must pay a tenant a higher interest rate on a security deposit than the landlord may obtain from depositing such funds in a bank.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]