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Removed from N.Y. budget, talks of enhanced consumer protections continue



New York lawmakers said they will prioritize enhancing the state’s consumer protection laws before session ends after the bolstered law Gov. Kathy Hochul originally wanted in the budget didn’t make the final $237 billion spending plan.

With the state budget completed last weekend, lawmakers are working on items they can campaign on back home before November’s critical elections.

Hochul made strengthening the state’s consumer protections a part of her State of the State address and budget agenda in January, arguing it will make the state more affordable — a top concern for voters.

“New York state’s consumer protection laws are just woefully out of date, and there’s this great opportunity right now to correct that,” said Alex Dery Snider, Empire Justice Center’s director of public policy and communications.

But after reforms fell out of the final budget, momentum is gaining in the Legislature to expand consumer protections by sending legislation to Hochul’s desk before session ends June 6.

Legislation known as the Consumer and Small Business Protection Act would broaden the definition of abusive conduct and prohibit unfair, deceptive and abusive business practices that are illegal in 43 other states.

“New York consumers and small businesses deserve these protections,” Dery Snider said Thursday.

They’ll fight hard to change consumer protections not in the budget, though it was a top priority of Hochul’s and the state Senate. It fell apart during budget talks over consumer oriented conduct, or court requirements to prove a business’ pattern of abuse, which makes consumers show an incident isn’t isolated.

“It’s an undue burden,” Dery Snider said. “It really makes it difficult for New Yorkers to access justice while that’s there. If the final legislation doesn’t close the consumer oriented conduct requirement, then most New Yorkers will continue to lack meaningful consumer protections.”

New York’s current law only prohibits deceptive practices, like bait and switch. That’s allowed companies to take advantage of consumers with practices that aren’t technically illegal in New York, like student loan servicers pushing the most expensive payments, and car dealers can take advantage of a customer by using bullying tactics to influence the sale.

But state business leaders are lobbying hard against enhanced consumer protections, and argue it will make the state less affordable for New Yorkers, not more.

They argue the proposal is too broad and would lead to a slew of meritless lawsuits that would hurt businesses of all sizes.

“Small businesses are already frequent targets of lawsuits since they do not have legal staff or retained counsel and are quick to settle to avoid being put out of business,” said Ashley Ranslow, NY director of the National Federation of Independent Business. “Legislation introducing a new standard of unfair, applicable to businesses of all sizes, only opens the door to even more groundless litigation. Too often, Albany’s answer is allowing plaintiffs’ attorneys to sue, but all this does is incentivize frivolous lawsuits at the expense of Main Street. Small businesses,  consumers, and everyday New Yorkers will inevitably be affected through even higher insurance premiums and costs of goods and services.”

Sen. Kevin Thomas, who chairs the Consumer Protections Committee, is confident regulating “buy now pay later” providers, increasing data privacy and keeping consumer debt consistent will get done outside the budget.

“We try to negotiate and compromise, but that doesn’t mean the issue is dead if it’s not in the budget,” Thomas said. “We always try to find a way outside of it.”

But advocates pushing for the legislation said the purpose of changing the law will allow consumers to have their day in court.

“Right now, New York consumers and small businesses are currently vulnerable to unfair acts and practices and abusive acts and practices, and we need to correct that right away,” Dery Snider said.

The budget didn’t change consumer protections in the ways that were expected, but representatives with Hochul’s office said Thursday they were bolstered in other ways, including eliminating co-pays for insulin for patients earning 400% of the Federal Poverty level, or $120,000 for a family of four and others. 

“Gov. Hochul secured big wins for consumers in the FY25 enacted budget, including eliminating co-pays for insulin, protecting low-income patients from medical debt and a landmark housing package that will make New York more affordable,” a spokesperson with Hochul’s office said in a statement Thursday. “The governor is committed to consumer protection and will continue working with her Cabinet, members of the Legislature and advocates to make New York more affordable.”

The state Department of Financial Services recovered more than $182 million for consumers and health care providers in 2023. The Department of Public Service returned $9.7 million to consumers and assisted over 51,000 New Yorkers with complaints in 2023, according to Hochul’s office.

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