The Senate’s financial regulatory reform bill (S 3217) includes a controversial amendment sponsored by Sen. Richard Durbin (D-IL) that would make it easier for apartment firms to accept credit cards for rent and other fees. The language limits the transaction fees credit card networks can charge retailers and other end-users, such as apartment firms. It would also allow apartment firms to charge different fees (or offer incentives) for renters who want to pay with debit or other automated check transactions instead of credit cards. Additionally, it would allow apartment firms to pass credit card fees on to renters.
Current law requires all payment types to be charged the same fee. This forces apartment firms to either absorb the credit card fee (which lowers net revenue) or to raise all rents to cover the fees. The existing system limits the ability of owners and renters to enjoy the cost savings associated with automation because it discourages apartment firms from accepting automated payments.
The House version does not contain a comparable provision, however, and similar attempts in the past have failed due to fierce resistance by the banking industry, which increasingly relies on the $10 billion in credit card merchant fees generated annually.
NAA/NMHC actively supported the amendment through a grassroots alert issued in mid-June as the House-Senate conferees began negotiating a compromise to resolve differences between their respective measures.