The Small Business Jobs Survival Act

The SBJSA is a simple, fair and effective solution to several of the city’s major economic problems and offers the only opportunity to restore economic equality to our business owners, save our art and cultural institutions, maintain the character of our neighborhoods , save the best pathway to social mobility to the majority of low income families, and reestablish NYC as the Gateway for the American Dream in America.

SBJSA deals with only a single business process: the commercial lease renewal process.

How important is the lease renewal process to the stability, vitality and future of our city’s small businesses to sustain growth and create jobs?

  • The number one reason given for 30 straight years for established businesses ( 5 + years) to close, was the failure of the commercial lease renewal process.

  • The number one reason given for 30 straight years for the laying off of employees in established businesses has been the failure of the commercial lease renewal process.

  • The number one reason for our city’s small businesses becoming unstable and stopping growth and ending capital improvements and delaying all future expansion plans, has been the failure of the commercial lease renewal process.

  • The number one reason for the increase of illegal extortion of the mostly immigrant owners by unscrupulous landlords demanding cash “under the table” or loss your business, has been the failure of the commercial lease renewal process.

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RETURN TO BARGAINING IN GOOD FAITH

Before Speculators and Greed invaded NYC and reaped windfall profits by exploiting the hard work of our small business owners, the Lease renewal process worked well for all parties.

The foundation of this process rested with both parties’ respect for each other’s investment and each other’s need to make a reasonable return on that investment.

New York City became the “crown jewel” of the nation’s economy, the hub for the country’s manufacturing, as well as several major industries such as printing and advertising. Also, NYC was the nation’s financial, entertainment and tourism center, and was considered to be the best environment in the country as an artist’s friendly community. Adding to this diversity was the ongoing status and reputation of NYC as being the gateway to American for immigrant small business entrepreneurs to invest in the American Dream.

From the most business friendly environment to the worst in America

In the mid 1980’s real estate speculators took full advantage of the unregulated lease renewal process, and the goodwill of their friends at City Hall, to rent gouge the tenants and stop all negotiations in good faith, and only demand unreasonable and oppressive lease terms. The outcomes of this over speculation in the free market in NYC was the complete collapse and exploitation of the vital free market commercial lease renewal process. Which has resulted in our city going from being the “gateway for immigrant entrepreneurs to achieve the American Dream” and having the oldest and most diverse and vibrant economy of any major city in the nation to the Worst city in the nation to start a new business, the Worst city in the nation to build a successful business, and the Worst city in the nation for long established successful businesses to remain in business. The passage of the SBJSA would end this Crisis immediately for all New Yorkers .

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SUMMARY OF SBJSA

To establish a commercial lease renewal process which is fair to all parties, one which would give the tenants enough rights so that they can again bargain in good faith with the landlords to arrive at fair least terms. To keep government out of the decision making process and on the sidelines during the lease renewal negotiation process. The only voices to be heard in the bargaining process would be between the tenant and landlord, and from a mediator if they fail to mutually agree on the terms of the new lease. And only from an arbitrator if the mediation process fails to achieve a mutually agreement between the parties. No government formulas are ever involved, the law would create a cost effective system for commercial lease renewals, one where all the costs are shared equally between and landlord and tenant. Also, one where no taxpayers dollars are spent , the only costs would go to an arbitration organization.

Step by Step

The law would create a quick step by step process to arrive at fair lease terms. One which is controlled by both parties and can be stopped at anytime by mutual consent. An Arbitration process, which gives both parties equal opportunity to present their arguments for their reasonable terms of the lease. A process which takes into consideration the unique nature of every business and every business community, where the arbitrator’s decision is guided by strict criteria and based upon a “case by case” situation to decide fair and reasonable lease terms.

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WHAT PRESENT LANDLORD ABUSES WOULD BE STOPPED BY THIS BILL?

  • Put an end to illegal extortion of commercial tenants who are forced to pay money “ under the table” to keep their leases.

  • Put an end to “rent gouging” by greedy landlords

  • Put an end to those landlords who refuse to even negotiate a lease renewal with the tenant.

  • Put an end to those landlords who refuse to “bargain in good faith” with their tenants.

  • Put an end to those landlords who work deals behind the backs of the tenants in order to take over their successful businesses or is some way gain profits as a result of the years of hard work by the tenants.

  • Put an end to those landlords who want to pass along all their own costs and responsibilities onto their tenants to pay.

  • Put an end to those landlords who only want to offer short term leases to the tenants so they can be in a better position to speculate on the property. Put an end to excessive security deposits without interests going to the tenants.

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WHAT ARE THE GOALS OF THIS BILL

  • Protect business tenants from unreasonable lease demands, thus keeping successful businesses from going out of business due only to rent gouging or unfair lease terms.

  • Stop the lost of jobs resulting from excessive rents or business failures due only to exorbitant lease demands.

  • Put stability and predictability back into the free marketplace, which would result in encouraging business expansion and the creation of more jobs.

  • Give businesses longer leases, which would enable them to expand, create jobs, and take advantage of the loan and assistance programs in the private sector as well as from government agencies. Longer leases promote economic growth.

  • Stop illegal extortion by unscrupulous landlords

Who is protected under this Bill

  • All manufacturing businesses
  • All Not-for-Profit organizations
  • All performing arts and theater groups
  • All retail businesses
  • All service businesses
  • All professional medical offices and businesses
  • All commercial tenants in New York City

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HOW LONG IS THE LENGTH OF COMMERCIAL LEASES

To encourage stability and growth, the minimum length of lease is 10 years, but a shorter or longer length can be established if both parties agree.

This is not commercial rent control! Not a single business of the city’s est. 200,000 would government set the rent for. This bill is based only upon mediation and arbitration and the bill establishes only the guidelines for the process of commercial lease renewals. Every arbitration decision is based upon a “case by case” situation. The final rent charged would be determined only from the facts presents by the landlord and tenant before an arbitrator.

This bill does not interfere in the general marketplace, but instead focuses only upon existing commercial leases entering into the lease renewal process. A landlord can charge whatever they wish in the open market for empty businesses. For new leases, they have no guidelines or regulations to follow in deciding their rent demands or the terms of the lease.