N.Y. Comp. Codes R. & Regs. tit. 9 § 4814.15

Current through Register Vol. 46, No. 36, September 4, 2024

Section 4814.15 - Establishment of maximum rentals

Upon receipt of a copy of an application for a license as an authorized commercial lessor, the commission shall determine the tentative maximum rental for the premises concerned and advise both the applicant and the licensing authority of such determination. The applicant shall be afforded a reasonable time within which to protest the tentative maximum rental by specifying the objections thereto and the grounds for such objections. In the absence of any such protest, the tentative maximum rental shall, without further notice, be deemed to be the final determination of the commission. The rental schedule is based upon a review of the bingo rental statement (form BC-102) and is determined on the basis of a 50-week year. The commission, in determining rental fees to be fair and reasonable, considers actual or estimated operating expenses and other income:

(a) Allowable operating expenses.

(1) Compensation, as it relates to the management of the bingo premises, that is computed on a per occasion basis. Management duties include, but are not limited to:

(i) responsibility for the cleanliness and proper maintenance of the premises;

(ii) supervision of other employees of the lessor;

(iii) receipt of the rent checks from the lessees and the preparation of the monthly rental statement;

(iv) computation and payment of salaries and wages paid to porters, matrons and security guards; and

(v) computation and payment of payroll taxes, including the applicant's contributions for social security, State and Federal unemployment insurance, disability benefits insurance and union welfare funds.

(2) Maintenance expenses, including services provided for cleaning, floor waxing, and other building-related service contracts that have been furnished to the commission and licensing municipality.

(3) Utility expenses, including the cost of providing adequate heat, air conditioning, light, electrical power and water.

(4) Repairs, including those repairs for which the applicant is responsible under its lease and that are not depreciable.

(5) Taxes, including real estate, occupancy, water and corporate franchise taxes, but not including income taxes.

(6) Interest on money borrowed at the current bank rate for operation of the bingo premises and interest on loans for initial conversion and leasehold acquisition, which may be amortized.

(7) Depreciation of buildings, furniture, equipment and major improvements under a reasonable use expectancy schedule approved by the commission.

(8) Accounting fees, provided the services are properly itemized.

(9) Insurance premiums paid for coverage that is reasonable and necessary for the operation of the bingo premises. To facilitate commission review, a copy of the broker's statement of the insurance premiums must be furnished to the commission. Insurance coverage or pension contributions for the benefit of the officers or principals of the applicant or their designees are prohibited.

(10) Legal fees, including those incurred in connection with the initial application for license, if reasonable. The commission may require, in some cases, that such costs be amortized.

(11) Rubbish removal expenses considered fair and reasonable. The municipal governing body or the commission may require a copy of the current contract, prior to approval.

(12) Telephone expenses considered necessary and reasonable.

(13) Supplies directly related to the operation of the bingo premises.

(14) License fees, as provided for in section 481 of the General Municipal Law.

(15) Other expenses such as postage, stationary, bank charges, permits and equipment rentals, when reasonable and properly itemized.

(16) Amortization. The cost of converting the subject premises for the conduct of bingo, or the cost of acquiring a leasehold interest may be recovered as a capital expenditure by amortization over a period of not less than 10 years, subject to commission approval. However, amortization is not considered an operating expense in the determination of the reasonable profit.

(17) Rental fees in the amount established in the lease between the applicant and the owner/lessor of the building, that are deemed reasonable by the commission. A copy of said lease shall be provided to the commission along with the application for commercial lessor's license. To determine the reasonableness of such rental fees, the commission may consider appraisals and the rental fees of other comparable premises. In cases where the principal(s) of the applicant is also the principal(s) owner or the lessor of the bingo premises, the commission will permit, in lieu of rent, those expenses relating only to the ownership of the premises. Such expenses are limited to mortgage interest, real estate taxes, depreciation and insurance.

(b) Other income. The applicant must report all other income derived from the use of the premises. Such other income includes, but is not limited to:

(1) concession income, which includes:

(i) all income specified in the lease agreement between the applicant lessor and the operator of the food concession; and

(ii) all income derived from the food concession if such facility is wholly owned and operated by the applicant lessor; and

(2) income derived from rentals for purposes other than bingo, parking fees, vending machines and public telephone commissions.

N.Y. Comp. Codes R. & Regs. Tit. 9 § 4814.15