NYC Washes Face Licensing

New York City Councilmember Melissa Mark-Viveritohas introduced a local law, Int. No. 0852-2012, which would amend the New York City Administrative Code to license carwashes. This bill would only have application in the City of New York.

Under this proposal, it would be unlawful for a carwash to operate without a license from the New York City Department of Consumer Affairs. A license would be issued for a year with an annual renewal. The proposed licensing fee is $300 for each location. The application for the license requires verification from the New York City Department of Environmental Protection and the New York City Department of Health and Mental Hygiene that the applicant has appropriate permits. An applicant for a license is also required to provide certificates of insurance for workers’ compensation, unemployment, disability and liability coverage carried by the applicant.

This legislation requires an applicant, as a condition of licensure, to provide a surety bond of not less than $300,000 payable to the City, conditioned upon compliance with this local law and for payment of any fines or penalties to the City. This bond would also be subject to final legal judgments based on claims against the carwash.

Also under this proposed legislation, a carwash license’s issuance and continuing validity is subject to payment by the licensee of any judgment with regard to the business. A carwash would be required to maintain a log with a detailed description of any damage and if the customer was compensated. The records must be maintained for at least three years. The log is required to be immediately available to the Department of Consumer Affairs.

The Commissioner of Consumer Affairs may also refuse to issue a license to an applicant who lacks good character, integrity and honesty. Back taxes, unpaid back wages, judgments for tort or breach of contract would be on a direct relationship to fitness to conduct the business.

The penalty for operating a carwash without a license under this proposed local law would be $200 per day, up to a maximum of $15,000. An applicant for a license who knowingly submits false information would be subject to a civil penalty of $5,000 in addition to any other applicable civil or criminal penalties.

New York City currently licenses a number of businesses including, laundries, towing companies and others. This bill is currently in the Civil Service and Labor Committee. A hearing was held by this Committee on May 2 regarding Oversight Business Practices of the City’s Carwashes: Labor, Consumer & Environmental Issues.

William Y. Crowell, III is a partner with the Albany-based law firm of Whiteman Osterman & Hanna LLC. You can reach him at 518/487-7677 or wcrowell@woh.com.

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