SB 219 — AN ACT CONCERNING CIVIL PENALTIES FOR CERTAIN VIOLATIONS RELATING TO RENTAL SECURITY DEPOSITS.

Senate General Assembly RaisedFile Bill No.

219122 February Session, 2026 LCOSubstitute Senate Bill No.

1568219 ReferredSenate, toMarch 23, 2026 The Committee on BANKINGBanking Introducedreported by:through SEN.

(BA)MILLER ANof ACTthe CONCERNING27th CIVILDist., PENALTIESChairperson FORof CERTAINthe VIOLATIONSCommittee RELATINGon TOthe RENTALpart SECURITYof DEPOSITS.the Senate, that the substitute bill ought to pass.

AN ACT CONCERNING CIVIL PENALTIES FOR CERTAIN VIOLATIONS RELATING TO RENTAL SECURITY DEPOSITS.

If the commissioner determines that any landlord has violated any provision of this section over which the commissioner has jurisdiction, the commissioner may, in accordance with [section] sections 36a-50 and 36a-52, order such [person][person to] landlord to pay a civil penaltypenalty, not exceeding one hundred thousand dollars per violation, cease and desist from such practices and [to] comply with the provisions of this section.

LCOsSB219 / File No.

1568122 1 ofsSB219 2File Raised Bill No.

219122 This act shall take effect as follows and shall amend the following sections:

Section 1 October 1, 2026 47a-21(j)(1) StatementBA ofJoint Purpose:Favorable Subst.

TosSB219 establish/ thatFile ifNo. the Banking Commissioner determines that any landlord has violated certain provisions concerning rental security deposits, the commissioner may, in accordance with sections 36a-50 and 36a-52 of the general statutes, order such landlord to pay a civil penalty not exceeding one hundred thousand dollars per violation, cease and desist from such practices and comply with certain provisions concerning rental security deposits.

[Proposed122 deletions2 aresSB219 enclosedFile inNo. brackets.

Proposed122 additionsThe following Fiscal Impact Statement and Bill Analysis are indicatedprepared byfor underline,the exceptbenefit thatof whenthe members of the entireGeneral textAssembly, solely for purposes of ainformation, billsummarization orand resolutionexplanation orand ado sectionnot ofrepresent athe billintent orof resolutionthe isGeneral new,Assembly itor iseither notchamber underlined.]thereof LCOfor No.any purpose.

1568In 2general, fiscal impacts are based upon a variety of 2informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

None Municipal Impact:

None Explanation The bill makes clarifying changes, resulting in no fiscal impact to the state.

sSB219 / File No.

122 3 sSB219 File No.

122 OLR Bill Analysis sSB 219 AN ACT CONCERNING CIVIL PENALTIES FOR CERTAIN VIOLATIONS RELATING TO RENTAL SECURITY DEPOSITS.

SUMMARY Existing law authorizes the Department of Banking commissioner to order a civil penalty of up to $100,000 for violations of any provision of the statutes within his jurisdiction or any regulation, rule, or order adopted or issued under these statutes.

This bill explicitly authorizes him, after an investigation, to order this penalty for certain violations of the security deposit laws, in addition to issuing cease and desist orders for violations of these laws, as existing law authorizes.

(The law also authorizes specified penalties for security deposit law violations (see BACKGROUND).) Existing law authorizes the banking commissioner to receive and investigate complaints about certain alleged violations of the security deposit laws.

These laws apply to residential landlords and generally (1) cap maximum allowable security deposits, (2) require deposits be placed inan escrowaccount,(3)set theinterest rate onsecurity deposits, (4) require landlords to pay tenants annual interest on security deposits, and (5) set timeframes for paying security deposits and interest at the end of tenancy.

By law, the commissioner does not have jurisdiction when the landlord(1)failstoannuallypaythetenantinterestonasecuritydeposit or (2) has a good faith claim for actual damages of which the tenant received written notice.

The latter includes situations where a landlord refuses or fails to return all or part of the security deposit because he or she has a good faith claim for these damages.

By law, anyone can take legal action in court to reclaim any part of their security deposit that may be due, and this does not stop tenants or landlords from recovering sSB219 / File No.

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122 other damages to which they may be entitled.

EFFECTIVE DATE:

October 1, 2026 BACKGROUND Penalties for Security Deposit Law Violations The law makes any landlord who fails to return a tenant’s security deposit (less the value of any itemized damages) within the statutory timeframe liable for twice the security deposit amount.

Any landlord who fails to pay the tenant the accrued interest on a security deposit is liable for the greater of $10 or twice the accrued interest.

Landlords are also subject to specified penalties under the security deposit laws if they knowingly and willfully:

1.

fail to pay all or part of a security deposit due when the tenancy ends (a fine of up to $250 for each offense);

2.

violate the escrow account requirements (a fine of up to $500, up to 30 days in prison, or both for each offense if at the time of the offense the landlord leased four or more residential units);

or 3.

fail to make the required interest payments on security deposits (a fine of up to $100 for each offense).