The landlord's demand was solely a negotiating point to try to avoid having to pay it back. Plenty of landlords and property managers don't operate this way, but their tenants aren't the ones calling tenants' rights organizations. At the MTO, where the consumer hot line fields renter calls from the inner city to Lake Shore Drive, about 60 percent of the 11,000 calls received last year involved security deposits, placing the issue near the top of the list of renters' complaints. Landlords charge security deposits to cover repairs to any damage caused by the tenant during the lease, and also to cover the last month's rent if a tenant leaves without giving notice. If landlords don't use the security deposit for either of these reasons, by law it must be returned to the tenants, with interest, within 45 days of the end of the lease.
Landlords have a few complaints of their own.
If someone has put dark green paint on a wall, that's not normal wear. Landlords also have tenants who give notice they're leaving and just tell the landlord to use the security deposit for the last month's rent. Under the ordinance, the landlord must hold all security deposits in a separate interest-bearing account for the duration of the lease. The interest due the tenant, a standard 5 percent until 1997, is now based on a formula calculated and announced each year by the city comptroller. Interest on the deposit is to be returned to the tenant annually.